Coca Cola Case

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Category: Business and Industry

Date Submitted: 11/18/2012 11:39 PM

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Background and Challenges

The term culture can be defined as the acquired knowledge that people use to interpret experience and generate social behavior. This knowledge forms values, creates attitudes, and influences behavior. (International Management, 2012) One major international cross-cultural management problem facing many multinational corporations is that of cultural differences. The culture of a society can affect a variety of management approaches therefore making it a must for multinational corporations to address in order to be successful. As these companies expand over the world, they must reevaluate their strategies to address the cultural similarities and differences that emerge when doing business with different companies. The most important aspect of culture is that it affects how people think and behave. Cultural impact on international management is mirrored by basic beliefs and behaviors. Here are some examples of when culture can directly affect how management is approached:

* Centralized vs. decentralized decision making

* Safety vs. risk

* Individual vs. group rewards

* Informal vs. formal procedures

* High vs. low organizational loyalty

* Cooperation vs. competition

* Short-term vs. long-term horizons

* Stability vs. innovation

A major part in explaining culture is that of values. Values are basic convictions that people have regarding what is right and wrong, good and bad, important and unimportant. (International Management, 2012)

The challenge for multinational companies is to identify and manage the similarities and differences that the company comes across when dealing with the different cultures. Some countries have similar cultures and it is the job of the managers to learn about their business and the growing markets environment through formal classes, mentoring, and experience. The negative side to this is that it has been shown that there are far more differences in cultures are the world...