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Cross Cultural Management

Question:

Undertake an Analysis of, and prepare an essay on, a difficult international business situation (the case), involving cross-cultural management issues, that has arisen in the past twelve months. 

Answer:

Cross cultural management is one of the new fields that are based on some theories like Cross Cultural Psychology, International Business, anthropology, organization behavior and human resources. It can be seen that cross cultural management seeks to understand properly that how the national culture affects the management practices. Apart from that, this is helpful in recognizing the similarities as well as dissimilarities across the cultures in several management practices along with the organizational contexts (Chhokar et al. 2013). Moreover, this increases effectiveness in the global management. Therefore, it can be stated that cross traditions is the communication of public from several dissimilar backgrounds in the business world. Cross culture is one of the fundamental issues in the intercontinental trade because success of the international trade depends upon smooth interaction of the employees from diverse cultures and areas (Doz and Prahalad 2012). 

With the course of time, globalization has directed several changes in the nature of the project team work and several intercontinental corporations have projects straddling a diversity of populations taking into account several different time zones and geographical distance (Prasad 2015). Therefore, in a nutshell, it can be stated that due to globalization, many companies operate in more than one country and thus it is obvious enough that some issues would arise and the managers are responsible to handle these issues. This particular research work has tried to shed focus on the fact that why Starbucks just cannot splinter the Australian marketplace. 

Article Synopsis

The article has stated the fact that Australians take coffee seriously and that could be why Starbucks has thrashed about to crack the Australian marketplace. Reports have stated the fact that Starbucks have supposedly accumulated the losses of at least $143 million since they unlocked here 14 years ago. Starbucks has grown the category of life style café and this successful formula of this leading organization has made other copied these formulas. Most tragic incident in this scenario is that if anyone asks a caffeine lover in Australia, they would probably say that they make some of the best coffee in the entire world. Market reviews have stated that there exist at least 6500 independent cafes across Australia and that generate about $4 billion annually, especially from the coffee sales (sbs.com.au 2016). The research has found this one as well that an average Australian consumes 3 to 4 cups of coffee per day. From the viewpoint of the President of Starbucks, it can be seen that the company has selected to partner with The Withers Group because they share similar values as well culture (Chhokar et al. 2013). The deal leverages the strength of the brand Starbucks with the experience of the local owner who has a history of productively invested and grown the global brands in the huge Australian market (Thomas and Peterson 2014). 

After going through the entire article, it can be seen that the company has been facing intellectual property theft from some other organizations in Australia. Prasad (2015) has stated that disclosing the business plans, pitching new and innovative ideas as well as proposing some more new designs are well-trodden paths for the startups and the tiny-sized trades in order to encourage a new client to purchase as well as an invest (sbs.com.au 2016). However, this might come up with the risk of intellectual property theft and this hampers the business growth largely. It has been seen that the marketing strategy and the recipe of the served coffee products are the secrets of Starbucks and some companies have these and this has been affecting the organizational expansion (sbs.com.au 2016). Therefore, it can be stated that protecting intellectual property, not including others from using the formations might provide an immense commercial advantage. Reports have stated that Paul Patterson, the marketing guru has spent several years studying the demise of Starbucks and he has argued that the company is going to move violently a lot to reconstruct the brand identity and obtain the consumers fall in love by means of this brand again. Therefore, theft of this intellectual property in the cross cultural scenario has affected the company and the managers are responsible to deal with this scenario sincerely on an early basis (sbs.com.au 2016). 

Theory and literature

History has been enriched with various examples where the international requirement of protecting the intellectual property has been documented. The example can be traced back from the industrial revolution era when the manufacturing techniques are innovated in a significant fashion (McCorkle et al. 2012). The prospect of Intellectual property concept has been always criticized by various scholars from time over time. However, it can be evidently identified that the contemporary business world can significantly point out several crucial areas which are most important part of the working of corporate sector (Bently and Sherman 2014). These areas are the licensing; copy left as well as creative commons; copyright, trade secrets, patents, droits morals, ideas along with trademark.

The protection of copyright was mainly practiced in case of issuing the sole right on any tangible work of any creators (May 2013). The copyright works include musical, artistic, architectural, literacy, cinematographic works as well as photographic content. The computer software as well as maps also include within the copyright content. However, the copyright act only prevents the breach of concrete expression rather than focusing on the abstract ideas. According to the copyrights act the creator can enjoy several rights which are reproduction of the work, adaption of the work, distribution of the copies, work display as well as public performance (Lemley 2015). In addition to that, the copyright also lapse after 70 years age of creator, 95 years of publication as well as 120 years from creation. The copyright owners are only able to use fairly as well as selling at the first time. In addition to that, the content can be used for limited use such as teaching, commenting, criticizing, news reporting, research as well as scholarship (Lalović et al. 2012).

The creative commons, licensing as well as copy left can be used as the most effective workaround of the first sale clause of the copyright act (Buchanan and Wilson 2014). This area of intellectual property allows using the protected content for very specific use. There are three distinctive types of patents which are acknowledged by the law: They are plant patents, utility patents and design patents. Utility patents are concerned with securing any new and useful processes, subject matter or a machine (Moore et al. 2012). Design patents are focused on protecting any new or contemporary ornamental design for the manufacture of an article. 

A trade secret can be defined as any business information that cannot afford to be disclosed to anyone or else they can take unfair advantage of it (Beebe 2013). This secret can be related to the process of manufacturing, a formula for a certain chemical compound or preserving materials. A trademark can be generally referred to as the good name of the organization or the company. A trademark is any name, symbol, or design used by the manufacturer to make his goods distinct compared to the ones produced by the competitors (Reardon et al. 2012). There is also a distinctive set of laws that allows people to protect their individual ideas. When these ideas are used by other people and organizations, they have to pay compensation.

From the extensive practice from a very early age the intellectual property rights has been rotated around three different forms which are personality-based justification, the utilitarian incentives-based argument as well as lockean justifications (McCorkle et al. 2012). According to the personality based justification it can be derived that the individual have their actual right for their own creation. The major problems in respect to this justification are confusion. At the same time, the personalities of the individuals are ingrained with the tangible as well as intangible works. In this scenario the property rights can be justified with proper argument. Furthermore, this particular justification cannot cover all of the intellectual innovations.

Cultural Analysis:

Despite of the above clauses which are influential for protecting the property law the contemporary market has experienced a greater numbers of intellectual property thefts. There are various examples which can identify the intellectual property theft in respect to cross cultural management. It is identified in various studies that as the world has become flat due to the globalization the organizations has faced a huge numbers of issues in respect to intellectual property theft (Beebe 2013). It is identified in various studies that the well established intellectual property rights stops short in front of the cultural practice of intellectual property. For example, it can be illustrated from the studies that there is a distinct confusion between Russian scientists as well as universities in context to the right of developed property in the Russian university.

In this context the individuals or the domestic organizations tend to greatly focus on participating with the foreign companies as they will be bound to comply with the intellectual property law. As stated by Bently and Sherman (2014), that it is for the best interest for everyone for collaborating every nations as well as organizations to protect the intellectual property theft. The cross cultural management will therefore allow the organizations to maintain the intellectual property act in a most willful fashion. In support of the statement the evidence can be presented with a significant ease with the example of software launch in the Russian industry. The software companies fear that the there is a significant chance of theft of their formula in the internal practice of intellectual property law. However, they operate their business on the sole ground that the Russian organizations will not be able to breach the global practice of intellectual property law as they will be in loss of business afterwards. Therefore, it can be concluded that cross cultural management is highly capable of developing the effective intellectual property law practice.

Conclusion and Recommendation:

The above article has been most efficient for identifying as well as analyzing one of the most important issues of cross cultural management. The issue which has been identified in the media article is intellectual property theft. The article was based on the Starbuck’s business idea theft. This particular paper has been able to evaluate the media article most significantly which result in the identification of the issue. In addition to that, the paper has been able to discuss the theory as well as literature review of intellectual property theft. Moreover, the issue has been analyzed in the light of cultural as well as global aspects. Lastly, the paper will be able to provide most impressive suggestion for preventing the intellectual theft.

IPR Protection strategy: In order to prevent the theft of the intellectual property theft the organizations must focus on the legal counsel for developing an effective as well as efficient IPR protection strategy. According to the content of the property the organizations need to take legal action for ensuring the security of the entire property.

IPR language: In the same context, the organizations must develop a crucial, legally perfect and most elaborate IPR language for undertaking the licensing as well as subcontracting the contracts. This way the organizations will not be suffered with a plausible loophole for the breaching of intellectual property.

Conducting due diligence: The organizations are also in dire need to conduct the due diligence according to the potential foreign countries in respect to preventing the intellectual property theft. The scenario will therefore receive ample benefit and security in those foreign countries.

Proper Registering: Another most effectual way to avoid the intellectual property theft is registering the copyrights as well as trademarks in a proper way. The major rules in respect of registering in the foreign countries are enlisting them with customs as well as border protection. This will be able to help the organizations to recover most effectively. 

Reference List:

Beebe, B., 2013. Shanzhai, Sumptuary Law, and Intellectual Property Law in Contemporary China. UCDL Rev., 47, p.849.

Bently, L. and Sherman, B., 2014. Intellectual property law. Oxford University Press, USA.

Buchanan, J.A. and Wilson, B.J., 2014. An experiment on protecting intellectual property. Experimental Economics, 17(4), pp.691-716.

Chhokar, J.S., Brodbeck, F.C. and House, R.J. eds., 2013. Culture and leadership across the world: The GLOBE book of in-depth studies of 25 societies. Routledge.

Doz, Y. and Prahalad, C.K., 2012. Quality of management: An emerging source of global competitive advantage?. In Strategies in Global Competition (RLE International Business): Selected Papers from the Prince Bertil Symposium at the Institute of International Business (pp. 345-370).

Lalović, G., Reardon, S.A., Vida, I. and Reardon, J., 2012. Consumer Decision Model Of Intellectual Property Theft In Emerging Markets. Organizations & Markets in Emerging Economies,3(1).

Lemley, M.A., 2015. Faith-Based Intellectual Property. UCLA L. Rev., 62, p.1328.

May, C., 2013. The global political economy of intellectual property rights: The new enclosures? (Vol. 3). Routledge.

McCorkle, D., Reardon, J., Dalenberg, D., Pryor, A. and Wicks, J., 2012. Purchase or pirate: a model of consumer intellectual property theft. Journal of Marketing Theory and Practice, 20(1), pp.73-86.

Moore, A.P., McIntire, D., Mundie, D. and Zubrow, D., 2012, October. The justification of a pattern for detecting intellectual property theft by departing insiders. In Proceedings of the 19th Conference on Pattern Languages of Programs (p. 8). The Hillside Group.

Prasad, R., 2015. Cross-cultural communication. Educating Young Children: Learning and Teaching in the Early Childhood Years, 21(3), p.21.

Reardon, S.A., Vida, I. and Reardon, J., 2012. CoNSUmEr dECiSioN modEl of iNtEllECtUal propErty thEft iN EmErgiNg marKEtS. Organizations and Markets in Emerging Economies, 3(1).

sbs.com.au, 2016. Why Starbucks just can't crack the Australian market. [online] News. Available at: <http://www.sbs.com.au/news/thefeed/story/why-starbucks-just-cant-crack-australian-market> [Accessed 3 Jun. 2016].

Thomas, D.C. and Peterson, M.F., 2014. Cross-cultural management: Essential concepts. London: Sage Publications.

Ting-Toomey, S. and Chung, L.C., 2012. Understanding intercultural communication. New York, NY: Oxford University Press. 

Appendix:

“Why Starbucks just can’t crack the Australian market”

By Patrick Abboud, June 2, 2014 - http://www.sbs.com.au/news/thefeed/story/why-starbucks-just-cant-crack-australian-market 

Whatever your style - long black, latte, espresso or flat white - Australians love a good brew. And let's face it, everyone's day starts better with a solid shot. In most cities around the world you'd be hard pressed not to find a Starbucks on every corner - but on our turf they just haven't delivered. Starbucks have reportedly accumulated losses of at least $143 million since they opened here 14 years ago. Having just sold their remaining outlets here to the massive multinational that runs 7-Eleven Starbucks will get one last shot at trying to become the most successful coffee chain in Australia.

Paul Patterson is a marketing guru that's spent years studying the demise of Starbucks. He says it's going to be very difficult for Starbucks to rebuild from here. "I think they're going to struggle to rebuild the brand and get people to fall in love with it," says Mr Patterson. The coffee giant still has stores in 63 countries leaving very few nations Frappuccino free. There are even more than 11,500 stores across the US alone. And they're rapidly growing in Canada (1396 stores) and China (1219 stores). But struggling to survive in Australia - Starbucks have closed around 60 shops leaving its current stable of just 22.

"I think we've got a lot to thank Starbucks for," says Mr Patterson. "They grew the category. They basically invented the lifestyle cafes that we know today. "But then the competition saw this was a successful formula and copied them... so they really struggled against the... competition." And if you ask any caffeine loving Australian they'll tell you that we make some of the best coffee in the world. There's at least 6500 independent cafes across Australia generating about $4 billion annually mainly from coffee sales. And on average Australians drink around 3- 4 cups a day.

Will Young is the Managing Director of Campos Coffee, one of the most successful roasters in Australia. Mr Young says Australians just won't settle for your average blend. "Many people see Australians as coffee snobs and really we are," says Mr Young. "We're spoiled rotten here for the great coffee all the time." "The specialty coffee industry in Australia has raised the bar so high... that Starbucks coming in sets a low level... where perhaps the baristas aren't so professional and are not as dedicated to their craft." "It's going to be tough for them."

The companies’ big guns are not in the country to speak to us but they made this statement regarding their new partnership. "We chose to partner with The Withers Group because we share similar values and culture.  The deal leverages the strength of the Starbucks brand with the experience of a local owner who has a history of successfully investing and growing global brands in the Australian market" - Jeff Hansberry, President, Starbucks China & Asia Pacific Even though Australians don't seem to want a bar of Starbucks they're on a mission to crack the market here and they'll probably throw everything they've got at it until they do.

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