Dissimilarities in rules governing different societies and countries make international trade different from local trade. Different political, cultural, and economic environments also exceptionally characterize international trade (Helpman, 2011). These factors define the incomparable responsibilities of global business managers. It is important that as PPQ Parts strategizes to venture into international business, it should have plans that identify the diversities and outline methods of handling them.
The host foreign country also has issues to deal with. The issues may have impact on the business affairs of the foreign investing company. PPQ Parts will need resources such as water, minerals, and land. The host country will therefore have to share their resources with PPQ Parts. At the same time, the country will most likely be forced to legislate on the mode of sharing the resources.
The host country will handle social issues that the country had not faced before. PPQ Parts’ presence in the country will have social assimilation impacts. The locals will have the opportunity to learn new cultures (Helpman, 2011).
Additionally, local industries will face stiff competition from PPQ Parts. This may influence the local population to have ill feelings concerning the company. They may think that the foreign company intents to out do them in business. The host country may also face issues such as shortage of classrooms, market stalls, hospitals, and clubs, among others.
This may force the government to develop new facilities or improve the existing ones to accommodate both locals and the staffs of PPQ Parts. The host country will therefore, provide these facilities (Stern, 2009). Since the trade has positive effects, including economic empowerment for locals, increased government revenue collection, and positive social and economic assimilation, PPQ Parts management should plan to ensure that the positive trade consequences remain outstanding.
Remarkably, international, multinational, and global organizations face a myriad of cultural barriers and diversity issues. PPQ Parts is not exempted from facing similar challenges. The organization should develop strategies to overcome the challenges that commonly arise due to differences in religion, language, and cultural believes.
People who share these attributes belong to similar cultural backgrounds. Unfortunately, individuals from different societies and countries do not belong to similar cultural backgrounds. A successful manager should be prepared to deal with these diversities (Yacoub, 2010). The managers and marketers should have respect for cultural values, practise, and believes of all the business stakeholders.
PPQ Parts therefore ought to train its managers and staffs on the cultural aspects of the host country. Studying their communication styles, taboos, religious believes, and lifestyle, among others, is highly essential. The training will help PPQ Parts to face little hindrances while interacting with the locals.
Moreover, the managers will learn to uphold the principles of honesty, transparency, and humility. These leadership attribute can help an effective manager top succeed both locally and internationally. Finally, it is important to encourage cultural assimilation.
The staffs should endeavour to assimilate to identify with the residents of the host society. When the staffs begin to assimilate, the local will also feel loved and appreciated as for who they are (Yacoub, 2010). If PPQ Parts successfully encourages its members to assimilate, it will increase its prospects of building a massive customer base in the respective host foreign nations.
There are serious consequences of ignoring the cultural barriers and diversity issues. Business experts hold that the ability to succeed in global business management is determined by the ability to manage the barriers and diversity issues effectively (Miller & Miller, 1995). It is common to have staffs and management personnel differing in opinions regarding global business governance. They cannot easily have a common ground due to the differences in believes (Miller & Miller, 1995).
These factors must be managed effectively to make a global business achieve its goals. Differences in the host county’s political climate also determine the essentiality of the topic of international diversity. Governments sometimes require foreign industries to incorporate a large population of the locals into their business.
When the companies face such pressures, they are obliged to comply. There are challenges that the directives can cause. The companies therefore should learn about the diversities to manage and work with the staffs from the host countries harmoniously. The education will help then to and respect the rights of the staffs (Miller& Miller, 1995).
Ignoring the diversities may lead to inability to carry on with international or multinational trade. A common solution to diversity barriers is inter- marriage. According to experts, inter-marriage is the best method of increasing understanding among different communities and countries (Borkar, n.d.).
Therefore, PPQ Parts should identify and provide solutions to the diversities. This will help the locals to recognize that the company is friendly. A company that does not show respect for the local cultures is destined to fail. A meat company in Arabia, for example, cannot trade in pork if it intends to succeed in business. A large portion of the Arabian market believes that pork is un-sacred animal and that those who trade in it are un-sacred too. Showing no respect for such believes, by design or by mistake, may lead to closure of the business (Stern, 2009).
There are several political and economic challenges of trading in international market. One of the most common political challenges is unhealthy competition. Host governments usually strive to protect local industries by giving them subsidies. However, the funding may lead to unhealthy competition.
In addition, the governments sometimes have irrational demands. They may demand for unreasonable taxes or use threats to influence investors to employ the locals (Helpman, 2011). A company willing to trade internationally should therefore sign a contact with the host government and agree to create favourable investment atmosphere for both parties to avoid the inconveniencies.
Subsequently, there are economic issues that may arise in the host country. Firstly, there is the problem of unfavourable standards of living. An extremely high standard of living may force the company to pay higher salaries to motivate its staffs. Moreover, conversion of currency may be a problem ( Helpman, 2011).The rates usually fluctuate on a daily basis. PPQ Parts should advise its staffs to prepare for the challenges before hiring them. It should also accept to reward them fairly.
Finding solutions for each of the diversities is the best method that PPQ Parts should adopt (Borkar, n.d.). That will help the company to determine its chances of success in both Germany and Japan markets. PPQ Parts has a great advantage because the Western world has great influence on the cultures of countries almost all nations (Stern, 2009).
Therefore, the company might face limited cultural restrictions selling its products in Japan. However, it needs to investigate the cultural believe system of the residents of Japan in detail and increase its competitiveness. The information will also help PPQ Parts to reach out to the Germany market. Germany is in the western part of the world and, therefore, PPQ Parts will face little restrictions entering into the Germany market. However, the company needs to implement this report.
References
Borkar, R. (n.d.). Why is Diversity Important. Buzzle. Web.
Helpman, E. (2011). Understanding Global Trade. Cambridge, Mass.: Belknap Press of Harvard University Press.
Miller, E. W., & Miller, R. M. (1995). America’s International Trade a Reference Handbook. Santa Barbara, Calif.: ABC-CLIO.
Rao, P. K. (2012). International Trade Policies and Climate Change Governance. Berlin: Springer.
Stern, R. M. (2009). Globalization and International Trade Policies. Hackensack, NJ: World Scientific.
Yacoub, J. (2010). Cultural Diversity and International Law. In the Field of Human Hights and Identities – Sens Public.. Web.