Cultural Faux Paus and How Companies Can Avoid Them Essay Example

don’t want them to reinvent it. ” (Gibson, 2006) Reinventing the brand is exactly what Subway’s franchising partners Manpreet and Gurpreet Gulri had to do in India to be survive.

Many Indians are vegetarian; therefore the Gulri brothers wisely added five meatless sandwiches to Subway’s menu. They also had to educate investors and patrons n the virtues of bread, which is not a part of Indian diet or culture. (Gibson, 2006) So how is Subway approaching foreign markets and what should they do to understand cultural differences and avoid mistakes? Avoiding Cultural Problems Subway fast-food sandwich chain believes that success dealing with cultural challenges comes down to picking the right partners. When dealing with international franchising, it’s important for companies to be able to delegate authority, with the utmost confidence in their partner’s decisions.Furthermore, the right associate is essential in dealing with bureaucratic landmines companies must navigate in emerging markets like India and China. A savvy partner can also overcome supply chain issues.

For example, Subway had great difficulty finding high-quality flour to bake their bread, a vital component of their franchise operations. (Gibson, 2006) Ultimately, this obstacle would only be solved through the local “know-how” of their Indian partners, the Gulri brothers. On the other hand, selecting bad partners can cause disaster.Starbucks Coffee Company encountered serious problems with two of its partners, resulting in their decision to abandon the Israeli market, and buy back their Germany stores from an under-achieving partner. (Gibson, 2006) Successful partnerships are important for Subway, but thoughtful analysis of cultural differences and pre-market entry research focused on likely customers is the best approach. Recommendations on How to Manage Cultural Differences

and Mistakes All three aforementioned cultural mistakes (Nixon, Dominoes, and Subway) were avoidable.

First and foremost, companies must take culture differences seriously and integrate cultural research into their global strategy. Today, there are numerous writings, like “Global Smarts: The Art of Communicating and Deal Making Anywhere in the World”, and tools like Hofstede’s Four-Culture Dimension Model, as well as armies of consultants dedicated to unraveling cultural differences. But companies should painstakingly survey their suppliers, customers, and partners to increase cultural understanding and weed-out areas for concern.This is especially important for global companies using a standardized or “cookie cutter” approach.

It is inevitable that some cultural mistakes will occur, but when they happen, management must be honest with both foreign and host nation employees and apply the lessons learned to future endeavors. Companies can not afford to make the same mistakes twice. Conclusion Dominoes and Subway can attest to the importance of cultural awareness.Selecting the right partner can help avoid potential pitfalls, but companies must accept the added responsibility of playing on a global stage, and build cultural awareness and research into their management practices.

It’s often said that “All Politics are Local”, perhaps all business is local too. References Lieh-Ching Chang (2003, March). An examination of cross-cultural negotiation: Using Hofstede framework. Journal of American Academy of Business, Cambridge, 2(2), 567-570. Retrieved March 1, 2008, from ABI/INFORM Global database.

Document ID: 288015351). Richard Gibson (2006, September). Small Business (A Special Report); Foreign Flavors: When going abroad, you should think of franchising as a cookie-cutter business; Unless, of course, you want to succeed. Wall Street Journal (Eastern Edition), p. R.

8. Retrieved March 1, 2008, from ABI/INFORM Global

database. (Document ID: 1134695111). Jared Wade (2004, March). The Pitfalls of Cross-Cultural Business. Risk Management, 51(3), 38-42.

Retrieved March 1, 2008, from ABI/INFORM Global database. (Document ID: 574079721).