Cultural Challenge

Nowadays, many of American entrepreneurs step into international markets. Opening the branch or subsidiary overseas has brought about the need for in-depth understanding of culture differentiation, the law and commercial customs. It is very important to understand the local cultures, languages, business practices and regulations.

Steve Kafka, an American of Czech origin and a franchisor for Chicago Style Pizza, is considering growing his franchise into the Czech Republic. He had to overcome a great deal of difficulties when he became a franchisor. Steve anticipates he will face some of the difficulties again at the new location in Prague, Czech Republic. The analysis will focus on the general attitude, diet, and eating practice for both cultures.

The purpose of this paper is to identify and analyze the cross cultural challenges of doing business overseas; evaluate the differences and determine the opportunities, the special attention is being placed on the Czech Republic.

The Differences and Incompatibilities between the U.S. and Czech cultures

According to CultureGrams (2007), in general attitude Americans tend to be frank and outspoken. People voice their opinions and share their views on a variety of subjects; there are few subjects they will not discussing certain issues. Americans value innovation, industry, and integrity. They enjoy a good sense of humor, including sarcasm. Czechs are individualistic in that they may be stubborn in stating opinions or wishes. Czechs value education, cleverness, social standing, modesty, and humor.

Eating styles and habits vary among people of different backgrounds. The abundance of fast-food restaurants in the United States would seem to indicate that the national foods are hamburgers, French fries, pizza and chicken. In Czech Republic, Czechs do not dine out often. The traditional Czech food is heavy and arduous to prepare. In the last decade, a healthier diet that is easier to prepare has become more popular. Hotdogs and pizza are popular snack foods that can be purchased from sidewalk vendors. The business hours in the United States are long, and many are open 24 hours a day while in the Czech Republic, workdays begin between 7 a.m. and end between 4 p.m.

With these differences to compete with, Steve must develop a strategy that will allow his business to thrive here in the Czech Republic. Respect for these aspects of Czech Republic culture is important to nurture business relationships and ensure that individuals are not offended.

Mitigating potential risks and the comparative advantage exist in the Czech Republic

CultureGrams states that Czechs do not eat out often and this is the biggest challenge; however, Steve can see this challenge as an opportunity to market his franchise as a family-oriented location focusing on the fact Czech families are traditionally close and tight-knit. This might motivate them to dine out more often and frequent his franchise. Next, Czechs consider pizza a snack, Steve can adjust his franchise to compete with the pizza selling street vendors. Possibly arranging the franchise as a takeout and home delivery facility may comparable to the street vendors. Steve can apply the knowledge and background of his family and friends as well as a way to comprehend the Czech culture.

Evaluation of Czech Business Culture Applying Hofstede's Four Primary Dimensions

Customs in overseas countries may vary from those in the U.S. The successful business person knows how to adjust and be flexible when doing business overseas. Hodgetts and Luthans (2005), defines the culture characteristics as Hofstede's four primary dimensions and these four dimensions can help Steve to evaluate the Czech Republic business environment. The four dimensions are; (1) Power Distance the level of preference for equality or inequality within groups, an employee's desire to fall within the good graces of his or her superiors., (2) Individualism the degree of individual accepts that he or she is at the lower end of the hierarchy., (3) Certainty the preference for risk vs. structure, Steve must be well aware of rules and regulations for doing business in Czech culture and adapt adherent strategies, at the same time as achieving his end-state goals., and (4) Achievement the relative degrees