Introduction
Expansion refers to the activity that generally adopted by organization to broaden the area of business. For expansion, organizations work towards the development of understanding regarding area. In such development, organizations may face several issues (Conrady & Buck, 2011). This report discusses regarding the issues that affect expansion by PPQ parts. This case study assignment help paper also helps PPQ to plan the assessment of such managers that must be trained in multiculturalism and ability to manage diversity. Following points will help senior managers to address the issues:
Issues Faced by Host Country by Expansion
Expansion is such step that impacts over the related areas directly and indirectly. In term of foreign expansion, host and home countries get affected with huge change. Host country may face several issues through expansion of a foreign company in their economy. Such expansion develops difficulty to manufacture products in new environment. For effective production, host country develop deep understanding regarding all environmental factors such as political, economical, legal, social, and technological and their impact over foreign firm (Seun, 2012). Also, host country can face problem to communicate with new entrance due to language difference as the Pepsi’s failure in Taiwan. Pepsi used the same marketing campaign in Taiwanese with the slogan “Come alive with the Pepsi’s generation” and faced failure because when it being transited into Chinese, it give different meaning such as “Pepsi will bring your ascendant back from dead”.
Along with this Dissertation Editors says that, host country could also face issue of cross-culture difference, so that human resource of host country cannot sink with organization’s operational culture. New technological assessment by organizations may develop problematic situation for host country (Conrady & Buck, 2011). Thus, host country’s people, culture and other environmental factors get affected by expansion of any organization.
Cultural Barriers and Diversity Issues
At the time of expansion strategy, a company may face problems to develop understanding regarding host country’s culture. The expansion of any global organization generally meets with similar issues of diversity and cultural differences. To be global or MNC enterprise from domestic, an organization have to develop global leadership skills due to diversity in human resource. Such diversity can create big hurdle in the way of expansion. At the time of expansion, organizations have to adopt culture of host country as it is important to do business in that country (Payne & Barbera, 2010). The difference in working culture of human resource may decline the efficiency of human resource and may result failure of expansion. Another difference is regulatory culture of both countries that creates hurdle in the expansion, because it is necessary to follow host country’s rules & regulations to run business successfully in another country.
The expansion of business may meet barriers due to difference between business cultures. This difference makes the management improper because human resource cannot negotiate with each other as line managers face difficulty to discuss directly with top managers (Brown & Gutterman, 2003). Such diversity in the employees and management also create barrier that develop restrained network in organization.
Diversity as Important Issue
In expansion form one country to another, organizations face several issues in the way. In all issues, diversity is an important topic in the concern of internationalization. In terms of diversity, organizational expansion suffers, when human resources cannot co-operate with each other due to several differences such as cultural, behavioral and regional (Kiene, 2011). Due to language difference also, organizations can face difficulty to make effective communication that directly affects organizational productivity. The difference between rules and regulation of home country and host country may not suit the type of business that may result in loss making conditions. Thus, diversity is an emerging issue for international and global organizations and it necessarily required to manage properly for organizational growth.
Ignorance of Multiculturalism and Diversity
The difference between cultures, languages, traditions and religions are big problems for international businesses. As, these problem cannot be ignored by organizations in the expansion of business in other regions. If an organization ignores issues like multiculturalism and diversity then the organization would not be able to achieve its objective effectively (Marc, 2009). Organizations cannot hire talented human resource from the foreign country; if it ignores diversity as in that condition it will be less effective to solve the issues of local workforce. It will pose the barriers over business growth in international market. In terms of expansion of business, diversity management is necessarily required, if organizations not highlights over needs and wants of diverse customer then organizations cannot meet the expectations of the customers (Burke & Cooper, 2009). Therefore, multiculturalism and diversity related issues must be managed within organizations in term of foreign expansion.
Political and Economic Issues
Organizations face several issues during expansion, but there are some environmental and political issues that plays vital role before and after the expansion of business in another country.
Political Issues: Host country’s legal requirement is one of the major political issues in the way of business expansion. Organizations have to mold its privies policies according to host country’s regulations that may take more time & efforts and effect over growth of the business. Another, major issue is currency control that is in the hand of host country. Due to increase and decrease in currency, organizations have to make several changes in many operations (D’Anieri, 2009).
Economic Issues: Economic issues affect global expansion vastly due to difference and changes in economic conditions of host country. Unavailability of appropriate infrastructure and technology for business is a big economic issue for global organizations. Due to this, business may stop to grow at one point of time. Similarly, change in host country’s GDP, GNP and per capita income may stop the process of business expansion because these changes may need vast changes before and after the expansion (Daft, Murphy, & Willmott, 2010).
Organizations can solve such political & economic issues through research & access of the potential market for expansion in an effective manner. Along with this, if organizations follow the rule such as “Think Global, Act Local” than there is less possibility to occur issues related to political and economic environment (Beck, 2005). At the same time, use of hedging strategies would be also effective for the firms to reduce the risk of currency exposure in foreign countries.
Applicability in PPQ
Above discussed issues are important for PPQ as it determines possibilities of global expansion issues. The issues related to host foreign country provide a path for PPQ to select host country, where all necessary requirements will be available (Seitz, 2002). Cultural and diversity related issues drive the necessity to occurrence of this issue as PPQ wants to expand the business in Germany & Japan. Also, it is important because it provide a way to manage diversity and cultural difference at the time of expansion and after the expansion in PPQ. The analysis of Germany and Japan will be beneficial for PPQ to determine the source of issues and to manage them properly (InfoBarrel.com, 2012). It would also be effective for the firm to reduce the expansion cost and to increase the significance of firm within the environment.
Conclusion
From the above discussion by our assignment service experts, it can be concluded that global expansion derives several issues that should be managed properly. These issues have impact over organizational growth vastly. It is also concluded that these all, host country, diversity, cultural, multiculturalism, political, and economic issues are necessarily important and must be solved for a successful expansion.
References
Beck, U. (2005). Power in the global age: a new global political economy. Polity.
Brown, R. & Gutterman, A.S. (2003). A short course in international business plans: charting a strategy for success in global commerce. USA: World Trade Press.
Burke, R.J. & Cooper, C.L. (2009). The Peak Performing Organization. Taylor & Francis.
Conrady, R. & Buck, M. (2011). Trends and Issues in Global Tourism 2011. Springer.
Daft, Murphy, J. & Willmott, H. (2010). Organization theory and design (10th ed.). UK: Cengage Learning EMEA.
D’Anieri, P. (2009). International Politics: Power and Purpose in Global Affairs. USA: Cengage Learning.
InfoBarrel.com. (2012). Issues with Business Expansion. Retrieved 13 February, 2012, from http://www.infobarrel.com/Issues_With_Business_Expansion
Kiene, T. (2011). The Legal Protection of Traditional Knowledge in the Pharmaceutical Field: An Intercultural Problem on the International Agenda. Germany: Waxmann Verlag.
Marc, A. (2009). Delivering Services in Multicultural Societies. World Bank Publications.
Payne, M. & Barbera, J.R. (2010). A Dictionary of Cultural and Critical Theory (2nd ed.). USA: John Wiley and Sons.
Seitz, J.L. (2002). Global issues: an introduction (2nd ed.). Great Britain: Wiley-Blackwell.
Seun, O. (2012). Benefits and Challenges of Multinational Companies (MNCs). Retrieved 13 February, 2012, from http://ezinearticles.com/?Benefits-and-Challenges-of-Multinational-Companies-%28MNCs%29&id=5171208