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Global Services and Culture: Strategies for Success

Explore the relationship between services and culture, examine global trade in services, and consider strategies for entering global service markets.

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Global Services and Culture: Strategies for Success

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  1. Chapter 15 Thinking Globally: “It’s a Small World After All”

  2. Objectives • To explore the relationship of services and culture • To examine the phenomena of global trade in services • To consider strategies for entering global service markets

  3. Objectives (cont’d) 4. To contrast standardization and adaptation strategies for global services • To communicate the imperative of adapting to a multilingual global marketplace • To briefly examine technology and global services

  4. Outline • Introduction • Services and Culture • Global Trade in Services • Entry Strategies for Global Service Markets • Standardization versus Adaptation of Global Services • Multilingual Service Systems • Technology and Global Services • Summary and Conclusion

  5. Services and Culture • Cultural Orientation Toward Nature • Cultural Orientation Toward Activities • Cultural Orientation Toward Time • Cultural Orientation Toward Others

  6. Global Trade in Services • In the industrialized world, services represent more than half the gross domestic product (GDP) • Measuring trade in services is problematic because of country-to-country differences in definitions • Sharp increases in trade volume and foreign investment in services in recent years demonstrate a strong global presence across many service industries, especially health care, entertainment, and tourism

  7. Global Trade in Services (cont’d) • Measuring the global significance of the service sector is very difficult: • As organizations grow, they frequently incorporate services internally that were previously supplied by independent service firms • When a customer travels to a service provider's country to be served, the transaction is foreign trade • As more women enter the work force, many services that were previously performed in the household are now performed by professionals • Organizations often combine their services data with nonservices data

  8. Global Trade in Services (cont’d) • An outbound service export strategy involves sending the service provider to other countries • An inbound service export strategy involves bringing foreign customers to the service provider’s country • A teleservice export strategy involves exporting services by delivering them electronically

  9. Entry Strategies forGlobal Service Markets • Foreign Direct Investment – Organization chooses to invest its resources directly in another country • Franchising – Organization expands service operations around the world • Joint Ventures – Organization contracts with local organizations and thereby shares risks and rewards

  10. Standardization VersusAdaptation of Global Services • Standardization means providing the same service in the same manner around the world • Adaptation means tailoring service offerings to accommodate conditions in each local market

  11. Standardization VersusAdaptation of Global Services(cont’d)

  12. Multilingual Service Systems • Multilingual service systems are increasingly needed to meet the varied needs of global customers, especially when a service system simultaneously serves customers who speak various languages. • Numerous methods are available to deliver services multilingually: producing signage, developing appropriate automated systems, creating written communications, and hiring and training a multilingual staff that can handle the diverse language differences throughout the global market.

  13. Multilingual Service Systems (cont’d)

  14. Technology and Global Services • Technology is an essential means of expanding the global reach of services • Communications and transportation technology allow a service organization to operate in multiple countries while maintaining close contact with employees and customers • Technology is the single most influential force behind the globalization of markets

  15. Web Sites • IBM (http://www.ibm.com), p. 227 • Shell Oil (http://www.shell.com), p. 227 • Visa (http://www.visa.com), p. 227 • Pizza Hut (http://www.pizzahut.com), p. 227 • CNN International (http://www.cnn.com), p. 227 • YouTube (http://www.youtube.com), p. 228

  16. Web Sites (cont’d) • McDonald’s (http://www.mcdonalds.com), p. 231 • KFC (http://www.kfc.com), p. 231 • Service Corporation International (http://www.sci-corp.com), p. 233 • Laura Ashley (http://www.laura-ashley.com), p. 233 • The Body Shop (http://www.bodyshop.com), p. 233 • Benetton (http://www.benetton.com), p. 233

  17. Web Sites (cont’d) • Burger King (http://www.burgerking.com), p. 233 • Wyndham (http://www.wyndhamworldwide.com), p. 234 • Days Inn (http://www.daysinn.com), p. 234 • Howard Johnson (http://www.hojo.com), p. 234 • Ramada Inn (http://www.ramada.com), p. 234 • Super 8 (http://www.super8.com), p. 234

  18. Web Sites (cont’d) • Walmart (http://www.walmart.com), p. 234 • Bharti Enterprises (http://www.bharti.com), p. 234 • Coca-Cola Company (http://www.coca-cola.com), p. 236 • Ogilvy & Mather Advertising Agency (http://www.ogilvy.com), p. 236 • Hotel Miraparque (http://www.miraparque.com), p. 237 • AT&T (http://www.att.com), p. 239

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