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THE CULTURAL INFLUENCE ON FIRM DECISIONS

On Tuesday, January 22, we will the entire class period on team discussions of cultural issues facing various firms. You will be asked to select a team from the below situations and come up ideas for the firm based on class concepts/information and your own judgment and creativity--the issues will tend to center primarily around culture.

On January 29, one representative of each team will be asked to make a brief (1-3 minute) informal presentation to the rest of the class on your conclusions. The project will not be graded, but individuals who volunteer to present and do a good job may earn up to three extra credit points.  You are not expected to work on this outside class time--you may stop when the class is over.

Please familiarize yourself with the choices below (including the option to select a firm and cultural issue of your choice) so that you will be prepared to make a selection in class on the 29th.

Creativity, within limits of good taste, is strongly encouraged!

  1. Revlon is interested in entering the cosmetics market in the United Arab Emirates (UAE, a consolidation of several small, oil rich sultanates). Although the rather strict Muslim rules observed in this part of the World prohibit women's faces from being seen in public, it is acceptable for women to wear cosmetics in front of their husbands (the purpose of the veil is only to avoid tempting other men), and women have been seen to eagerly embrace cosmetics introduced on a small scale by competitors. Advertising showing women's faces, or in other ways being too explicit, are, of course, not permitted.
  2. There is a relatively large Muslim population in the United States, and its members are significantly represented in the middle class. Muslim scholars disagree among themselves on whether the Koran prohibits the paying of any interest at all or merely prohibits usury, or excessive interest. In any event, because of the interest issue, many Muslims are uncomfortable with the idea of a home loan, which makes buying a house very difficult--few people can afford to buy a house with all cash. Some Muslims reluctantly go along and take the loan. Others have embraced relatively creative systems--for example, in one arrangement, the person makes a monthly payment, part of which is for rent and part of which converts into equity; technically, no interest is paid although the financial institution gets its return. Some Muslims, however, are uncomfortable with what appears to be merely a way to circumvent the law. What would you recommend to realtors and/or financial institutions?
  3. In the Japanese business setting, there is typically tremendous pressure for conformity, particularly in dress. The "salary men" have traditionally been expected to wear a rather standardized dark blue suit, and wearing a blue rather than white shirt or too flashy a tie would tend to be seen as a matter of rebellion. Yet, Japan is evolving, and there is an increasing desire for individuality among its people. A U.S. based manufacturer of men's wear is thinking about introducing a line of suits which is relatively conservative, but yet allows for some subtle individual differences in style and color. How would you evaluate this idea and, it could reasonably be pursued, what kinds of strategies might you recommend? (The CEO has a dream of one day introducing casual Friday wear, but he understands that this will not happen in the near future).
  4. In Britain, the social class system has traditionally been quite rigid--people have tended to strongly perceive their "place" in society. There were large differences in behaviors among the labor and upper classes. In particular, while working class people went to pubs, they did not tend to frequent more elaborate and upscale restaurants, although, in recent years, they have patronized fast food joints such as McDonald's. With increasing affluence, working class people now have more options in Britain as well. TGIF, not a fancy place but a bit "above" McDonald's, would like expand its presence in Britain to take advantage increasing patronage by the working class. Also, while the British have often been rather inward looking, trying to export rather than import culture, there is an increasing fascination with things foreign. What might be some cultural factors in positioning and promoting the restaurants?
  5. Walt Disney is worried about a European backlash against an excessive invasion of American culture into their countries. The theme parks are an occasional indulgence and may not be perceived as much as a threat, but movies are another matter entirely. On the one hand, part of Disney's appeal is exactly based on being American, and the exotic image this presents. On the other, the firm is worried about boycotts, increased taxation, or demands for having a certain number of screens reserved for local productions. Most competitors, of course, share Disney's concern.
  6. Japanese women have traditionally been expected to marry, stop their careers, and have children very early on. Things are changing, however, in Japan. Although it is still very difficult to maintain a career after marriage, let alone after having children, an increasing number of Japanese women is now choosing to put off marriage to as late as into their thirties (late by Japanese standards, anyway). These women often stay with their parents in their early adulthood which means that, although women tend to be paid significantly less than men in Japan, they have a lot of disposable income given their low expenses. Aside from buying clothes and jewelry, these single women often spend a great deal of their income on travel abroad--Hawaii is a very popular destination. The women usually go in groups. Given the very conservative nature of Japanese society, both parents and employers are quite worried--actually near paranoid--about reputational issues. This worry results in some pressure being put on the women to forego or limit such travel. Even among adults, independence and standing up to parents are not as well established as they are in the United States, so the pressure is real. As a tour provider and/or a Hawaiian resort destination, how would these factors influence your marketing efforts?
  7. It is difficult to change established ways of life, and there has been a long tradition in Latin America of shopping in small, neighborhood stores even among those who live in the big cities. There are certain practical reasons why people prefer the local stores, such as the fact that the small store owners may extend credit during a cash shortfall, but another factor is simply that many consumers do not feel comfortable in such large stores--despite the lower prices and greater assortment that they provide. Home Depot has aggressively entered the Southern tip of Latin America, particularly in Chile and Argentina. What are some issues that Home Depot should think about? Any suggestions?
  8. Cultural issue of your choice. Based on a situation with which you are familiar, you may define a firm situation and suggest approaches based on cultural considerations.