This report focuses on Cross Cultural Management in terms of developing e-commerce. This report has been developed in the context of an Australian online retailer of clothing, which is thinking to expand business in Indonesia and New Zealand. The organisation operates its business through the shopping application named ‘E-Tailor’. As E-Tailor is going to take initiation in order to go beyond territorial boundaries, it is necessary to consider cross-cultural challenges. In the part A of this assignment, effectiveness of performing business via online is critically evaluated. It is part B of this assignment, which aims to bring into notice about major internal and external factors in terms of dealing with cross-cultural challenges via online. This report gives some of the feasible business recommendations based on the cross-cultural management. Hence, this report discusses about E-Tailor, internal factors, external factors, recommendation along with conclusion respectively in terms of cross cultural challenges.
An online fashion retailing in Australia drives their business operation through E-Tailor App. At the starting of business, this organisation only sells their products to the Australian consumers. Recently, this organisation intends to globalise their business. In order to be successful in business, it is necessary to accomplish consumer needs and expectation. This organisation targets Indonesia and New Zealand in terms of globalising business. Both Indonesia and New Zealand have stable economic and political base at the present. On the other hand, business administration of these two countries is highly coordinated with the foreign investors. However, the problem is to know the varieties cultures of Indonesia and New Zealand. Until or unless the organisation cannot know the cultural diversity of those countries, it will not be able to make any idea of the buying behaviour of those countries. Hence, the organisation needs to promote their online application in terms of cross cultural communication, etiquettes and buying behaviour. Being a consumer centric organisation, the purpose of E-Tailor App is to offer individual consumer exceptional shopping experience irrespective of cross cultural diversity. The online shopping application, ‘E-Tailor’ facilitates the organisation to automate communication with the consumers from diversified cultural background. On the other hand, with the help of this shopping application, the organisation is able to operate their business with less number of staffs. It is one of the positive factors to take into consideration in terms of globalising business (Ashraf, Thongpapanl & Auh, 2014). In addition, technological arrangement is also necessary to take into account for maintaining the operation of the application, ‘E-Tailor’. Being an online shopping application of clothing, E-Tailor has to consider a number of risks in order to develop loyal relationship with the cross-cultural consumers. The premium risks associated with online shopping are - data damage, data breach that are considered in order to threaten privacy of business. E-transaction system of business is also affected due to breach of data in the online shopping application (Hwang & Lee, 2012). Hence, the organisation may consider a huge amount of techbills in terms of expanding business outside of Australia (Kuntz et al., 2013). The application facilitates the organisation in order to adopt the most suitable structure in order to perform business operation at cross-cultural context. The functional structure of the shopping application is divided into marketing, finance, and production and application maintenance.
Language is one of the premium barriers to deal with cultural differences (Stahl & Tung, 2015). As E-Tailor is thinking to expand their business in Indonesia and New Zealand, the official language of those countries is necessary to take into account in terms of approaching the consumers of those countries. In Indonesia, the most spoken language is Malay (Suryana & Ipnuwati, 2015). On the other hand, the official language of New Zealand is English (Rosebery, Warren & Lee, 2014). However, a large percentage population in New Zealand speaks in Maori language (Kuntz et al., 2013). As E-Tailor is an online application, it can offer people to set their preferred language in order to enjoy their online service. Otherwise, it will be highly challenging in order to deal with Malay and Maori speaking people for the organisation.
In order to deal with cultural differences, business etiquettes need to be one of the primary considerations (Ray, 2014). Business etiquettes of Indonesia is characterised by meeting, greeting, handshake, conservative attire (Fajar, 2015). It is necessary to note hereby that Australia and New Zealand are neighbouring countries (Rosebery, Warren & Lee, 2014). Hence, Australia is familiar with the business etiquettes of New Zealand (Shangqin, McCann & Oxley, 2013). Therefore, in order to operate business in New Zealand, E-Tailer does not need to face serious challenges.
As opined by Ashraf, Thongpapanl and Auh (2014), organisational hierarchy plays an important role in order to set up organisational behaviour regarding cross-cultural diversity. In order to deal with different attitudes and expectation of cross-cultural people, the organisation needs to develop multicultural teams. Organisational hierarchy is necessary to take into account because their attitudes are considered as the reflection of a country’s societal values (Gallagher & Savage, 2013). Organisational hierarchy of E-Tailor app needs to have experience of working beyond cultures and geographical borders.
Consumer interest, expectation, needs and behaviour varies based on cross-cultural differences. In Indonesia, there are more than 300 ethnic groups, who speak different local dialects (Musgrave, 2014). Each ethnic group of Indonesia gives priority to their individual ethic dress up, makeup, festivals (Gesteland, 2012). Hence, in order to understand the consumer behaviour of Indonesia, the organisation of E-Tailer shopping app needs to consider in collecting a deal of cultural information of Indonesia. On the other hand, in New Zealand a large percentage of population belongs from the European background (Rosebery, Warren & Lee, 2014). Hence, Christianity is the predominant culture in New Zealand (Kuntz et al., 2013). Being an Australian shopping application, E-Tailor will face fewer challenges in terms of offering the most appropriate fashion clothing to the New Zealand’s consumers.
The organisation has started their business from Australia. Hence, cultural diversity in Australia is also necessary to take into account in this context. Australia is a country of a large number of cultural differences. A larger percentage of population in Australia belong from the England. Therefore, main speaking language in Australia is English. More than 200 languages are spoken in all over the Australia (Piyakul & Chomeya, 2012). Around 26% population of Australia belong from New Zealand and China. Hence, the organisation has experience in dealing with cross-cultural diversity. It is expected that this experience will help the organisation in studying the consumer behaviour in Indonesia and New Zealand.
Being an online shopping application, E-Tailor app is completely dependent on technology. Auto update of the online application and cyber security are necessary to take into account in order to facilitate excellent experience of online shopping to consumers (Ur & Wang, 2013). In addition, technological factors of the countries affect business in terms of managing resources, demand and production (Kuntz et al., 2013). The Indonesian Ministry of ICT has announced a new e-commerce roadmap by which Indonesian government will be able to support 1000 new ‘technopreneurs’ by the year 2020 (Suryana & Ipnuwati, 2015). In addition, Indonesia has exclusive growth in terms of digital innovation. More than 252 million people of Indonesia who are aged 39 or below 39 are considered highly tech savvy (Gesteland, 2012). Internet access is available to more than one-third people in Indonesia (Piyakul & Chomeya, 2012). Most of the people in Indonesia prefer to use internet through smartphone. All these situations are preferable in terms of fulfilling business expansion in Indonesia. Technological innovation sector in New Zealand is dynamic (Stahl & Tung, 2015). Therefore, the organisation can enjoy all advancement of technology in terms of making their business successful. However, online retail business in New Zealand is highly competitive. In that case, the organisation has to meet high challenge from the low cost bulk competitors in that country.
Indonesia and New Zealand both are considered as the premium hubs of Foreign Direct Investment (FDI) due to excellent political and legal support. Legal and political framework in Indonesia is supportive in terms of boosting global investor confidence (Fajar, 2015). On the other hand, New Zealand’s legal and political system is developed according to the British model (Shangqin, McCann & Oxley, 2013). Therefore, E-Tailor’s decision of investing in the online market of New Zealand is a wise decision. In terms of securing multicultural consumers, these situations are undoubtedly favourable.
At the present, Indonesia is one of the premium hubs in leading global economy (Janita & Chong, 2013). New Zealand also has a high degree of economic stability. In Australia, E-Tailor has to consider poor protection of property rights in terms of doing online business. However, in New Zealand, the organisation will receive a great support in terms of protecting the rights of property (Shangqin, McCann & Oxley, 2013). Hence, E-Tailer can achieve a vast population of cross-cultural consumers from Indonesia and New Zealand.
From the above discussion, it is extracted that cross-cultural management is highly challenging, but beneficial in terms of securing excellent monetary growth. Expanding business in Indonesia, E-Tailor can develop a large percentage of cross-cultural consumers. Knowing the culture of a large number of Indonesian ethnic groups is a matter of high challenge definitely. However, the other macro environmental factors like technology, political, legal and economic stability of Indonesia will help E-Tailor to meet cross-cultural challenges positively. The culture and religion of Australia and New Zealand are same kind of. Hence, belonging from the Australia, E-Tailor will not face a high amount of challenges in terms of satisfying the consumers of New Zealand.
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