International Business Case Analysis

Topics: Project management, Costs, Cost Pages: 5 (1747 words) Published: October 8, 2011
Many U.S. companies are doing business internationally, but many complex situations can arise. Having an understanding of cultural differences in the workplace becomes important, and to understand these differences, people need to know and understand a culture’s ecological correlations, or in other words, the concepts that describe a culture (Brislin, P. 278). In reading the case “Negotiations – BWA Discovers the Indonesian Way” in Understanding and Managing Diversity, many cultural issues had come into play with the negotiations between the United States and Indonesian firm.

Even though Jake Campbell, who is a U.S. project manager for BWA, has experience in managing other projects similar to the size and complexity of the National Electric Company in Indonesia project, this was his first international assignment. In preparing for his assignment, Jared talked with other experienced BWA project managers who had already completed complex foreign assignments like his NEC project. He learned that delays were common, particularly in obtaining payments and communication could be problematic (Harvey, et. al., P. 99). Jake does think he can resolve these issues with frequent progress meetings and good record keeping. This is the first issue I discovered in analyzing this case. Even though Jake did go to his other colleagues for their opinions with international dealings, he should have done more research about how businesses in Indonesia conduct business. When Jared sat with the National Electric Company in Indonesia and also with their engineering firm MEC, he raised the issue of the delay and the costs it would create. The NEC engineers seemed surprised and uncomfortable at this mention and along with this they did not ask any questions, not even what the costs would be. They told Jared that projects have delays and their company should have expected and considered them. They moved on to other topics and Jared decided not to press the issue further (Harvey, et. al., P. 100). Jake calls Anwar at PT Fagar, which are the local sales agents (they provide access to decision makers and help to influence the buying decision) who are expected to provide support. Anwar advised getting more money for the delay would be difficult because delays are common and expected in his country. Anwar knew NEC had really no additional funding for the project and would not be very receptive to a big claim. This would probably be a very contentious issue, difficult to present and difficult to resolve. If Jared must pursue the claim, then the best way would to be first meet informally and learn what might be done. Anwar agreed to arrange a lunch meeting with several of the NEC and MEC project managers (Harvey, et. al., P. 100). After having this discussion with Anwar, Jared should have gone straight to his boss with the issue instead of dealing with it on his own. At the lunch meeting, Anwar raised the issue of the project delay during conversation of the project. He explained that extra costs would occur and asked if the engineers could help find a way to cover some of the costs. He talked about commitment from BWA and PTF to work together with NEC and make the project a successful one (Harvey, et. al., P. 100). The issue I found during this meeting, is that Anwar explained the additional costs in detail, but never mentioned the $5 million estimate. The engineers listened and indicated that they understood the problem. From this, Jared should have known that just because they understood the problem, doesn’t mean that they agreed with it. A week later Jared happened to meet some of the same engineers at a party. While discussing the project, he asked about the delay costs. The engineers said it was a very difficult problem, but they had been discussing it internally. Nothing else was offered and Jared thanked them (Harvey, et. al., P. 101). If Jared had done some research about how business is conducted in...
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