Americans: More than meets the eye

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The United States of America has two symbols that most Americans use to identify their core values. One is the Statue of Liberty and the other is Uncle Sam. The Statue of Liberty represents all of the things that have made America great; the hope for a better life, freedom from persecution, new chances, a new life, all that is even promised in the constitution, the pursuit of happiness. This dream, of being able to become anything you want, from rags to riches, in short, the American Dream, is what she represents. The vision of her, looking out at the ocean, welcoming new Americans and new dreams, is what represents so many of the good and positive values that Americans hold.
On the other side is Uncle Sam. He is there to tell you to join the Army, pay your taxes on time, in some cases, to buy a new car! All in all, he is quite a demanding character! He is also often used as a representation of the US Government.

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Iran after the nuclear agreement – Is the euphoria justified?

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Iran after the nuclear agreement – Is the euphoria justified?

"We are hoping for a better future, when international companies return to Iran, invest in us and generate prosperity". We hear this sentence almost every day in our talks with Iranian managers, officials, workers, consumers and people on the street. The Iranian economy fell into a veritable recession following the intensified economic sanctions and local mismanagement. High inflation, rising unemployment, a lack of investments and international isolation put an obvious strain on the Iranian standard of living. Since Rohani administration has taken office, however, there was a slight recovery even before the agreement in the nuclear talks – the economy grew in 2014 by 2% - and now all signs point to investment, expansion, re-integration into the global economic system and an opening of the market. 

What opportunities does Iran have to offer?

For several weeks now, highly-ranking international economic delegates have been streaming in and out of the country's economic realm. The interest in business with and in Iran is enormous. Yet how attractive is the Iranian market really for foreigners, especially for German companies? And what specifics need to be observed; what problems should companies be prepared to face? Iran's population of approximately 78 million people, who have accumulated a huge "consumption backlog" (and whom primarily international markets covet), have turned the country into a massive potential for consumer goods and service providers. In addition, producers of capital goods and infrastructure can look forward to a giant pent-up demand for products and investments. Eighty percent of Iranian industrial facilities are obsolete  and must be replaced, the infrastructure needs to be modernized, tourism developed and the financial system brought to the state of the art, to name just a few industrial sectors. Today, several sectors are dominated by local companies that can hardly keep up with international competition in their current state, with obsolete factories, processes and management systems.

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Internationalization Strategies - Just how global is your company?

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Internationalization Strategies - Just how global is your company?

German products are known throughout the world under the quality label “Made in Germany”, and several German brands generate the majority of their turnover beyond the borders of their home country. The requirement of having an international presence and being a global player in one’s respective market segment is a matter of course for many medium-sized and large companies. Yet just how far has “international thinking” really come in the management and executive levels of German companies?

Particularly when talk is of international cooperation, there is a variety of models according to which companies orient themselves toward respective partners, subsidiaries or branch offices. In the following, four internationalization strategies will be presented that can help depict the various approaches and behaviours in such interaction.

In the illustration above, the left circle depicts the corporate culture of the home country (which, for purposes of explanation, represents the German head office), whose organizational structure has a grey background; the right circle represents the international partner, whose local circumstances are depicted on a white background.

Polycentric strategy: The German head office and the foreign subsidiaries work well and with little overlap parallel to each other, almost independently.
This strategy is frequently employed for functional internationalization: There is a high degree of independence from the German head office; the corporate management of the partner is adapted to local circumstances; the foreign corporate culture remains intact; there is no exchange of employees and know-how.

Ethnocentric strategy: The environment in the foreign subsidiaries is clearly influenced by German culture, and work is done according to the instructions of the head office.
In the past, it was typically used for institutional internationalization, but is also still a widespread corporate philosophy: Central decisions are made in the head office; the corporate culture and corporate management of the foreign partner are strongly influenced by German methods; a German expatriate has an executive function in the foreign country; hardly any foreign know-how or employees are integrated into the German mode of thinking.

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Fail in foreign trade - Ten ways to waste money abroad: The tenth case: We don’t have any premises and we don’t need a subsidiary

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Fail in foreign trade - Ten ways to waste money abroad: The tenth case: We don’t have any premises and we don’t need a subsidiary

An article of InterGest, partner of ti communication

Ms. Diener runs a industrial-cleaning company at the German- Dutch border, and she has about 200 employees. In Germany, her important customers include Deutsche Bahn and large hotels. Her employees come from all over, mainly from Eastern Europe, but they always have valid German employment contracts and are naturally properly registered.
During a trade association event, Ms. Diener comes in contact with a Dutch businessman who owns a hotel in the Netherlands with more than 200 beds, and who is looking for a company to do the necessary cleaning work. Previously, the hotel had its own cleaners and maids, but the personnel and social security costs have become so large that it seems very reasonable to outsource these activities.
After some negotiation, they come to an agreement, and Ms. Diener is asked to provide the cleaning crews for the hotel immediately. Ms. Diener assigns about 15 people to the Dutch hotel, and every day they drive about 30 km from Germany to their workplace in the neighbouring country.
Some time passes, and both business partners are quite satisfied with the deal they have made. Ms. Diener is earning good money in the Netherlands, and the hotel owner is very pleased. Everything is going perfectly. Everything? Well, yes, as long as you ignore the fact that Ms. Diener is providing services in a foreign country and acting as if there were no tax implications. In fact, it never even occurred to Ms. Diener that she could establish premises in the Netherlandsfor her work; so she conscientiously adds German value-added tax to the invoices for her company’s services and pays taxes on her earnings in Germany.

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Fail in foreign trade - Ten ways to waste money abroad: The ninth case: Let’s go to China – after all, everyone else is doing it

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Fail in foreign trade - Ten ways to waste money abroad: The ninth case: Let’s go to China – after all, everyone else is doing it

An article of InterGest, partner of ti communication

Altmeier makes windows. He makes good windows – the kind that really save energy and also look great. Altmeier also supports the local soccer club for the large city of Stemmelfeld, and he is a model entrepreneur for the entire region. He is innovative, environ­mentally friendly, a supporter of local business, creates jobs, and a great guy all around.

In late 2005, it happened that an ambitious politician from the Stemmelfeld district was able to attract a few potential investors for his district during a trip to China. He quickly found a group of Chinese people who were interested in acting as a delegation to Germany, in order to see for themselves what kinds of investments could be made in China or Germany as part of a cooperation.

When it came time to get ready for the visitors from China, Alt­meier was contacted. He would be introduced to the Chinese dele­gation, present his factory and his products, and represent German entrepreneurs as a whole. No one else seemed better suited, and no one could do it better.

In the days before the delegation’s visit, Altmeier polished his factory to a high shine and made everything look nice, even going so far as to display three Chinese flags. The delegation could come any time now.

When they finally arrived, everything went very fast. The Chi­nese visitors came, were in fact impressed by Altmeier’s factory, and immediately took over. Altmeier followed along behind the dele­gates, was asked to sit next to the head of the Chinese delegation, and a few “ganbei”s later Altmeier was inevitably invited to visit China. He simply needed to see for himself, they said, what amazing opportunities there were in China for his company. Investing in China would be the ideal approach for him.

Just three months later, Altmeier was in China, welcomed heartily by the members of the last delegation. He was taken everywhere, was shown the fast-growing industrial zones and was extremely impressed by the growth figures, which people could only dream of back in “good old Germany.”

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Fail in foreign trade - Ten ways to waste money abroad: The eighth case: Use a trade representative as your only sales distributor in the target country

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Fail in foreign trade - Ten ways to waste money abroad: The eighth case: Use a trade representative as your only sales distributor in the target country

An article of InterGest, partner of ti communication

Mr. Schmidt makes wonderful furniture out of rattan and woven materials. His company relies on true handcrafting and prides itself on being exclusively “made in Germany.” This quality standard is sacred to him – and above all, it justifies his fairly high prices; compared to the competition mainly from Indonesia, Mr. Schmidt’s products are more than twice as expensive.
Last year, Mr. Schmidt went to the furniture trade show in Paris and exhibited his valuable products there. He knows there is a large market for his products in France, and the South of France in particular promises to be a fantastic market.
The trade fair began, and Mr. Schmidt’s optimism was not in fact misplaced. Straight away, there were many interested retailers at his stand on the first day, admiring the great quality, professionally noting the excellent craftsmanship and showing a strong interest in buying. The interested parties also agreed that the prices were in the upper range, but that there was a strong enough target group in the target region of the southern coast.
However, Mr. Schmidt now faced a dilemma: he had a large number of potential customers who wanted to purchase relatively small quantities. There was a furniture store in Cannes that wanted to take a couple of armchairs – preferably on commission – and another one in St. Tropez that was interested in two sofas.
Just as Mr. Schmidt’s mood was slowly starting to darken, M. Dujardin appeared at the exhibition stand and declared that he had the ultimate concept for him to ensure business success in France. M. Dujardin said that he was a successful importer of high-quality garden furniture, and that Schmidt’s woven furniture would round out his product portfolio perfectly.

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ti communication in Zurich - On site for you - in Switzerland & worldwide

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ti communication in Zurich - On site for you - in Switzerland & worldwide

NEW: ti communication in Switzerland! ti communication is your local team for international success! After opening our agency in China in January of this year, ti communication has now launched its bureau in Switzerland. In the interview on the next page you‘ll find out more about ti communication in Switzerland and Dorothea Hegner, your contact person in Zurich.

ti communication: How do ti communication customers profit from the new Switzerland office?
Dorothea Hegner: Firstly, especially the Swiss customers will profit, but also those from Southern Germany and Liechtenstein, who can now enjoy more intensive and comprehensive support locally: Nothing can take place of a personal conversation. The proximity to our customers is particularly useful in more complex mandates and projects that we can coordinate and operate group-wide, according to uniform standards. Existing customers in Germany also profit from the extended network, because they have access to additional, highly qualified trainers for training sessions on Switzerland as needed.

The same language – the same culture? Is there even a need for intercultural training within the context of Germany and Switzerland?
You bring up a touchy subject. “With Germans? I have no problem at all with them”, is something I hear a lot, and in my work as an intercultural trainer, I see many good examples of functioning collaboration between Swiss and Germans. Nonetheless, there are cultural differences, especially regarding communication, that repeatedly lead to misunderstandings, tension and conflict. While personnel representatives immediately think of intercultural preparation before sending someone to China, hardly anyone would think it would also be an especially good idea for an extended stay in Switzerland and that becoming familiar with Swiss culture can happen much quicker and with much less friction loss. To assume that the same language = the same culture would be a false conclusion, because even the language itself does exhibit differences. In addition: In February, the Swiss took on the mass emigration initiative, which, in part, is harsh criticism of the Germans, which, in turn, makes German specialists insecure and can affect their work. In such a case, it helps to be better able to read and understand the Swiss and interact with them more confidently.

How does ti communication fit your personality? What do you like about your collaboration?
I am an entrepreneur at heart and primarily think from the viewpoint of the customer: What does he really need to attain goals as optimally as possible, how can we support him best, and which services would I want in his situation? In addition, values such as honesty, teamwork and analytical and strategic thinking are essential. I can identify very well with ti communication’s professionalism and concept of service and fulfil the high demands on quality our customers have in an optimal way.

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Fail in foreign trade - Ten ways to waste money abroad: The seventh case: Put your sales force in charge of international sales

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Fail in foreign trade - Ten ways to waste money abroad: The seventh case: Put your sales force in charge of international sales

An article of InterGest, partner of ti communication

Oh, how beautiful it is in Switzerland! The mountains are im­pressive, the chocolate is divine, and Swiss German has a sympathe­tic sound to it. And that’s not all – the citizens of this Alpine nation also have plenty of money and are enthusiastic consumers. So what could be more natural for a company in Southern Ger­many to conquer at least German-speaking Switzerland, and to sell the universally beloved products made by Pfleiderer GmbH there as well?

Mr. Pfleiderer Junior is the third generation of his family to ma­nufacture high-quality fitted kitchens near Lake Constance, on the Swiss border. His kitchens – high quality from German producers – are very popular but expensive, which makes them practically per­fect for the Swiss market. Until now, no major sales activities had been geared toward Switzerland but the fact could not be ignored that more and more Swiss consumers wanted Pfleiderer kitchens and were beginning to travel to Germany and order the kitchens there. It was a lucrative business with strong growth potential.

Mr. Pfleiderer decided to get down to brass tacks, and he ima­gined supplying all of Switzerland with his high-quality kitchens in the immediate future. He already had a tax representative in the country, because he needed one for his kitchen installation activi­ties. The next step, namely founding his own Swiss branch, could therefore be done fairly easy by the same local tax advisor.

For cost reasons, Mr. Pfleiderer decided not to have a showroom at first; instead, sales would take place through local trade fairs and exhibitions, as well as a direct sales approach he had designed himself according to the “Vorwerk” model, which he used very successfully in Germany. His skilled, well-trained salespeople just had to gain access to the potential customer’s house or apartment, and then they could build a virtual kitchen for the amazed customer on the spot, using his proprietary computer simulation program. Once they had gotten that far, an order was usually within reach. Another advantage was that, thanks to fairly high profit mar­gins, he was able to live well on just a few orders. Now he planned to transfer this approach to Switzerland, and there was no reason to expect anything less than a complete success.

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Fail in foreign trade - Ten ways to waste money abroad: The sixth case - Don’t worry about the fact that your customers abroad speak another language and have a different mentality

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Fail in foreign trade - Ten ways to waste money abroad: The sixth case - Don’t worry about the fact that your customers abroad speak another  language and have a different mentality

An article of InterGest, partner of ti communication

Mr. Schmidt had always been someone with a strong affinity toward Great Britain, and he was particularly fond of London. Whenever he can, he flies across the Channel to spend a few free days there.

Mr. Schmidt is also an entrepreneur, and he manufactures all ty­pes of locks. The cylinder locks and padlocks from Schmidt GmbH are known for their quality and their multifunctional utility.

Back in London one fine day, Mr. Schmidt is in a lock store and realises that his locks would actually be well suited to the British market. He wonders why he never thought of it before, and at that moment he begins to develop a strategy for entering the market.

Back in Remscheid, where locks have already been built with great success for years, Mr. Schmidt calls together his team to announce the new expansion strategy in the United Kingdom. A working group is founded immediately, and the ladies and gentlemen start assigning the various tasks internally – a powerful troop of German specialists is now planning their market entry for the UK.

In one of the subsequent strategy meetings, Mr. Kleinschmidt pipes up and – how could he? – expresses some concern about whether it might be a good idea to talk with a consultant in England in order to adapt the planned marketing and sales materials “to the English taste.”

Mr. Schmidt’s response to this suggestion is almost aggressive, and he points out to Mr. Kleinschmidt that he has been travelling to London for years, is practically a native speaker, and knows the English people through and through. When someone mentions that Great Britain includes more than just England, Mr. Schmidt dismisses them immediately, saying, “I know what I’m doing here”.

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Internationalization needs structure - Interview with Gerhard Hain and Anna Corbett

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Internationalization needs structure - Interview with Gerhard Hain and Anna Corbett

Today, internationalization and globalization are among the dynamic factors of business. What moves companies to take advantage of your intercultural training courses?

Gerhard Hain: There are a number of typical hurdles in the intercultural realm that can influence business success. Just one example: In China, it is considered unethical to demand the fulfilment of a contract if the framework conditions have changed – that is a conflict of values with which should be dealt with in good time. Another example, also from Asia, relates to communication. Instead of the duty to provide information that is customary in Germany, in India there is a duty to obtain information – you ask about what you need to know. When German executives are the last to find out about important issues, they come to the false conclusion that their employees are sabotaging them.

Anna Corbett: But the most common example is probably time culture. Here, it’s insulting to keep the next person you are meeting with waiting. On the other hand, in other countries, it is impossible to abruptly end a conversation with someone in order to start the next appointment on time.  

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