Company A can successfully enter the country of South Korea. South Korea has strong ties to the United States government and has a similar quality of living as the United States there will not be a huge labor cost advantage however, there won't be a disadvantage. This report however, will focus on cultural differences not the business model for entry which should be done with a joint venture with a local company.
Major potential cross cultural issues could be the following Language Barriers, Foreign Culture, Environment, Labor, and Ethical Differences. We will look at these one at a time.
Language Barriers the spoken Language of South Korea is of course Korean so Company A will need a ...view middle of the document...
Family welfare is far more important and individual needs. There is a strong teaching of Confucianism which stresses duty, loyalty, honor, filial piety, respect for age and seniority and sincerity. Kibun is a Korean word with no direct English translation a close terms are face, mood, pride, feelings, or state of mind. Korean interpersonal relationships operate on the principle of harmony. To cause someone to lose face is to hurt their Kibun. Korea is a high context culture as most Asian cultures are there is a strong focus on harmony and being polite. Another related term is Nunchi and that is the ability to judge a person's Kibun by using the eye. It is understanding a person's Kibun by watching body language and tone in their voice. Another important aspect of Korean culture is gift giving they are reciprocated and it is considered rude to give someone an expensive gift if you know they cannot reciprocate accordingly. Appropriate gifts may be a good quality chocolate, fruit, or flowers and should always be nicely wrapped. The number four is unlucky and so should be avoided but the number seven is considered lucky. Do not wrap gifts in black, green, or white. However, red and yellow are royal colors and pink or yellow denote happiness and would make a great wrapping for gifts. Business Meeting Etiquette just a few points by no means a complete list. Meetings need to be scheduled 3 to 4 weeks in advance, be on time to show respect, all printed material needs to be in English and Korean send an agenda and supporting material in advance, and do not remove your jacket unless the most senior Korean does. There are many other cultural issues that will not be gone into for time consideration such as dining which has a strict etiquette.
Environment South Korea is a warm humid climate which is a good fit for Company A's extra heat hardening process should be able to withstand function at the high temperatures and humidity that will be present. South Korea also has a geographic advantage to other countries in the region so there can be a focus not only on capturing the market in South Korea but lower shipping cost to countries around it which can also benefit from our heat treated parts.
Labor South Korea offers a great mix of highly trained and highly trainable people to be able to staff Company A's expansion with an average income about $2300 a month US in the larger cities such as Seoul labor will not be a large savings but it is also well trained.
Ethical differences as before mention in Foreign Culture Confucianism is the driving force behind South Korean ethics. However, from a business stand point it is important to understand that gift giving while considered a bribe in the US is customary in Korean Culture. Koreans are also going to have a much stronger focus on family than is normally found in the US. Another important ethical note is that there is a strong perception that other...