1. IBS 118 MODULE 3
Provide and discuss examples of five multinational companies that effectively handle the issue of
cultural challenges in global advertising.
!. Nokia,
Nokia Corporation is a Finnish multinational communications corporation that is headquartered in
Keilaniemi, Espoo. Nokia is involved in the manufacturing of mobile devices and in converging
Internet and communications industries. It is the world's largest manufacturer of mobile phones with its
global device market share was 23% in the second quarter 2011. Nokia produces mobile devices for
every major market segment and protocol and also Internet services such as applications, games,
music, maps, media and messaging through its Ovi platform. The Nokia brand, valued at $25 billion, is
listed as the 14th most valuable global brand in the Interbrand Best Global Brands list of 2011. In the
global smartphone rivalry, Nokia held the 3rd place in 2Q2011, behind Samsung and Apple.
Nokia’s mission is simple, “Connecting People”. In its website, Nokia states its vision is to build great
mobile products, and to enable millions of people everywhere to get more of life’s opportunities
through mobiles. Nokia’s management apparently failed for too long to understand these game-changes
going on within the mobile industry and failed to install a sense of urgency for change throughout the
organisation. The management stuck for too long within its ‘comfort zone’ of design and superior
mobile cameras. And it seems that Nokia forfeited a connection with mobile software developers and
thereby missed out on the opportunities of getting new applications from global co-creation among
entrepreneurs and innovation eco-systems. Incidentally, the most successful app for i-Phone is the
game ‘Angry Birds’ developed by a Finnish company.Nokia’s agreement with Microsoft essentially
allows Nokia to have a very important strategic competitive advantage against their competition. It will
allow them to have mobile phone experiences no one else would have in the market if you were Nokia
and wanted to survive what would you do?
One way is creating your own ecosystem and this is where Nokia needs Microsoft’s help. This sounds
rather crazy, but not so when you consider this; companies, the size of Nokia, don’t play to get by, they
play to win. If they can’t win or come in a credible second they are good as dead anyway. Their
overheads will just flatten them. At the other end of the alliance, Microsoft also suffers from similar
issues. As mobility is seen as the future of computing, Microsoft has faced much criticism for not being
able to create a credible mobile OS platform, hardware included. Microsoft can now focus on their
software platform. As it is, they are already having so much trouble keeping up with the competition.
I’m sure Microsoft is probably not perfect for Nokia, but under the circumstances, they are the best
option.

2. 2.Nike
3.Once a company, like Nike, decides to become a global entity, it will often experience an increase in
profitability. Unfortunately, companies like Nike must overcome some difficult obstacles before
establishing a successful business in a foreign country. Some of the issues of concern are child labor
laws, wages, and outsourcing’s effect on sales. Because of this, most widely known companies have
presented various cases to defend their positions on conducting business in the foreign country. One
such example is a Nike sweatshop labor case that stirred up a large amount of controversy over ethical
business practices. Even though Nike has attempted to recover from the bad press it received about the
sweatshops, it still struggles to defeat the negative feelings from people across the United States. Thus,
a summary of the case, the legal, cultural and ethical challenges, an understanding of the roles the host
governments play, and the strategic and operational challenges faced are important to gain a thorough
understanding of the issues and case. Most people could easily define Nike and are familiar with the
products offered, like the customized options available in the Nike store online, Nike Sportswear, Nike
Women, Nike Basketball, and Nike Football. These products, among others, have led Nike to a profit
of $15 billion in 2006 and a catchy “Just Do It!” slogan (Hill, 2009). The company outsourced its
manufacturing plants to several countries in order to lessen costs and become more efficient in
productivity. The outrage and protests that followed were far from what Nike expected; the company
was labeled as forcing “children to slave away in hazardous conditions for below-subsistence wages” .
As a result, protestors of globalization and human rights activists criticized Nike for taking advantage
of the workers overseas and placing them in a destructive working environment. Moreover, the fact
that Nike was making billions of dollars and still failed to provide a safe working environment only
made matters worse. After Nike realized it was the target of several protests and complaints against
globalization, it recognized the need for safer work environments and an adherence to certain standards
for each of the overseas factories. The factory workers were forced to work exceptionally long hours to
fulfill quotas and had to follow strict rules during work for below minimal pay despite having “77
percent of the employees in Vietnam suffer from respiratory problems” . Therefore, the legal, ethical,
and cultural challenges began to add up for Nike and it was time for the company to confront them.
The majority of challenges Nike had to overcome involved ethical issues and debates. Even though
Nike was providing jobs to those who may not otherwise have one, it was paying “a mere $1.60 a day
to Vietnam factory workers when the living wage is at least $3 a day” (Hill, 2009). Nike could have
avoided this challenge by paying each employee worker the living wage of the country he or she lives
in to purchase necessary items. Moreover, the living wage is a cultural expectation which Nike failed
to meet that led to protests. Another ethical issue involved “a report that found workers with skin or
breathing problems had not been transferred to departments free of chemicals and that more than half
the workers who dealt with dangerous chemicals did not wear protective masks or gloves” (Hill, 2009).
The debate was over the unsafe conditions Nike was providing its factory workers while it experienced

3. The company attempted to redeem itself by stating “it had formulated an action plan to deal with the
problems cited in the report, and had slashed overtime, improved safety and ventilation, and reduced
the use of toxic chemicals” Even though Nike took steps to improve the accusations in the report, it
should have been corrected once it was aware of the conditions and provided each worker with a fair
and safe work environment. “Nike joined a task force called Fair Labor Association to assess whether
companies are abiding by the code and banish sweatshops in the shoe and clothing industries” (Hill,
2009). The debate over independent auditors performing audits of overseas factories came from the
“United Students Against Sweatshops to ensure a truly independent audit” (Hill, 2009). Nike is a
widely recognized brand, which is the reason several other host governments became involved in the
sweatshop case. The strategic and operational challenges Nike faces are vast and will require a large
amount of time and effort. This is especially true because the operational practices and strategies Nike
previously adhered to was no longer effective; rather, those practices began to hinder its success. One
operational challenge Nike faces is the development of a strict monitoring system in its factories
overseas. On the other hand, hiring a firm to ensure accurate accounting reports are produced is a
strategic challenge. Moreover, determining a country to set up another factory in is both a strategic and
operational challenge. Nike faces several challenges; however, it can achieve continual success through
an effective operational and strategic plan. Therefore, the factories and sweatshops established
overseas by Nike launched a debate regarding whether Nike was in compliance or violation of ethical
guidelines and regulations. Despite several attempts, Nike is still the focus of protests regarding
violation of child labor laws and unsafe working environments. Moreover, numerous governmental
organizations have worked with Nike to ensure safe and ethical business practices and to monitor the
sweatshops Nike established overseas. Consequently, Nike was forced to change its operational and
strategic plans drastically in order to remain successful and appease labor and civil rights unions. The
case of the Nike sweatshops demonstrated how difficult it can be for a business to become global
because of the different rules and regulations established by that country.
4.
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6.Citigroup/
7.Along with organic growth, Citi has completed a number of targeted acquisitions in emerging
markets to reach new customers. While its US consumer unit is slowly building itself back up, Citi’s
real bread and butter is coming from its efforts overseas. Strategic acquisitions in key markets
(including China, Turkey, India, UK, Japan and Central America) have left Citi well positioned to
capitalize on future growth. “In 2006, we opened just under 1200 Citibank and CitiFinancial branches
globally – more than three a day on average – with some 70 percent outside the US,” Prince says. “In
addition, our markets and banking business and wealth management business have continued to grow
around the world.”
Since the second quarter of 2006, Citi has completed more than a dozen transactions, most of which

4. fall outside the US. With its eye on greater international revenue, Citi has its sights set on rebalancing
ciscoits earnings to eventually take in 60 percent international and 40 percent US – a sharp jump from
this year’s second quarter earnings mix that was closer to 50/50.
Citi is already well on its way to reaching that target with a veritable shopping list of key transactions
completed in fertile markets. In Central America, Citi acquired Grupo Uno, a prominent credit card
company, and Grupo Cuscatlan, a regional bank, and also entered into a key partnership with the
holding company controlling Banco de Chile. In the UK, it acquired the world’s largest online bank
with its purchase of Egg, and acquired Quilter to leverage its wealth management capabilities. The
company also scored in China by becoming Taiwan’s largest international bank, after acquiring Bank
of Overseas Chinese, and securing greater ownership in another major bank, Guangdong Development
Bank.The list goes on, with even more ownership stakes secured in Turkey, Japan and India – through
Akbank, one of Turkey’s leading banks, Japan’s Nikko Cordial, a long-time joint venture partner, and
India’s second largest mortgage lender, HDFC Ltd. Citi plans to continue stamping Citi across the
globe. “All of these transactions position us to increase our ownership stakes in the future, while also
providing valuable product and distribution arrangements now. We will continue to pursue a strategy of
diversifying our investments and deploying capital towards the faster growing regions of the world.”
While the red arc will be used consistently across the business in all its advertising and marketing
communications, red’s not the only color that will be associated with Citi. Part of its image overhaul
has involved a new focus on environmental responsibility and a commitment to ‘going green’. Leading
Wall Street with a whopping $50 billion commitment to climate control over a 10-year period, Citi will
be capitalizing on the ‘green is good for business’ mantra that other big corporations – such as GE and
IBM – are currently spouting.
“Citi recognize that there clients want to do business with a company that is serious about dealing with
climate change and other environmental issues,” n addition, there is huge growth in those companies
focused on being more environmentally focused and in the alternative energy arena; citi working with
many of these companies now, and expect to do even more in the future to drive innovation and
change.
Citi is no stranger to environmentally friendly moves. The company was one of the institutions
responsible for developing the Equator Principles, a doctrine of best practices for assessing and
mitigating social and environmental risks in finance, and the firm’s ongoing commitment is evidence

5. of today’s growing corporate trend of incorporating ‘green’ as a critical and necessary part of business
decisions.
2.Cisco
3.A key element of Cisco's sales philosophy is to focus on architecture and end-to-end solutions, when
appropriate, not on individual products. Raising the overall knowledge of architecture among relevant
groups throughout the company will enable Cisco to engage customers and partners at a more strategic
level with greater added value. To accomplish this, Cisco must create a bridge between siloed
architecture experts and customer-facing staff in diverse groups across Cisco.
Selling end-to-end architecture solutions is not simple, and the required knowledge and expertise is
mostly held by a relatively small group of individuals scattered across multiple organizations and
geographies. In addition, the word "architecture" itself was not uniformly understood within Cisco.
Cisco needed to spread the knowledge throughout the workforce, providing sales engineers, account
representatives, and other customer-facing groups with the information they need to position Cisco
solutions and services effectively from an architecture perspective.To execute its architecture strategy
successfully, Cisco had to overcome several technology, process, and cultural challenges. These
challenges include:
Architecture content is typically spread across various repositories (e.g., document control systems,
wikis).
Architecture experts are not readily identifiable. Many do not have "architect" in their title.
Architecture content is not always up to date.
Content and expertise tend to remain among architects within their own teams and locations. Adding
value and sharing expertise is limited.
Underlying these challenges are several root causes:
The tendency for architects to work in functional or regional silos.
Multiple content repositories and systems that do not easily enable exchange of information or efficient
content updates. Even within a single group, collaboration and document tools might not
interoperate.
Information overload, making it difficult to know what information is important or relevant.
Over-exposure, exacerbating time constraints. Being identified as an expert and contacted frequently
makes it difficult for the best architects to get their work done efficiently.
5. Fedex