Topic > The cultural challenges of doing business abroad

Steve Kafka, a Czech-American and franchisor of Chicago Style Pizza, has decided to expand his business to the Czech Republic. He knows it's a risky decision; when he became a franchisor he had to overcome many difficulties. Steve anticipates he will face some of these challenges again in his new location in Prague, Czech Republic. Although he was born in the United States, he has family and friends in the Czech Republic, speaks fluent Czech, and has visited his home country several times. He knows the people and the culture. In this article I will analyze the cross-cultural differences between the United States and the Czech Republic, determine the comparative advantages of this country, and recommend ways to minimize the risks of establishing a franchise abroad. One of the main challenges in doing business internationally is adapting effectively to different cultures. Such adaptation requires an understanding of cultural diversity, perceptions, stereotypes, and values ​​(Hodgett & Luthans, 2005). Doing business abroad brings challenges and rewards at the same time. Some of the main differences and incompatibilities between US and Czech cultures concern norms, values, beliefs and behaviors. These differences will create a business risk for Steve because even though he is of Czech origin, has friends and relatives living there, visits multiple times, and speaks the language fluently, he does not have full knowledge of how business is conducted in Czech. Although it is a franchisor of Chicago Style Pizza, it cannot operate internationally as it does locally due to differences in value, as this would affect its management functions. Although Steve is of Czech origin and speaks the language, he would still have to take into account language barriers as well as different attitudes and expectations from local partners. His friends living in the Czech Republic can help him, but Steve cannot expect them to be present for all his business transactions. For example, to show respect towards others in the Czech Republic, both men and women are addressed by their professional titles and surnames. People don't use names until they know each other well. This culture is very different from that of the United States, and Steve must be aware of this to avoid offending local business partners and customers. They influence Hofstede's four dimensions, power distance, uncertainty avoidance, masculinity/femininity, individuality and collectivism. have an organizational show in all cultures and in all cultures.