Managers' Forum ~ Business Case Reviews
Assessing Foreign Business Practices
Business Case Review by: Chris Riggio
The following business case has been taken from the
Harvard Business
School. The emphasis of this case is to explain how as businesses
expand
worldwide they become forced to wrestle with acceptable foreign conduct.
These global companies face many questions such as should managers
of
companies act in an ethnocentric or a polycentric manner. Other
decisions
revolve around the issue of when does a commission paid in a foreign
country
become an illegal bribe. Also, what are the norms regarding safety,
administration, and health procedures. To further complicate
this issue are
governments actions. Foreign governments regulate businesses
in their home
country and governments of the international companies regulate their
trade.
This case study does a wonderful job to help a reader
and/or a potential
manager in a foreign country understand how culture can lead to different
actions. For instance, if a company manager gives a government
official of
the United States money it is considered an illegal kickback.
However, in
particular foreign countries and even certain industries this is the
norm of
doing business. Another issue in this review deals with
businesses shifting
production to subcontractors in China and trying to implement a company-wide
policy of social responsibility and employee’s rights. As one
knows, human
rights in China is a topic that is very controversial and is protected
by the
national government. Other issues in this review deal with abductions
of
children of foreign expatriates and how grease money can help companies
get
products into countries.
Galton, Zanley; "Assessing Foreign Business Paractices". Harvard
Business
School Publishing 1995. Case No. 9-796-105
