Shin Kong Mitsukoshi is the department store that is going to branch out either Brazil or Russia. The objective of this research is to determine which country is the best one to branch. The research was collected from the internet. The five dimensions of national culture and leadership styles are the tools that have been used to help to determine. As the fact that Taiwan and Brazil have shared the most similarities, Brazil is the one that has been chosen to be branch out. On account of the five dimensions of national culture and leadership styles are similar to Taiwan than Russia. It is also the first South American subordinate company for Shin Kong Mitsukoshi. Also, during the discussion part the advantages and disadvantages of branching out Brazil and Russia has been compared.
The objective of the research is to determine where is the best place between Brazil and Russia to branch out for the department store. The company of Shin Kong Mitsukoshi was selected. This is a famous department store in Taiwan. It has 13 branches and 19 stores in Taiwan. The Shin Kong Mitsukoshi even has branched out to China. In this case, Shin Kong Mitsukoshi was consider well-prepared to branch oversea. Owing to the developing countries’ economic is raising up, the department store in Brazil or Russia could be a success. The company was chose on account of that Brazil or Russia, there might not have a luxury, casual department store.
There were two tools that have been used which were the five dimensions of national culture and the leadership styles. The five dimensions of national culture can break into five different pieces into: power distance (PDI), uncertainty avoidance (UAI), individualism (IDV), masculinity (MAS) and long-term orientation (LTO). The higher score for PDI means that the boss has more powers and makes decisions than their employees. In the same way, the higher UAI means that the company doesn’t like to take the risks. Also, for the lower IDV means people usually tend to more together like a group. If the country has higher score for MAS that means people tends to work hard, being strong and competitive. The last but not the least, the lower score for LTO means people would think that time is money.
There is another tool that has been used, which is the leadership style. There are three different types of leadership styles. First, authoritarian leadership is that the leader cares more about ensuring tasks are accomplished as a priority and the leaders tends not like to have discussion with their employees. Second, paternalistic leadership is that leaders believe that once the employees worked hard, the company will pay them equally. Finally, participative leadership is that leaders encourage their employees to do their work and control of their own work loads.
I think my leadership style would be paternalistic and a little bit of authoritarian. I am a leader that sometimes can be bossy, however, can also accept the alternatives if there’s a better way. I am a leader who tends to hear more opinions but when it comes to making decision I do not hesitate.
To determine the best country to expand to several factors will be considered. The country which has the most similarities with Taiwan and less culture difference is one factor. Also, the leadership style should be similar to Taiwan as well. The other factor is that the citizen in the country should be able to purchase the products of Shin Kong Mitsukoshi. Also, the Unilever will be one of the fact that help the company to decide.
The information was collected on Internet. The five dimensions of national culture were collect from geert-hofstede.com It was a valid website which contained lots of information about Greet Hofstede’s idea. The leadership styles information about Russia and Brazil was clearly found in Google. Therefore, the management style was typed as the key word. The data about the management styles in Russia, Brazil and Taiwan was found in this website, kwintessential.co.uk. What’s more, the data of this company Unilever was collected due to the success of its products. In addition, there were some business blogs that were found in Google.
However, there is always having pros and cons in the research. For example, some websites are the opinion of the people not the fact. Also, there are some data that was collect from the blog, the business blog. It is hard to know that if the information is right or wrong, yet, it could provide some personal idea about branching company overseas. Besides that, some data was collected from the journals online. The journals are more trustful owing to it was written by the experts.
The score in five dimensions of national culture in Brazil is 69 for PDI which is the second highest among the five aspects. It has 38 for the individualism, 49 for MAS, 65 for LTO, and the highest UAI which is 76. In contrary, the score in Russia is that it got 93 for PDI which is also the second highest among all. 39 for IDV, 36 for MAS, and the highest one is uncertainty avoidance which is 95. Moreover, there are no data available for the long-term orientation in Russia. Furthermore, the score of five dimensions of national culture in Taiwan is that 58 for PDI, 45 for MAS and 69 in UAI. Also, the highest is 87 for the LTO and the lowest 17 for the IDV. [pic] [pic]
Above are the pictures of five dimensions of national culture.
The leadership style in Brazil is that people considered to be great significance, the employee should listen to the managers or the bosses. Relationship in Brazil is important due to the trust between the employees and the boss. The managers were expected to manage, and the boss was expected to give direction also making the decisions. The leadership style in Brazil would be considered as the authoritarian leadership style. Yet, in some smaller companies, the leadership style would be considered as paternalistic due to less people work in the company so that the boss can guide each employee to help them achieve their goals.
“The Russian management style tends to be centralized and directive.” (Management Styles: U.S., Europe, Japan, China, India, Brazil, Russia, 2011) In general speaking, the higher position people get, the more powerful people will be. Also, working with Russian has to understand the importance of honest and open approach. Russians tend to have low tolerance for change and risk; it can clearly point on the above graph of Russia. The leadership style in Russia is considered be authoritarian than Brazil.
On the other hand, the Taiwanese leadership style tends to be vague. People tend to express or understand without word, yet, this could cause misunderstanding with others. In Taiwan the rank and the status in the company is extremely important, for example, people have to talk very respect to the boss or the managers, otherwise, it would be consider as impolite and rude. In this case, the leadership style in Taiwan is considered to be somehow paternalistic.
The company Unilever used different strategy in Brazil and Russia. Unilever used three different kinds of strategy in Russia. Before applying their strategy to the market, they did the research about what their consumer needs, where their consumer would be, how many consumers they will have, where to sell their products with different brands. “These three strategies are building leadership in large categories, trading markets up, work on the consumer pyramid and building capabilities as a competitive advantage.”(Unilever in Russia, 2008) As for the Brazil, Unilever seems to have some issues with the local consumers while there is evidence show that Unilever is the company that Brazilians wants to work in. The Unilever Company also did the research about its products, for example, which one is the most popular, which brand it more well-known. They also did the research about why consumers were complaining, why their sale has been decrease since 2007, etc. ( some of this information to
To compare these three countries with the five dimensions of national culture and leadership styles. The leadership style of Brazil and Russia are somehow similar to Taiwan. However, Russian is more authoritarian which is not suitable for Taiwanese, yet, the ranking and the status is similar with Taiwan. As some way, Brazil is resembled to Taiwan. Both of their leadership styles are paternalistic, and they both care about the employees.
In the five dimensions of national culture, there are 93 for the Russia in PDI which means Russian cares more about the position and the statue, while Brazil and Taiwan has the closer score for PDI. On the other hand, in the IDV, the Russia got the closer score to Taiwan. Taiwanese are tends to work by themselves with the specific deadline. When it comes to MAS, three of them got the very close scores, which is good on account of that people can work together also they could have the same spirit. As for the UAI, the Russia got the very high score; it shows that Russian cannot really accept the changes or risks. However, Brazilian and Taiwanese have a better attitude towards to the UAI; they are more able to accept the changes and the risks. Last but not least, on the geert-hofstede.com it showed that Russia doesn’t have score for the LTO. However, when the research was digging in, it was surprise to found out that Russians tends to care about present instead of future. On the contrary, both of Brazil and Taiwan got a very high score on LTO.
According to the Unilever history and what they did in Brazil and Russia. It seems that Brazilian care about the quality of services; they want their purchase to be good. However, in Russia, it seems fine doing the business there. People are supported, willing to try new staffs. On the other hand, combine all factors together. The advantage of going Brazil is that there are more similarities with Taiwan, either the five dimensions of national culture or the leadership style. However, the paternalistic leadership style works in the smaller company, there is no guarantee that the bigger company would be paternalistic. As some way for Russia, the advantage of going to Russia is that Russian could purchase more products according to the data from Unilever, for example there are “total € 5 billion market (all categories), growing at 8% in 2007, strong potential for appreciation, opportunity for consolidation” (Unilever in Russia, 2008), also both Russian and Taiwanese business cares about the rank and the statues in the business. Yet, the leadership style of Russian is authoritarian, which is bad for Taiwanese. The Taiwanese manager may not used to be authoritarian once the Shin Kong Mitsukoshi decided to branch there.
Conclusion and Recommendations
After all the comparing of the Brazil and Russia, the Shin Kong Mitsukoshi decided to branch out in Brazil owing to the similarities of the culture and the leadership styles. In the future, the Shin Kong Mitsukoshi will have an action plan to branch out in Brazil, and first the subordinate company would likely to set in the capital to see how much sales it has. After observing few years, the company will decide to open other branches and so on. It is the first time of branching department store to South America.
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