Chris Radtke Dennis Duarte Sean Berry Matt Owens

Sweden, Korea, FinlandChile – comparative studiesGlobal Strategy – thinking bigger than location

Group 3

SWEDEN

Map

450,295 sq. km - slightly larger than California

Population about 9 million Growth rate 0.163% GDP 455.8 Billion 1 Swedish krona = 0.1498 US dollars Population base

◦ 88% ethnic Swedes◦ 12% Immigrants

Facts

Free compulsory education Literacy rate of 99% Life Expectancy

◦ Men 78.59 yrs ◦ Women 83.26 yrs

More Facts

4.93 million total labor force◦ 1.1% Agriculture ◦ 28.2% industry◦ 70.7% Service ◦ 7.9% Unemployment

Work Force

75% Lutheran 5% Protestant 5% Muslim

Religion

500 CE Svea Tribe 9th – 11th centuries German-speaking groups 13th century - gained control over trade and

politics

Early History

1397 Union of Kalmar Queen Margareta of Denmark

16th century Union of Kalmar ended and Sweden became an independent nation

Riksdag

1523 Gustav Vasa dynasty

17th century Age of Enlightenment 1749 - population statistics Scientific discovery Growth of arts and freedom of thought and

expression

Modern Evolution

Riksdag introduced constitution limiting power of Monarchy

1809 Treaty of Fredrikshamn signed 1842 Riksdag introduced compulsory

education.

18th Century- Age of Freedom

19th Century Industrial Revolution 1921 universal suffrage proclaimed 1971 Riksdag became single chamber 1974 new constitution gave Monarch purely

ceremonial function

19th &20th Centuries

Limited Constitutional Monarchy with a Parliamentary system

Current King is Carl XVI Gustaf

Government

The government wants to make markets more competitive but also retain its commitment to the welfare of it citizens.

2006 government took 51% of nations income in tax

Government

Merging Ideals of Socialism & Capitalism Lagom “middle-road” and “reasonable” 6 Fundamentals

◦ Equality ◦ Freedom ◦ Democracy ◦ Solidarity ◦ Security ◦ Efficiency

Social Democracy

Difficult to motivate employees Absenteeism and excessive use of sick

leave Labor cost are high Tax is Very high Swedish firms moving abroad

Negatives

Self development Stuga Solitude and quite Weaker generation bonds

Swedish Individualism

Allemansratt - “everyman’s right” Payment adjustments Dagsboter “day fine” Tax Immigrants???

Egalitarianism

Summer Home/ Vacation House More than 600,000 across Sweden

Stuga

Strong love for nature First nation to established environmental

protection laws in 1909 “green lung” http://www.youtube.com/watch?v=o8sWHHf

d-TQ&feature=related

Nature

Orienteering Hiking/Backpacking Rafting Fishing Picking berries, flowers or mushrooms Skiing

Nature Activities

3rd ranked for number of patents per 100,000 people internationally

4th ranked among nations for innovation, information, and technology

4th ranked in human development

Business & Economics

Handshake is done swiftly and firmly. Between men and women, it is a lot lighter. Men should wait until a woman extends her

hand first. Swedes like to establish relationships on an

informal level. Private and business lives are very much

segregated.

Business Etiquette

Its common to address a person by his/her first name. 

Personal space is private - so with the exception of the handshake, avoid touching.

Avoid speaking with your hands in your pockets, as this is considered bad etiquette.

Swedish communication style is direct and open.

When conversing, be sure to listen intently to anyone speaking and not to interrupt.

Etiquette

Keep a low profile do not show emotions Avoid scheduling meeting in June, July,

August and late February and early March NEVER be late The first meeting may be low key and very

matter of fact. Decision will never be made in the first

meeting. http://www.youtube.com/watch?v=YDu5FtXj

qeU

Comparison

Chile Sweden

Republic 756,945 sq. km Population 17 million GDP 203.9 billion Class Structure

Limited Constitutional Monarchy with a Parliamentary system.

450,295 sq. km Population 9 million GDP 455.8 Billion Egalitarian

Comparison of Business Etiquette

Chile Sweden

First meeting build relation ships

Schedule not very Structured

Interruptions are common

First meeting straight to the point

Never be Late Never interrupt

someone

http://www.sitesatlas.com/Maps/Maps/502.htm

http://www.state.gov/r/pa/ei/bgn/2880.htm#profile

http://www.kwintessential.co.uk/etiquette/doing-business-sweden.html

Understanding Global Cultures by Martin J. Gannon and Rajnandini Pillai

References

Now we will go halfway around the world to…..

Korea“The Hermit Kingdom”

And what’s the difference?◦We’ll get to that in a bit. Just know for now

that our main focus here is South Korea.◦In our opinion, North Korea is far too corrupt

to discuss in a business class, as it is near impossible to do business there internationally.

North or South?

South Korea facesJapan across the East Sea and Chinaacross the YellowSea. The Taebaek Rangereferred to as the“Backbone” of the Peninsula stretchesacross the East Coastand into the East Sea.

Map of Korea

Along the Western and Southern Coasts mountains descend gradually onto the coastal plains and many large rivers can be found winding the area.

Many of Korea’s highest mountains are part of the Teabeak Range. ◦ Most famous is Mt. Seoraksan.

Annual precipitation is 1,245mm which is 1.4 times the global average. Although 60% of all water is lost in runoff during floods and torrential rains.

Famous rivers: Hangang, Geumgang, Yeonsangang, Seomjingang, and Nakdonggang Rivers.

Topography

The Republic Of Korea is a small country on the far eastern edge of Asia. South Korea is about the size of Indiana.

Although it only ranks 109th in the world in terms of land area it is considered to be a vast nation in regards to such areas as economics, culture, and arts in Asia.

Population 48.87 million (South Korea)

Cities Population: Seoul (10.4 million)Busan (3.6 million) Incheon (2.7 million)Daegu (2.5 million) Daejeon (1.5 million)Gwangju (1.4 million), Ulsan (1.1 million)

Life expectancy: Male, 77 years Female, 83.8 years

Korea facts

Capital city is Seoul

National flower Mugunghwa ◦ Also called Hibiscus, or Rose of Sharon

National Flag Taegeukgi

South Korea

Religion A 2005 Census showed that half of the population

practices some form of religion.◦ Three majors are Buddhism, Protestantism, and Catholicism.

Government President Lee Myung-bak since 2008. Presidents are elected through a direct popular vote for a

term of 5 years. Division of power among the executive, legislature

(unicameral National Assembly) and judiciary branches. Other election information: National Assembly elected

every 4 years, Local Government elected every 4 years.

Religion and Government

People have been inhabiting the Korean Peninsula for over 700,000 years.

Neolithic Age began over 8,000 years ago. Traces of this era can be found throughout the Korean Peninsula, mostly in coastal areas and near big rivers.

http://www.teachertube.com/viewVideo.php?title=Ancient_Korea&video_id=230973

History

The Bronze Age began around 1,500 to 2,000 B.C. in present-day Mongolia and on the peninsula. As this civilization began to form, numerous tribes appeared in the Liaoning region of Manchuria and in northwestern Korea. These tribes were ruled by leaders, whom Dangun, the founder of the Korean people, later united to establish Gojoseon (2333 B.C.). The founding date is a testament to the longevity of Korea's history. This heritage is also a source of pride for Koreans and their strength to persevere in times of adversity.

http://www.metacafe.com/watch/2733283/korean_history_gojoseon_the_first_state_of_korea/

History

The year 57 BC marks the beginning of the Silla Dynasty. Together with the Goguryeo and Baekje, Silla was the third of the Three States Era, controlling the southeastern region of the Korean peninsula for 1000 years.

Gaya (42-562) began as a type of confederation, formed when several tribes from the Nakdonggang River came together.

Silla became unified by forming an alliance with The Tang Dynasty of China they were able to break away from Gogeryeo and Baekje to further consolidate the Korean Peninsula.

In 698, refugees from Goguryeo established the Kingdom of Balhae in south-central Manchuria.

http://www.youtube.com/watch?v=dRWGn2IO6_A

History

Founded by Wang Geon, a general who had served under Gungye, a rebel prince of the Silla Kingdom.

Wang Geon named his dynasty Goryeo, from which the English name "Korea" is derived.

Goryeo Dynasty had a sophisticated culture represented by cheongja, or blue-green celadon, and flourishing Buddhist traditions. 

Around that time, skilled Korean artisans also completed the carving of the entire Buddhist canon on large woodblocks.

The Goryeo Dynasty (918-1392)

Some 800,000 woodblocks were intended to invoke the power of Buddha for the repulsion of Mongol invaders. Internationally called the Tripitaka Koreana, they are now stored at the historic Haeinsa Temple.

Joseon Dynasty (15th century) In 1392, General Yi Seong-gye overthrew Korya and established a

new dynasty called Joseon. The early rulers of Joseon, in order to counter the dominant Buddhist influence during the Goryeo period, adopted Confucianism as the guiding ideology of the new dynasty.

Governed with a well balanced political system and highly valued academic learning while disdaining commerce and manufacturing.

During the ruling of King Sejong the Great Korea enjoyed vast growing of culture and the arts.

Scholars at the royal academy created the Korean alphabet Hangeul. It was then called Hunminjeongeum, or "proper phonetic system to educate the people."

http://www.youtube.com/watch?v=HPECFBVxWSI&feature=related

History

WHICH LEADS US TO…….

LONG STRETCH OF HISTORY

http://www.youtube.com/watch?v=TM0BZ_24mhQ&feature=related

Important Dates◦ 1910: Treaty is signed on August 29th marking

formal annexation to Japan, which this colonial rule would last for 35 years. This rule would see control of all political, social, economic, and cultural aspects of life.

History from 1910

1919: On March 1st more than 1 million Koreans took to the streets demanding independence. This movement made Japanese authority rethink their colonial policy from one of brutality to a more conciliatory stance known as Cultural Policy.

1922: The Joseon Art Exposition sponsored by Korean Government-General is inaugurated, consisting of three parts which included Eastern-style, Western-style, and calligraphy. Mainly highlighted Japanese artists residing in Korea and was carried out through 1944.

History from 1910

1945: Korea is liberated from Japan. Korean peninsula is divided into two parts. North under Russian control and the Southern portion under American occupation.

The two parts are known as the Republic of Korea (south) and the Democratic People’s Republic of Korea (north) and are proclaimed so in 1948.

1945: The Museum of the Government-General of Korea is renamed and opened as National Museum of Korea.

History from 1910

1950-1953: The Korean War begins on June 25, 1950, when North Korea launches an unprovoked full-scale invasion of the South, triggering a three-year war which drew in U.S., Chinese and other foreign forces. The entire peninsula was devastated by the conflict. A cease-fire was later signed at Panmunjeon at the 38th Parallel in July 1953.

History from 1910

Syngman Rhee, a U.S.- educated intellectual and former independence fighter, was elected the first President of the Republic of Korea in 1948.  His insight and vision was instrumental on establishing a separate government in South Korea, laying the groundwork for a democracy and a market economy.

Despite contributions to Korea, Rhee was ousted from power in 1960 due to election frauds and other accusations by protesters.

Syngman Rhee

1950s-mid-a1960s: Various art movements from Europe, United States, and Japan are brought into Korea and adopted by artists. This helps local artists to recapture the true essence of Korean culture.

1979-1981: Over 5,000 years of Korean Art is exhibited throughout United States and showed in several museums including the Metropolitan Museum, which includes pieces of “national treasure” organized by the National Museum of Korea. A similar exhibition is produced and travels to London on exhibit at the British Museum in 1984.

History from 1910

1986: The National Museum of Korea moves back to its location of origin at the Government-General Headquarters Building at Gyenongbok Palace, after several moves dating back to 1945.

History from 1910

1988: Seoul, Korea is host to the 24th Summer Olympic Games. The theme of Peace, Harmony and Progress was established for the games with more than 13,000 athletes and officials from 160 countries gathered to promote the lofty ideals of harmony and peace, while transcending the barriers separating East and West, and North and South, making it the largest ever Olympiad up until that present time.

1988 Summer Olympics

It was the first boycott-free Olympics in 12 years, the Seoul Olympic Games rose above ideological division and national interest and returned the Olympic movement back to its founding ideals in the eyes of many.

As a result of the games Korea now has many world-class sports facilities, concentrated in Seoul and Busan where most of the Olympic events were held. The complex is Seoul contains a land area of 545,000 square meters, includes the Olympic Stadium with a seating capacity of 100,000, two gymnasiums for basketball and boxing, an indoor swimming pool, a baseball stadium and a warm-up field.

Olympic Park covers over 1.5 million square meters in southeastern Seoul and has a dome which seats over 6,000. It aslo has fencing, weightlifting, gymnastics, and many indoor swimming facilities to just name a few.

1988 Summer Olympics

A Korean traditional meal is not complete without kimchi - a mixture of various pickled vegetables such as Chinese cabbage, radish, green onion and cucumber. Certain types of kimchi are made spicy with the addition of red chili pepper powder, while others are prepared without red chili peppers or are soaked in a tasty liquid.

Kimchi can be compared to the Korean lifestyle in that Kimchi is easily preserved and may last a very long time without going bad. Koreans are used to overcoming the odds and harvesting what they can to make it through their trials and tribulations.

It also stands for honoring tradition by preserving which is how Koreans live. Always family first before individual, this is the same in the workplace, with company before the individual worker.

Kimchi and Culture

Koreans are very big on family and pecking order within that family unit.

Family members are not addressed by name but rather by son, big brother, husband, father, elder, or young one. The titles are important and in fact most families do not even know the first names of their family. During the Korean war this almost made it impossible for families to reunite due to having no idea of each others’ names.

Family Life

Men are the general leaders of the family. They are expected to be good workers and providers and represent the family with honor in public.

Women play the role of mother and caregiver. They are to bare children with at least one male offspring to help carry on ancestral heritage.

In public women are expected to care for a man by waiting on them and following them by letting them exit doors first or by carrying their possessions for them. Women do play another role however behind closed doors as they have much say on what goes on in the household.

Family Life

Most marriages are arranged according to social class and are set up through the family.

Some young men try to set up their own engagement through nights out at “booking clubs” where men may try to court women.

They summon a waiter to bring a certain women over and she comes to the table where he is sitting and may leave if she feels inclined to do so.

Family Life

Newly married women are expected to take care of their husband and if they marry the eldest son but they are required to care for his parents as well.

When entering a family the women is considered to be at the lowest end of the family chain.

In some ways you can compare Korean men and women to the signs of yin and yang on the National Flag. With men expected to be the proactive force of yang and women that of the reactive force of yin.

Family Life

http://www.korea.net/Resources/Multimedia/Video/view?articleId=1281&pageIndex=1

Some popular foods or dishes in Korea are: Kimchi of course!!! Which we touched on earlier. Rice remains the most popular accompanied by

side dishes such as vegetables, soup, pot stew, and assorted meats.

Some other dishes include Ssalbap (steamed white rice), porridge, and noodles.

However most of the younger generation prefers the cuisine of the West.

Culture

Celebrating birthdays in Korea is very big especially when it is one of monumental relevance such as the 60th birthday.

This is a time of celebration and reflection of accomplishments in one’s life and a time to look forward to relaxation and enjoyment of life.

These birthday celebrations are celebrated at K’unjip (big house) or the eldest son’s where he is responsible for seeing for the care of his parents and preserving traditions to help carry on the family through each generation.

Culture

Much of the values in Korea are based off of the five relationships of Confucianism.

1) Father & Son: Governed by affection 2) Ruler and minister: Governed by righteousness 3) Husband and Wife: focused on attention to

separate functions 4) Old and young: organized on proper order 5) Friends: faithfulness It is important that all relationships be based on

this concept or authority, subordination, and orderliness.

Confucianism

Gross Domestic Product US $1,014 billion (2010)◦ Ranked 13th in the world

Per Capita GNI US $20,759 (2010)◦ Ranked 25th in the world

GDP Growth Rate: 6.2% (2010)◦ Ranked 29th in th

Foreign Exchange Reserves: US$ 291.5 billion (2010) Exports US$441.5 billion (2010) Imports US$400.6 billion (2010) Agriculture: The weather varies markedly according to elevation, and lack of

precipitation, along with infertile soil, makes land high elevations unsuitable for purposes other than grazing. However, they are a producer of rice.

Major Industrial Products include semiconductors, automobiles, ships, consumer electronics, mobile telecommunication equipment, steel and chemicals.

Major Companies: Samsung, Daewoo Group, Hyundai Group, & Doosan Group to name a few.

Information and Communications along with automobile production are at the top of the industrial chain.

Business

In Korea it is essential that the company comes first and individual comes second.

Generally in America we ask what do you do or job title. In Korea it is all about the company. People associate success with that of the team.

Koreans are generally uncomfortable with Western ways of communication. They believe in speaking only when necessary to do so.

Business Culture

Koreans would rather take a non-stance when doing business and here all the information rather than a Western-style stance where we usually take a side from the beginning and negotiating from that platform.

They want to get all of the facts and will make a decision based off of the information presented. They will draw out the process as long as they see fit.

If they do not want to do business they generally do not say no directly. They will say “not at this time” or “we will consider your proposal and get back to you”. These are all answers that are equivalent to no.

Business Culture

Koreans are very hospitable and go out of their way to be polite to people. If one comments on something another one is wearing out, it is not uncommon for that person to give it to them as a good gesture of faith.

In South Korea where team is key, Chaebols or groupings of companies based on family ownership help to rule over business activities.

Koreans tend to keep management and the general labor force separate to ensure the standards of the Chaebols are upheld and a form of order is maintained in the business.

Individual decisions are not usually made or encouraged. A group or committee is generally involved in every major decision made by an organization.

Personal space and responsibility usually comes after a relationship has been clearly defined. Up until that point one is not treated as an individual. The individual will usually be ignored or ran into. Behavior we see as rude in our business culture.

Business Culture

Business is conducted at all hours of the day and will take precedent to family life.

It is not unusual for Koreans to partake in late night drinking sessions with coworkers and business counterparts. They love to karaoke and will go to karaoke places to develop business relationships.

Koreans are considered to be more emotional than other Asian cultures and enjoy entertaining people when it comes to business ventures.

http://www.youtube.com/watch?v=Xi5fyU2mICU

Business Culture

http://www.youtube.com/watch?v=JzX5VpALQ6A&feature=related

Koreans are very reserved and quiet and as mentioned earlier will discuss every possible solution before coming to a decision involving business. Very few blind risks are taken without much deliberation.

It is best to take a Confucian approach by putting the good of the company first followed by that of your own.

More Korean Etiquette

Both have similar terrain, with a mountain Chain running north and south into the sea.

Chile has the majestic Andes mountains whose peaks reach 6,893 meters, ending in extensive plateaus and valleys downstream and to coast and cliffs overlooking the sea.

Both have a democratic form of government with different branches of administration.

Chile & Korea

Chile is more diverse in its agricultural production than the nation of Korea with its limited resources.

Norte Chico in Chile is known for its production of grapes for papayas and Pisco which a form of wine in the region, which may also be used to make Pisco sours. Olives and avocados are some other crops produced in Chile.

Norte Grande produces non-edible plants such as flowers and in Norte Grande's Puna plateau indigenous Aymaras practice traditional llama and alpaca herding. Cattle herding is also practiced in regions such as Zona Sur.

Other forms of the economy include the manufacturing, utilities, and mining industries.

These include the production of such goods as copper, finished shingles, molding, wallboard as well as lumber and rough wood. Unmanufactured steelmaking industrial inorganic chemicals is also part of Chile production.

Chile & Korea

As one can see the industries are very different with Korea focusing on communications and the automobile industry and Chile more involved in the agricultural aspect of industry along with several manufacturing trades.

Chile & Korea

http://www.chileangovernment.cl/our-economy/ http://

www.korea.net/Resources/Multimedia/Video/view?articleId=1281&pageIndex=1

http://www.youtube.com/watch?v=JzX5VpALQ6A&feature=related http://www.youtube.com/watch?v=Xi5fyU2mICU http://www.youtube.com/watch?v=TM0BZ_24mhQ&feature=related http://www.youtube.com/watch?v=HPECFBVxWSI&feature=related http://

www.teachertube.com/viewVideo.php?title=Ancient_Korea&video_id=230973 http://www.metacafe.com/watch/2733283/korean_history_gojoseon_the_first_st

ate_of_korea/

www.korea.net www.metmuseum.org http://afe.easia.columbia.edu/webcourse/key_points/korea_timeline.htm http://www.funtrivia.com/en/Geography/Korea-5805.html http://en.wikipedia.org/wiki/Agriculture_in_Chile http://wiki.answers.com/Q/What_kind_of_goods_does_Chile_produce Understanding Global Cultures, fourth edition. Gannon, M. & Pillai, R. 2010

Sources

The Finnish Sauna

Finland Population:

◦ 5.4 million GDP (PPP):

◦ $186.0 billion◦ 3.1% growth◦ 1.0% 5-year compound annual growth◦ $34,585 per capita

Unemployment:◦ 8.4%

Inflation (CPI):◦ 1.7%

FDI Inflow:◦ $4.3 billion 1 Euro= 1.31 USDSource http://www.heritage.org/index/country/finland

Finland Located between Sweden and Russia on the Baltic Sea

Finland has a highly industrialized, free-market economy with a per capita output equal to that of other western economies such as France, Germany, Sweden, or the U.K.

The largest sector of the economy is services (64.9%), followed by manufacturing and refining (32.4%). Primary production is at 2.7%.

http://www.youtube.com/watch?v=S6raDTpawfY&feature=related

Education Schooling is compulsory for ages seven

through 16, and it is free, even at the university level.

The University of Helsinki, founded in 1640 and located in central Helsinki, is the largest of the country's 20 universities and 29 polytechnic institutes.

Language The official language of Finland had been

Swedish for more than 600 years, but a language decree issued in 1863 by the Russian Czar Alexander II started Finnish on the path to becoming an official administrative language.

Today the country is officially bilingual, and the populace is constitutionally guaranteed the right to transact any business with the government in their choice of Finnish or Swedish

Capital City The capital and largest city is Helsinki, a port

city which was founded in 1550. Located in the far south of the country on the

shore of the Gulf of Finland, it is the northernmost national capital on the European continent.

With a population of slightly more than half a million

It is widely appreciated for its outstanding architecture, abundance of parks and excellent transportation system.

Historycirca 9000 B.C. Finland emerges from the last Ice Age

c. 8000-9000 B.C. First traces of post-Ice Age habitation

c. 8600-5100 B.C. The Suomusjärvi Culture

c. 3200 - 2300 B.C. The Battle-Axe Culture - the first signs of agriculture

c. 800 - 1100 The Viking Age

c. 1157 Crusade of Prince Erik and Bishop Henry of Sweden into Finland

1227 Prince Jaroslav of Novgorod sends Orthodox missionaries to Karelia

c. 1309 Founding of the city of Turku (Åbo)

1323 Peace of Nöteborg divides Finland between Sweden and Novgorod

1397-1523 The Kalmar Union

1523-60 Reign of King Gustav Vasa

1520s-1593 Lutheran Reformation

1548 Mikael Agricola publishes the New Testament in Finnish

Timeline

1550 Founding of Helsinki

1593 Uppsala Decree formally establishes Lutheranism in the Swedish kingdom

1595 Peace of Teusina between Swedish kingdom and Russia

1596-1597 The War of the Clubs peasant rebellion

1617 Peace of Stolbova between Swedish kingdom and Russia

1640 Foundation of University of Turku

1642 Full Bible published in Finnish

1695-1697 Crop failures and epidemics decimate Finland's population by a third

Timeline

1700-1721 The Great Northern War

1713-1721 Russian armies occupy Finland

1721 Peace of Nystad between Swedish kingdom and Russia

1741-1743 The Hats' War between Swedish kingdom and Russia

1788-1790 Gustav's War and the Anjala League

1808-1809 The War of Finland, annexation of Finland to Russian Empire

1809 Porvoo Diet, in which Emperor Alexander I of Russia confirms Finland's laws and religion (March 25-July 19)

1812 Helsinki named Finland's new capital

Timeline

1812 Helsinki named Finland's new capital

1828 University moved to Helsinki from Turku

1835 Elias Lönnrot publishes The Kalevala

1860 The introduction of the mark as Finland's currency

1863 Language Rescript makes Finnish co-official with Swedish

c. 1890-1914 Finland's artistic Golden Age

1899 February Manifesto reduces Finland's autonomy

1904 Assassination of Governor-General Nikolai Bobrikov

1906 Creation of unicameral Parliament

source- http://history-of-finland.com/timeline.htm

History Shows long history of living at the mercy

of foreign domination

During the 12th century, Finnish tribes were subordinated into Swedish society for 700 years

After Napoleonic wars in early 1800, Finland was transferred into Russia due to the remapping of Europe.

History Became an Independent nation in

1917 after the collapse of the Russian Empire and Rise of the Soviet Union

Became politically unstable and a civil war erupted soon after declaration of independence

Finland changed hands yet again when Hitler gave the country to the Soviet Union in 1930.

(One of three countries militarily involved in World War II to not become occupied)

After World War II moved towards “Sauna Diplomacy.”

PoliticsType: Constitutional republic.

Constitution: July 17, 1919; March 2000.

Independence: December 6, 1917.

Branches: Executive--president (chief of state), prime minister (head of government), Council of State (cabinet). Legislative--unicameral parliament. Judicial--Supreme Court, regional appellate courts, local courts.

Subdivisions: Six regional state administrative agencies, plus Aland.Political parties represented in parliament: Social Democratic Party, Center Party, National Coalition (Conservative) Party, Left Alliance, Swedish People's Party, Green League, Christian Democrats, True Finns.Suffrage: Universal at 18.

Politics Current Finnish

President is Taraja Halonen

Politics is a mixture of Scandinavian roots that evolved into a Finnish Scandinavian society.

Politics Finland has created political and economic

competencies for successful relations with both the neighboring countries that ruled its country and the neighboring world.

Neighboring countries (Russia/Sweden) presented a challenge since neighboring countries historically tried to conquer the territory.

The People

Nationality: Noun--Finn(s). Adjective--Finnish. Population (July 2011): 5,259,250. Population growth rate (2011): 0.075%. Ethnic groups: Finns, Swedes, Lapps, Sami, Roma, Tatars. Religions: Lutheran 82.5%, Orthodox 1.1%, Christian 1.1%,

other 0.1%, none 15.1%.Languages: Finnish 91.51%, Swedish 5.5% (both official); small Lapp-speaking (0.03%) and Russian-speaking (0.97%) minorities.

Education: Years compulsory--9. Attendance--almost 100%. Literacy--almost 100%.

Health: Infant mortality rate (2011)--3.43/1,000. Life expectancy--males 75.79 yrs., females 82.89 yrs.

Work force (2.68 million; of which 2.46 million are employed): ◦ public services--32%;◦ industry--19%◦ commerce--15.9%◦ finance, insurance, and business services--14.5%◦ agriculture and forestry--4.5%◦ transport and communications--6.8◦ construction--7.2%.

Finnish Work Force

Finns Very Hearty Have dealt with a high

degree of market competition

Welfare State that stresses the importance of social equality

Believe in doing it on their own compared to other EU societies.

“Running away from a wolf is running into a bear”

Notable Famous Fin- Linux Creator -Linus Torvalds

The Sauna Sauna is One of Most

important aspects of Finnish Life

Sauna Metaphor is functionally and symbolically related to local and nature- focused values and customs

People should behave in sauna as they do in church.

Seen as a religious cleansing of the body

Doing Business In Finland The top income tax rate is 30.5 percent top corporate tax rate is

26 percent. Other taxes include a value-added tax (VAT) and a flat 28 percent

tax on capital income, with the overall tax burden equal to 43.1 percent of total domestic income.

Finland’s trade policy is the same as that of other members of the European Union, with the common EU weighted average tariff rate standing at 1.4 percent. However, myriad non-tariff barriers add to the cost of trade. Investment regulations are transparent and efficient, with openness to foreign investment long established. The financial sector, buttressed by sound regulations and prudent lending practices, provides a wide range of services.

Source- http://www.heritage.org/index/country/finland

Doing Business in Finland Firm handshake is standard for both genders in Finland. When being

introduced to a group, shake hands with women first. You should address people by their title followed by surname. If you

are unaware of a title then Mr, Miss or Mrs is fine. Wait for the other party to initiate the move to first names.

The Finns are egalitarians and as such do not appreciate shows of ostentation. For example, over dressing would be seen as a sign of arrogance. This also extends to behavior in that most Finns do not like loud talking in public or 'over energetic' behavior.

The folding of the arms is viewed as arrogant. If you see someone tossing their head at you they are saying "come here." Physical contact such as back slapping or putting hands on shoulders is not generally done. Avoid talking with your hands in your pockets as this is considered too casual and bordering on rude. Men should remove hats when entering a building or talking to someone.

Business Meetings

Doing Business in Finland Do not overdress Folding of arms is

seen as being arrogant

Reduce physical contact to the shaking of hands

Doing Business in Finland Business meetings should be arranged and

confirmed in advance, usually in writing Bring business cards to any meeting and

hand them out to everyone present. Finns like to get straight down to business.

Always come to a meeting well prepared hosts will want to see an organized, logical

and fluent presentation.

Doing Business in Finland Do not give off any sense of superiority. In

such an egalitarian society shows of this sort are frowned upon.

There can often be long periods of silence in business meetings.

Always look people in the eye when speaking Never put your hands in your pocket when

speaking. Do not show any emotion, do not allow

yourself to become too informal.

Comparison

Chile Finland

Population:17.2 million

GDP (PPP):$257.9 billion5.3% growth3.3% 5-year compound annual

growth$15,002 per capita

Unemployment:8.1%

Inflation (CPI):1.5%

FDI Inflow:◦ $15.1 billion

Population:◦ 5.4 million

GDP (PPP):◦ $186.0 billion◦ 3.1% growth◦ 1.0% 5-year compound annual

growth◦ $34,585 per capita

Unemployment:◦ 8.4%

Inflation (CPI):◦ 1.7%

FDI Inflow:◦ $4.3 billion

Comparison

Chile

First meeting build relation ships

Schedule not very Structured

Interruptions are common

Finland

First meeting straight to point

Structured Schedule Avoid Showing

emotion

Sources

http://history-of-finland.com/timeline.htm http://www.stat.fi/hae_en?word=Chile&sort

=inv_aika&function=Search http://www.history.com/topics/finland http://www.worldatlas.com/webimage/count

rys/europe/lgcolor/ficolor.htm http://www.linfo.org/finland.html

Chile

This is Chile

Incan rule until 17th Century 1818 – Independence from Spain War of the Pacific (1887-1893)

◦ Chile defeated Peru and Colombia 1973 Military cout (golpe de estado) by

Pinochet◦ Ruled until 1990 – free election presidency

History

Democratic state◦ Presidential republican system◦ Constitution

Executive Legislative Judicial

Current President ◦Sebastián Piñera

Echenique

Government

Sound political and economic policies since 1980s have led to long-term growth◦ Cut poverty rates by half◦ Secured a spot as a stable international leader

High level of foreign trade Highest sovereign bond rating in South

America Exports > ¼ GDP

◦ Commodities > ¾ of GDP Copper alone provides 1/3 of total government revenue

Economy & Growth

4% average growth since 1999 2004 – FTA with the US Claims most bilateral trade agreements

◦ MERCOSUR, EU, China, India, South Korea and Mexico

FDI quadrupled in the past 7 years

Economy & Growth

Fiscal policy allows for sustained growth Low tax rate (23.7% of GDP) Budgets flux with copper prices

◦ Surplus used to stimulate economy in 2009 5% growth in 2010, despite major

earthquake 6% growth in 2011

◦ Ranks 32 in the world First South American country invited to

OECD◦ Organisation on Economic Co-operation &

Development

Economic Policy

GDP $281 billion (2011 est.)◦ Ranks 45 in the world

GDP Composition by Sector:◦ Agriculture: 5.1%◦ Industry 41.8%◦ Services 53.1%

Labor force > 8 million 2010 inflation rate 1.4% vs. 3.4% disc. Rate

Economy & Business

$86.13 billion (2011 est.)◦ Ranked 45 in the world

Main exports ◦ copper, fruit, fish products, paper and pulp,

chemicals, wine Main export partners

◦ China 23.8%, Japan 10.2%, US 10%, Brazil 6%, South Korea 5.9% (2010)

Exports

$72.31 billion (2011 est.)◦ Ranked 42 in the world

Main imports◦ petroleum and petroleum products, chemicals,

electrical and telecommunications equipment, industrial machinery, vehicles, natural gas

Main import partners◦ US 17%, China 13.6%, Argentina 8.5%, Brazil

7.9%, South Korea 5.8%, Japan 5%, Germany 4% (2010)

Imports

Chile is an excellent place to do business

The big point here?

With plenty of opportunity….

Oakley Optics◦ Oakley – worldwide model

Owned by Italian based Luxottica Group Two main focuses: OPTICS and AFA Wholly owned retail stores in the US and Canada Retail presence in Chile through GMO Óptica, similar

to Sunglass Hut International

A Case for International Expansion

A recognizable brand Adventure / Sports Related Covers all seasons Products run the gamut

◦ Optics, sun, ski, performance, AFA No retail presence for Oakley AFA

Missing 25% of their business!

Chile has a great home market, tourism market, and global strategic placement.

Oakley (Luxottica) & Chile seem like a great fit!

Why Oakley?

Why Chile?

Total Global Strategy Chapter 3

Building Global Market Participation

Globalization > Internationalization Increasing global competitive position Looking at expansion through this lens

the big picture

Definitive economic opportunity Desiring an international presence

◦ Globally strategic Latin America Asia

Growth Market 3,999 miles of coastline

◦ More than half western coast of South America

Oakley’s Opportunity

1) Transferrable Business Model

2) Leverageable Competitive Advantage

3) Being from a More Developed

Economy

Bases for Global Expansion

• “the most globalizable business models are those that seek to impose the company’s logic on the marketplace”

• Luxottica and Oakley have built a hugely successful model that is proven to be transferable• “With net sales reaching Euro 5.8 billion in 2010,

approximately 60,000 employees and a strong global presence, Luxottica is a leader in the design, manufacture and distribution of fashion, luxury, sport and performance eyewear.”

• Operations in North America, Europe, Asia and Africa• Annual production of 56 million units• Almost zero participation in South American markets

Transferrable Business Model

• Six categories of advantage customer market

first to market AND/OR product superiority products and services

being better than current market offerings (scale) business system or value chain

being better at an element; or being better at chain coordination

assets and resources tangible and intangible – built long before present day

partners owned and otherwise

scale and scope scale helps lower production costs, scope helps share costs

across the board

◦ One advantage gets you in the door, but multiple keep you there.

Leveragable Competitive Advantage

Weaknesses at home may be strengths abroad Current Oakley markets are more

sophisticated than Chile’s◦ But Chile is still well developed◦ “selling down” can give you a competitive advantage in the new market

Being From A More Developed Economy

Developed Countries

Developing Countries

POPULATION SIZE

WEALTH / SOPHISTICATION

6 production facilities in Italy 2 in the United States (sports glasses) 2 wholly owned factories in China 1 small plant in India Retail locations on four continents

◦ Asia, North America, Europe and Africa South America is surrounded!

◦ Ideal launch for next venture Their model is not truly global…yet Not nearly strategic enough…yet

Global Reach - Oakley / Luxottica

From Oakley’s CEO◦ Company Overview

Founded in 1975 2006 revenue: $762 million Segment sales

Optics 73% | AFA 21% | Other 6% Wholesale 77% | U.S. Retail 23% U.S. 56% | International 44%

Distribution◦ 110+ countries through 20,000+ accounts◦ 225+ company-owned retail locations◦ 3,400+ worldwide employees

Types of Global Market Participation – Typical View

What percentage of your “world market” actually comprises the world market?◦ 54% international vs. 46% domestic (US) ?

Meaningless Global Market Share Global Balance Presence in Globally Strategic Markets

◦ Being International vs. Thinking Globally Large Source of Revenues or Profits

◦ When thinking globally…a large driver somewhere can help float growth elsewhere.

◦ RCM may not be best consider strategic impact

Global(ization) Strategy View

Cost reduction◦ Increasing volume for economies of scale

Improved quality demanding consumers + innovative competitors = improved product quality

Enhanced customer preference◦ Increased preference through global availability,

global service-ability and global recognition Competitive leverage

◦ Adaptive, proactive and reactive

Benefits of Global Market Participation

Boston Consulting Group Growth/Market Share Portfolio

Business Growth / Competitive-Strength Matrix

Growth Potential of Business in Country

Competitive Strength of Business in Country

HighLow

Low

High

WILDCAT COUNTRIES

Eastern Europe, Japan,

STAR COUNTRIES

Italy, EU, Finland, Sweden

DOG COUNTRIES

Chile, Ecuador, Colombia,

Africa, Korea

CASH COW COUNTRIES

United States, India, China

Global Strategic Importance / Competitive Strength Matrix

Global Strategic Importance of Country

Competitive Strength of Business in Country

HighLow

Low

High

DANGER/FIX

Japan, Australia

MAINTAIN/EHANCE/PREEMPT

United States, EU (esp. Italy), China

AVOID/RAID

Africa

DEFEND

Chile, Brazil, Mexico

Pay attention to changes in your market◦ ….and make changes accordingly

Plan likely directions of movement Consider organizational / economic /

political impacts◦ …and pay attention to your markets!

Be careful broadcasting these matrices◦ …cows will be cows, and dogs will be dogs.

IMPORTANT CONSIDERATIONS

Could just as easily be multilocal Select countries for stand-alone

attractiveness AND global strategy placement

Consider your competition (local and global) Different countries with different roles Alliances and misad-ventures Think outside of the triad

Multinational Global

Japan

US EU