When a company starts to do business in a foreign country, there are often many business practices that are different and difficult to understand. As a result, many companies experience cross cultural miscommunication that can inhibit business and break the trust between corporate headquarters and the foreign office. In this paper, we look at some real examples of communication problems between offices in two locations. This occurs both between vendors and their customers as well as internally in the same company between different sites.
The problem with communication problems is that the cost can be very high. It can result in reduced productivity, lost opportunities and failure to execute on projects. However, the payoff can be very big if issues are addressed quickly and thoroughly.
Case 1: Two Sets of Books
An American company opened up a branch office in Japan to provide local access to the market. This office had access to the company’s intranet and used the same management software tools. The company has invested a significant amount of money in accounting software that provided a real-time access to accounting information at either location.
During a visit to the branch office in Japan, an American manager noticed that when his Japanese counterparts accessed the accounting software, they also made entries into a paper copy. In fact, the paper system appeared to completely replicate the financials of the accounting software.
When the manager returned to the United States and raised this issue, there was a lot of concern amongst the executives at the headquarters. Why did the branch office keep two sets of books? Were they stealing from the company? The executives decided that there was too much potential for fraud. They decided to launch an investigation.
A team of accountants traveled from the United States to Japan to look into the problem. In the course of their...