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The Cultural Challenges of Doing Business Overseas: The United States and the Czech Republic

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Running Head: DOING BUSINESS OVERSEAS The Cultural Challenges of Doing Business Overseas: The United States and the Czech Republic Nestelynn Friday University of Phoenix Hector Morales MBA 501 The Cultural Challenges of Doing Business Overseas: The United States and the Czech Republic Doing business overseas can bring about many cultural differences. Comparing and contrasting the differences between the U.S. and Czech Republic cultures will be the primary focus of this paper. Determining the business risks for Steve Kafka to start a Chicago-Style pizza parlor may have a variety of complications. The differences in the American and Czech cultures are widely due to the way that the Czech Republic was formed. This paper will also focus on the formation of the Czech Republic and the way that business ventures are handled. After a long era of economic stagnation, the Iron Curtain suddenly fell. In 1989, Czechoslovakia, Hungary, and Poland, commonly known as the Central European Three (CE3), finally moved away from the socialist system and opened up their markets to the capitalist system. ...read more.


Similarly, a party-goer in Prague might witness hippies, yippies, beatniks, skinheads, and punks at the same party, none of them, seemingly, aware that they clash. The Czechs, however, have no monopoly on such obtuseness. The U.S. Chamber of Commerce has set up the East European Trade and Technical Assistance Center (EETTAC) to provide information on the business climate there. EETTAC has sponsored trade and investment missions and seminars where American business executives can meet with high-level government officials from the U.S. and Eastern Europe to discuss business opportunities (Holzinger 1990). Western observers have collectively heralded the economic "miracle" within the Czech Republic, which currently boasts a balanced national budget, the lowest inflation and unemployment rates in post-communist Central and Eastern Europe, and a Standard and Poor's credit rating higher than that of Greece and much higher than any other post-communist economy (Economist, 22 October, 1994). A large majority of World Bank representatives surveyed in early 1994 identified the Czech Republic as the most promising post-communist country for foreign investment, and the European Bank for Reconstruction and Development (EBRD) ...read more.


By December 31, 1993 the Ministry of Economy had registered 1,262,264 licenses to run small businesses or to act as entrepreneurial agents in a country of 10.3 million people. At the same tune, some 877,669 business entities (physical or legal entities) were registered for trade activities operating outside of the large firm business sector. Similarly, the Czech Business Register in January 1993 identified 1,062,222 persons who were registered entrepreneurs. The latter number represents some 22.5 percent of the total Czech Republic labor force. By adding to this number working family members and other employees within each entrepreneurial enterprise, one observer estimates that fully one third of the Czech labor force is fully or part-time employed in small business enterprises (Benacek, 1994). In conclusion, the Czech Republic does enjoy a prosperous and stable community. The community does focus on indirect communication, family, uncertainty avoidance and individualistic values and concepts. Thus, by any method of statistical calculation, small business development for Chicago-style pizza in the Czech Republic appears to be thriving. However, as is true in small business in the United States and other advanced capitalist economies; small business entrepreneurs' face daunting obstacles to their economic success and survival (Gorrill, 2005). ...read more.

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