SEU MOD 11 The Strategic Evaluation and Control Process Discussion

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This week’s discussion will focus on management control using the case study “Brief Integrative Case 3.1: Google in China: Protecting Property Rights” (p. 415) in International Management: Culture, Strategy, and Behavior.

Decision-making and controlling are two vital, and often interlinked, functions of international management. Strategic evaluation and control is the process of determining the effectiveness of a given strategy in achieving the organizational objectives and taking corrective actions whenever required. Control can be exercised through formulation of contingency strategies and a crisis management team.

Using the Decision-Making Process (stages 1-9) outlined in the textbook (Fig 11-1) and this module’s content, what are your thoughts on each step in the process using the Google in China case study as it relates to the strategic evaluation and control process definition above?

For example:

  • Stage 1: What is the problem perception in the case?
  • Stage 2: What is the problem identification in the case?
  • Repeat for stages 3-9.

What overall assumptions can you make using this decision-making process?

Answer all questions posted by students and your professor. These post replies need to be substantial and constructive in nature. 

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Module 11: Management Decision-Making and Control 1. Contingency Strategies and the Strategic Evaluation and Control Process As we have learned in this course, decision-making involves choosing among alternatives. As globalization becomes more pervasive, this is becoming more relevant for the international manager to use as a common business practice. One critical decision an international manager must make is that of deciding on an effective strategy to work within a specific culture. Luthans and Doh (2018) pointed to the following indicators that decision-making practices vary from country to country: • • • • French managers tend to spend ample time on searching for and evaluating alternatives. German managers focus more on productivity and quality of goods and services than on managing subordinates. Swedes focus much more on quality of work life and the importance of the individual in the organization. Japanese managers employ a long-term focus, making heavy use of a decisionmaking process called ringisei, which is a Japanese term that means “decision making by consensus” (p. 394). Since different cultures approach decision-making in different ways, it is necessary to have a strategy or mechanism that brings these decisions to the same point. Direct mechanisms that provide the basis for the overall guidance and management of foreign operations include the design of appropriate structures. Such decisions proactively set the stage for operations to meet goals, rather than troubleshooting deviations or problems after they have occurred. Decision-making and controlling are two vital and often interlinked functions of international management. Controlling is the “process of evaluating results in relation to plans or objectives and deciding what action, if any, to take” (Luthans & Doh, 2018, p. 398). Management control helps align employee actions with corporate objectives. Multinational corporations (MNCs) employ various control mechanisms to coordinate units worldwide in order to meet global organizational objectives. Process controls specify desirable employee behavior and include centralization and standardization to ensure that employees adhere to specified processes. Some countries tend to use more centralized decision-making than others so that more decisions are made at the top of the MNC than are delegated to the subsidiaries and operating levels (Sageder & Feldbauer-Durstmuller, 2018). Look through this chart to learn more about types of control (Luthans & Doh, 2018). Type of Control Application Internal Control MNC focuses on the things it does best. External Control Management wants to ensure that there is a market for the goals and services being offered. Direct Control Face-to-face meetings are used for the purpose of monitoring operations. Indirect Control Reports and other written forms of communication are used to control operations. An additional component of controlling involves evaluation results in relation to objectives, then taking action to correct deviations. MNCs can control their overseas operations in several ways: • • • • • Combining direct and indirect controls Using heavily quantifiable methods Using qualitative approaches Using decentralized approaches Using increased centralization. After appropriate control measures are decided and implemented in a firm, evaluation must take place. Dereksy (2017) indicated a major problem in the evaluation of the performance of foreign affiliates is the tendency by headquarters managers to judge subsidiary managers as if all of the evaluation data were comparable across countries. Unfortunately, many variables can make the evaluation information appear differently between countries. One way to ensure more meaningful performance measures is to adjust the financial statements to reflect the uncontrollable variables peculiar to each country where the subsidiary is located. Another way is to provide meaningful, long-term performance standards to take into account other nonfinancial measures. Watch this video to learn more about the basic mechanisms of controlling an organization. https://youtu.be/qMS95M6RBW4 This video explores the components of organizational control. The premise of organizational control is that action aligns with standards. Click through these tabs to learn more about types of control models (Gregg, 2018). Feedback Control Model: • • • • • • • It regulates the organization’s activities. It uses feedback to determine whether performance meets established standards. Key steps are establish standards, measure performance, compare performance to standards, and make corrections. Standards of performance should be clearly defined so employees know what they need to do. Formal reports can be used to measure/quantify performance and should reflect the standards set by the company. Completed activities are compared to performance standards. Adjustments are made as necessary to ensure alignment to performance standards. Balanced Scorecard Model: • • • • • It compares financial measures with operational measures, linking to success factors. Financial performance focuses on how the organization’s activities contribute to improving short- and long-term financial performance. Customer service includes indicators that measure information such as customer retention and satisfaction. Business processes focus on production and operating statistics. Organizational capacity for learning and growth involves how well resources and human capital are being managed for the company’s future. Managers should record, analyze, and discuss these various metrics to determine how well the organization is achieving its strategic goals. 2. Decision-Making Process and Challenges in a Global Organization Luthans and Doh (2018) indicated that there are a number of factors affecting decisionmaking authority for international firms and managers. One factor reflects either the retention of authority or the delegation of authority to a subsidiary. One major influence in this decision is the organizational structure that was initially set up for the subsidiary. This week’s discussion requires you to use the stages of the decision-making process outlined in Chapter 11 of the text and apply them to the case study of Google in China (Case 3.1). Stages of Decision-Making 1. Problem Perception: What do the stakeholders view as the problem? 2. Problem Identification: What steps can be taken to identify a problem or a decision to be made? 3. Problem Formulation: What factors and variables contribute to the problem? 4. Search for Alternatives: What options are needed to solve the problem or make the decision? 5. Evaluation of Alternatives: What is the means to measure alternatives and weigh the outcomes? 6. Choice of Alternative: After considering all possibilities, what is the best choice? 7. Start of Operation: How can the chosen method be used to solve the problem? 8. Implementation: How can the plan be put into motion? 9. Control: Based on an evaluation of the results, is there any action to take? Another influence in the decision-making process is the size of the company. Larger companies tend to encourage centralization, while smaller firms tend to encourage decentralization of the subsidiary decision-making process. Watch this video to learn more about the decision-making process and how to organize choices in a clear way. https://youtu.be/5a0Fe3AchAI This video reviews steps to take when making a decision. While the decision-making process is linear, looping back is common and consists of the phases a manager will need to make effective decisions. References Deresky, H. (2017). International management. (9th ed.). Hoboken, NJ: Pearson Education, Inc. Luthans, F., & Doh, J. P. (2018). International management: Culture, strategy, and behavior (10th ed.). New York, NY: McGraw-Hill Education. Sageder, M., & Feldbauer-Durstmüller, B. (2018). Management control in multinational companies: A systematic literature review. Review of Managerial Science, 1-44. © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Chapter 11 Management Decision and Control © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Learning Objectives • Provide comparative examples of decision making in different countries • Present some of the major factors affecting the degree of decision-making authority given to overseas units • Compare and contrast direct controls with indirect controls © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Learning Objectives (continued) • Describe some of the major differences in the ways that MNCs control operations • Discuss some of the specific performance measures that are used to control international operations © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Global Online Retail: Amazon versus Alibaba • Competitive strategies – Alibaba is a conglomerate, whereas Amazon specializes in business-to-consumer sales – Alibaba acts as a facilitator for third-party sellers, whereas Amazon acts as a direct merchant itself • Geographic positioning of both companies affects their potential future growths © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Managerial Decision-Making Processes • Involves choosing a course of action among alternatives • Often linear but looping back is common • Degree of managerial involvement depends on the: – Structure of the subsidiaries – Locus of decision making • Can be centralized or decentralized © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Figure 11.1 - Decision-Making Process © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Table 11.1 - Factors That Influence Centralization or Decentralization of Decision Making in Subsidiary Operations © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Cultural Differences in Decision Making • How managers view time in the decisionmaking process – French managers tend to spend ample time on searching for and evaluating alternatives – Danish managers want to act first and take advantage of opportunities © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Cultural Differences in Decision Making (continued 1) • Germans and Scandinavian countries both have codetermination – Codetermination: Legal system that requires workers and their managers to discuss major decisions – Germans tend to be fairly centralized, autocratic, and hierarchical – Swedes focus more on quality of work life and the importance of the individual in the organization © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Cultural Differences in Decision Making (continued 2) • Japanese are different from Europeans though they employ a long-term focus – Use the following decision-making processes: • Ringisei: Decision making by consensus • Tatemae: Doing the right thing according to the norm • Honne: What one really wants to do © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Research Findings on Decision Making • Swedish teams – Higher team orientation, flatter organizational hierarchies, and open-minded and informal work attitudes – Transparent and less formal decision making • German teams – Willing to accept a changed or unpopular decision and have clearer responsibilities for the individual – Faster in decision making as it is largely dominated by the decision authority of an expert in the field © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Total Quality Management (TQM) • Organizational strategy and accompanying techniques that result in the delivery of highquality products or services to customers • Critical to achieve world-class competitiveness • Has a big impact in the manufacturing area – Employs concurrent engineering or interfunctional teams to develop new products • Used by MNCs to tailor their output to customer needs © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Total Quality Management Techniques • Employee empowerment – Empowerment: Gives individuals and teams the resources, information, and authority needed to develop ideas and effectively implement them • Rewards and recognition – Merit pay, discretionary bonuses, pay-for-skills and knowledge plans, plaques, and public recognition © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Total Quality Management Techniques (continued) • Ongoing training – Takes a wide variety of forms • Ranges from statistical quality control to team meetings designed to generate ideas for streamlining operations and eliminating waste – Objective is to apply kaizen, which is a Japanese term for continuous improvement © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Decisions to Attack the Competition • Examples – Ford Motor Company’s decision to challenge other automakers and to be a major player in developing markets, such as Asia and Africa – Audi company's decision to target younger professionals in established markets – BMW company's decision to focus on providing more options and personalization for consumers – Mercedes company's decision to go for a lowestcost strategy © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. ISO 9000 Certification • Indirectly related to TQM – To ensure quality products and services • Examines design, process control, purchasing, service, inspection and testing, and training • Necessary prerequisite to doing business in the EU • Screening criterion for getting business in the U.S. and around the globe © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Decision Making and Controlling • Interlinked functions • Controlling – Process of evaluating results in relation to plans or objectives and deciding what action, if any, to take – Types of control • Internal and external control • Direct and indirect controls © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Figure 11.2 - Models of PC Manufacturing Traditional Model © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Figure 11.2 - Models of PC Manufacturing Direct Sales Model © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Figure 11.2 - Models of PC Manufacturing Hybrid Model © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Control Problems • Conflict between the objectives of the overseas operation and the MNC • Disagreement in the objectives of joint venture partners and corporate management • Variance in the degree of experience and competence in planning among managers • Basic philosophic disagreements in the objectives and polices of international operations due to cultural differences © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Internal and external control • Internal control - Focuses on the things that an MNC does best • External control - Ensures that there is a market for the goods and services that it is offering – By finding out what the customers want and be prepared to respond appropriately © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Table 11.3 - Impact of Internal- and ExternalOriented Cultures on the Control Process Source: Adapted from Fons Trompenaars and Charles Hampden-Turner, Riding the Waves of Culture: Understanding Diversity in Global Business, 2nd ed. (New York: McGraw-Hill, 1998), pp. 160–161. © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Direct and Indirect controls • Direct controls - Use face-to-face or personal meetings for monitoring operations – Example - Top executives visit overseas affiliates to learn of problems and challenges • Indirect controls - Use reports and other written forms of communication to control operations – Example - Monthly operating reports © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Financial Statements Required from Subsidiaries for Indirect Controls • Statements prepared to meet the national accounting standards and procedures prescribed by the host country • Statements prepared to comply with the accounting principles and standards required by the home country • Statements prepared to meet the financial consolidation requirements of the home country © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Approaches to Control • Major differences among countries – Great Britain • Financial records were sophisticated and heavily emphasized • Top management tended to focus on major problem areas and not involve in specific matters of control • Control was used for general guidance than for surveillance • Operating units had a large amount of marketing autonomy © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Approaches to Control (continued) – Germany • Managers employed very detailed control and focused attention on all variances • Managers placed heavy control on production and stressed operational efficiency – France • Managers employed control systems closer to that of Germans than to the British • Control was used more for surveillance than guidance and was centrally administered • Less systematic and sophisticated system © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Approaches to Control: U.S. Firms versus European Firms • U.S. firms – Measure quantifiable, objective aspects – Need precise plans and budgets in generating standards for comparison • European firms – Measure qualitative aspects – Need high levels of knowledge about appropriate behavior in supporting the goals of the firms © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Approaches to Control: U.S. Firms versus European Firms (continued) – Need large central staffs and centralized information-processing capability – Require less decentralization of operating decision making – Favor long vertical spans between parent and subsidiary firms – Need capable expatriate managers willing to spend time abroad – Require more decentralization of operating decision making – Favor short vertical spans between parent and subsidiary firms © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Performance Measures for Control: Financial Performance • Measured by profit and loss and return on investment – Profit is an important part of ROI calculation • Amount of profit is directly related to how well or poorly a unit is judged to perform – Can be affected by fluctuations in currency value • If a country devalues its currency, subsidiary export sales will increase • If a country revalues its currency, export sales will decline © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Performance Measures for Control: Quality Performance • Quality control (QC) - Major function of production and operations management – Achieved through quality circles • Quality control circle (QCC): Group of workers who meet on a regular basis to discuss ways of improving the quality of work • Example – Reasons why Japanese goods are of high quality • Minimal worker error, effective use QCCs, use of early warning systems, use of training overkill, and use of cutting edge technology © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Performance Measures for Control: Personnel Performance • Common approach is the periodic appraisal of work performance • Variations are found across countries in: – Methods used in evaluations – How the control actually is conducted – How rewards and monitoring of performance are handled © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Performance Measures for Control: Personnel Performance (continued) • Assessment centers: Identifies individuals with the potential to be selected for or promoted to higher-level positions – Involve the following simulation exercises: • In-basket exercises that require managerial attention • Committee exercises that require candidates to work as a team in making decisions • Business decision exercises that make participants compete in the same market • Preparation of business plans and letter-writing exercises © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. World’s Most Admired Firms • Common themes based on the analysis from the consultants at the Hay Group – Top managers take their mission statements seriously and expect everyone else to do the same – Success attracts the best people, and the best people sustain success – Top companies know precisely what they are looking for – Firms see career development as an investment, not a chore © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. World’s Most Admired Firms (continued) – Whenever possible, these companies promote from within – Performance is rewarded – Firms are genuinely interested in what their employees think, and they measure work satisfaction often and thoroughly © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Be the International Management Consultant • If you were a foreign investor, would you want to invest in a consumer electronics company in Japan? – Does the fact that the company has had past problems requiring government intervention affect your initial decision? – How does it impact your decision that you would be competing with a government-backed company during the bid process? © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Review and Discuss 1. A British computer firm is acquiring a smaller competitor located in Frankfurt – What are two likely differences in the way these two firms carry out the decision-making process? • How could these differences create a problem for the acquiring firm? – Give an example in each case © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Review and Discuss (continued 1) 2. Which cultures are more likely to focus on external controls? – Which cultures would consider direct controls more important than indirect controls? 3. How would you explain a company’s decision to use centralized decision-making process and decentralized control process, considering the two are so interconnected? – Provide an industry example of where this may occur © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Review and Discuss (continued 2) 4. How are U.S. multinationals trying to introduce total quality management into their operations? Give two examples 5. Would a U.S. MNC doing business in Germany find it easier to introduce TQM concepts into German operations, or would there be more receptivity to them back in the United States? Why? – What if the U.S. multinational were introducing these ideas into a Japanese subsidiary? © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Review and Discuss (continued 3) 6. In what ways could an accelerated decisionmaking process harm a company? – Using Figure 11–1, which stage(s) do you think would be most in danger of being overlooked? 7. A company does a personnel performance evaluation by reviewing the financial decisions the management has made, specifically focusing on ROI – How is this approach beneficial to the company? © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Review and Discuss (continued 4) – Which aspects could the company be neglecting? – Which cultures are most likely to employ this method? – Which cultures would avoid this tactic? © 2018 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Discussion ( 1 ) The immediate problems Google two-faced was the serious criticism within the U.S after they determined to befit the Chinese government in censoring data. Google’s stocks plummeted and protestors stood outside of their headquarters hard to please Google not censor data. The future effects of Google’s call to befit censorship are that they become accomplices to China’s harsh laws. Chinese individuals can still be jailed for exposing human rights problems and expressing their right to speech, online. This doesn’t align with Google’s locution “Don’t be evil.” It might still have a negative impact on Google within the U.S and that they might see their stocks still decrease. Prior to the launch of Google.cn, Google ought to have taken into thought the ethical dilemma that comes with China’s government censorship laws. thereupon being aforementioned, they should have brought attention to themselves by asking queries like, “If we have a tendency to dogo ahead with China’s censorship laws, however, might it hurt the corporate?” or “How could it create the company better?” and weigh out the results of each. In my opinion, I think Google was being “evil.” The growth and also the “future financial benefits” got the simplest of them. Solon believes that his company’s actions were unethical, however, he believes that not expanding in the least and motion Google down would fare worse. In my opinion, I believe that having all the data is best than having as a result of you ne'er known what the opposite aspect of the fabric might hold. It might initially be seen as a truth, however, flip-up as a lie. I think that Google was acting “evil.” I feel that the corporate ought to not have allowed the censorship of its search engines. I do believe that Google acted unethically. Google has its own standards and its own set of rules and simply going against them says plenty regarding the corporate. Google ought to not have censored any of its data as a result of it goes against our human rights. The ethical rule isn't adequate once creating moral selections as a result of Google’s guidelines within the U.S. (the host culture) is abundant totally different than those of China. I trust this statement. each country is totally different in its own approach, thus so as to expand your business in a very foreign country you can you'll you may either need to make a case for your laws and persuade them to follow otherwise you will need to adapt your business to their pointers ina approach that may not damage your company’s name or economic stability. Google ought to have a gathering with the Chinese government to debate all the self-made prospects that the web site might have in China. If China decides to say no the chance, then Google ought to simply decline to try and do business with them. References: • O'Rourke, James & With, Iv & Assistants, Research & Harris, Brynn & Ogilvy, Allison. (2011). Google's Entry into the Chinese Market: A Lesson in Government Censorship and Corporate Reputation. Journal of Organizational Behavior Education. 4. • https://www.technologyreview.com/2018/12/19/138307/how-google-took-on-china-and-lost/ Discussion ( 2 ) Globalization of business is almost a must for companies for continuity. Nowadays, organizations with a global presence and operating in different cultures are not exceptional anymore but rather are the norm (Luthans & Doh, 2021). However, many companies struggle to open a business in Chine because the Chinese prefer to deal with Chinese companies and because there are many governmental and regulations restrictions on international companies' foreign investment. One of them is Google (Sun, 2018). By applying the decision-making process, an analysis of Google's problem in China will be introduced. Stage 1: the perception of the problem is Google tried to enter the Chinese market by offering its service in Chinese-language format, but they got blocked because of Chinese regulation and policies violations claims. Stage 2 and 3: the problem identification and formulation is China trying to control the content and monitor its citizen, which is against Google policy. Stage 4: Google's alternatives are cooperating with the Chinese government or keeping its promise and policy with its Chinese users. Stages 5 and 6: when Google evaluated the alternatives, it found that it can cooperate with China by blocking some websites and content in addition to alerting users that are being censored and also promised not to maintain any services that involved personal or confidential data. Stage 7 and 8: Google started to implement its decision by creating an actual service in China with the domain google.cn and received a license in 2007. Stage 9: after many attacks against human rights activists and filing lawsuits against Google in the States, it decided to stop censoring, but it could not bypass the Chinese restrictions, which decreased its market share from one third to one percent. Google also tried to redirect its users' traffic to other servers like Hon Kong, but still, the service was not working properly (Stevens et al., 2016). References Luthans, F., & Doh, J. P. (2021). International management: Culture, strategy, and behavior. New York, NY: McGraw-Hill Education. Stevens, C. E., Xie, E., & Peng, M. W. (2016). Toward a legitimacy‐based view of political risk: The case of Google and Yahoo in China. Strategic management journal, 37(5), 945-963. Sun, H. (2018). Foreign investment and economic development in China: 1979-1996. Routledge.
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Explanation & Answer

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Running head: GOOGLE IN CHINA

1

GOOGLE IN CHINA
Name
Institution

GOOGLE IN CHINA

2
Google in China

Managerial decision-making is a nine-step process. Each of these steps is tailored to
address a specific aspect between problem identification and control. The first step, problem
perception, involves understanding all the issues and needs existing in a market (Wierenga,
2011). From the case, Google's problem perception entails realizing the hindrances in the
Chinese market due to competition from Baidu and censorship by the government. The second
stage is problem identification, which involves developing a clear definition of a business's
obstacles in achieving a particular objective. Google's problem identification entails
acknowledging Baidu's dominance in the Chinese market and realizing the severity of
government censorship policies to its business model.
Problem formulation, which involves ...


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