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Tuesday, February 1, 2011

International business (IB) is not the bed of roses

Background
As the world grows smaller because of increasingly efficient global communications and multinational corporations, chances are good that your business will take you outside your home country. All types of businessman and consultants are all finding that international business can provide an avenue for growing their business. Sometimes a customer's international operations will require your services in other countries. Even if you never plan on opening an office outside your national borders, you may find that your best customer has. Your customer may want to count on your involvement in equipping his or her international installations. In any of those scenarios, you should know what you're getting into before jumping in.
Most of Nepalese are at more of a disadvantage in being prepared than their international neighbors. For reasons having to do with geography (as well as perhaps an historical proclivity toward isolationism), international travel and multilingual and multicultural awareness do not come naturally to Nepalese, unlike citizens of many other continents. But during the past several decades, for many countries citizen’s international business has become a matter of survival in many industries.

Challenges doing IB
High-profile design consultants and businessman are also increasingly involved in international work. Most agree that having an international presence is easier if offices are run by local nationals. That obviously helps with issues such as language, cultural differences, and local government connections. Sometimes the biggest challenge in doing international business simply understands that people in different cultures conduct business differently. Decision making and negotiations are conducted in ways that may be totally foreign to a Nepalese -based contractor or consultant. First of all, you learn to be accommodating and you also need to understand cultural differences, work process, work ethic — all of these are key elements if you intend to operate on an international basis. You have to be hypersensitive to all of these issues.” In some cultures, business body language can differ to the extent that miscommunication occurs, even when negotiating in the same language. For example, in some Asian cultures, head shaking from side to side accompanied by verbal agreement can be interpreted as conflicting messages to a Western businessperson, when that is not the message at all. Being aware of subtle aspects such as differences in international body language is one example why it is important to consider some of the less obvious challenges. Most of the costs and risks result from barriers created by distance. By distance I don't mean only geographic separation, though that is important. Distance also has cultural, administrative, or political and economic dimensions that can make foreign markets considerably more or less attractive. His CAGE Distance Framework (“Distance Still Matters,” Harvard Business Review, September 2001) for analysis of the impact of distance on the viability of international business considers many factors that don't usually occur to a novice global businessperson. These factors are applicable whether you are considering opening a branch office or providing installation services in another country
Tips for doing Successful International Business
Some management Guru (consultant) has recommended following tips for making easier of doing   international business:
1. Lose your tunnel vision. Forget the misconception that conditions around the world are just as they are in the country — or should be. They aren't, and they never will be. The sooner you embrace that essential truth, the faster you'll latch on to other salient issues for doing business overseas.
2. Get to know the culture. Someone once said that it's an incredible faux pas to offer a Japanese executive your business card without first turning it around so that he or she can read it right away. That detail illustrates the importance of understanding the traditions and nuances of the cultures with which you wish to do business. Check out Web sites that discuss various cultures; if possible, talk with businesspeople from foreign countries to gain a sense of appropriate business practices. Is a handshake sufficient to close a deal? Is bribery an accepted element of business leverage? “We think the ways of Nepal are the ways of the world, and they're simply not.”
3. One size does not fit all. Granted, barriers are breaking down worldwide, but that still doesn't mean that one product will work in every situation. Expensive, proprietary software likely will not command the attention of a developing third-world nation that it would in Western Europe. Part of getting to know a country's traditions and culture understands interest and demand. That, in turn, can help better direct marketing and other sales efforts.
4. What price is right? Likewise, it's essential to understand what pricing structure is going to be attractive — but nonetheless profitable for you — in various parts of the world. Again, less developed nations may not be suitable if a product or service is too expensive. By the same token, more affluent cultures may be able to obtain like products less expensively than you can offer. This can really be an overwhelming task, one that often happens through trial and error. It's usually a good idea to start prices a little bit high and then come down if need be the right way.
5. How are you going to ship your product and at what cost? Depending on where you want your wares to go, it's essential to gain a realistic grasp of prospective shipping costs (likely more than you think). Equally important is establishing who's going to pay that bill. If you're setting up an international network, make certain you negotiate whether you or your customers will be covering shipping (or, by contrast, if you can share costs). For example The European Union has that Value Added Tax that always adds to the cost of goods. You should also pay attention to the culture of the country in which you're doing business. That may dictate who should pay shipping.
6. How will you get paid? Credit card use is far less common in Nepal then internationally. Give just consideration how you're going to set up a reliable payment structure. Look into wire transfer systems or, if you're doing business on the Internet, online payment programs (it's a way of getting what's owed you, and many also offer currency exchange features).
7. Consider language differences. If you operate a small business on an international scale, not everyone who stops by your Web site is going to speak English. That means another salient issue is making sure your site content also offers services in a sufficient number of languages. On top of that, recognize that the time will come that an overseas customer, like his or her Nepalese counterpart, will want to speak with a living customer rep. So don't overlook staffing, or having access to, bilingual customer-service personnel.
8. Pay attention to politics. Lastly, never overlook the political environment — or even worse, the threat of terrorism — in areas where you hope to do business. That's particularly true if you're planning on sitting a warehouse or some other facility overseas. Make certain you gauge the economic and social stability of prospective markets, not merely to protect any resources that happen to be located there but also to ensure that any goods shipped will, in fact, arrive at their intended destination.
Conclusion
Doing IB is not easy job. We need to better prepare to over come all the difficulties as we have mentioned in above. We have keeping mind the physical and societal factors of that country like political and legal practices, cultural factors, economic forces, geographical influences. And competitive factors are also equally important. Like major advantages in price, marketing, innovation or other factors, number and comparative capabilities of competitors and competitive differences by country. As we know there has growth in globalization in recent decades due to many factors mostly: Technology is expanding, especially in transportation and communications. Governments are removing international business restrictions. Institutions provide services to ease the conduct of international business. Consumers know about want foreign goods and services.
Competition has become more global. Political relationships have improved among some major economic powers. Countries cooperate more on transnational issues and Cross-national cooperation and agreements. This is very reasons we need be better prepared and educated to take step in the international Business and we easily can realized the doing IB is not the bed of roses. There are many thons around it, we should prepared and efficient to overcome all difficulties.

1 comment:

Unknown said...

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