week four - culture and business in North America

Question 1

characteristics of the US economy

Answer 1

• ethnocentric
• lots of entrepreneurial behaviour
• high level of internal diversity (melting pot) between cultures, races and ethnicities
• strong patriotism

Question 2

characteristics of business in the US

Answer 2

• professionalism is highly valued
• language is clear and direct
• they can quickly change tactics
• formalisation is broadly used
• employment rotation is high
• high costs of doing business in US (insurance, taxes, liabilities)
• many different tax jurisdictions
• eye contact is perceived as a sign of interest and trust
• expenses are usually shared at informal meals

Question 3

characteristics of negotiating in the US

Answer 3

• US negotiators are arrogant, unsophisticated and even naive but also effective
• Americans feel comfortable in situations of confrontation
• they can quickly change tactics
• negotiations focus on profitability
• haggling is not common
• negotiators are authorised to make decisions and don’t need to consult
• agreements are reflected in highly detailed contracts

Question 4

characteristics of the Mexico economy

Answer 4

• culturally latin
• comprises four main areas each of which requires a different entry strategy
• maquiladoras: assembly plants near the US border are a foundation of Mexico’s economy
• violence is a major problem in the country

Question 5

characteristics of business in Mexico

Answer 5

• time and effort must be taken to establish relationships of trust
• avoid saying ‘no’, language is indirect
• usual form of greeting is a handshake
• women usually face powerful obstacles to reach their professional goals
• titles and degrees are used to contact the person
• there is appreciation for spain but topics on the colonial past should be avoided
• gifts are not a custom but are appreciated

Question 6

negotiating in mexico

Answer 6

• decision making is slow: ‘ahorita’
• business deals always begin with informal chats
• using aggressive tactics to apply pressure is counterproductive
• haggling is accepted
• decisions are made at the highest level