Wednesday, May 11, 2011

Cross Cultural Strategy in International Business Competitive Intelligence (2)

A Critical Review of Current Practices

Business competition in the end is the competition in the marketplace. The traditional international or multinational approach to business concentrates largely on geographic markets, developing a distinct marketing mix for each market. Traditional approaches scarify experience curve effects that can be gained by using the same marketing mix in more than one market. Global business, in contrast, concentrates on product, emphasizing their similarities regardless of the geographic areas in which they located. However, it does not ignore differences; these differences are taken into account when implementing the marketing program. For instance, advertising is translated into different languages for different national markets; while different distribution strategies are developed for areas with different distribution structures (Emery and Tian 2003, Tian 2000).

All these business decisions should be based on clear understanding of the differences in cross-national boundary perspectives as well as in cross-cultural perspectives. By the same token all these differences need to be seriously considered when using CI programs in international marketing. Apparently the majority of current international CI practitioners neglect this sharp point. For instance, Griffith (1998) notices that many U.S. marketers are hard pressed to understand the French governments’ actions restricting retail store size, especially after the success of efficient supermarkets.

Certainly, if the U.S. marketers want to penetrate French supermarket they must need to know this information to avoid business loss.
The above elaboration does not mean that all current international CI practices are not on the right track. In fact many intensive exporters, as Calof (1997) among other scholars found, have been proficient in obtaining information cross culturally. These exporters are more likely to utilise any source of information than less intensive exporters; they try to understand the host country more in depth and to successfully implement international marketing strategies by considering cultural differences. For instance, success in the Persian Gulf required most American franchisers to adapt and be flexible in their operations and policy due to cultural sensitivity (Martin 1999).

In international CI practice, the more intensive exporters can also use personal contacts abroad for the most important sources of information. Anthropological approach in gathering information could be best applied in this type of practice (Tian 2004). For example, one of the authors once worked as an international business consultant for a Canadian firm. By applying his anthropological skills he used his personal connections/relations to search for useful information and helped the Canadian firm successfully develop a project in China. We termed this type of information resource as the social capital pool whose values are flexible depending on how individual organisations implement its business practice. There are some other successful international CI practices in the business world, but our primary purpose in this paper is to probe the opportunities and the processes in conducting international CI programs.

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To be continued.


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