STRATEGIC

GLOBAL
SOURCING
Chapter – 04

CULTURAL CONSIDERATIONS FOR

GLOBAL SOURCING
CULTURAL CONSIDERATIONS
FOR GLOBAL SOURCING
 195 countries in the world according to the book.

 All countries do not have same business conditions

& practices.

 Cultural variation in the conduct of business from

one country to another is, in itself, an enormous body
of knowledge, the subject of many books and papers.
CONDUCTING BUSINESS IN
OTHER NATIONS
 If you intend to conduct business in a country that
is not your own or with which you are unfamiliar,
it would be well worthwhile to study its culture as
thoroughly as possible.

 Look for instructional material that focuses on

how business is conducted in the particular
country where you are sourcing.
CONDUCTING BUSINESS IN
OTHER NATIONS
 For example, in some countries, relationships must be formed
first, prior to any business discussions or transactions.

 Doing this may mean socializing to some extent so that you

and your business counterpart have a chance to get to know
one another.

 In some countries, business is business, and socializing is

unacceptable.
 We often refer to these preferences as “cultural values.”
CULTURAL VALUES
 Indeveloping an approach to global sourcing in an
unfamiliar country, you should spend some time gathering
important facts about its culture.

 Focus on actual examples rather than statements of the

country’s ideal set of values.

 Often there is a large gap between actuality and ideals.

 You must be prepared for what you may face in real
 Develop what is important and what is not
 If socialization is important then you must visit for socialization, not for business
at first time
 If socializing will be part of your visit, be sure you understand some of the key
protocols and make up a checklist of do’s and don’ts.
CULTURAL VALUES
 Organizational and Social Culture

 ORGANIZATIONALSTRUCTURE
 INDIVIDUAL ROLES
 CONFLICT RESOLUTION
 DRESS REQUIREMENTS
 TREATMENT OF VISITORS
 DELEGATION OF AUTHORITY
CULTURAL VALUES
CULTURAL VALUES
 Ethics/Code of Business Conduct/Social Responsibility

 BUSINESSETHICS
 CODE OF BUSINESS CONDUCT
 SOCIAL RESPONSIBILITY

 Environmental Responsibility

 Legal Aspects of Sourcing

CULTURAL VALUES
SOURCING CHALLENGES
 Communication

 Concept of Time

 Conducting Negotiations

 Intellectual Property
SOURCING CHALLENGES