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The company Green Courier is one of the leading environmentally-friendly courier service company in the UK. This company focuses on reducing the environmental impact by using one of the lowest carbon-emitting fleets in the industry. This company is now planning to enter the new market of the Brussels region and thus needs to consider several factors for entering into new markets, an overview of which is given below.

International Business - Answer 1

Competitive advantage can be described as factors or elements that allow a company to stand out differently in the market from its competitors. Competitive advantage enables the company to distinguish itself from its competitors in the market place and generate more sales or superior margins compared to its market rivals. Companies constantly try to alter their market strategies to achieve a competitive advantage. While developing marketing and communication strategies, the marketing managers of any company take into consideration several factors while assessing the various locations around the world. Similarly, the managers of Green Courier will consider some factors when assessing for maximizing the company’s competitive advantage in the market. These factors include quality of core product or service offering, cost structure, the distribution network, customer service, branding, intellectual property, the long- term and short-term market trends, and so on. When the company wants to expand its business operations from home country to other international locations, the manager has to strategically design the value proposition of the new market to gain maximum competitive advantage. The company can create a niche for itself by offering a unique product and service. Similarly, the managers also have to make many strategic decisions in terms of the communication mix and distribution channels other locations other than the host country. The communication mix strategy which is successful in the host country may fail in other location. Also, distribution mediums vary from one region to another. It is also essential for the managers to assess the consumers of that different location and understand their behaviour, to suit the demands of the consumer of that region. This will also help the company to succeed in providing high customer service, the customer retention rate will increase, which in turn will help the company to gain maximum competitive advantage in that region.

International Business - Answer 2

The company Green courier which is environmentally-friendly and planning to expand its operations in Brussels. Porter’s Five Force, tool used by companies to understand the extent of competition in the business environment, and thus to identify and develop strategies for gaining profitability. The companies can evaluate the forces in the industry that affect the profitability of their business with the help of this model, and thus customize their strategies accordingly. This model to understand the competition in the business was developed by Michael Porter, and he identified five forces that are prevalent in the business market and concluded that these forces play a significant role in shaping every business market or industry (Lumbanraj, Dalimunthe & Hasibuan, 2019). The five forces identified by Porter are as follows (Lumbanraj, Dalimunthe & Hasibuan, 2019):

  • Competition in the industry
  • Potential of new entrants into the industry
  • Power of suppliers
  • Power of customers
  • Threat of substitute products.

The country of Brussels was chosen by the management of this country to expand its operations. This choice can be explained with the help of five force model as follows:

  • Competition in the industry

The importance of this competition force is the number of competitors in the industry. The more the number of competitors, with the equivalent number of products and services they offer, the lesser the power of a company. The financial market in Brussels in very competitive. The major competitor of this company is VSL worldwide, which is also an eco-friendly courier company.

  • Potential of new entrants into the industry

A company’s present position is affected by a new entrant into the market. A strong competitor who enters using less time and money is said to be an effective competitor, and will more affect the company’s position and may result in its dilution. The market of Brussels being conducive for business operations makes it favourable for the companies to enter into this new market.

  • Power of suppliers

In industries where there are only a few suppliers, some suppliers usually enjoy a greater power. Such suppliers drive the price of goods and services in that market. This company may not have a high bargaining power due to the competition in the market.

  • Power of customers/bargaining power of buyers

When the customers or buyers in the industry have many available alternatives to choose from, they enjoy a high bargaining power, and also the transactions volumes are high. The country of Brussels has many players in its markets, and thus the consumers of this market hold high bargaining power.

  • Threat of substitute products

The changes in the market place like a technological change can give rise to substitute products. Companies innovate and try to gain maximum advantage by leveraging from the market changes, and considerably pose a threat to other companies. Thus, the competition increases and the already performing company’s position is affected.

International Business - Answer 3

VRIO framework is the tool used to analyse a firm’s internal resources and capabilities to find out if they can be a source of sustained competitive advantage. This framework helps the companies understand the requirements for sustained advantage. The VRIO is an acronym of four components of value, rarity, imitability, and organization that the companies must possess to gain a competitive advantage (Rockwell, 2019). These components are used by the company to answer their decision making questions about these components and determine the competitive potential. The components can be explained as follows (Rockwell, 2019):

  • Value- helps to answer the question whether the resource or component adds value to the firm for capitalizing on opportunities, and protecting the company from the market threats. The value helps to increase customer perceived value, and gain more market share. The components that are unable to create value lead to a competitive disadvantage for the company.
  • Rarity- The resources or components distinctly available and are capable of being acquired by only a few companies are considered to be rare. Rare and valuable resources can impart a competitive advantage to the company. Such resources helps the company to stand differently in the market.
  • Imitability- A company should possess resources or components that are difficult or costly to imitate, and no equivalent substitute can be found by competition companies. Even if the company has resources or components that are valuable and rare, but easy to imitate than the company only has a temporary disadvantage. This one step of imitation can pull the company down from the leader’s position, and the company will lose its competitive advantage.
  • Organization- The resource or component by itself will not be able to offer any advantage for the company if it is not organized adequately to capture the value from them. Thus, companies need to organize its management systems, processes, policies, organizational structure and culture to be able to fully derive the maximum potential of the valuable, rare and costly to imitate resources and capabilities. Such practices only will help the company to achieve sustained competitive advantage.

International Business - Answer 4

Agglomeration is a term used in economics in context to refer to the phenomenon or concepts of firms which are clustered or being located close to one another. It simple terms it can also be explained as spatial clustering process or a process of concentrating the industrial activities close to one another in a relatively smaller area (Komorowski, 2020). It is a process generally referred to manufacturing companies where more and more companies cluster to operate in s smaller space within close proximities of one another. The agglomeration advantages can be given for this company in Brussels can be given in terms of cost advantage. The companies which are agglomerated can derive greater cost benefits in terms of low transportation cost, increased and low-cost labour availability, increased availability of physical capital and amenities and resources, more consumers, and creation of a great local market. However, this agglomeration also has some disadvantages to it as well. Excessive agglomeration will lead to exploitation of the location.

International Business - Answer 5

The OLI framework is a framework introduced by John Dunning in 1977, and addresses the question of the location for the operation of the firm or where shall it operate on the international level. OLI is the acronym for ownership, locational and internalization advantages. Ownership advantages for a company in Brussels, include competitive advantages for its competitors and will enable the company to gain advantage of investment opportunities both domestically and internationally. Some advantages of OLI include the company can have greater access to innovation and technology at low marginal costs, access to cheaper inputs and knowledge about market and local production (Autio, 2017). The localization advantages remain specific to one country and make the company attractive for FDI. The advantages of internalization consists of the advantages which are derived from internal production of the company.

International Business - Answer 6

Formal institutions consist of the various government and legal directives of a place that forms the basis of different industries and organizations operating in that region so that these organizations can have a greater impact on global entry strategies. These formal institutions also drive how well multinational organizations can develop and execute their global entry strategies. These formal institutions are the basic rules and regulations governing the businesses and industries (Ho, Chan & Sheh, 2016). Awareness of such formal institutions can determine the success or the failure of the business of these countries operating at the global level. Formal institutions impacting this company in Brussels consists of regulative, cognitive and normative actions, structures and framework that makes the firm stable and gives a meaning to it. These institutions are a formal set of pre-written and laid down rules, regulations and policies that are implemented by the legislative bodies of the region to shape the company and stabilize and mould the economy. This company operating in Brussels, have a strong formal institution which has a great benefit for this company. With this strong formal institution and legal systems of the business market, the economic conditions are relatively more stable. Thus, the market uncertainty and volatility is quite low and the risk of doing business in this company is very less (Ho, Chan & Sheh, 2016). Thus, the formal institution of this company will be a great advantage for the company to succeed.

International Business - Answer 7

Informal institutions consist of systems and structure about the culture or shared cultural norms, and provide similar effects and have similar roles as that of formal institutions on businesses. These informal norms consist of socio-cultural influences and factors of the business environment. One of the main informal institution that influences and have an impact on the businesses is the national culture of the country and also the cultural influences of the employees of that country. The important cultural characteristics of the business culture of Brussels comprises of the business communication styles, the business etiquettes, and the stress on work-life balance (Lanz, Lee, & Stolenzburg, 2019). The business culture of the people of Brussels consists of hard-working people committed to their jobs and committed to following the rules and regulations of the corporate world. The people of Brussels have a relatively polite and amiable approach, in their working style. Having operations in such a country can help the company, to succeed in achieving its organizational goals and objectives. The company can gain high customer service and customer satisfaction rate by employing such positive and approachable employees. This will in turn increase the customer retention rate and bring greater profitability to the company.

International Business - Answer 8

The resource-based view (RBV) is a managerial structure that enables the management to determine and identify the strategic resources the company can exploit and make use of to achieve sustainable competitive advantage. Important strategic decisions are made by the company using this resource-based view. The resource-based view in simple terms can be explained as a tool used by the management that enables them to view and identify which are the key and integral resources that will provide the superior performance of the firm and help the firm to gain competitive advantage (Xiao, Arikan & Barney, 2018). It is an approach used by the companies to accomplish a competitive advantage. The principle of this resource-based view is that the leaders and the companies should evaluate their internal organization and try to find out the resources of gaining competitive advantage, instead of looking at the competitive environment outside the organization (Xiao, Arikan & Barney, 2018). The key resources that are required for this company to be successful in the region of Brussels are the financial resources to fulfil the financial and monetary requirements of the business operations, the physical resources like the machinery and equipment, the delivery vehicles, and so on, the intellectual resources like the expertise and talent of the various business consultants, managers and another key advisory of the business. Along with these the other key and integral that this company requires for operating in Brussels are, the human resource or a committed and qualified personal and staff with a positive working attitude, and the digital resources which are a must required resources nowadays, like the technological equipment’s, the digital media used for marketing, and so on.

International Business - Answer 9

Operating in international locations can pose a threat to any company due to the fluctuations in the currency. Fluctuations in currencies generally occur in uncertain and volatile business market times, like in situations of political elections, civil unrest and due to any political changes. To protect the company from such risks of fluctuating exchange rates and foreign currency the companies use several methods like hedging and other foreign exchange risk management strategies. This company in Brussels will also make use of different foreign exchange risk management strategies like making invoicing and accepting contracts only in U.S dollar currency. Managing the expenses and the revenues of the company in the same currency can also help the company to protect itself from the exchange rate fluctuations. Another method which this company can use to protect itself from the exchange rate fluctuations is by matching. In this method, the companies open a bank account in the international region where it is operating and then tries to match their sale receipts and other financial bills and receipts in the same currency. This reduces the currency exposure of the company and balance is left in the account after all the foreign-currency liabilities are met. However, it might not always be cost-effective to park the money in a bank account for long periods, thus the company can also make use of the method of hedging, in which the risk is reduced against the future fluctuations with the help of forward-exchange deals for locking in exchange rates.

International Business - Answer 10

Strong currency rates can cause a problem for the company. If a currency is stronger and is appreciating, then this situation may lead to a decline in domestic demand for goods and services in the home country. The company will experience less competition in exports, and imports remain less costly. In the case of an economy or country which has a slow pace of growth, a strong currency will worsen this economic slowdown.

International Business - Answer 12

Exchange rates can simple defined as values at which one currency can be converted to another currency of some other regions. These exchange rates are important when the businesses are involved in expanding their businesses to foreign locations. These exchange rate influences and driven by several interrelated factors of the business market environment. The exchange rate fluctuates due to variety of factors of the business market. Similarly, the major factors that will influence the exchange rate in the host country of Brussels are as follows:

  • The exchange rates are influenced and affected by the supply and demand. When the demand for a product or service increases, the associated value increases, however an excessive supply of the same product or service will decrease its value and consequently the demand. Thus, the exchange rates also fluctuate simultaneously.
  • The interest and inflation rate will affect the exchange rate. Inflation is the rate at which prices of goods and services increases; while interest rates reflect the payment charged by the bank for individuals to borrow money or the earnings on the savings. The exchange rate is affected in both the cases. Like an increase in interest rates will cause the currency value to rise.
  • The balance of trade and deficits influence the exchange rates.

A demand for foreign currencies can increase their value on the open market. However, an excess of local currency will decrease the value of it.

  • Government debt affect exchange rates
  • The political and economic stability also affects the exchange rates

International Business - Answer 13

Global economic integration is an arrangement between the nations that consist of reducing or eliminating the trade barriers and the coordinating the monetary and fiscal policies. This global economic integration tries in reducing costs for both consumers and the companies who are involved in the economic integration agreement. When regional economies agree for integrating, the trade barriers collapse and the economic and political coordination between the nation increases. However, at times some nationalists oppose this economic integration due to issues with their sovereignty. Global economic integration provides a variety of benefits like trade benefits, political stability and cooperation, employment benefits, etc. Global economic integration increases the employment opportunities in the integrating nations. This global economic integration is also advantageous to the countries as it leads to market expansion, technology sharing, and cross-border investment. The political ties also improves between nations, which in turn provides greater economic stability and a positive business environment.

International Business - Answer 14

The term liability of foreignness (LOF) is used to explain all the costs that the companies operating in a host country and operating outside their home countries experience, and this cost is above the cost that is incurred by local companies. This concept of liability of foreignness (LOF) can also be described as the additional costs that a company operating in a host region outside its home country, have to bear and these costs are higher for these foreign companies as to compared to their indigenous competitors (Nachum, 2015). Generally, the multinational companies operating in the foreign market are affected by this liability of foreignness. Liability of Foreignness affects the functioning of a foreign country operating in a host country and has its disadvantages. Similarly, this company operating in the host country of Brussels will also experience this liability of Foreignness and be at a disadvantage because of its non-native status. As this company is operating in the host country of Brussels, has to deal with the major differences of legislation and regulation of the host country, the differences in language, culture and traditional norms pose extra challenges for the host company as compared to the local companies from the host country do not have. This gives rise to the additional costs in meeting these differences and may also cause competitive disadvantage that will which the company will have to overcome by implementing more costs.

International Business - Answer 15

When companies expand their business operations from domestic to international boundaries, they also have to transfer the important functions of the company including their human resource practices, for achieving success in the host country. This also helps to improve the competitive advantage position of that company on a global scale. Similarly, to operate with efficiency different types of human resource management strategies are used by this company in Brussels. Thus strategies which are generally used by the companies are Ethnocentric, Polycentric or Geocentric. Polycentric approach to international management of human resource is the strategy in which the company hires and promotes employees who are the residents of the host country. The polycentric strategy helps to gain cost advantage as it saves higher costs of recruiting and training and gives rise to lesser conflicts of adjustment and communication and cultural norms as the employees belong to the same region. The ethnocentric approach of human resource management is used by companies which have international strategic orientation and this ethnocentric strategy involves posting the personnel of the home region or parent country to that of the host country, while the polycentric approach will focus on employees from the same host region. Geocentric employee management strategy is used when companies try to employ transnational orientation. In the geocentric approach, employees are recruited based on their expertise and skills. The nationality of these employees are not considered in this approach. This company’s attitude in managing the employees of the company reflects a mix of these two approaches of the polycentric and ethnocentric. Since the company is operating in a host country it needs to minimize cost on employee management and need local expertise for achieving success. However, some employees of the home country also need to be posted at the host country which will enable the company’s management to exercise their universal human resource management strategies. 

International Business - Answer 16

Expatriates are the personnel who are appointed for work at a foreign location or a host country, other than the home country, for a long-term job assignment. These employees are usually appointed to locations to fill or populate a new office or appointing senior managers who are required to manage or set up a new branch or office in the host country. In simple terms, expatriates are staffs that are sent or posted by the employers for long periods to a foreign location. Sending expatriates to give various benefits for this company, like it will help the company to gain greater parent control and replicate the expertise of work in the host country. Along with sending these expatriates to other countries for work, management of these employees is also essential and an important function of the human resource team of this company. The company will have to conduct a rigorous process of selection to identify the best expatriate with skills of language skills, relationship skills and job expertise. Once the employee is selected and posted as an expatriate, human resource management of these expatriate is important and a strategic approach for effective management of people or employees in an organization such that they contribute to business to gain a competitive advantage. This company can manage the expatriate by arranging for related and necessary immigration facilities for prospective and current expatriate employees, and by organizations operating in domestic and/or foreign countries. The company also needs to make arrangements for family for these expatriates because most often the expatriates are appointed for long term assignments and travel with their family to foreign locations. The expatriates will also experience a cultural shock in foreign locations, due to the cultural differences and thus, the company should ensure to help the employee to adjust to the new culture and perform with its maximum capacity.

International Business - Answer 17

Repatriate or repatriation is in contrast to expatriate which involves the process of sending back the employees back to its home country. Repatriation refers to returning or sending an employee to their own country. Repatriation can also be referred to as terminating the foreign location assignment of the expatriate and returning the employee to the home country or to the country where the company’s head office is located or to the home subsidiary from the host country where the expatriate was posted (Chaing, 2017). A repatriate has a significant role in connecting the corporate boundary to the rest of the world. The successful completion of the assignment makes it sure for corporate growth prospects. The reasons of repatriation can be given as completion of the assignment in the overseas location, moving on another global assignment. One of the most common reasons for the return of expatriate to the home country is due to failure in the job or unable to perform in a foreign location. This generally demoralises the expatriates, and thus are return to the home country or are sent back by the management due to low job performance (Medatwal, 2015). Some other reasons and factors of employee repatriation also include a dissatisfaction of the employees with the overseas job and some personal concerns like family unwillingness and low morale due to cultural shock. Thus, to avoid such situations and issues with the repatriate the company will employ several strategies for effective management of the people. It is the responsibility of the human resource team to understand the gap and the problem area thus take corrective actions like providing adequate training for better performance. The principal objective of repatriation management is the process of retaining the talent in the company. The process goes through some phases which internally combine organizational factors, individual factors, social factors that affect re-entry and work adjustment. The company should address the concern of repatriation and design effective repatriation programmes.

International Business - Answer 18

While entering a new market the organizations will make use of many strategies and methods of entry in the market. Some commonly used method for market entry by the firms these days is utilizing a strategic alliance or a joint venture. Such methods of entry provide the company with great benefits as the company is unaware and new to the foreign location or the host country. However, there are some differences in the strategic alliance or a joint venture approaches of market entry. The most important difference between strategic alliance and a joint venture is that for a strategic alliance, the two or more companies remain and operate as separate individual entities, however in a joint venture, a completely new entity is established (Prange & Mayrhofer, 2015). Thus, a joint venture is considered as a separate legal entity while a strategic alliance cannot be considered the same. For a joint venture, a new management committee is formed, while in case of strategic alliance the business is managed by the representatives from both the parties. A joint venture is mainly focused on limiting the risk for all the associated parties, while the strategic alliance tries to leverage on the opportunities that bot the companies bring with them and maximize the benefits and profits of the company (Prange & Mayrhofer, 2015). A joint venture is executed by a binding contract signed by both the parties, while a strategic alliance may just involve a written agreement or a handshake to seal the deal. For this company, who is planning to enter the new market of Brussels, the most appropriate method of market entry would be a strategic alliance, as this method will enable this company to maintain its individuality and a separate brand in the market, along while letting the company to capitalize on the strengths, opportunities and other advantages of the company with which it is allied to. Also, the firm with which this company will form an alliance being a local company and Brussels being their domestic location will be well-aware of the important formal and informal institutional factors of the Brussels market, and thus can protect this company from its harmful effects.

International Business - Answer 19

While entering a new market the organizations will make use of many strategies and methods of entry in the market. Some commonly used method for market entry by the firms these days is using the franchisee model or licensing model. These models also have some differences between them and the company will implement either of these models which suits their needs the best. The main difference between licensing and franchising models is that the licensing model consists of a legal relationship and that relationship is limited in its extent scope. This model only relates to making use of the trademark or technology of the company which has given the license to do so, however franchising model consists of a relationship between the parent company and the franchisee which is beyond the granting of a license. (Grullon, 2019) This relationship consists of a relationship of exercised control where the underlying business is required to operate by designated systems and procedures of the parent company. When in a franchise model the protocols are to be followed by franchisee and are bound to abide by the standards and rules and policies, which can only be altered by the parent company (Grullon, 2019). The degree of control is also different between these two models. The licensee is governed by the licensor’s terms as mentioned in the licensing agreement for the licensed product or service. Franchisor exercises great control over the business of the franchisee about the quality of service provided, marketing & selling strategies, procedures and protocols, etc. Thus, for this company who is planning to enter the new market of Brussels, the most appropriate method of market entry would be the method of licensing. This company is the licensor take advantage of vertical integration in the market without making any heavy investment of capital. The licensor can also have its brand image and can improve it without the fear of any control. This company can also get greater access to the market and can eliminate competition by using the licensing method of market entry.

International Business - Answer 20

Competition is an inevitable phenomenon in the business industry. Competition of any kind may pose a threat for any company in a business market, but it is also important as it motivates a company to perform better, innovate itself and improve their offering and thus maximize their growth. The business being old or a new venture, it is very important to understand the competition that is prevailing in the market and thus, form strategies accordingly. This understanding involves evaluating and analysing the direct and indirect competitors of the business in the market place. Direct competition can be described in simple terms as a situation in which two or more firms compete in the same market by offering the same type of product or service (Schertler, 2014). On the other hand, indirect competition is can be explained as a phenomenon in which two or more firms compete in the same market, and target similar customer needs, by offering the different type of product or service (Schertler, 2014). For this company with its operations in Brussels, will have to counter mostly indirect competition presently, as not many companies have come up with the model of eco-friendly courier services. This company can counter and manage this competition by developing strategies effective consumer engagement, using social media for marketing and altering another marketing mix as per the consumer’s need, and so on.

International Business - Answer 22

Hofstede's cultural dimensions theory can be described as a framework or model for cross-cultural communication and was developed by Geert Hofstede (Vasile, 2016). This framework explains the effects of a culture of the society on the values of its members. It also tries to explain how these values affect the behaviour of these members, with the help of structure derived from factor analysis. Hofstede's cultural dimensions help the managers to understand how the national culture or culture of the region will influence the values of the employees in the workplace. There are six dimensions of culture as given by Hofstede's (Vasile, 2016). These dimensions are described as follows (Vasile, 2016):

  • Power Distance Index (PDI) - This dimension explains the degree to which the less powerful members of a society accept and expect that power is distributed unequally (Vasile, 2016). The fundamental issue here is how a society handles inequalities among people.
  • Individualism vs. collectivism- this dimension considers the extent to which societies are integrated into groups and their perceived obligations and dependence on groups.
  • Uncertainty Avoidance Index- it explains the degree to the people in the society can tolerate uncertainty and ambiguity. This dimension tries to explain how the unknown situations and events are dealt with.
  • Femininity vs. Masculinity- this dimension considers the society’s attitude towards sexuality equality, their behaviour, society’s preference for achievement. It is called as the tough vs. tender dimension.
  • Short-Term vs. Long-Term Orientation- The long-term orientation vs. short-term orientation dimension considers the extent of the society to views its time horizon.
  • Restraint vs. Indulgence- this dimension considers how people in the societies can control their impulses and desires. It considers the degree and tendency of the society to fulfil its desires.

The Hofstede's cultural dimensions that best apply to the host country, are uncertainty avoidance index, and restraint vs. indulgence dimensions.

International Business - Answer 23

When companies move forward to international borders for their business operations, the culture of that region has a significant effect on the functioning of the business. Often it is observed that employees who are sent from the home country to work at the host country locations often are restricted to their behaviours similar to their home country. They are most likely to adhere to their own morale’s, cultural and ethical beliefs. This behaviour of the people is referred to as ethical imperialism (Dimitrova, 2017). Thus, ethical imperialism directs the people to do everywhere exactly as they do at home. However, the people at times also prefer following the culture of the region in which they are located and do as the people of that region do. Such a type of behaviour of the people is referred to as ethical relativism. Thus, ethical relativism occurs when the values and practices of the local setting determine what is right or wrong,” and when ethical behaviour is determined by its cultural context (Dimitrova, 2017). The most practical path for this who plans to start its operations in Brussels is to adopt the path of ethical relativism. Though the host country cultural differences will give rise to cultural shock for the company and its employees the company should follow the path of ethical relativism, as with ethical relativism the company will be able to adapt to the cultural norms of Brussels, will get more acquainted with the host country and thus will be able to perform to its maximum capacity.

International Business - Answer 24

With the increase in the globalisation, the companies are moving across their domestic borders to international locations to gain maximum market share. However, when the companies are involved in such cross border transactions, they should focus on the major differences existing between the two locations which will affect the business operations. One of the major differences between the home country and host country that impacts the operations in the host country is the cultural differences. Similarly, the culture of Brussels being the host country differs from the home country culture of this business. Brussels has a key position in the international and European business market and economy. It is one of the most important business hubs in Europe. The political culture of the Brussels is moderately free from governmental interference. The human resource culture of this country comprises of people who are highly committed to work and hardworking. These people out here have the required expertise and skills in various sectors business. The top-down approach of management is usually practised here in the businesses, and the employees are committed to abide by the corporate rules and policies. Such a positive and growing culture of Brussels makes it a conducive location for conducting business operations and achieving success.

International Business - Answer 26

The company when moving from home country to the host country for expanding its business often encounters several ethical challenges and changes due to differences in culture and ethics of the region. Some of the effects that these ethical challenges and changes will have on this company while operating in the host country of Brussels are low employee performance, low organizational growth, conflicts between the management and the employees, and so on. Thus, the management of the company should make some strategic decisions and implement some strategies to counter these ethical changes. The four strategic responses that the company can make use of in response to ethical changes are using the approaches of defiance, camouflage, negotiation and compliance, and are explained as follows (Zhang, Zhu, Dowling and Fan, 2017 ):

  • Defiance- in this strategic response the company will try to defy the ethical expectation of the local region and focuses on maintaining the core values and principles of the institutional logic. This is usually used in cases where the ethical risk is low.
  • Camouflage- the company by using this approach tries to imitate or camouflage and blends itself in the peripheral culture of the host country, along with maintaining the core values and principles of the institutional logic. This is usually used in cases where the ethical risk is high.
  • Negotiation- in this approach the company will negotiate and involved in the manipulation of the institutional logics in both the regions, to meet the expectations in both the home country as well as the host country. Such an approach is used in case where the ethical risk is high.
  • Compliance- in these types of approach the company will comply and abide by the local expectations in terms of ethics in the host country and will abandon its core institutional value. Such an approach is used in case where the ethical risk is low.

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