Sign Up Now
Get instant access to over 1 million+ study documents
OR
Already registered? click here to login
By creating your account, you agree to our terms of service, privacy policy and student honor code.
He knew he would not attain the $5 million and therefore seemed happy to take any offer. Rather, he could have leveraged the relationship to get a better figure.
With respect to home office, Jared should have been more direct with them. He did not inform them in a timely manner about the situation. He only came to them after it appeared he was going to be unsuccessful. This spurred Malcolm to feel that his direct involvement was the only way to resolve the situation. As a result, the situation was made worse. Malcolm may have had formal authority, but he was not a part of the relationship with Madjid and therefore his involvement set a negative tone for the negotiations.
Not only should Jared have spoken with home office earlier, but he should not have spoken to Malcolm.
Jared's boss did not have adequate knowledge of Indonesian culture or business practices to become involved. Jared had spoken prior to departure with advisors experienced in international business. He should have taken the situation to them for advice. This not only would have avoided Malcolm's involvement, but allowed to either achieve a better outcome or at least to understand that the $1 million offer was the best outcome.
Advise to a U.S. Company Seeking to Expand to Indonesia
The Indonesian market is one of the most difficult in eastern Asia. Though tempting because of its size, it is fraught with difficulty.
Any U.S. firm looking to expand operations into Indonesia should undertake significant research into the differences between U.S. business culture and Indonesian business culture.
These differences take many dimensions. The role and strength of the legal system is one major difference that needs to be understood. Had BWA understood this difference better, they would have been able to find a better outcome than they did. The role of relationships in business culture is also very different.
Furthermore, it is recommended that U.S. firms understand some of the religious and historical differences. Indonesia is primarily Muslim, which means U.S. firms will need to understand the implications of dealing with a Muslim culture. Moreover, the archipelago has a history that includes both...
Colonialism will inevitably color the way in which locals deal with Westerners. When the country signed the Cochran-Subardjo Agreement in 1952, for example, the backlash forced Subardjo to resign (Negotiations.com, 2009). Dictatorship, under Suharto, colors the way in which Indonesians view formal authority and authority figures.
These are among many areas in which Indonesia differs significantly from the U.S.
There are certain costs associated with business overseas that may be different than in domestic markets. Part of the problem with BWA is that they did not anticipate some of these costs. Thus, they did not build them into their budget projections. As a result, they felt that they needed the $5 million remedy. Had they been better prepared, and armed with more knowledge, they might have known prior to the negotiations about such potential costs. Those costs could then have been built into the decision whether or not to enter into a contract with NEC at all, and if so, under what terms. It is also important that senior management have this knowledge as well, even if they are not directly involved in the project. This will help manage the expectations of senior management and reduce the likelihood that such un-knowledgeable people as Malcolm become involved.
Understanding the differences between two cultures is critical to success in the international business arena. Before making such a move, as much knowledge as possible should be gained, to better prepare management for some of the problems that will occur, and arm them with the means to remedy those problems.
Doing this will not avoid all problems, but it will help to mitigate the damage when problems do occur.
Works Cited
No author. (2009). Unequal Foreign Negotiation. Negotiations.com. Retrieved March 1, 2009 at http://www.negotiations.com/case/unequal-negotiation/
Taylor, Stephen. (2008). Indonesia. Cyborlink.com. Retrieved March 1, 2009 at http://www.cyborlink.com/besite/indonesia.htm
No author. (2009). Indonesia: Culture. Michigan State University. Retrieved March 1, 2009 at http://globaledge.msu.edu/countryInsights/culture.asp?countryID=20&CategoryID=6,1
Works Cited
No author. (2009). Unequal Foreign Negotiation. Negotiations.com. Retrieved March 1, 2009 at http://www.negotiations.com/case/unequal-negotiation/
Taylor, Stephen. (2008). Indonesia. Cyborlink.com. Retrieved March 1, 2009 at http://www.cyborlink.com/besite/indonesia.htm
No author. (2009). Indonesia: Culture. Michigan State University. Retrieved March 1, 2009 at http://globaledge.msu.edu/countryInsights/culture.asp?countryID=20&CategoryID=6,1
Indonesia and International Trade Indonesia is an archipelago i.e. A group of islands that stretches along the equator between the Southeast Asian mainland and Papua New Guinea. The country controls important shipping lanes from the Indian Ocean to the Pacific Ocean. The strategic sea-lane location of the Indonesian archipelago has been an important facilitator of inter-island and international trade. There are several aspects of international trade in Indonesia this include; the trade
As the text by Cessanos (2005) notes, this would be among the longest-standing and most determinant internal conflicts confounding the stability and political unity of Indonesia as a whole. Cessanos reports that even at the outset of its independence under new President Sukarno, any unified vision of how to balance political modernization with deference to its Islamic cultures was met with splintering, factionalism and conflict. Accordingly, the source indicates that
A key celebration in the village invites a festive dance in which the performers fall into a stupor and try to stab themselves with knives (Heinrich, 2005 p. 78). Rituals in life are pertinent events for religious display and artistic expression. Events of puberty, marriage life and burial offer opportunities for Balinese to express their notions regarding statuses, society and the afterlife. The Balinese denomination organizes their faith in a
In the past century, tsunamis have killed more than 50,000 people. Scientists have set the Pacific Tsunami Warning System in Hawaii in U.S.A to save lives. The system of earthquake detectors and tide gauges can sense quakes that may create a tsunami. We cannot conquer the tsunami, but we can know when it's approaching and run away from the sea monster's vehemence. (Killer wave! Tsunami) Tsunami in Indonesia: An earthquake measuring
Lastly, sharia law violates human rights and creates a nation divided between Muslims and non-Muslims. Such a division undermines the traditional values that Indonesia has with respect to unity across multiple islands, races and religions. If these values are eroded, the nation could be eroded as well in the wake of economic collapse, social unrest, and potential succession from the republic. Therefore, sharia law should not be imposed in
The United States Military has a social obligation to protect its interests in the region from terrorist activities, such as the ones used to fund Indonesian defenses. Through expanding its role in Indonesia, the United States can provide an alternative way for the country to defend itself from internal and external threats. Despite Indonesia's desire to be fully self sufficient, the country lacks the tools and man power to fully