CHAPTER 5

Globalization Issues

Firms entering the global economy generally face a wide range of issues not faced when they operate domestically—issues such as time, language, culture, and ethics in addition to infrastructure, government policies, and money.

Time

Firms extending their supply chains to Asia face time differences of up to 12 hours and even different days (because of the international date line). This means that if direct communication is to take place, someone must be working outside his or her normal working hours. Some Indian IT companies have located their call centers in countries in South America, such as Paraguay and Uruguay, to be closer to the eastern U.S. time zone. A German consulting firm with which the author was familiar actively sought business in South Africa to eliminate the time zone effect (i.e., jet lag) in its global activities. Electronic communication makes communication across time zones easier, but there still may be delays of a day or more. Simply picking up the phone and calling someone is not always feasible. If a supplier is located across the street, you always have the option of walking over there and discussing a problem on the spot. If the supplier is in China, it may take several days to even establish the nature of the problem.

Language

Language is a problem Americans often ignore on the assumption that everyone speaks English. English has become the universal language of business, but that does not mean that everyone speaks English or speaks it fluently. Even among those who speak it fluently, there can be significant differences. For example, “pipped at the post,” meaning defeated or nosed out at the last minute, is a common expression in Australia, but it is unknown in the United States. Accents may differ and lead to misunderstandings. Americans are often exhorted to learn more languages, but the question remains which to learn. Should one learn Chinese because of the size of their economy (although there was no rush to learn Japanese when Japan was the second-largest economy)? Should one learn a European language (even though English has become a common language in the EU)? A survey of U.S. firms projected that between 2010 and 2020, the languages other than English that will be most in demand are Spanish, Chinese, Arabic, and Russian.¹ Translation is always available, even online, but it is not always reliable. Getting documents correct can be critical. The most effective way to ensure that documents are correct is to have them double translated—for example, from English to Chinese and then back again. Comparing the two English versions will highlight any problems. In any event, a native speaker should edit all translated documents. First Solar Inc., for example, has mandated English as the official language of the company. This means that all management communications are carried out in English. All shop-floor instruction manuals are translated into the local languages, however.

Culture

Culture and ethics are often two big sticking points in dealing with global supply-chain partners. The two issues are often considered together, although, for the most part, they are two different issues. There is nothing ethical about how to present a business card, and there is nothing cultural about murder. Culture is a complex subject that could fill an entire book in itself. The focus here will be on some of the issues that may arise in managing global supply chains.

Culture is determined by five factors:²

• Religion
• Political and economic philosophies
• Education
• Language
• Social structure

Religion

The cultural factors are not equal in all situations and often have an impact where one does not expect them. Religion is probably the most pervasive factor in that it tends to transcend the others. Changes in governments, economic systems, or education systems tend to have little effect on underlying religious values. Governments, for example, may encourage or suppress religion but seldom have a long-term effect on its practice. The question for the manager of a global supply chain is how important religion is in a particular country or region. In Germany, for example, religion is a minor (or nonexistent) factor in business dealings. In the Middle East, it may be of overriding importance. Religion may appear in unexpected situations. In greeting rituals, for example, a Hindu woman may decline to shake hands with a man (or a Hindu man may decline to shake hands with a woman). This practice is rooted in religion but expresses itself in the common practice of whether or not to shake hands. Religion may contribute to the degree of collectivism or individualism in society and thus affect the nature of business negotiations.

The Political and Economic Philosophies

The political and economic philosophies in a society can affect the culture, although they may not be as deep rooted as religion. In extreme cases, the political and economic philosophies in North Korea and Cuba certainly affect the culture of doing business. These are apparently imposed from above but could change rapidly, as evidenced by South Korea having a radically different business culture from North Korea. When the countries of Eastern Europe were in the Soviet bloc, they had a collectivist economic and political culture. When the so-called iron curtain fell, most of these countries changed rapidly to a more individualistic and private-market culture.

Education

Although the role of education is normally thought of as teaching the basics of math, science, language, art, and social science, the educational system has a major role in teaching culture. Children are taught to be in school at the same time every day and to stay there until they are dismissed, just as they will be required to do when they enter the workforce. They are taught (we hope) to be respectful to their elders and about the common history and lore of their country or region. They are taught the common language of their country. Education may not create culture, but it is a powerful force for the transmission and perpetuation of it.

Language

Language can reflect cultural values and particularly social structure. In the United States, people tend to be quite informal in business dealings, often using first names (perhaps to excess) with people they do not know well. Such a practice would be a grave social error in countries such as Japan or even Germany. In Germany, for example, their language has different forms of the pronoun “you” depending on how well one knows the person. Using the familiar instead of the formal form of “you” with a relative stranger can be considered an insult (as would using the formal with a close acquaintance).

Social Structure

Countries with a history of social strata may retain vestiges of these strata even if they have been outlawed. In India, for example, castes still exist even though it may be illegal to consider them in business dealings. In other cultures, women may have a different social status than men. Race and ethnicity may be involved in local hiring decisions. It is often a difficult decision for a manager to know how or even if to consider such factors in business decisions. What appears to be a cultural decision may, in fact, turn out to be an ethical decision.

Cultural Training

For the manager going abroad, or even dealing with business partners from other countries, cultural training is a must. Some global firms, such as the Swiss bank UBS AG, provide a detailed cultural guide for their employees, offering advice such as to “never reject an invitation to the sauna” when in Russia.³ Any local university with a business school will have experts in international business who can provide cultural training. Fortunately, self-study in this area has been made easy. Marshall Cavendish Books publishes a “Culture Shock” series of books on a number of countries. They do not prepare one for everything, but they do give a good background. Another aid is the International Herald Tribune. Each Monday it prints a list of the countries that have holidays that week (meaning businesses may be closed). Every day is a holiday somewhere in the world! (The information is also available from sources such as Bloomberg and Reuters.) From time to time, publications such as the Wall Street Journal will offer cultural tips.⁴ Robert J. Trent and Llewellyn R. Roberts’s book Managing Global Supply Chain and Risk has a chapter on subjects such as greeting rituals and gift giving.⁵ If you are responsible for a particular country or area, buy a local calendar that has its holidays. This can save you from a lot of missed appointments, poor scheduling, and social gaffes.

A helpful step can be to join a service club such as Rotary, Kiwanis, Lions, or Zonta. These are organizations of professional people and have chapters in virtually every country in the world. When you visit or move to another country, you will have an instant network of professionals and access to people who can be mentors or answer your cultural questions. No matter where you are, when you go to a meeting (which you can do without an invitation), you are immediately welcome. No one will question why you are there.

Always be aware that countries do not always have common cultures within their borders. In the United States, New York City; Austin, Texas; and San Francisco have vast cultural differences. The Bavarians in Germany are distinct from the Berliners. The Scots and the English are different. Fortunately, everyone operating in a global environment faces the same dilemmas and questions no matter what his or her country of origin. The person who is flexible and willing to learn succeeds the best. The president of PharmaSecure, commenting on their success abroad, noted that “the company’s ease and comfort working across cultures [has been important].”⁶

Decision Sharpness Example

An example that illustrates the issues with time, language, and culture, as well as some of the lean issues discussed in the previous chapter, can be referred to as the “decision sharpness” example. The definition and metric of decision sharpness is the interval between the point in time when a decision maker realizes he or she needs to make a decision and the point in time when there is enough information to make it. The example (a true story) involves deciding if there is enough inventory on hand to continue production or if the item needs to be reordered.

The supply-chain manager in New Jersey wanted to increase the production schedule at a plant in Malaysia. The supplier of the parts he needed was in the Netherlands. The supplier in the Netherlands was a subsidiary of a company in Germany, so he had to go through the chain of command (an effect of long supply chains). At 9:00 a.m. on a Friday, he called the Germans to ask them to call the Dutch to determine the number of items in inventory. It was, however, 15:00 (3:00 p.m.) in Germany (time differences), and German firms typically do not answer the phones after 14:00 (2:00 p.m.) on Fridays because the secretaries have left for the day. So he got no answer. He called again on Monday, but it was a holiday in Germany, so no one was at work (differences in culture). He called again on Tuesday, and the Germans readily agreed to forward his request to the Dutch. The Dutch are not predisposed to taking orders from Germans, so they put off checking the inventory level until Wednesday (culture). They discovered that they did not use the same nomenclature and stock-keeping units (SKUs) as the Americans, so they had to check the inventory manually instead of on the computer (language, measurement, and computer system differences). They sent the answer to the Germans, who forwarded it to the United States. On Friday, a decision-sharpness gap of 7 days, the supply-chain manager in New Jersey had his answer. The result was that the factory in Malaysia ran out of parts and had to stop production. If the inventory had been in New Jersey, or if the supply chain had been internal and they had used an ERP system, the decision-sharpness factor would have been 5 minutes. Instead, a global supply chain using external suppliers stretched the decision-sharpness factor to 7 days.

The supply-chain manager who related the story said that the situation was even more complicated than it sounds. The headquarters for the company owning the Malaysian factory was in Hong Kong; the headquarters company was a subsidiary of a firm in Singapore that had a U.S. sales office in California. So his communication chain with the factory in Malaysia went through California, Singapore, and Hong Kong and finally to Malaysia. This involved at least three languages and multiple time zones. The cost savings from cheaper labor by producing in Malaysia was clear and easy to calculate; the cost of complicated communication lines and the lack of decision sharpness is something that does not typically appear in the accounting statements.

Ethics

Ethics is also a multifaceted subject that could occupy whole chapters and books. It covers everything from basic taboos such as killing and stealing to grayer areas such as bribery. To complicate things further, a matter such as bribery can range from excessive tipping to large kickbacks on contracts. A good global business textbook—such as Charles W. L. Hill’s Global Business Today⁷ or John Wild, Kenneth Wild, and Jerry Han’s International Business⁸—can lay out the issues. Ethics has been in the foundations of capitalism from the beginning. Adam Smith was a moral philosopher, and before he wrote The Wealth of Nations, he wrote The Theory of Moral Sentiments. Ethics and moral behavior were a prerequisite to his system of laissez-faire economics.

The first guideline for the global supply-chain manager is to be legal. Be legal in your home country and be legal in your host country. The United States has a Foreign Corrupt Practices Act, making bribery illegal anywhere in the world. (The U.S. Department of Justice initiated 150 cases under this act in 2010.) The Organization for Economic Co-operation and Development (OECD) has a Convention on Combating Bribery of Foreign Officials in International Business Transactions⁹ that has been signed by 38 countries. The German-based company Siemens, for example, has paid more than $1.6 billion in fines to the United States and German governments for corrupt practices. The U.S. company Johnson & Johnson paid $70 million to the United States and the United Kingdom because of the payment of bribes and kickbacks.¹⁰ New cases appear almost weekly in the business media.

The second guideline is to have an organizational code of ethics: “Companies need to develop explicit codes of conduct on corruption, train their staff to handle demands for pay-offs and back them up when they refuse them.”¹¹ Be sure that your company culture is one that demands ethical behavior and that everyone, from the CEO to the lowest-paid worker, behaves ethically and expects ethical behavior from others.

Finally, one should have a personal code of ethical conduct. There are some who would argue that ethical behavior depends on where you are—that different countries and cultures have different ethical standards. A counter to this argument is that the service organizations mentioned earlier have codes of ethical behavior that every member in the world agrees to follow. There are no cultural exceptions, no equivocation. Rotary, for example, has a “Four Way Test”¹² that all members, in every culture and country, agree to follow:

1. Is it the truth?
2. Is it fair to all concerned?
3. Will it build goodwill and better friendships?
4. Will it be beneficial to all concerned?

Since Rotary has members in virtually every country in the world, you can find professionals around the world who profess to adhere to the same code of ethics.

Development and Infrastructure

The state of development and the infrastructure are important factors to consider in deciding whether to move into the global economy and where. A country attractive for its low wages may not have the port facilities, for example, to move raw materials in and finished goods out of the country. Transportation to and from the port may be difficult because of the lack of good roads, railroads, or canals. Or a poor transportation system may make it difficult for workers to get to work. It is not unheard of for a company to establish an internal bus system to get its employees to and from work. A poorly organized banking system may make it difficult to transfer funds or even to pay workers and suppliers.

The state of development is an issue in several ways. In developed countries, one assumes that if there is a need for raw materials, parts, or subassemblies, then there will be a vendor available to supply these items who will charge a reasonable price and deliver within a reasonable time. In a developing country, none of these may be true. The classic story is when McDonald’s entered Russia for the first time: They had to buy and develop the entire supply chain to ensure the quantity and quality of their beef, potatoes, and other components.

One might think that communications would be difficult in developing countries, but a phenomenon sometimes known as “generation skipping” makes many of them more advanced than the United States in telephone communications. Landlines have long been a bottleneck in communications in developing countries. Most telephone companies have been state monopolies. This meant a poor response to customer needs and politicization of the management process. Even where sufficient lines were erected, the cost was high and the wires were frequently stolen for their copper. Starting in the 1990s, however, the introduction of mobile telephony in the developing countries has revolutionized communications there. They are able to skip over landlines and the early technology in mobile phones. Mobile phones have spread so rapidly that many economists have estimated that they add 0.8% or more to the growth rate in developing countries.¹³ Communication allows better access to information such as crop prices and better efficiency by enhancing communications with suppliers and customers. People in villages act as “walking phone booths” by selling use of a phone by the minute to their neighbors. Mobile minutes are used as a faux currency since they can be transported easily electronically. Mobile phone companies have responded by redesigning transmission towers (e.g., to use solar energy) and phones (to reduce their cost) and changing the cost structure of adding time to a call plan. In Germany, for example, the least-expensive

Table 5.1. Advantages and Disadvantages of Global Supply Chains
Advantages	Disadvantages
Lower costs	Long supply chains
Centralized functions	Exchange rate risk
Economies of scale	Remoteness from customers
Local talents	Transportation arrangements
	Cultural differences
	Political unrest
	Decisions not “sharp”

plan for adding minutes to a prepaid SIM card costs about €15 (about $20). In India, one can add minutes for 100 rupees (about $2). In Kenya, competition has driven the cost of a text message down to one cent.¹⁴ The mobile infrastructure has been relatively immune to damage since, it seems, even criminals and terrorists use mobile phones. In short, what once was a significant disadvantage of operating in a developing country has become a distinct advantage.

The Impact of Governmental Policies

Governments can be a significant issue in globalization. Aside from the issues of stability, corruption, and political philosophy, there are a number of areas that can have a major impact on a firm looking to locate in a particular country. The first is the ease of starting a business. The irony is that the countries that need new businesses the most are those in which it is most difficult to get one started. According to the World Bank,¹⁵ 7 of the 10 countries in which it was most difficult to start a new business were in Africa (an improvement from 9 out of 10 the year before). The easiest was New Zealand (the United States was ninth). One day was required in New Zealand to start a business; Haiti required 105, and Suriname required 694 (the United States required 6). Starting a business involves everything from obtaining capital to obtaining construction permits. It is little wonder that the developed countries are more likely to attract foreign direct investment than the developing countries. The World Bank report is a good reference rating countries on nine different dimensions of the ease of doing business.

All governments control trade: from tariffs, to quotas, to embargoes, to administrative requirements. Sometimes governments seek to promote trade with subsidies or free-trade zones, but most often they seek to restrict it by imposing costs, direct controls, or bureaucratic requirements. Although average tariffs and restrictions have been reduced dramatically since the 1950s, individual countries differ widely in their treatment of trade. The World Bank¹⁶ ranked countries based on the time, cost, and number of documents required to import or export a full 20-foot container (the 20-foot equivalent unit [TEU] standard). The two easiest countries were Singapore and Hong Kong. The bottom 10 were all developing countries in Africa and Asia. Table 5.2 is a sample of countries

Table 5.2. Ease of Exporting
Country	Rank	Days to export	Documents needed	Cost ($)
Singapore	1	5	4	456
Hong Kong	2	6	4	625
Germany	14	7	4	872
USA	20	6	4	1050
China	50	21	7	500
Niger	174	59	9	3545
Burkina Faso	175	41	10	2412
Congo, Republic	180	50	11	3818
Kazakhstan	181	81	10	3005
Cent. African Rep.	182	54	9	5491
Source: World Bank.

to show the wide differences.¹⁷ Since greater exports are a national policy in most countries, only the data for exporting are shown.

It is clear from Table 5.2 that a lack of economic development is more a cause of low levels of exports than a result. It is also clear that trade brokers to help negotiate one’s way through the export process are necessary for a company that wishes to participate in the global economy. Trading in the world economy is far more complex than trading domestically. One should enter the arena with caution and be fully prepared. Fortunately, brokers are available, and governments, from the local to the federal level, are eager to help businesses that wish to export. One such broker specializing in small businesses—High Street Partners Inc. of Annapolis, Maryland—has been working with more than 300 small firms. The president commented, “There’s an explosion of 50- to 100-person companies that are going overseas. We’re not even scratching the surface.”¹⁸

One way to avoid the problems of importing and exporting is to produce in the countries where one’s markets are located. Some countries may require this as a condition of trade (Airbus produces the A320 airplane in China, for example, as a condition of selling them to the Chinese), but it is one way of moving behind tariff and quota barriers as well as avoiding the time, cost, and bureaucracy of importing and exporting. The other factors mentioned (infrastructure, communications, etc.) may come into play, so it is a matter of balancing the plusses and minuses.

Money

The final globalization issue discussed here is money. The history of money is complex, and its roles are many. An elementary economics textbook is a good place to review the fundamentals. Money is another area that involves governments. Although the U.S. dollar is the primary reserve currency in the world, other currencies, such as the euro, the British pound, the Swiss franc, and the Chinese yuan, either are growing in importance or, in the case of the pound sterling, have been important reserve currencies in the past. Any company trading in the global economy takes on the additional headache of managing currency risk. In the post-GATT (General Agreement on Trade and Tariffs) world, in which gold is no longer a currency standard and the major currencies float freely in value on world markets, dealing with currency risk has become a major part of engaging in world trade. A strong domestic currency encourages imports and direct investment in other countries. A weak currency encourages exports and direct investment in the home country.

Currency Risk

Currency risk appears at three levels: transaction, translation, and economic risks. A firm encounters transaction risk each time it exchanges one currency for another. This may be a direct exchange, or it may be buying or selling goods in another currency. On the individual level, for example, a U.S. tourist who travels to a euro zone country with a credit card and a bank debit card will encounter transaction risk each time he or she withdraws cash from a money machine or pays for something with the credit card. The exchange rate could change dramatically from transaction to transaction. This does not happen often, but in the summer of 1973, for example, the U.S. dollar did fall dramatically in value, and many U.S. tourists in Europe were left without enough money to buy a train ticket back to the airport to fly home. The tourist who buys euros before leaving the United States incurs transaction risk only one time because he or she has locked in the exchange rate. A business faces the same risks, but a change in currency value is more likely to happen because the time between agreeing to buy or sell goods and the time payment takes place can span weeks or months.

A firm that incurs no transaction risk may still face translation risk. It is possible for a U.S. firm to have branches in multiple countries where all suppliers and customers are domestic. At the end of the year, however, the firm must convert its financial statements into dollars for a number of reasons, not the least of which is paying taxes. A changing exchange rate can have a dramatic effect on the firm’s bottom line, even though no currencies have actually been converted into dollars. The firm faces the same risk when repatriating profits.

Finally, a firm operating in the global economy faces economic risk in the long term. Although a strong domestic currency may encourage investment abroad, investment typically takes time to complete and is intended to stay in place for several years. Factories cannot be moved around like people. The economic risk is that an investment abroad that seems to be a good idea one year may, in fact, turn out to be a bad idea by the time the investment is complete because of exchange rate fluctuations. Investing abroad is a matter of good forecasting and risk management.

The global landscape is quite complicated in terms of currency even when one considers only market fluctuations in exchange rates. This is an area, however, where government intervention is pervasive and constant. Although the major currencies in the world have their exchange rates determined by the market, the majority of countries (over 80%) use some kind of government intervention to control the rate. They may have pegged rates or currency boards to attempt to keep the rate constant with respect to a major currency. From a business point of view, this is desirable since it guarantees the exchange rate (with the major peg) as long as the peg does not change. For example, until 2010, China generally kept the yuan pegged to the dollar. The yuan still fluctuated with regard to other currencies such as the euro and Japanese yen. Governments may use exchange rates to try to enforce political or economic policies. In 2010, Venezuela, for example, had four different exchange rates ranging from the official rate of 4.3 bolivars per dollar to the 8.0 black-market rate. They also had a rate of 2.3 for importing food and medicines and 5.3 for buying dollars for business. Some countries may allow conversion only one way—from a major currency into theirs but not back again.

It is difficult to overstate the importance of managing currency risk when operating in the global economy. For Toyota, for example, a one-yen appreciation against the dollar reduces annual operating profits by $450 million!¹⁹ In 2004, Volkswagen’s first-quarter profits dropped by €300 million because of unfavorable exchange rates.²⁰ In Canada, for every one cent the loonie (Canadian dollar) strengthens, their manufacturers lose about C$1.5 billion per year. When the U.S. dollar collapsed in 2007, Standen’s Ltd. of Canada saw the value of their U.S. sales drop below profitability in the 60 days they allowed their customers to pay their bills.²¹ The CEO of Christie Digital Systems Canada Inc. reports using aggressive hedging and strategies to minimize exchange-rate risk (such as sourcing in U.S. dollars and selling in Canadian dollars). Despite their efforts, every one-cent change in the exchange rate has a 1% impact on their bottom line.²² Clearly, exchange-rate risk demands one’s attention and efforts to mitigate it.

Purchasing Power Parity (PPP)

The question faced by every currency-risk manager is what the exchange rate should be. Knowing this can tell one if a currency is over- or undervalued and help with forecasting exchange rates. There are two primary factors determining the exchange rate between two currencies at any given time. One is the relative purchasing power of the currencies in their home economies. This is what the exchange rate should be. The other is speculation. Virtually all the day-to-day changes in exchange rates are caused by speculation. (See Figure 5.1.) For the manager trying to forecast the medium- to long-term movements in the value of a currency, the difference between these two rates is key information. The speculative value is the market-exchange rate (or, in the case of nonfloating currencies, whatever the government in question says it is). This information is easy to find. The most common measure of the underlying exchange rate based on purchasing power is called purchasing power parity (PPP). Except in cases of rapid inflation or deflation, PPP is relatively stable. (Again, see Figure 5.1.) The difficulty is measuring it. Economists have devoted a lot of energy trying to construct good measures of PPP. To construct PPP,

one must compare identical goods in different countries. Finding goods that are identical around the world is difficult. In the 1990s, the Economist, in a self-described “light-hearted” attempt, constructed a PPP index using the Big Mac hamburger from McDonald’s. Except where eating beef is taboo (such as among Hindus in India), beef is eaten around the world, and the Big Mac is virtually identical in its presentation and distribution.²³ From an economist’s point of view, the fatal flaw is that the Big Mac Index contains only one item. On the other hand, experience has proven the Big Mac Index to be remarkably accurate in determining if the market value of a currency is over- or undervalued compared to its PPP value. In addition to its accuracy, it is readily available and easy to understand. By looking at the Big Mac Index, a manager can make a reasonably accurate judgment about future movements of a currency’s value relative to the U.S. dollar (or, by inference, any other currency). There are two major caveats: No index is 100% accurate, so while the direction of the movement may be fairly certain, the size of the movement may be less so. The other caveat is that knowing if a currency will change in value does not indicate when it will change. This is a matter of the manager’s forecasting judgment (and perhaps luck).

There are many ways to mitigate exchange-rate risk; detailed explanations can be found in the finance literature. The following are some of the most common and easiest to implement:

• Purchase forward contracts to lock in your exchange rate. This can be done through a bank or broker.
• If you do a lot of business in a particular country or area, keep a bank account in that currency to eliminate some of the transaction risk caused by multiple currency exchanges.
• Maintain a facility in a country where you are selling. This allows you to make more of your transactions in that currency and avoid transaction risk.

Doing nothing is the same thing as speculation. You put yourself at the mercy of the currency market and the speculators. Taking basic steps to mitigate currency risk is relatively easy, even for a small business.

Summary

Be aware of the issues you will face when you are part of a global supply chain. Every country or region is different. According to the MIT global risk survey,

The perception of earthquakes may change in the United States after the 2011 earthquakes in Japan shut down some important supply chains.²⁵ In fact, in an article in Barron’s, Alan Abelson, quoting Stephanie Pomboy, speculates that with the earthquakes in Japan and the political turmoil in the Middle East and northern Africa, the age of globalization may be coming to an end. Companies may decide that the risks and costs of global supply chains are too great and may shorten their supply chains²⁶ (in a manner similar to the examples in chapter 7).

Allow time to prepare yourself for managing in the global arena:

• Join a service club to give you instant access to a professional network no matter where in the world you happen to be.
• Take training in the culture and language of the countries and companies where you do business; give the same training to your employees.
• Know the law when it comes to ethics. Know and follow your company’s and your own ethical codes no matter where you are.
• Keep a clock (or clocks) on your wall showing the time in the regions where you do business (the kind of display you see in airports and hotels that cater to international customers).
• Get a calendar from the region(s) where you do business so you are aware of holidays.
• Take advantage of sources such as the World Bank and the Economist to learn “the numbers” of the countries where you do business.
• Learn the risks particular to the country or region where you are doing business.
• Develop reliable communication channels.
• Manage your currency risk; don’t speculate (doing nothing amounts to speculation).