OVERVIEW PLAN- 1. METHODOLOGY CHAPTER- Analysis o.docx

OVERVIEW / PLAN
- 1. METHODOLOGY CHAPTER
- Analysis of secondary data / No interviews / Not US focused
The whole methodology needs to be changed to explain
secondary data ONLY
2. RESEARCH CHAPTER (approx 2000 - 2500 words)
3/ 4 case studies
The research should mostly refer to case studies / the past
experiences of a few firms example: McDonald’s when it
launched in Japan, the changes they had to make to adapt to the
culture there (e.g. the teriyaki burger) and the difficulties
Walmart or similar brands have faced when trying to enter new
markets. The study should also use models and theories that
explain how firms should deal with cultural issues. The study
should examine diverse literature on cultural issues, emerging
markets, and globalisation.
Find information from past articles / academic writing on this
and analyse the findings of that research
Also need the following two chapters to be done:
Conclusion and Reccomendations for future research (approx
1500 words)
In your own words explain the findings of the research drawing
back to the case studies / future recommendations

Cultural Issues a Company Faces when Emerging in a New
Market 20
CULTURAL ISSUES A COMPANY FACES WHEN
EMERGING IN A NEWMARKET
TABLE OF CONTENT
INTRODUCTION…………………………………………….3
1.1 BACKGROUND…………………………………………...3
1.2 OBJECTIVES AND AIM………………………………….4
1.3 RESEARCH QUESTIONS………………………………...4
LITERATURE
REVIEW……………………………………….5
2.1 CULTURE CATEGORIES……………………………….5
2.2 DECIDING THE MODE OF ENTRY……………………6

2.3 METHODS OF
EXPORTS……………………………….7
2.4 ECONOMIC
MODEL……………………………………...7
2.4.1PESTEL MODEL…………………………………7
2.5 CULTURE AND
MARKETING…………………………8
METHODOLOGY AND
METHODS…………………………9
3.1
METHODOLOGY………………………………………9
3.2 DATA
COLLECTION………………………………….9
3.2.1 PRIMARY
DATA………………………………9
3.2.2 SECONDARY
DATA………………………….10
3.3 RESEARCH
APPROACH…………………………….11
DISCUSSION AND
LIMITATIONS………………………….12
4.1 DISCUSSION……………………………………………12
4.2 LIMITATIONS………………………………………….12
WORK
SCHEDULE…………………………………………….14
REFERENCES………………………………………………….15
Chapter 1
Introduction
1.1 Background
A company can develop a new product or emerge in a new
market by using its ideas or those of others. However, there are
several issues, such as cultural problems, that it can encounter

during the entire process. Firms have to take cultural issues into
consideration before deciding to enter into a new market. Some
of cultural issues include religion, norms, customs, and
language. When a company has adequate knowledge and
information it needs, the process of emerging into a new market
will be less painful.
The most important thing for a company is to consider the
market it's about to enter, once it begins the process of
developing a business model and concept (Govindarajan and
Ramamurti 2011). The key to a successful venture is taking time
to understand the market, which means carrying market research
to evaluate every aspect of the market including cultural issues.
The reason for this study is that firms always look to expand to
new opportunities and markets, and for each new market that a
firm establishes itself in, there is always a different culture that
might sometimes generate different problems for the firm. This
paper aims to research the cultural issues that companies face
when emerging in the new market and how they solve the
issues. This study is hence so important since it will create a
guide to those firms planning to enter new markets. The guide
will provide the best way possible on how to avoid or/and deal
with cultural issues.
1.2 Objectives/Aims
The objective of the research is to increase our understandings
of the various cultural issues that most companies face when
emerging in new markets.
1.3 ResearchQuestions
· How do firms gain understanding and knowledge concerning
the cultural issues of a new market?
· How do firms overcome these issues?
· What is the utmost efficient and effective technique to lessen
risk relating to cultural issues in new markets?

Chapter 2
Literature Review
Culture is the knowledge and characteristics of a particular
group of individuals encompassing religion, language, arts,
cuisine, social habits, and music. According to Hofstede Geert
"culture is the collective programming of the mind which
distinguishes the members of one human group from another"
(Hofstede 1991, p. 90). In general, culture is a way people do
their things. The chief cultural issues that an organization must
consider before entering a new market include religion, norms,
customs, and language. Over the years, the changing landscape
of technology has made it possible for people from different
sides or regions of the planet to interact, especially through
social networking sites. These interactions and information
exchange have opened regions to foreign people making it
possible for new organizations to move to such regions.
The most advantage that organizations have harnessed from
these interactions is the ability to learn about the cultural norms
of people from a particular region of interest. This way, the top
management can collaborate with relevant people within the
firm to develop and adapt business models and strategies with
the ability to succeed in the targeted market segment
(Logemann and Piekkari 2015, p.33). Importantly, it is essential
for organizations to adopt a localization strategy, which
incorporates religion, norms, customs, and language of the local
people in the model and strategies. Ideally, the targeted people
have to feel that they are part of the company, which would then
make them to support the company. Therefore, it is mandatory

for the new entrants in the market to initiate and actualize
various corporate social responsibilities as well as adopting a
localization strategy.
2.1 Culture Categories
One has to understand the diverse cornerstones of culture, to
understand the various issues that firms face when entering new
markets. Culture can be categorized into various categories for
easy understanding. The sense of space and self is the first
category. Self-identity and appreciation can be expressed
differently in a different culture. For example, it is more okay
to boast in some cultures, whereas people have a habit of being
humble in other cultures (MacCormack et al. 1980). People are
structured and formal in some cultures, whereas others are
flexible and informal.
The other category of culture is body language and spoken
language. Body language differs between different cultures.
People speak different languages with different dialects in
various parts of the world. Body language is somehow
universal; however, signals and gestures have a different
explanation in different cultures. For instance, most European
culture prefers hugging as a sign of greeting while in some
Asian nations, culture abhors body contact especially when it
involves people of different gender. In particular, most nations
where Islam is the dominant religion advises against shaking
hands people of opposite gender. The differences in these
practices imply that the ways of greeting also vary. For
instance, Cambodians greet by one person touching their chest
and bowing to the other person, who must be older than them or
occupy a higher sociocultural class (Jensen 2017, p.137). On the
other hand, people in many African nations prefer handshaking
as compared to hugging or pecking. Therefore, the top
management is responsible for understanding the practices
pertinent to the targeted market and liaising with the relevant
stakeholders to adopt a business model and strategy with high
efficacy.
There are diverse feeding habits and diets in different cultures.

For instance, many Americans and Europeans eat a lot of beef,
which is unacceptable among Hindus. Jews and Muslims are not
permitted to eat pork, whereas several Swedes have distinct
harm for Christmas. The food generally varies from culture to
culture, and the way food is served and eaten also differ. Food
is eaten directly with bare hands in some cultures, while in
other cultures, individuals use wooden sticks and many more.
People have different norms and values in different cultures. In
several parts of the world, individuals try to survive due to the
absence of food and water, whereas individuals in other regions
concentrate on upgrading their standards of livings through
material possessions and better employment. Success is
frequently measured in wealth in the United States, whereas in
other regions such as Pacific Island, success is measured on the
bases of how much an individual shares his/her wealth.
Attitude and beliefs of people are other significant factors of
culture. This is an aspect of culture that is difficult to measure.
People have different attitudes and cultures. Religion has the
same effect on the attitudes of people, but a person interprets a
message might be different from the other interpretation.
Generally, message interpretations depend on attitudes, norms,
and religion. Understanding this concept is imperative because
the new market entrants must develop and implement
promotional activities intended to introduce the products or
services of the company to the customers. The only known way
for an organization to enter a new market and mount a stiff
competition with the existing players is when the potential
customers in the market segment can comprehend the message.
In this respect, it is advisable to use promotional methods and
messages that would reach many people in the market and be
understood. As long as the customers interpret the messages in
the advertisements as intended by the organization, they would
demand for the products and services, especially when they
prove more superior and advantageous in comparison to the
existing products.
Apart from message interpretation, the top management must

also understand the attitudes of the host people towards certain
tendencies. For instance, environmental protection is one of the
most crucial responsibilities of organizations when they enter a
new market. This responsibility has crept to the top of the CSRs
pile due to the heightened calls on the need to slow climate
change. Different types of pollution undermine the quality of
life of people, and therefore, it is necessary for firms to play
critical roles in ensuring that their operations do not jeopardize
lives of the host people. This is principally crucial in societies
where people are much concerned with environmental
protection.
Additionally, the adopted localization strategy must make
people feel that they are part of the company. The human
resources department must adopt a recruitment framework that
hires local people. These people would help the company to
understand the local market much better, thereby positioning it
as a competitive player in the local market.
The competitiveness of the company would depend on its
market share. Through recruiting the local people, the company
would receive the support of people within the market segment,
which would be instrumental in cementing the operations of the
organization within the industry. Even so, the organization has
to adopt the human resource department with the local market
since the variables that influence job satisfaction,
organizational commitment, and employee motivation varies
across culture. Some studies have indicated that the failure of
firms to align the human resource department with the cultural
profile of the locals is one of the main reasons for the failure of
organizations in foreign markets. Also, performance appraisals
differ across cultures due to the underlying differences in the
conflict resolution modalities and giving and receiving of
feedback (Luo and Shenkar 2017, p.72). Therefore, the pinnacle
management must align the practices of the human resource
debarment with the cultural profile of the host region to raise
the likelihood of success.
2.2 Deciding the Mode of Entry

A firm has to choose the means of entry when it decides to
emerge into a new market. This decision is thought to be
affected by the following aspects: external factors, internal
factors, favorite mode characteristics, and so on. The most
interesting factor in our study is the external factors because
cultural issues belong to external factors that face a firm (Zhang
et al. 2007). The socio-culture comprises of language, cultural
characteristics, and education level, to name a few. The socio-
cultural issues influence a choice of means of entry for a
company because it can generate internal indecision in the
business and by that, it will influence their choice. Perhaps,
deciding on the best entry model is the hardest for an
organization that wants to emerge in a new market (Azhar and
Lin 2017, p.15). The people concerned with the development of
business models and entry strategies must liaise with numerous
stakeholders to position the company on the brink of success.
Importantly, conducting a PESTEL analysis would help reveal
internal and external variables that are likely to determine the
success of the firm. For instance, studies have indicated that the
failure of the firm to understand the local legal and ethical
issues is one of the underlying causes of company failure.
Globally, the operations of firms are governed by the existing
laws and ethical guidelines, which ensure that these operations
do not undermine the rights of any stakeholder. Therefore, the
apex leadership in a company intending to enter a new market
must understand the local legal and ethical issues to develop a
strategy that can foster the success of the firm.
Apart from the local legal and ethical issues, organizations must
also understand the socio-cultural and economic variables of the
targeted market segment. As pointed out earlier, adopting a
localization strategy positions the company on the brink of
success. Some of the elements within this strategy that a firm
must consider include spending power of the targeted
customers, the cultural norms, educational level of most people,
and their overall attitudes. Normally, a society that has a high
literacy percentage expects much from the entities. For

instance, people from such communities would likely demand
that organizations act by the laws of the land along with
protecting environment. Failure of the organization to practice
this would attract the anger of the locals, thereby shaking the
continued operation of the firm.
Furthermore, the spending capacity of the targeted customers
determines the type of pricing strategy adopted by the
organization (Davcik and Sharma 2015, p. 770). There are
various pricing strategies that firms can adopt when entering a
new market segment. The adopted pricing strategy must
incorporate the purchasing power of the targeted people along
with the quality of the products or services. Some of the most
popular pricing strategies that a firm can adopt when emerging
in a new market are penetration and premium.
Ideally, the penetration strategy is adopted to assist the
company in entering a new market and expanding its customer
bases. In most cases, penetration pricing is lower than the
existing market prices, which plays a crucial role in attracting
and retaining customers. The major drawback of this strategy is
that it leads to narrower profit margins and might cause the
company to go under when the established companies also
decide to lower their prices. Conversely, the premium pricing
strategy generates the illusion of quality and exclusivity. In
simple terms, those products or services offered at high prices
generate the feeling that they are of high quality, thereby
making people to increase their demand for them. However, this
strategy should only be used when the potential customers in
the market segment have a high purchasing power. Due to this
condition, this strategy is mostly applied in societies where
most of the targeted customers are within the middle or rich
classes. Concisely, an organization emerging in a new market
must utilize a localization strategy, which would also include a
pricing strategy that matches the socio-economic and cultural
variables of the potential customers.
2.3 Method of Exports
The products of a country are both manufactured in either the

third country market or domestic market and then indirectly or
directly exported to a new market or a new country. Export is
the most common means for the initial entry of a company and
is essential in evaluating the market growth. It is normally the
distinctive way for firms to initiate entry to external markets,
which changes towards foreign-based activities. The major
types of export methods include cooperative exports, direct
exports, and indirect exports.
Cooperative exports are when a company collaborates with
other companies in exporting functions (Michaely 1977, P.50).
Direct exports are when the firm itself carry out the exporting
processes, and also the company is in direct connection with the
intermediary. Indirect export, on the other hand, is when the
firm indirectly carry out the exporting processes. As an
alternative, a domestic corporation, for example, export house
or trading company accomplish those activities. When entering
a new market, the company must do all it can to attract and
retain the potential customers. This can only be achieved by
adopting a localization strategy, which focuses on empowering
and motivating the community. Based on this requirement, a
company emerging in a new market must utilize cooperative
exports as a strategy to build and expand its market share.
Importantly, the selected company must have an exceptional
reputation in the market, thereby helping the new entrants to
make good strides. The fact that the new entrant collaborates
with the local existing company to export the produced products
would auger well with the community. For most outsiders, this
would be a perfect expression of the company in its bid to
support the community. Therefore, the apex management in a
company entering a new market must select the cooperative
exportation strategy, which would appeal to both the emotions
and logic of the potential customers, thereby promoting the
growth of the company.
2.4 Economic Model
There are different economic models established to evaluate
how cultural issues affect the decision of a company to emerge

in a new market. There are four main types of economic models
used to tell a story about the performance of the economy of the
targeted market. These models include simulation, visual,
empirical, and mathematical. The models used in exploring the
economy put in consideration the behaviour of the customers in
the market. Visual models provide the pictures and charts that
illustrate the performance of the economy. For instance, the line
graphs could show the variation of a nation’s GDP over a given
period. The main advantage of these models is that an
individual can read and understand them with easy and within a
short time. The decision-makers in an organization can then
make the expansion decisions based on the graphical
representation of the changes in the economy. A very popular
visual representation of the economy focuses on the supply and
demand curves in a nation or a region. Demand is based on the
purchasing power of people, which depends on the
socioeconomic variables within the society. Therefore, the
visual models showing high demand would indicate that the
socioeconomic variables in the society are attractive for
business operations. This is the most popular model applied by
business organizations to understand the performance of the
economy before deciding to expand and venture.
2.4.1 PESTEL model
The PESTEL model categorizes six key types of the external
environment that have an influence on a company. These factors
include economic, social, political, environmental,
technological, and legal factors. The PESTEL model is suitable
for viewing the future effects of environmental aspects to the
company. The socio-cultural factors are the most interesting
aspect of the model to this study (Issa et al 2010). The
sociocultural factors include income distribution, lifestyle
changes, population demographics, attitudes to leisure and
work, consumerism, education level, and social mobility.
Moreover, the political variables have a profound influence on
the business climate in a nation. For instance, a move by the
national government to scale up taxes would likely lead to

inflation. This might not be great for business operations.
Therefore, decision-makers must explore the political variables
existing in a region before deciding on entry. Environmental
and legal issues must also be explored and adhered to when an
organization enters a new market segment. As pointed out
earlier, environmental protection has become a popular
initiative for many organizations globally. In this respect,
management must explore the legal policies regarding
environment protect within the target region and adhere to the
policies accordingly. Today, technology has become a
cornerstone of many operations. Although an organization can
import technology, it is also important to have an idea of how
technology-developed a region is before entering the market.
2.5 Marketing and Culture
Culture varies from one state to another. A company, therefore,
has to strategize its marketing approach to fit the values and
principles of a particular country. Culture entails individuals'
beliefs, attitudes, and values, what works in a particular state
may not work in another. Culture plays a crucial role for a firm
when it comes to understanding consumer behaviour, therefore,
culture influences customer's consumption at the end of the day
(Deshpande and Webster 1989). It is important for firms to
carry thorough marketing research to know how a particular
aspect works in an external market, to assist them in selecting
the perfect promotional mix that is suitable for the culture of a
particular country (Webster 1995, p.10). A company needs to
design the market mix: price, product, people, and promotion to
fit the culture of a particular country.
Chapter 3
Methodology and Methods
3.1 Introduction
The research aims to find out more about cultural issues when a

company enters a new market. The research will mostly refer to
the past experiences of a few firms. The study will also use
models and theories that explain how firms should deal with
cultural issues to analyse the answer from the respondents. The
study will look at diverse literature on cultural issues, emerging
markets, and globalization. The literature was analysed to
facilitate the completion of the literature review section. The
section contains summaries of previous studies that investigate
how new firms navigate the cultural barriers in the host nations
or regions to attain the set goals. Notably, most of these studies
converged on the observation that cultural barriers must be
addressed to enhance the chances of realizing the set objectives.
Today, navigating the cultural landscape has been made easy by
the advancements in technology. As people from different
corners of the world interact, especially on social networking
sites, the differences among cultures are explored, thus
positioning organizations on solid grounds to emerge in new
markets. Countries work diversely, and whatever works in a
region does not normally work in another region. The research
wants firms to understand the difficulties that different cultures
can bring to a company emerging in a new market. This research
will do that by using theories and models and what companies
do. Particularly, the study will collect first-hand information
from employees in management positions of organizations that
have emerged in new markets. The respondents will provide
both quantitative and qualitative data regarding the impact of
culture on the performance of their organizations. Furthermore,
the respondents will provide information about the change and
penetration strategies that have been employed to promote the
continued growth of the organizations in the host regions or
nations amidst the cultural barriers. Comment by Chi
Maher: using theories and models such as ?
3.2 Research Design
The research problem is the underlying determinant of the type
of research approach or design adopted to complete the study.
As mentioned above, the study will investigate the types of

cultural barriers that influence the penetration of organizations
in the new markets. Additionally, the study will investigate the
types of penetration strategies that can enable the company to
succeed in the emerging market. In this regard, a need exists to
collect both quantitative and qualitative data, thereby making
mixed-method research design the most relevant and applicable
choice.
Since the study will collect primary data from participants
meeting all the requirements of the adopted selection criterion,
then the experimental approach will be relevant. The study will
involve interviews and responding to questionnaires with a few
companies that have emerged in new markets to find answers to
the objectives. The interview will provide a further
understanding of the issue and offer sufficient evidence to come
up with a better deduction than other firms, thinking of moving
to new markets can benefit from. Furthermore, the study will
employ data collection techniques that facilitate the gathering
of relevant data.
3.3 Data Collection Methods
In research, the selected data-gathering instruments must align
with the research design, the needed type of data, and the
research question. Canals (2017) asserts that interviews and
questionnaires are some of the common data collection
techniques employed by researchers. While these techniques
foster the collection of credible and reliable data, some
researchers prefer using them along with the triangulation
matrix. This matrix eliminates the limitations of using a single
method, thus guaranteeing data credibility. In such studies, the
established findings could inform practice in relevant settings
without questioning the study’s reliability.
The formulated research question is the primary determinant of
the research design, type of desired data, and data collection
instruments selected to complete the study. Evaluation Toolkit
(n. d.) reveals that after deciding the data gathering instruments,
it is vital for researchers to triangulate these methods to
eliminate bias and limitations that arise from depending on a

single data-gathering method. A host of instruments exist that
foster the collection of required data, including interviews,
observations, questionnaires, surveys, and existing data. Each of
these instruments has weaknesses that might undermine the
reliability and credibility of data. In this light, it is
recommended for researchers to use two or more methods to
triangulate the data sources and data-gathering instruments, thus
eliminating the limitation of individual techniques.
Interviews and questionnaires are popular techniques
employed in gathering useful data. Wilson, Onwuegbuzie, and
Manning (2016) maintain that interviews could contain both
open-ended and closed-ended questions, which leads to the
collection of the desired data. In this manner, some researchers
prefer using interviews to collect reliable and credible data.
However, researchers need to have essential research skills to
guarantee the collection of desired data. Importantly, the
interviewer has to guarantee the privacy and confidentiality of
the provided data, which gives the interviewees the confidence
to respond to questions without holding back. Moreover,
interviewees need to sign the informed consent forms, which
provide them the freedom to cancel their involvement in the
study at any time. Moreover, questionnaires are employed to
collect both qualitative and quantitative data from the selected
participants. These tools have a series of questions that are
tailored to collect data relevant in responding to the formulated
research question.
The study will investigate the impact of cultural barriers on the
performance of organizations that have emerged in new
markets. Primarily, the cultural shocks in the new markets can
undermine the core operations of an organization, thereby
derailing its growth. Therefore, interviews and questionnaires
will be crucial for collecting desirable data aimed at explaining
the cultural occurrences in the host markets that might
jeopardize the attainment of the set objectives. These
instruments will be relevant in collecting data from employees
in managerial positions in organizations that have emerged in

foreign markets. The responses by the study participants will be
crucial for the successful completion of the study. Comment by
Chi Maher: Reference required
3.4 Data Collection Process
The literature has to achieve the following criteria when
selecting the information for the dissertation; it must be in an
understandable language, be contemporary, and must relate to
the subject. The dissertation will use the following type of data;
secondary data and primary data. Notably, the secondary data
will be collected and used to complete the literature review
section of the paper. The data might also be used to complete
the discussion section of the paper. On the other hand, the
primary data will be foundational to the establishment of
credible and reliable recommendations and conclusions. Primary
data will be collected from the respondents using questionnaires
and interviews. The study participants will be identified using a
suitable selection criterion; then, they will sign the informed
consent forms before the data collection process starts.
Primary data is the category of data collected from the source
by a researcher. This type of data can be collected differently,
for example, through interviews or observations. Interviews are
useful for gathering reliable and valid data, which is essential to
the research (Wilcox et al. 2012). There are different methods
of interviews, and they can either be informal and unstructured,
or they may be formalized and structured or semi-structured
method. The interview method that will be used for this study is
the semi-structured because the study will not use similar
questions for all firms, only for a few, and it will not use pre-
coded responses as is done in structured interviews. Further or
follow up inquiries may be asked during the interview to
explore the answers/questions deeper. The research will not
conduct unstructured interviews because the research uses
predetermined questions.
A semi-structured method of interview is usually used to
evaluate data qualitatively, therefore, the semi-structured
method fits this research because the data in the study is of a

qualitative and quantitative nature. Additionally, semi-
structured methods are suitable when the research is
investigative, this will fit this research because it is examining
in what manner cultural issues create challenges for companies.
Moreover, employing questionnaires will facilitate the
collection of primary data from the study participants. The
participants will be issued questionnaires with pre-set questions
and asked to respond to them with the highest level of sincerity.
Questionnaires are excellent data collection tools because they
enable comparison of data provided by the respondents exposed
to the same conditions, thereby making it possible to establish
the credibility of the responses.
Secondary data was also used to facilitate the completion of the
project. Notably, it was crucial to conduct a literature review of
the previous study to establish common themes and patterns.
Secondary data is the information that has already been
collected by another individual in other studies. It includes both
quantitative and qualitative data. Secondary data comprises the
following categories; survey-based data, government database,
and documentary data, to name a few (Szabo and Strang 1997).
The documentary data that the research will use is from the
website of the companies, newspapers, articles and from books
relating to the subject. To add to that, documentary data is
frequently suitable in the study that also uses primary data
collected by different methods. In this situation, the
questionnaire.
3.5 Sampling
Sampling is an essential process in data collection. During
sampling, the study participants are selected from the
population, and there is a need to ensure that the sample is a
good representative of the entire population. In this study,
participants will be from organizations that have emerged in
foreign markets. The parent firms or their headquarters must be
located in different nations, implying that the selected
participants must have been subjected to cultural shocks. The
study will employ a random sampling procedure to eliminate the

possibility of bias in data collection (Emerson, 2015). The first
step in sampling will involve identifying the companies that
have established subsidiaries in foreign nations. Participants
must have worked in the organization for a minimum of three
years within the managerial position.
Employees at the management level have access to pertinent
information, especially quantitative data. Additionally, the
participants must be foreign, too, and this will make them the
best sources of data based on the objectives of the study and the
underlying problems that the study seeks to address. A
minimum of two hundred participants will take part in the
study. Such several participants will be essential to provide
credible data that will be used to formulate reliable
recommendations and conclusions.
3.6 Data Analysis Method
The mixed-method research design employed in the study will
facilitate the collection of both quantitative and qualitative
data. Therefore, the analysis techniques and software used in
the study must facilitate an effective analysis of the collected
data. A host of techniques and software exist that are used in
analyzing qualitative and quantitative. For instance, SPSS and
MS excel are common software used in the analysis of
quantitative data, while webQDA and HyperRESEARCH are
both common software employed in analysing qualitative data.
The study will utilize SPSS and webQDA to facilitate the
analysis of quantitative and qualitative data respectively. After
analysis, inferences will be derived from data that are essential
in the formulation of relevant and accurate recommendations
and conclusions.
3.7 Data Quality Issues and Preparation for Research
The quality of data collected in the study determines the
effectiveness and accuracy of the recommendations established
in the study. Researchers must adopt a technique that can
guarantee the quality of data, thereby guaranteeing the
formulation of reliable recommendations. Sometimes, it is
impossible to establish the reliability of the data provided by

the respondents. In such cases, researchers are at the mercy of
the respondents and only hope that the participants provide
correct data. In this study, data collection will target at least ten
employees from a single organization. These employees will be
subjected to similar pre-set questions in the questionnaire with
the variations in their responses helping to establish the
credibility of some responses. Importantly, it will be possible to
identify outliers during data collection, thereby enhancing the
quality of data.
3.8 Limitations
Despite the ability to control the quality of data at some
considerable level, the existence of several outliers from a
single organization will make it hard to establish the credibility
of data. Therefore, the underlying limitation in this study will
be the inability to guarantee the accuracy of the data provided
by the respondents especially when using questionnaires.
Comment by Chi Maher: So what could have done to
minimise the limitations?
Chapter 4
Discussion and Limitations
This chapter will analyse the findings and the expectations of
the research. It will also include limitations of the study.
4.1 Discussion
People tend to think that all human beings are the same when it
comes to actions and behaviour, no matter what culture.
Directors make a lot of wrong choices because perform in a way
that they would have performed in their local culture. A
business deal or a relationship can be damaged easily because
of misunderstanding that arises due to cultural issues.
Cultures might bring substantial problems for firms when

emerging into new market. A market culture may influence a
strategy of a company. An important aspect that this study
concentrates on is the mode of entry of a company. Cultural
issues will influence the mode of entry of a company. Cultural
problems will also influence marketing strategy of a company.
Additionally, culture will also influence the mode of exports for
company products. Many companies hesitate when it comes to
emerging into new markets, since it is understood as a risk.
4.2 Limitations
There may be a possible limitation in this study, some of the
limitations include the following;
· Limited access to data
When research involves questioning certain organizations or
people, a problem may arise of limited access to the
respondents.
· Time constraints
Academic researchers must always meet the deadline for
submitting the research. Thus, the time available to carry out
the research may be constrained by the deadline of the
assignment.
· Conflict arising from personal issues and cultural bias
Sometimes the researchers may be biased due to their
perspectives or cultural background, and this may affect the
legitimacy of the study. The researcher may also have biases
towards results and data that only support their arguments or
hypothesis.

References
Azhar, A. and Lin, C.W., 2017, April. The fundamental business
strategy for state owned mobile provider company enter the
regional market community. In 2017 3rd International
Conference on Information Management (ICIM) (pp. 16-20).
IEEE.
Canals, L., 2017, ‘Instruments for gathering data.’ Institute of
Education Sciences. Accessed from
<https://files.eric.ed.gov/fulltext/ED573582.pdf>
Davcik, N.S. and Sharma, P., 2015. Impact of product
differentiation, marketing investments and brand equity on
pricing strategies: A brand level investigation. European
Journal of Marketing, 49(5/6), pp.760-781.
Deshpande, R. and Webster Jr, F.E., 1989. Organizational
culture and marketing: defining the research agenda. Journal of
marketing, 53(1), pp.3-15.
Emerson, R. W., 2015, ‘Convenience sampling, random
sampling, and snowball sampling: How does sampling affect the
validity of research?’ Journal of Visual Impairment &
Blindness, 109(2), pp.164-168.
Evaluation Toolkit. (n. d.). Linking your research questions and
data collection methods. The Pell Institute. Available
from<http://toolkit.pellinstitute.org/evaluation-guide/collect-
data/link-research-questions-and-collection-methods/>

Govindarajan, V. and Ramamurti, R., 2011. Reverse innovation,
emerging markets, and global strategy. Global Strategy
Journal, 1(3‐4), pp.191-205.
Hofstede, G. (1991). Cultures and organizations: Software of
the mind. London: McGraw-Hill, 4(1), pp.70-100.
Issa, T., Chang, V. and Issa, T., 2010. Sustainable business
strategies and PESTEL framework. GSTF International Journal
on Computing, 1(1), pp.73-80.
Jensen, C.B., 2017. ‘Integrating Human to Quality’: Capacity
Building across Cambodian Worlds. The Cambridge Journal of
Anthropology, 35(1), pp.131-145.
Logemann, M. and Piekkari, R., 2015. Localize or local lies?
The power of language and translation in the multinational
corporation. Critical Perspectives on International
Business, 11(1), pp.30-53.
Luo, Y. and Shenkar, O., 2017. The multinational corporation as
a multilingual community: Language and organization in a
global context. In Language in International Business (pp. 59-
92). Palgrave Macmillan, Cham.
MacCormack, C., MacCormack, C.P. and Strathern, M. eds.,
1980. Nature, culture and gender. Cambridge University Press.
Michaely, M., 1977. Exports and growth: an empirical
investigation. Journal of development economics, 4(1), pp.49-
53.
Szabo, V. and Strang, V.R., 1997. Secondary analysis of
qualitative data. Advances in nursing science, 20(2), pp.66-74.
Webster, C., 1995. Marketing culture and marketing
effectiveness in service firms. Journal of Services
Marketing, 9(2), pp.6-21.
Wilcox, A.B., Gallagher, K.D., Boden-Albala, B. and Bakken,
S.R., 2012. Research data collection methods: from paper to
tablet computers. Medical care, pp. S68-S73.
Wilson, A. D., Onwuegbuzie, A. J., & Manning, L. P., 2016,
‘Using paired depth interviews to collect qualitative data.’ The
Qualitative Report, 21(9), pp. 1549-1573.
Zhang, Y, Zhang, Z and Liu, Z., 2007. “Choice of entry modes

in sequential FDI in an emerging economy”. Management
Decision, Vol. 45 No. 4, 2007, pp. 749-772
Cultural Issues a Company Faces when Emerging in a New
Market 11
CULTURAL ISSUES A COMPANY FACES WHEN
EMERGING IN A NEWMARKET
Chapter 1
Introduction
1.1 Background
A company can develop a new product or emerge in a new
market by using its ideas or those of others. However, there are
several issues, such as cultural problems, that it can encounter
during the entire process. Firms have to take cultural issues into
consideration before deciding to enter into a new market. Some
of cultural issues include religion, norms, customs, and
language. When a company has adequate knowledge and
information it needs, the process of emerging into a new market
will be less painful.
The most important thing for a company is to consider the
market it's about to enter, once it begins the process of
developing a business model and concept (Govindarajan and
Ramamurti 2011). The key to a successful venture is taking time
to understand the market, which means carrying market research
to evaluate every aspect of the market including cultural issues.
The reason for this study is that firms always look to expand to
new opportunities and markets, and for each new market that a
firm establishes itself in, there is always a different culture that
might sometimes generate different problems for the firm. This
paper aims to research the cultural issues that companies face
when emerging in the new market and how they solve the
issues. This study is hence so important since it will create a
guide to those firms planning to enter new markets. The guide
will provide the best way possible on how to avoid or/and deal

with cultural issues.
Overall aim Comment by Chi Maher: Overall aim missing
1.2 Objectives/Aims Comment by Chi Maher: You need 3
research Objectives
The objective of the research is to increase our understandings
of the various cultural issues that most companies face when
emerging in new markets.
1.3 ResearchQuestions
· How do firms gain understanding and knowledge concerning
the cultural issues of a new market?
· How do firms overcome these issues?
· What is the utmost efficient and effective technique to lessen
risk relating to cultural issues in new markets?
Chapter 2: Literature Review
Culture is the knowledge and characteristics of a particular
group of individuals encompassing religion, language, arts,
cuisine, social habits, and music. According to Hofstede Geert
"culture is the collective programming of the mind which
distinguishes the members of one human group from another"
(Hofstede 1991, p. 90). In general, culture is a way people do
their things. The chief cultural issues that an organization must
consider before entering a new market include religion, norms,
customs, and language. Over the years, the changing landscape
of technology has made it possible for people from different
sides or regions of the planet to interact, especially through
social networking sites. These interactions and information
exchange have opened regions to foreign people making it
possible for new organizations to move to such regions.
The most advantage that organizations have harnessed from
these interactions is the ability to learn about the cultural norms
of people from a particular region of interest. This way, the top
management can collaborate with relevant people within the
firm to develop and adapt business models and strategies with
the ability to succeed in the targeted market segment
(Logemann and Piekkari 2015, p.33). Importantly, it is essential

for organizations to adopt a localization strategy, which
incorporates religion, norms, customs, and language of the local
people in the model and strategies. Ideally, the targeted people
have to feel that they are part of the company, which would then
make them to support the company. Therefore, it is mandatory
for the new entrants in the market to initiate and actualize
various corporate social responsibilities as well as adopting a
localization strategy.
2.1 Culture Categories
One has to understand the diverse cornerstones of culture, to
understand the various issues that firms face when entering new
markets. Culture can be categorized into various categories for
easy understanding. The sense of space and self is the first
category. Self-identity and appreciation can be expressed
differently in a different culture. For example, it is more okay
to boast in some cultures, whereas people have a habit of being
humble in other cultures (MacCormack et al. 1980). People are
structured and formal in some cultures, whereas others are
flexible and informal.
The other category of culture is body language and spoken
language. Body language differs between different cultures.
People speak different languages with different dialects in
various parts of the world. Body language is somehow
universal; however, signals and gestures have a different
explanation in different cultures. For instance, most European
culture prefers hugging as a sign of greeting while in some
Asian nations, culture abhors body contact especially when it
involves people of different gender. In particular, most nations
where Islam is the dominant religion advises against shaking
hands people of opposite gender. The differences in these
practices imply that the ways of greeting also vary. For
instance, Cambodians greet by one person touching their chest
and bowing to the other person, who must be older than them or
occupy a higher sociocultural class (Jensen 2017, p.137). On the
other hand, people in many African nations prefer handshaking
as compared to hugging or pecking. Therefore, the top

management is responsible for understanding the practices
pertinent to the targeted market and liaising with the relevant
stakeholders to adopt a business model and strategy with high
efficacy.
There are diverse feeding habits and diets in different cultures.
For instance, many Americans and Europeans eat a lot of beef,
which is unacceptable among Hindus. Jews and Muslims are not
permitted to eat pork, whereas several Swedes have distinct
harm for Christmas. The food generally varies from culture to
culture, and the way food is served and eaten also differ. Food
is eaten directly with bare hands in some cultures, while in
other cultures, individuals use wooden sticks and many more.
Comment by Chi Maher: Reference required
People have different norms and values in different cultures. In
several parts of the world, individuals try to survive due to the
absence of food and water, whereas individuals in other regions
concentrate on upgrading their standards of livings through
material possessions and better employment. Success is
frequently measured in wealth in the United States, whereas in
other regions such as Pacific Island, success is measured on the
bases of how much an individual shares his/her wealth.
Attitude and beliefs of people are other significant factors of
culture. This is an aspect of culture that is difficult to measure.
People have different attitudes and cultures. Religion has the
same effect on the attitudes of people, but a person interprets a
message might be different from the other interpretation.
Generally, message interpretations depend on attitudes, norms,
and religion. Understanding this concept is imperative because
the new market entrants must develop and implement
promotional activities intended to introduce the products or
services of the company to the customers. The only known way
for an organization to enter a new market and mount a stiff
competition with the existing players is when the potential
customers in the market segment can comprehend the message.
In this respect, it is advisable to use promotional methods and
messages that would reach many people in the market and be

understood. As long as the customers interpret the messages in
the advertisements as intended by the organization, they would
demand for the products and services, especially when they
prove more superior and advantageous in comparison to the
existing products. Comment by Chi Maher: Same as above
Comment by Chi Maher: Sae as above
Apart from message interpretation, the top management must
also understand the attitudes of the host people towards certain
tendencies. For instance, environmental protection is one of the
most crucial responsibilities of organizations when they enter a
new market. This responsibility has crept to the top of the CSRs
pile due to the heightened calls on the need to slow climate
change. Different types of pollution undermine the quality of
life of people, and therefore, it is necessary for firms to play
critical roles in ensuring that their operations do not jeopardize
lives of the host people. This is principally crucial in societies
where people are much concerned with environmental
protection. Comment by Chi Maher: Reference your work
throughtout
Additionally, the adopted localization strategy must make
people feel that they are part of the company. The human
resources department must adopt a recruitment framework that
hires local people. These people would help the company to
understand the local market much better, thereby positioning it
as a competitive player in the local market.
The competitiveness of the company would depend on its
market share. Through recruiting the local people, the company
would receive the support of people within the market segment,
which would be instrumental in cementing the operations of the
organization within the industry. Even so, the organization has
to adopt the human resource department with the local market
since the variables that influence job satisfaction,
organizational commitment, and employee motivation varies
across culture. Some studies have indicated that the failure of
firms to align the human resource department with the cultural
profile of the locals is one of the main reasons for the failure of

organizations in foreign markets. Also, performance appraisals
differ across cultures due to the underlying differences in the
conflict resolution modalities and giving and receiving of
feedback (Luo and Shenkar 2017, p.72). Therefore, the pinnacle
management must align the practices of the human resource
debarment with the cultural profile of the host region to raise
the likelihood of success.
2.2 Deciding the Mode of Entry
A firm has to choose the means of entry when it decides to
emerge into a new market. This decision is thought to be
affected by the following aspects: external factors, internal
factors, favorite mode characteristics, and so on. The most
interesting factor in our study is the external factors because
cultural issues belong to external factors that face a firm (Zhang
et al. 2007). The socio-culture comprises of language, cultural
characteristics, and education level, to name a few. The socio-
cultural issues influence a choice of means of entry for a
company because it can generate internal indecision in the
business and by that, it will influence their choice. Perhaps,
deciding on the best entry model is the hardest for an
organization that wants to emerge in a new market (Azhar and
Lin 2017, p.15). The people concerned with the development of
business models and entry strategies must liaise with numerous
stakeholders to position the company on the brink of success.
Importantly, conducting a PESTEL analysis would help reveal
internal and external variables that are likely to determine the
success of the firm. For instance, studies have indicated that the
failure of the firm to understand the local legal and ethical
issues is one of the underlying causes of company failure.
Globally, the operations of firms are governed by the existing
laws and ethical guidelines, which ensure that these operations
do not undermine the rights of any stakeholder. Therefore, the
apex leadership in a company intending to enter a new market
must understand the local legal and ethical issues to develop a
strategy that can foster the success of the firm.
Apart from the local legal and ethical issues, organizations must

also understand the socio-cultural and economic variables of the
targeted market segment. As pointed out earlier, adopting a
localization strategy positions the company on the brink of
success. Some of the elements within this strategy that a firm
must consider include spending power of the targeted
customers, the cultural norms, educational level of most people,
and their overall attitudes. Normally, a society that has a high
literacy percentage expects much from the entities. For
instance, people from such communities would likely demand
that organizations act by the laws of the land along with
protecting environment. Failure of the organization to practice
this would attract the anger of the locals, thereby shaking the
continued operation of the firm.
Furthermore, the spending capacity of the targeted customers
determines the type of pricing strategy adopted by the
organization (Davcik and Sharma 2015, p. 770). There are
various pricing strategies that firms can adopt when entering a
new market segment. The adopted pricing strategy must
incorporate the purchasing power of the targeted people along
with the quality of the products or services. Some of the most
popular pricing strategies that a firm can adopt when emerging
in a new market are penetration and premium.
Ideally, the penetration strategy is adopted to assist the
company in entering a new market and expanding its customer
bases. In most cases, penetration pricing is lower than the
existing market prices, which plays a crucial role in attracting
and retaining customers. The major drawback of this strategy is
that it leads to narrower profit margins and might cause the
company to go under when the established companies also
decide to lower their prices. Conversely, the premium pricing
strategy generates the illusion of quality and exclusivity. In
simple terms, those products or services offered at high prices
generate the feeling that they are of high quality, thereby
making people to increase their demand for them. However, this
strategy should only be used when the potential customers in
the market segment have a high purchasing power. Due to this

condition, this strategy is mostly applied in societies where
most of the targeted customers are within the middle or rich
classes. Concisely, an organization emerging in a new market
must utilize a localization strategy, which would also include a
pricing strategy that matches the socio-economic and cultural
variables of the potential customers.
2.3 Method of Exports
The products of a country are both manufactured in either the
third country market or domestic market and then indirectly or
directly exported to a new market or a new country. Export is
the most common means for the initial entry of a company and
is essential in evaluating the market growth. It is normally the
distinctive way for firms to initiate entry to external markets,
which changes towards foreign-based activities. The major
types of export methods include cooperative exports, direct
exports, and indirect exports.
Cooperative exports are when a company collaborates with
other companies in exporting functions (Michaely 1977, P.50).
Direct exports are when the firm itself carry out the exporting
processes, and also the company is in direct connection with the
intermediary. Indirect export, on the other hand, is when the
firm indirectly carry out the exporting processes. As an
alternative, a domestic corporation, for example, export house
or trading company accomplish those activities. When entering
a new market, the company must do all it can to attract and
retain the potential customers. This can only be achieved by
adopting a localization strategy, which focuses on empowering
and motivating the community. Based on this requirement, a
company emerging in a new market must utilize cooperative
exports as a strategy to build and expand its market share.
Importantly, the selected company must have an exceptional
reputation in the market, thereby helping the new entrants to
make good strides. The fact that the new entrant collaborates
with the local existing company to export the produced products
would auger well with the community. For most outsiders, this
would be a perfect expression of the company in its bid to

support the community. Therefore, the apex management in a
company entering a new market must select the cooperative
exportation strategy, which would appeal to both the emotions
and logic of the potential customers, thereby promoting the
growth of the company.
2.4 Economic Model Comment by Chi Maher: References
required
There are different economic models established to evaluate
how cultural issues affect the decision of a company to emerge
in a new market. There are four main types of economic models
used to tell a story about the performance of the economy of the
targeted market. These models include simulation, visual,
empirical, and mathematical. The models used in exploring the
economy put in consideration the behaviour of the customers in
the market. Visual models provide the pictures and charts that
illustrate the performance of the economy. For instance, the line
graphs could show the variation of a nation’s GDP over a given
period. The main advantage of these models is that an
individual can read and understand them with easy and within a
short time. The decision-makers in an organization can then
make the expansion decisions based on the graphical
representation of the changes in the economy. A very popular
visual representation of the economy focuses on the supply and
demand curves in a nation or a region. Demand is based on the
purchasing power of people, which depends on the
socioeconomic variables within the society. Therefore, the
visual models showing high demand would indicate that the
socioeconomic variables in the society are attractive for
business operations. This is the most popular model applied by
business organizations to understand the performance of the
economy before deciding to expand and venture.
2.4.1 PESTEL model
The PESTEL model categorizes six key types of the external
environment that have an influence on a company. These factors
include economic, social, political, environmental,
technological, and legal factors. The PESTEL model is suitable

for viewing the future effects of environmental aspects to the
company. The socio-cultural factors are the most interesting
aspect of the model to this study (Issa et al 2010). The
sociocultural factors include income distribution, lifestyle
changes, population demographics, attitudes to leisure and
work, consumerism, education level, and social mobility.
Moreover, the political variables have a profound influence on
the business climate in a nation. For instance, a move by the
national government to scale up taxes would likely lead to
inflation. This might not be great for business operations.
Therefore, decision-makers must explore the political variables
existing in a region before deciding on entry. Environmental
and legal issues must also be explored and adhered to when an
organization enters a new market segment. As pointed out
earlier, environmental protection has become a popular
initiative for many organizations globally. In this respect,
management must explore the legal policies regarding
environment protect within the target region and adhere to the
policies accordingly. Today, technology has become a
cornerstone of many operations. Although an organization can
import technology, it is also important to have an idea of how
technology-developed a region is before entering the market.
Comment by Chi Maher: Same as above
2.5 Marketing and Culture
Culture varies from one state to another. A company, therefore,
has to strategize its marketing approach to fit the values and
principles of a particular country. Culture entails individuals'
beliefs, attitudes, and values, what works in a particular state
may not work in another. Culture plays a crucial role for a firm
when it comes to understanding consumer behaviour, therefore,
culture influences customer's consumption at the end of the day
(Deshpande and Webster 1989). It is important for firms to
carry thorough marketing research to know how a particular
aspect works in an external market, to assist them in selecting
the perfect promotional mix that is suitable for the culture of a
particular country (Webster 1995, p.10). A company needs to

design the market mix: price, product, people, and promotion to
fit the culture of a particular country.
References
Azhar, A. and Lin, C.W., 2017, April. The fundamental business
strategy for state owned mobile provider company enter the
regional market community. In 2017 3rd International
Conference on Information Management (ICIM) (pp. 16-20).
IEEE.
Davcik, N.S. and Sharma, P., 2015. Impact of product
differentiation, marketing investments and brand equity on
pricing strategies: A brand level investigation. European
Journal of Marketing, 49(5/6), pp.760-781.
Deshpande, R. and Webster Jr, F.E., 1989. Organizational
culture and marketing: defining the research agenda. Journal of
marketing, 53(1), pp.3-15.
Govindarajan, V. and Ramamurti, R., 2011. Reverse innovation,
emerging markets, and global strategy. Global Strategy
Journal, 1(3‐4), pp.191-205.
Hofstede, G. (1991). Cultures and organizations: Software of
the mind. London: McGraw-Hill, 4(1), pp.70-100.
Issa, T., Chang, V. and Issa, T., 2010. Sustainable business
strategies and PESTEL framework. GSTF International Journal
on Computing, 1(1), pp.73-80.
Jensen, C.B., 2017. ‘Integrating Human to Quality’: Capacity
Building across Cambodian Worlds. The Cambridge Journal of
Anthropology, 35(1), pp.131-145.
Logemann, M. and Piekkari, R., 2015. Localize or local lies?
The power of language and translation in the multinational
corporation. Critical Perspectives on International
Business, 11(1), pp.30-53.
Luo, Y. and Shenkar, O., 2017. The multinational corporation as
a multilingual community: Language and organization in a
global context. In Language in International Business (pp. 59-
92). Palgrave Macmillan, Cham.
MacCormack, C., MacCormack, C.P. and Strathern, M. eds.,

1980. Nature, culture and gender. Cambridge University Press.
Michaely, M., 1977. Exports and growth: an empirical
investigation. Journal of development economics, 4(1), pp.49-
53.
Szabo, V. and Strang, V.R., 1997. Secondary analysis of
qualitative data. Advances in nursing science, 20(2), pp.66-74.
Webster, C., 1995. Marketing culture and marketing
effectiveness in service firms. Journal of Services
Marketing, 9(2), pp.6-21.
Wilcox, A.B., Gallagher, K.D., Boden-Albala, B. and Bakken,
S.R., 2012. Research data collection methods: from paper to
tablet computers. Medical care, pp. S68-S73.
Zhang, Y, Zhang, Z and Liu, Z., 2007. “Choice of entry modes
in sequential FDI in an emerging economy”. Management
Decision, Vol. 45 No. 4, 2007, pp. 749-772

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