Impact of Cultural Distances on Country Selection: Analyzing Culture, Corporate Culture, D, Lecture notes of Business Strategy

Download Impact of Cultural Distances on Country Selection: Analyzing Culture, Corporate Culture, D and more Lecture notes Business Strategy in PDF only on Docsity! University of Tennessee, Knoxville TRACE: Tennessee Research and Creative Exchange Chancellor’s Honors Program Projects Supervised Undergraduate Student Research and Creative Work 5-2012 The Impact of Cultural Distances on the Country Selection Process Alan Blizzard alanblizzard7@gmail.com Follow this and additional works at: https://trace.tennessee.edu/utk_chanhonoproj Part of the Business and Corporate Communications Commons, Human Geography Commons, International Business Commons, Language Description and Documentation Commons, Linguistic Anthropology Commons, Marketing Commons, Social and Cultural Anthropology Commons, and the Strategic Management Policy Commons Recommended Citation Blizzard, Alan, "The Impact of Cultural Distances on the Country Selection Process" (2012). Chancellor’s Honors Program Projects. https://trace.tennessee.edu/utk_chanhonoproj/1504 This Dissertation/Thesis is brought to you for free and open access by the Supervised Undergraduate Student Research and Creative Work at TRACE: Tennessee Research and Creative Exchange. It has been accepted for inclusion in Chancellor’s Honors Program Projects by an authorized administrator of TRACE: Tennessee Research and Creative Exchange. For more information, please contact trace@utk.edu. The Impact of Cultural Distances on the Country Selection Process Chancellor’s Honors Program Thesis Alan Blizzard Advisor: Kathy Wood 4 Section I - What is Culture? Culture is a word that many people use to describe a variety of aspects of human life. The word can be taken as a verb meaning “the act of developing the intellectual and moral faculties especially by education” (Merriam-Webster) or in the biological sense “to grow (microorganisms, tissues, etc.) in or on a controlled or defined medium”(Dictionary.com). Used as a noun with reference to the human social experience, culture is “the arts and other manifestations of human intellectual achievement regarded collectively” (Google.com) or more simply “culture is a way of life of a group of people”(Francesco 18). All of these definitions, although different, all see culture as the idea of examining what life does, whether through a Petri dish in the laboratory or the bustling streets of the metropolis areas that speckle the globe. Project GLOBE was an independent study carried out in the 1990’s by 170 scholars looking at the cultures of society in order to gain insights into the cultural relationship that occur in the modern world. The study defined culture as “the shared motives, values, beliefs, identities, and interpretations or meanings of significant events that result from common experiences of members of collectives that are transmitted across generations”(House 15). Project GLOBE looked at the elements of culture by examining practices (the way things are done) and values (the way things ought to be done.) The focus of the project was human industry 5 (financial services, food processing, telecommunications), throughout levels of companies, and across 62 different cultures, most of which were separate countries. In the world of business studies like Project GLOBE and the frameworks of different anthropologists and economists can be used to see the relative distance in between cultures spanning the globe in order to shape their international strategies. Levels of Culture A former professor at the Harvard Business School, Vijay Sathe, looked at the level of culture within a people to three levels: manifest culture, expressed values, and basic assumptions. Manifest Culture Easily observable traits Behaviors, Language, Music, Food, Technology, Speech, Dress, Possessions Expressed Values How the culture describes their manifest culture Culture’s explanation of itself to others Water Line – Point at which it becomes harder to understand the culture from an outsider’s perspective. Basic Assumptions Foundations of the culture Shared ideas and beliefs about the outside world. That which guides all actions. A lot to do with history of the people. 6 This table is often thought of as an iceberg example where the “water line” separates what is easily identifiable through outside examination in possible focus groups and survey’s, to what really lies at the root of a culture’s essence. In doing cultural studies researchers have often concluded that what makes a specific culture unique and different is sometimes unexplainable. Sometimes the notion is given “that’s just the way they do things,” but why? It has largely to do with the basic assumptions of that group of people, which may be something that in order to fully understand you would have to be raised your entire life within that cultural group. Forming Cultural Distinctions Now that we have explored what culture itself is and how to look at it within people in society, it is also important to see how these different cultural distinctions form within a person. Seeing how culture forms in people is beneficial to the business world so that product introduction is done at stages in people’s lives where they could possibly hold a brand distinction along with their culture. In 1966 sociologists Peter L. Berger and Thomas Luckmann came up with three different levels of cultural learning that describe how people learn their culture and adapt their personal culture over time due to travel, social interaction, and work environments. 9 different cultures would become obsolete because there will one day just be the culture of the entire world. This theory though seems farfetched considering the world’s population has passed 7 billion and the United Nations project population to hit 8 billion in the next decade. Divergence in a growing world population is actually more likely although certain preferences will become the same as the world globalizes and companies can try to offer everyone the same things and expect them to like it or learn to like it. People will try in some cases to desperately cling to their own cultural identity that was so firmly ingrained into who they are as a person through primary socialization on the level of basic assumptions. The most likely scenario for the world population is that which we have already seen throughout world history and that is a constantly changing cultural makeup of the world. Once a certain population gets so large, there is the likelihood that subcultures will start to bud off the main culture as generations take over one from the other and new ideas flow through the society. Eventually, these subcultures can become their own dominant culture in the region and gain a more solid place among the world’s established cultural identities. This process can take years and generations to form. 10 Section II – Corporate Culture Culture has a lot of different implications for companies on both supply and demand sides of their businesses. Within a company however there is a sense of a culture just within in the organization that has its own set of values, goals and missions, and cultural norms and structure. This phenomenon has only come into play with the invention of the modern business structure making the group of people doing business more like a small tribe of people. In the case of companies like Foxconn who make a large portion of the world’s iPhones and iPads for Apple, their employee population is over one million, larger than approximately 8 of the state populations in the United States. There is a large advantage for companies to maintain a known and visible corporate culture that can help boost productivity and overall employee satisfaction. Companies can split their corporate culture into two main areas: internally, how to manage within the organization and get things done, and externally, how to compete in the market against other businesses and within a region (Fatehi 158). Corporate cultures are important to consider when a firm is looking to expand into another region or country because the way that the company already uses culture to their advantage, or not, can affect how successful they are in the long run. It can also highly affect the decision of where exactly to go because a high level of cultural 11 integration already internally in the company can affect them externally and therefore determine how aggressive the company can realistically be. Dutch author Fons Trompenaars and British philosopher Charles Hampden-Turner came up with a way to look at different corporate cultures in four different groups: The Family, The Eiffel Tower, The Guided Missile, and The Incubator (Trompenaars 158). Personal/Informal Task/Formal Egalitarian/decentralized Incubator •Person oriented •ex. Sweden •Small Guided Missiles •Task/project oriented •ex. USA, UK •Large Hierarchical/centralized Family •Power oriented •ex. France Spain •Small Eiffel Tower •Role oriented •ex. Germany •Large Source: Fatehi 161/Trompenaars 159 14 Section III - Dimensions of Culture As previously stated there are many things to consider when one starts to look at the culture of a particular country. Being cognizant of all the various things that make people different can help in determining where a firm would fit well within a foreign environment or what steps it can take in order to understand or adapt better to what sets the business different from its target market. Differences in cultures can be both physical and nonphysical. Physical means include the functional objects and artistic creations of that culture whereas the nonphysical elements include the mental and emotional frameworks of the people that cannot be expressly seen on the surface. Physical or easily recognizable things include architecture, crafts, music, dance, literature, and poetry. Nonphysical items include the visual perception of objects, relationships and how they are structured in between individuals and family orientation (Francesco 130.) The biggest three components of culture to consider are: •Language •Religion •Ethnicity 15 Language According to Ethnologue.org, there are 6,909 known languages in the world today. This is only an estimate of course because of the known amount of discernable dialects of languages that could or could not be considered full languages themselves. Looking at it from the literary standpoint of what is read and written around the world, however, the number drops substantially. The Bible of Christianity is translated into 2,197 languages worldwide which could be an easier estimate to deal with, but that really only considers the groups of people that have taken on the Christian faith. Looking by region, language distribution has a little more meaning. Within Europe, there are said to be about 230 languages in use compared to roughly 2,197 in Asia. A good example of the high variability of languages within a population is Papua-New Guinea. Papua-New Guinea has a population of around 3.9 million people who speak 832 different languages with only an average of 4,500 people per language. Within an island country with a land mass of 178,000 square miles, this means that the culture is highly heterogeneous and may require a lot of thought before any entry into the country is made. With the globalization of business in the future, it is likely that the world will see a significant decrease in the number of different languages spoken throughout the world due to necessity to communicate effectively. It is projected that nearly half of 16 the world’s languages will go extinct in the next century because of a focus on global languages such as English and Chinese. Source: http://www.acclaro.com/translation-localization-blog/world-language- map-14 Religion Seven major religions dominate the world today: Buddhism, Christianity, Confucianism, Hinduism, Islam, Judaism, and Shinto. The seven religions developed out of two regions in the world, the Middle East, and Asia. Religion is one of the biggest determinants of how a culture will vary from another because of the fundamental effect it has on so many aspects of a person’s life. 19 Ethnicity Ethnic groups are largely defined by common heritage and family lineages, which takes into account language and religion, but can also be considered in the genetic makeup of different people. Just because someone is a part of a different religion they may still be part of larger ethnic group that is part of different religion. A lot of ethnic groups are divided by current or past country lines, making a previous citizenship a factor in the identification as part of that ethnic group. Within New York City there are various ethnic groups that stick together based on where they or their family immigrated from. Famous examples of this are the large Jewish and Chinese immigrant populations that are seen as separate ethnic groups from the larger surrounding ethnic group of people from the Northeastern United States. Cultural Complexity in Countries There are two factors that largely affect how complex a given culture is, the context of the culture and the heterogeneity. The context of the culture means how difficult it is for an outsider to understand the culture and the expectations within the culture. It also shows how deep relationships tend to run especially in a business sense. In low context countries you have very direct conversations and relationships tend to come and go easily. This transactional, temporary feel can seem superficial to people from higher context 20 countries. Examples of low context countries are the United States, Germany, and Switzerland. In high context countries, you have a lot of physical contact and gestures to convey meaning and closeness. Relationships tend to be longer and deeper with a value in maintaining lifelong friendships more so than low context countries. There are many implicit social rules that are learned throughout a person’s lifetime. Also, social hierarchies are very important and followed with respect. Heterogeneity is diversity within the country and references how many religions and languages as well as general differences there are amongst people. Low levels of heterogeneity can be found in countries like Saudi Arabia and Japan where pretty much all people speak the same language, practice the same religion and even look alike and like a lot of the same things. Countries with high levels of heterogeneity include the United States, Canada, and India where within the country there are many different religions and languages and people have lots of varying and distinct preferences. These countries tend to be known for their amount of different subcultures as is true within lots of large metropolitan areas. Sometimes heterogeneity is thought of in terms of the land area of the country in question. Japan and Saudi Arabia are relatively small in land mass compared to the 21 US and India so it stands to reason that possibly the amount of area influences the amount of heterogeneity in the country. However remembering back to the example of Papua New Guinea that has a relatively similar landmass to Japan, Papua New Guinea has over 800 languages and Japan has one, Japanese. Probably one of the biggest influences of heterogeneity is history of the region. In countries that have seen a high turnover of leadership throughout the decades, higher levels of diversity can be seen. Countries who have generally maintained their own forms of government, for instance, Japan, typically have little diversity from the founding culture. 24  Doing – emphasis on working, and achieving, high activity  Being – work to live rather than live to work, enjoying life most important  Containing/Controlling – balanced approach, restrain desires to achieve mind and body balance, logical 5. Relationships Among People – considers how people in the culture will relate to each other in light of authority in an individualistic, group or hierarchical manner.  Individualistic – people define themselves by achievements and personal characteristics  Group – collective more important than self, defined by group and harmony within the group  Hierarchical – value group, but in a ranking system where some people are more important than others, class conscious 6. Space Orientation – considers how people value space in a variety of settings and how space is owned and can be a public, private or mixed view.  Public – space belongs to everyone, communal spaces common  Private – personal space is coveted, private space is not to be invaded  Mixed – different views based on the situation, some levels may deserve private space while others may be expected to share 25 Hofstede 1980 – Dimensions of Cultural Values Geert Hofstede’s Dimensions of Cultural Values deals with many of the same dynamics as Kluckhohn and Strodtbeck but with more a work-related value system that is directed at how people interact differently within the workplace. Although not the most recent of these types of frameworks, Hofstede’s original 4 dimensions, adding the 5th dimension of Time Orientation later, are popularly used in many texts to look at the most pertinent aspects of culture that influence business interactions across industries. 1. Individualism/Collectivism – looks at how people interact with others outside their families and is either seen as individualistic or collectivistic.  Individualistic – People care more about themselves and those close rather than strangers, personal rights are highly valued and the ability to decide protected. Individual achievements recognized.  Collectivistic – Group decisions are most important and harmony within a group is key. Group performance is valued and individual achievements are seen as group victories. 2. Power Distance – considers how different levels of power within a company interact with each other and how easily or not the flow of communication and ideas is exchanged between each level.  Small Power Distance – Subordinates feel like they need a voice within the organization. Upper-level managers will treat those with less power in the company as equals and listen to ideas from all levels. 26  Large Power Distance – bosses and employees have clear rankings and or social class distinctions and these differences are accepted and respected. Decisions are made at top and filtered through the ranks 3. Uncertainty Avoidance – considers the amount of structure seen in the society as it pertains to rules, regulations and penalties. Also looks at how things are seen as having been done a declarative right or wrong way or if things are open to interpretation.  Strong uncertainty avoidance – There is preference for structure in these countries. Rules and regulations are specific with clear penalties. People expect things to be done correctly in a prescribed manner.  Weak uncertainty avoidance – These countries prefer flexibility, and creativity is encouraged in problem-solving. Individuals are given more freedom and unstructured situations are preferred. 4. Masculinity/Femininity – examines how a culture’s gender roles are viewed and whether the values lean more towards male or female ideals.  Masculine – Tough values of success, competition, assertiveness, goal attainment are key. Male and female roles are defined and each is supposed to act in their assigned gender roles.  Feminine – Softer more nurturing values like caring, relationships, feelings, equality and emotions are important. Male and female roles are less defined and cooperation and understanding are dominant themes. 29 5. Achievement versus ascription – this is how people give credibility to others and how people are seen as more or less important than another person.  Achievement – what a person has done recently and accomplished is what their record is (ex. What did you study in school?)  Ascription – status is attributed to a person based on their birth, gender, age, who they know, and where the come from (ex. Where did you study for school?) 6. Relation to Nature – Nature here means more generally the environment surrounding individuals but also deals with the natural environment. The two viewpoints here are that either the most powerful force comes within each individual and is the most important or that the world as a whole has a greater effect on the individual. Values and virtues come from either within the person or are shaped by the environment and surrounding people. 7. Relation to Time – This is very similar to the Time Orientation of the previous two frameworks and basically looks at people and how they view the passage of time. Cultures are seen as either being past focused or present and future focused. It divides people based on if they see time as a straight line where the past is past and future is future or as people who see time as circular and things that have been will be once more again. 30 Project GLOBE 2004 – The GLOBE Study of 62 Societies Project GLOBE was a cultural research project conducted over the greater part of a decade that used the talent of 170 researchers to investigate people from 62 cultures across the world across different industries including financial services, food processing, telecommunications. The interviews covered of over 17,300 managers from 951 organizations to compile their report. The researchers of GLOBE took many of their metrics from Hofstede but with a little variation. 1. Power Distance - from Hofstede. 2. Uncertainty Avoidance – from Hofstede. 3. Institutional Collectivism – based on the Individualism vs. Collectivism of Hofstede, this assessed the degree that institutions in the culture rewarded and encouraged collective action and collective distribution of resources 4. In Group Collectivism – also based on the Individualism vs. Collectivism of Hofstede, this assessed the degree that individuals expressed pride, loyalty, and group cohesion in an organization. 5. Gender Egalitarianism – from Masculinity/Femininity of Hofstede. 6. Assertiveness – this aspect of societies is basically the support and encouragement of assertiveness, aggressiveness, and toughness or unassertiveness, ingressiveness and tenderness. 7. Future Orientation – based on the Time Orientation of Kluckhohn and Strodtbeck and subsequently Hofstede. 8. Performance Orientation – one of the lesser-used metrics in cultural frameworks, this looks at the degree that a culture values innovation, high 31 standards and performance improvement, similar to the Activity Orientation of Kluckhohn and Strodtbeck 9. Humane Orientation – this dimension is the degree to which a society supports and encourages individuals to be fair, altruistic, friendly, generous, caring and kind to others. Based on how people treat each other and the use of public institutionalized social programs. There are many more frameworks that go over the differences between cultures with these being four of the more commonly used ones. As you can see with these frameworks there are many overlapping themes between each because they all look at how cultures value things differently. Through the years though several of the characteristics examined by each study have stayed the same or similar in meaning. Of the 14 unique dimensions used across the 4 frameworks 8 of them were used more than once, with the most popular being Individualism versus Collectivism, which was used in all four. Some of the most used metrics included individualism versus collectivism, relations to time, relation to nature, human nature, gender roles and power distance. This could be because of the more recent studies looking back to what had already been done, but likely it is because the studies and the sociologists saw these as the metrics that had the most distinct variability between people of different cultures. The purpose behind each of these studies is slightly different but most of them have some orientation to use in a business setting, which means that they can be very useful in studying countries of interest for business expansion. 34 Geocentric Mentality This is the most advanced global mentality that a firm can have and does not happen overnight. Geocentric minded companies have the same view as centocentric companies of a one-world market, but instead of making all decision from the home market perspective. The company actively seeks the input from all areas where the company is involved and looks at ideas from any branch of the company as equal and relevant. Some geocentrically minded companies even try to claim a “no home country” presence in the world claiming that their headquarters is only a physical location and that the company has no true “home base.” Section VI - Cultural Segmentation of the World When company executives get ready to look out into the world for new growth opportunities it brings up the question, what exactly is out there in the world today? Country borders have been in constant fluctuation throughout history and even today the total count of countries in the world is up for debate. According to the United Nations, there are 193 member states that recognize each other as independent sovereign nations, however, there are 206 total states in the world, some of which are separate but not full countries like Vatican City and Kosovo. The United States recognizes 195 states and with the inclusion of Taiwan as a separately recognized state (although China claims them as a province) this brings the total to 196. So for firms based outside the US, this is the best number to use because that is 35 what the government of home country recognizes. The number of countries doesn’t tell you anything about where a firm should go, but it does tell you how many options there are and how many different strategies a company could possibly need to come up with because after all, every country is different than the next. For simplicity sake, however, looking at 196 different markets seems a little bit unfeasible and a market segmentation approach could help in deciding regions and then to specific countries. In their book “Management Worldwide: Distinctive Styles Amid Globalization,” British professor David J. Hickson along with American professor Derek S. Pugh came up with a 7-segment approach to looking at the countries of the world based on the studies of cultural similarities in the workplace by people like Hofstede and American academic Simcha Ronen and Israeli Oded Shenkar. Hickson and Pugh derived their diagram from the 5 created by Ronen and Shenkar adding East-Central Europe and the Developing Countries of the world as segments. The following is a diagram similar to the original created for this report. 36 Northern Europeans  Example Countries: Germany, Denmark, Sweden, Finland , Norway, Switzerland, Austria, the Netherlands and Israel  Location: Northern Europe, the Scandinavian Peninsula, the northern islands and Israel in Central Europe  History: the Roman Empire of the barbarians and the sixteenth-century Reformation of the Roman Catholic Church  Language: German, English, and Germanic Languages like Danish, Dutch, Finnish (exception of Israel with Arabic and Hebrew)  Religion: Christianity mainly Protestant  Characteristics: low power distance in between managers and subordinates, individualistic tendencies with private life and property as strong values. Stability and longevity are encouraged. East-Central Europeans  Example Countries: Russia, Hungary, Poland, Ukraine, Bulgaria  Location: Eastern half of Europe, North and Northwest Asia  History: Unstable country borders that have seen the traffic of many empires and wars, with ties back to Communist occupations  Language: Russian, Germanic and Slavic Languages usually by country or former country/cultural lines.  Religion: Roman Catholic and Orthodox 39  Language: French, Italian, Spanish, and Portuguese are spoken all of which are relatively similar.  Religion: Christianity, mostly Roman Catholic  Characteristics: Very personal people where personal relationships are important and respect to hierarchal levels is apparent and can lead to dealing with a lot of bureaucracy in procedures and regulations. Anglos  Example Countries: United States, United Kingdom, Canada, Australia, New Zealand  Location: located throughout the world in Europe, North America, and Australasia  History: ties to the old British Empire.  Language: English  Religion: Christianity  Characteristics: one-quarter of the world population, they are low –context cultures where things are expressed directly and personal achievement is an important part of life. This segmentation is based on cultural similarities in the way business is done in these countries and in many cases is connected to things like colonial ties, language, religion and geographic closeness or isolation. Geography, even as influential as it is, has not completely defined what cultures dominate in a region and therefore simple geographic segmentation of the world is not advisable. With supply chain decisions 40 it might be easy to make a country selection based on geographic closeness but ignoring the cultural differences could negate any positive gains. Section VII - Country Selection Process and Conclusions The cultural differences between people and the distance that these differences create can affect the interactions between people. In the world of business, these distances can affect many decisions and can determine ultimate success or failure for a company looking to expand. The country selection process is something that can be overlooked by simply searching for where the biggest markets are and where can make the company make a profit or save money in sourcing from that region. The fact of the matter is that culture is a variable that should be considered heavily in order to match the company with the best entry points in the global economy. The following are the steps a company should take in order to help them make the best selection of a country based on what their company does, how integrated they are already in the global economy, and how intensive they want their investment to be in the long run. 1. Think about the need for expansion 41 The company should first think about their ultimate reasoning for wanting to expand their business globally. For companies that are already located in more than one country this decision has already been made, but for companies that have yet to make their first international move should make sure it is something the entire company wants to pursue. Clear goals should be laid out for the expansion and not just because competitors are doing it. The worst thing would be to start doing business in another country without being sure why are there in the first place. 2. Figure out what part of the company should go abroad. It basically boils down to being a supply-side, demand-side, support or management business function to move or start up in another country. Research should be done to analyze what that part of the business currently looks like and how it might change once put into another country, if at all. Making sure you know what you are moving and what the requirements are will keep all team members focused during the transition. The focus should first be internal before the selection process starts for countries of interest. 3. Pick dimensions of culture that relate to the business functions. A company could go through on use one of the four cultural frameworks mentioned in this report or they could come up with a composite of different dimensions on how they relate to the specific part of the business being considered. For example for supply-side decision negotiation is key and looking at how big the power distance is in a company can help the firm determine how to train their 44 8. Make the Country Selection Based on the right combination of resources, expertise, and cultural compatibility a company can select a country to enter. They should be at all times mindful of the cultural differences between people and should use them to their advantage by embracing culture instead of trying to control it. Many times companies will go in with initial idea of respecting the established cultures but then try to change the thoughts and actions of the people. Culture is something that takes generations to change so a company should not be as bold as to think that their interaction in people’s lives will change their basic cultural natures. This diagram goes through the thought process differences between the demand and supply side of businesses going through the country selection process. The implications are different because of the different ways that culture enters into each situation. Buyers on the consumer side see their purchases affecting them in their Company decides to expand globally Demand Side Expansion (Consumers) Nature of the Product Cultural relevant or not (i.e. food and music vs. paper towels) Marketing Demographics of population - ethnicity, age, male/female Use of certain images - not using religious or cultural images, political Level of Investment Exporting, Licensing, Direct Investment, Joint Venture Supply Side Expansion (Suppliers) Negotiating Style Formality, reference to time, personal connection requirements Country of Origin Requirements and implications of origin Level of Investment One time transaction vs long term relationship 45 personal lives, whereas buyers on the business side in the supply chain see purchases as a part of their job function and may view their job as distant from their personal lives or interconnected with as part of their personal lives. Conclusions In a perfect world, a company would have both the time and the resources to do the research internally and externally to match cultures or see how the cultural matching will work out. Unfortunately, other factors play a large part in the selection of countries. A CAGE analysis (which stands for Culture, Administrative, Geographical and Economic) done by Indian professor Pankaj Ghemawat of the Harvard Business School includes cultural as one of the biggest obstacles in global expansion but other factors such as political instability, the administrative aspect of CAGE, could have a much more definitive impact on the country selection process. In an ever increasingly fast-paced world, the timeliness of these decisions can often be rushed in search of reduced prices or new markets. Culture is at the root of each of us and apart from secondary forms of culturalization it is rooted in each of us at a very early age. Seeing the world as a diverse melting pot of ideas and viewpoints will lead companies to more success if they respect and tailor their approaches in entering new countries. Reckless global expansion is financially dangerous and can tarnish the image of both companies and their home countries if cultural differences are not respected. The country selection process should be thought of as unique to each company, for each country and for each situation because careful selection can 46 create the most value-added results that go beyond economic benefits and can make future global integration a possibility. Bibliography