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Dr. Kelly Fish
Hofstede’s Cultural Dimensions
Hofstede’s cultural dimensions is a theory developed by Geert Hofstede to describe the effects
of a society’s culture. It measures a country based on six categories: power distance,
individualism, masculinity, uncertainty avoidance, long term orientation, and indulgence.
Companies can use this data for when they want to enter the market in other countries to
determine the best strategies to use to generate the most success.
Power distance measures a country as a whole’s beliefs on equality for all citizens.
Countries with a low-power distance rating believe that all people, regardless of social class,
should have a chance to achieve wealth and power. Alternatively, countries with a high-power
distance rating believe in a more hierarchical structure where only the wealthy have access to
gain power. Of the three countries chosen, the United States scored the lowest with forty. In
the United States, despite somebody being born to a lower class, they opportunity to progress
in society. South Korea scored in the middle with sixty. They have a slightly more hierarchical
society than the United States, but still allows for progression. Mexico scored the highest of the
three with an eighty-one. In Mexico, people are more accepting of their place in society and do
not try to move into a different class. In countries with a high-power distance score, like
Mexico, you stay in the class you are born into and that is understood by everyone.
Individualism measures how independent a countries’ citizens are. Countries with a high
individualism score are expected to do look after yourself. Countries with a low individualism
score are more likely to do things in groups and look out for one another. The country with the
lowest score, eighteen, was South Korea. They are considered a more collectivistic society.
South Koreans are very loyal to their groups, whether it be family or friends. They take
responsibility for everybody in their group’s actions. This is sometimes carried over into
employment too. If somebody from your family did something shameful, this may reflect poorly
on you personally. Mexico scored in the middle with a thirty. Their beliefs are very similar to
those of South Korea. The country that scored the highest was the United States with a ninetyone. Americans believe that you should “fend for yourself” and not rely too much on
authorities for support. They are good at talking to others to receive information but not very
good at creating and maintaining friendships.
Masculinity measures how driven a country is by competition, achievement, and
success. A country with a high masculinity score values the competition and wants to be the
best. A country with a low score is considered feminine and values quality of life and caring for
others. South Korea scored the lowest with a thirty-nine and falls on the feminine side. As a
whole, they focus on working in order to live. Incentives like free time are favored over raises or
promotions. The United States scored a sixty-two, which would fall on the masculine side. In
American culture, people are taught to strive to be the best they can be. They have the
opposite belief of South Koreans and believe that you should live to work. Raises and
promotions are the preferred incentives. Mexico scored the highest with a sixty-nine. Their
beliefs align with those of the United States. They believe that you should be assertive and
decisive to be successful.
Uncertainty avoidance measures how societies deal this the unknown of the future.
Countries with a high uncertainty avoidance score do not like the idea of not knowing what the
future will hold. They like to be in control. Countries with a low uncertainty avoidance score are
comfortable with the possibility of not being about to predict the future. The United States
scored the lowest with a forty-six, which is below average. Americans are typically more open
to new ideas. They do not require a lot of rules but are less emotionally expressive than higherscoring cultures. Mexico and South Korea scored very close. Mexico with a score of eighty-two
and South Korea with a score of eighty-five. In these countries, there is a strong need for rules.
People are not always accepting of new ideas. Security is a big individual motivator.
Porter’s Four Competitive Models
Porter’s four competitive models is a way for companies to decide what strategy to use
to enter the market. The four types are lower cost across the industry, lowest cost within an
industry segment, better product/service across the industry, and better product/service within
an industry segment.
Low cost, Industry wide
The primary goal of this model is to achieve the lowest cost across the entire industry.
Companies that utilize this strategy try to cut costs wherever they can to make room for lower
product costs. This allows them to still make the money necessary for covering costs and
producing a profit. A good example of a company that utilizes this model is Walmart. They cut
costs by squeezing the prices of manufactures and in turn, lowering the cost for the consumer.
Low cost, Industry segment
The primary goal of this model is to achieve the lowest cost within a portion of the
industry. This is a fairly popular strategy for companies to utilize because it is significantly easier
to lower cost for a smaller group of people than it is for the entire industry. Just like the low
cost, industry wide model, the goal is to cut costs in order to compensate for the lower product
Better service, Industry wide
The primary goal of this model is to produce a product or service that consumers are
willing to pay extra for. The product or service must have something that the competitors do
not like better quality or more features.
Better service, Industry segment
The primary goal of this model is to produce a product or service that specific
consumers are willing to pay extra for. This model is very similar to the better service, industry
wide model except for who it targets. Instead of generalizing all consumers and their specific
needs, it narrows the search down to a specific group of people like “middle aged women” or
DeHart Travel Agency
DeHart Travel Agency focuses on creating a better service within a smaller section of the
market. Their focus is primarily on couples or small families, but occasionally service business
men and women traveling for work. Focusing on a smaller section of the industry allows us to
create a better experience for the customer. Our packages are designed for families with
children, of any age, in mind.
DeHart Travel Agency focuses on a smaller portion of the industry. Narrowing the
consumers we service has allowed us to spend more time focused on our specific customers’
needs and create services they would like.
Key Benefits Offered
Some of the key benefits that DeHart Travel Agency offers are discounts, packages, or
customization. As a company, we are able to get discounts that an individual planning a trip
would not have access to and find some that they might overlook. Our highly trained staff know
the ins and outs of all of the destinations listed on our website and strive to find our customers
the best deal. We offer preplanned packages that require no additional planning from the
customer. This saves time for the staff and in turn, saves the customer money. We also offer
customization to the preplanned packages at no extra service cost.
DeHart Travel Agency is a smaller company, and this allows for easier communication
between the staff and the customer. We have a member of our staff on call at all times, 24/7. If
a customer has a problem, they can always get in contact with a highly skilled member of the
Since DeHart Travel Agency is a smaller company, we are able to create and maintain
more personal relationships with our customers. This is a benefit when it comes to planning a
vacation because the background knowledge of the client and their family gives the staff a
better idea of places to suggest, hotels that best fit their needs, and best means of
transportation while they are there.
The egg diagram shows the decision process of a client of DeHart Travel Agency. The
first thing that happens is the initial meeting with the client. This is where the travel wants and
needs are discussed. After that, an employee will create an itinerary of the things the client
wants. When the itinerary is created, the employee will try to find the best discounts that apply
to this specific trip and create the lowest possible price. The client is sent the itinerary and total
cost to make sure it is what they want. It is at this stage where adjustments can be made. Once
the customer decides they want to go through, another meeting is schedule. During this
meeting, they receive the finalized copy of their itinerary, along with any tickets, reservations,
car rentals, or anything else provided by the agency. While they are on their vacation, they are
able to contact us with any additional help they need.
The resource system maps out the core benefits that DeHart Travel Agency offers to its
customers. We are able to offer discounts and preplanned packages through companies like
Disney and Universal that want us to encourage families to visit. Another key benefit that we
offer is 24/7 access. This can be achieved through multiple points of access. We are available
via website, phone, or by visiting a branch during office hours. This can also be achieved
through Disney and Universal who also offer a 24/7 service.
DeHart Travel Agency utilizes the product or service business model. This is the best
model for the company because we provide a service and are able to keep the majority of the
revenue that comes from sales.
CIT 4453 – Technologies of Global e-Commerce
Write-up must have:
-Porter’s Generic Strategy
Web site must have:
Each student will be responsible for
developing a prototypical e-commerce
website. This is a culminating project that
provides the opportunity to apply both the
business concepts and technologies that we
are studying this semester. Students will be
provided server space from an ASU server
and the project must be located at that server.
Students should consider the following
guidelines when developing their web sites:
• Students are free to choose any of the business
models discussed in class or covered elsewhere
as the basis for developing the web site.
• Students must target at least three international
markets. One must be from a country that does
not speak English
• Students are encouraged to begin this process
by outlining a project (CE#2)
• 40% (400 pts) of your course grade – more
than just a term paper.
• Project graded 200 pts on the web site and
200 pts on the write-up
• All write-ups are due 11:59 PM, May 2nd
• All web sites are due 11:59 PM, May 2nd
• 8-15 pages text (discussion); exhibit or table space
does not count as discussion space.
• Use sub-headings on various sections.
• Use exhibits to shorten text and then use text to go
in-depth on exhibits. Walk reader through exhibits.
Don’t throw in exhibits as after thought.
• Number all pages and exhibits.
• Proof read – no grammatical or spelling errors.
• Must have cover page with URL
• Use Word and place at your web site
Porter’s Four Competitive
To be effective, organization goals, objectives,
culture, and activities must be consistent with
Components of a Business Model
Developing a business model in the networked economy requires four key choices on the part
of the senior management:
• Specify the value proposition or
the value cluster for the business
• Articulate the online product,
service and information offer
• Define how the company needs to
align its resources to deliver the
• Define and select the most
appropriate revenue model to
The definition of the value proposition is the result of a combination of choices about the
customers, the benefits offered and the unique capabilities of the firm:
Search for Ideas
Case Study: Schwab
Schwab’s resource system is centered around Schwab’s three main benefits: low price,
innovative products and superior services.
= Core Benefits
Investment in IT
Multiple Points of
While firms can pursue a number of revenue models, some are used most frequently:
• Advertising revenues can be generated through the selling of ads, site sponsorships, event
underwriting, etc. (e.g., Yahoo, AOL, Business2.com)
Product, Service, Information
• Revenues can be generated from the sales of goods and services (e.g., Amazon, CDNow,
• Revenues can be accrued from charging a fee or taking a portion of the transaction sum for
facilitating a customer-seller transaction (e.g., Schwab, eBay)
• Website can gain revenues by offering subscription services for information (e.g., FT.com,
• Hofstede’s Cultural Dimensions
– Make assumptions for each of the four
dimensions and discuss site adjustments as a
result for each of your targeted markets
• Language Translation issues
• Other cultural issues such as color etc.
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