Question

The Jonas Brothers think that they can go into other countries and manage the business just like the one in the US.

Explain to the Jonas’ in a memo some of the major differences and challenges in managing the operations abroad.

Answer 1

There are various challenges while doing business in an abroad country:

1. The company structure at the international level may differ in terms of human resource management, investment and project appraisal.
2. Foreign laws and regulation are challenging at times.
3. International accounting in terms of tax compliance is significantly challenging.
4. Many countries have protective policies and thus lead to higher costs of setup of the business.
5. The pricing strategy is very challenging task when the taste and the consumption patterns of the population in the country abroad is not known
6. The exchange rates are very flexible and the fluctuations many times affect the production costs adversely.
7. Communication and cultural differences prevails and at times challenging to deal with.