1. Select a country (India) that your organization or one that you select that you would like to explore as to the feasibility of conducting operations within the select country’s borders.
2. Identify the cultural differences of the people and society in comparison to the United States focusing on bias related to gender, religion, race, social class, disability, age, and sexual orientation. In addition, comment on value systems and beliefs.
3. Evaluate the system of government, regulations, and ownership restrictions in the selected country.
4. Assess the current status of the economy and identify the pros and cons of conducting business in your selected country.
5. Evaluate the foreign exchange and banking system within the selected country. Address factors that may limit transferring funds to the parent company in the United States.
This material may consist of step-by-step explanations on how to solve a problem or examples of proper writing, including the use of citations, references, bibliographies, and formatting. This material is made available for the sole purpose of studying and learning - misuse is strictly forbidden.Introduction
The increase in competitive pressures in the operating environment has forced companies to innovate and come up with new strategies to enhance their competitive position. One such strategy has been internationalization of operations. This helps to reap the benefits of scale and scope economies since organizations can access the global consumer markets and resource markets. Another major benefit of internationalization has been to reduce the country specific risk from the portfolio. Accordingly, this report is based on a US organization that has been aiming to internationalize to a developing economy, India so that it can gain access to its fast growing consumer markets and cheap labor resources. This would also help the organization to operate in economies on two different stages of development and thus reduce economy-specific risk from the portfolio. This report presents an analysis of the difference between the home economy US and India and assessment of the key business factors.
Cultural differences between US and India
U.S. and India are on different stages of economic development and as such, the cultural attributes are different across these economies. It is important to study the cultural differences between the economies since cultural attributes also shape the values and mindset of the individuals and these influence the work patterns and purchasing trends of the residents in that country. Hofstede’s (2015) six-factor model has been applied to understand the differences in the cultures of these economies. The scores of both the economies across each of the 6 dimensions has been charted in Figure 1.
The first factor is power distance. Power distance refers to the extent to which power is distributed unequally across the economy. In case of India, the high score of 77 means that power is not distributed equally and the top management exercises control over the activities of the people at the lower levels. On the other hand, the score for US economy is 40 which means that there is an equal distribution of power across the economy. In case of organizations, it means that the top management is directive in nature and the communication takes place from top to bottom of the organizational ladder.
The second attribute refers to individualism. This refers to the degree to which the residents have an affinity for groups. In case of India, the score is 48 implying that it is a collectivist culture, while US has a high predominance of individualistic culture. Collectivist culture means that the Indians...