Real effectiveness in business can only be achieved when there is an efficient form of communication between employers, workers, clients and associates. Communication in business is used for swapping information, increasing efficiency, coordination and communication, decision making, formulating and executing plans and improving relationships with external parties. Hence, organizations where there is a seamless and unobstructed exchange of goals, objectives, and ideas in internal and external communication are the ones which prosper the most.
This exchange of information, however, is a form of art and requires a great amount of deliberation. Deficient communication within the company and with the outside world lead to poor performance. In the corporate world it is best to communicate ideas in a way in which they cannot be held against you. The exchange of information should be clear and fathomable, but should all so be somewhat evasive providing an opportunity of leeway.
When it comes to the professional world, it is better to speak and write tentatively and make statements which give room for error, rather than stating opinions and facts in a way, which give no space for denial or clarifications later on, in case of there being any fallacies in the prior stated words.
It is better to use an impersonal passive sort of approach in communication as it highlights the object of the message, yet does not draw as much attention to the correspondent. It is better to use vague writing in touchy situations where there is a blurred line between actualities and claims.
Such form of communication softens the tone of the language and makes it more persuasive. The addressee is more likely to show consent to the contention if the communicator is subtle and less insistent in delivering his ideas.Writing or speech lacking in tentativeness can be harsh and result in avoidance of the actual purpose of business communication, which is the smooth and persuasive conveyance of information.
Tentative language can be acquired by use of limiting words, modal verbs and hedging. Modal verbs are auxiliary verbs which indicate the mood or tone of the sentence, and provide room foruncertainty. They should be used carefully when dealing with official communications.Limiting words indicate the likelihood of something happening. They show the possibility of something happening, but do not confirm to it with entire certainty.
The purpose of all of which is to cushion the impact of the words which you are trying to convey giving, more room later on for denial or modifications. This use of tentative terms is suitable in making assertions that show as much evidence of accuracy as present in reality, and to avoid making assertions which may necessarily not be entirely true. This also helps in avoiding any form of opposition which may arise in case of a false claim, by the receiver picking on the initialcertainty in regards to the authenticity of the words.
Barack Obama, president of the United States, running one of the greatest nations of the world, a businessman of his own sorts on a late night TV show compared his poor bowling abilities to the Special Olympics(Business Communication: In Person, In Print, Online: Amy Newman, Scot Ober). What we see here is an example of lack of tentative language. The president first off could have drawn a better analogy, and if this was the most accurate comparison he could find, he could have stated it in a more subtle sort of way, covering the stringency of the meaning by using vague and tentative terms, not claiming to have the conclusive word on the topic, nor making any staunch and definite comparisons.
The result of the President’s verbal faux pas it seems to be, was that he had to call the chair of the board of the Special Olympics and apologize for his seemingly insensitive words. All of this due to lack of proper cushioning and adequate discretion on part of the President in delivering his notion. Thus extra care must be taken when referring to or dealing with handicapped. In the world of business where competitors and the press are waiting like scavengers to pick on your words it is best to use as much cushioning as possible in saying your piece.
Effective Business Communication
Head of HR Management in Yahoo sent a memo to all employees in the not so distant past telling them that commuting or working from home would soon no longer be an option from them, and those who continue to wish to work this way would have to quit or clearly risk being fired. The harsh terminology used in this inefficiently conducted memo is evidence of why it resulted in a fervently adverse reaction on parts of the employees. First of the memo failed to give any staunch motives for this abrupt new policy. Furthermore, the lack of attempts, at dampening the impact of the new program, and trying to cushion the outcomes of what may happen if employees failed to meet with the new regime, make it blatant that the proposal would backfire on the company, which it did.
Thus we can see what happens when there is an absence of tentative language in communication within businesses. The employees were rightfully upset and there was a lot of bad water, all of this owing to the communication fallacy of just one manager. Had he used a better and more cautious approach in delivering the news, the employees would have accepted the new policy with open arms.
Tentative language gives room for opinions and change. It provides the addressee with an opportunity to add to what is being said. It makes the communicator appear more cautious and open for improvement. The recipient seems to have some room to add to the initial argument if the speaker or writer uses tentative language. This improves the exchange of ideas and removes any barriers which may exist between the two parties allowing an effortless exchange of thoughts and objectives.
Conclusion
Thus we can see the importance of effectual communication. Those people who cannot communicate effectively will find it difficult to beemployed, to function well and earn promotions in their jobs. If they don’t employ essential communication techniques, and continue making blunders which are bound to arise from lack of important practices such as that of using tentativeness. We can see now that caution in writing and employing the use of vague statements which give room for alteration are necessary and lead to better transfer of thoughts.
References
Judd, A., McElroy, J. and Baker, P. (2014). BC teachers’ strike: Tentative deal reached between BCTF and government. Global News
Enterprises, L. (2014). Metro, drivers and mechanics reach tentative deal on contract : News
The Globe and Mail, (2014). B.C.’s teachers are the losers in tentative deal
Foreign Direct Investment (FDI) in economic terms refers to the investment that an investor makes in a foreign country in which the investor has a significant control of the business or company invested in. It applies in many sectors of the economy, including the mining industry. Different governments have varied policies that seek to govern and regulate the application of foreign direct investment in their respective countries. This exploration evaluates the situation of FDI in the mining industries in Nigeria and Argentina. In the analysis, the paper incorporates the Dickens’ framework to evaluate the impact that foreign direct investment has on the mining industry and determine whether the adopted FDI policies in the two countries, that is, Argentina and Nigeria serve in the best interest of the investors.
FDI policies in Mining
It is very important to consider a deeper understanding of the effects that mining activities will have in the country, both social, economic, political and environmental impacts before developing policy to regulate FDI in the mining sector. With the advent of globalization, each country tries as much as possible to engage in trade and allow trade in within their borders. This has led to global competition and the growth of Multinational Enterprises (MNE) and the Transnational Corporations (TNC). Many countries, especially the mineral rich countries have business opportunities within their borders to exploit their resources, but do not have the financial muscle to invest in such explorations. Due to the need for exploitation of the business opportunities within the borders amid limited resources to exploit them, governments enact policies that either encourage or restrict foreign direct investment in their respective countries (Johnson 2005, p. 15).
One aspect of the FDI policies that is very critical is the aspect of quality. The term quality in this regard refers to the foreign direct investment’s ability to enhance the welfare of the host country’s citizens in terms of social, economic, political and environmental wellbeing. Based on this requirement, governments, therefore, have to assess the impact of allowing FDI in the mining industry to take place within their countries and to device mechanism of mitigating the possible negative impacts of FDI, for the benefit of the citizens’ welfare (Vazquez-Brust et al. 2013, p. 2).
The impact of mining activities and the subsequent social conflicts depend on an array of factors, including the type of mineral mined. Some minerals when mined leave more devastating effect on the environment than other minerals. Secondly, is the technology, the technology used will determine the extent of destruction the extraction of minerals will have to the environment. Thirdly, the level of involvement by the MNCs in the mining activities will determine the impact it has on the economy. The fourth condition is the strategies of the mining companies; some companies involved in the mining business may want to optimize profit at the expense of the host country’s economic development. Finally, the culture of the host nation and its level of economic development among other conditions may also lead to conflict in the mining activities (Stiglitz 2007, p. 134).
In this respect, therefore, it is incumbent upon both the host nation and the international agencies to collectively evaluate these aspects of conflict and make decisions that are desirable and specific to every mineral extracted and the respective location of extraction. On the same breath, the researchers too have a responsibility to choose a theoretical framework, which encompasses all the conditions necessary for evaluation in order to address all research concerns (Gibson 2006, p. 19).
FDI policy in Argentina
Considering the FDI policies in Argentina, since the year 2001, Argentina has been encouraging huge foreign direct investment, especially in the mining industry. This policy followed the massive reforms that the country made in the mining code. Argentina is a developing economy having a substantial amount of mineral resources. At present, Argentina’s third most significant product for export is Gold. Gold has attracted many investors from outside the country to come and exploit the opportunity.
Nevertheless, since the government put these policies in place in 2001, with the government encouraging foreign direct investment, the mining reforms in Argentina have not fallen short of challenges. In many parts of the country, there has been an uprising resistance to the mining activities. Those who persistently resist FDI policies claim they are doing so based on the social and environmental factors. Today, about six provinces have succumbed to this public pressure to introduce legal bans on open-pit mining within their provincial zones. This public resistance has been growing and rapidly spreading manifesting lack of consensus between the government and the public on the mining policies (Auty 2001, p. 36).
This conflict between the Multinational enterprises and the public in Argentina is a clear manifestation of varied perception about the quality of FDI, especially in the mining sector. Whereas the companies consider boosting the local economy as an improvement of the welfare of the citizens, citizens, on the other hand, consider the effect mining activities have on their environment and the subsequent effects these negative externalities to the environment extend to affect the society. Even though there is a need for the alignment of quality of FDI between the local community, the government and the respective MNEs, it is not easy to reach a common ground on the quality of FDI, which is a relative measure that depends on other aspects of the prevailing welfare standard. This is also because, the perceptions of welfare of the citizens vary from time to time and from individual to individual depending on their expectations, level of knowledge they possess and the overriding cultural values of the community (Ali 2003, p. 70).
One case in point that supports the gap in perception of citizens about the quality of FDI is the Esquel case. In this case, Meridian Gold, which is a Canadian multinational corporation, secured rights to mine a gold deposit in Esquel, a town in the province of Chubut at a cost of investment of over 200 million US dollars. The provincial government approved all the standards and environmental impact assessment reports for a potential mine. The provincial government gave the project a green light terming it as a high quality FDI, being environmentally friendly and useful economic development in the province.
Nevertheless, the community had a completely different perception. According to the community, the project was low quality FDI, dangerous to the environment, economically weak and if implemented would divide the society. The subsequent social unrest that followed compelled the provincial government to organize a referendum in 2002 in which, 80% of the citizens overwhelmingly voted against the mining activities. In the year 2003, as the social pressure continued to pile against mining activities, a judge ruled against any mining project in the province, forcing the Meridian Gold to drop the project (Mutti et al. 2012).
FDI policy in Nigeria
Similarly, the FDI policy in Nigeria as well has had a long journey. Before the year 1988, the Nigerian government was still skeptical about allowing FDI into Nigeria on grounds that it deemed FDI as a scheme for economic and political control. In 1972, the government outlined a regulatory policy on FDI by establishing the Nigeria Enterprise promotion Decree (NEPD). This declaration was meant to regulate rather than promote the foreign direct investment in Nigeria by limiting foreign equity participation in some sectors to a minimum of 60 percent. By the year 1977, the government again made a declaration further limiting the participation of foreign equity to 40 percent in Nigeria’s business. These declarations implied that Nigeria had a restrictive FDI policy between 1972 and 1995. By the year 1988, the Nigerian government made some structural reforms that initiated the beginning of eliminating the restrictive policy on FDI. The government established the Industrial Development Coordination Committee to act as an agency responsible for the facilitation and the attraction of the flow of foreign investment (UNCTAD 2009, p. 89).
Subsequently, in the year 1995, the government repealed the restrictive NEPD and made a new one known as the Nigerian Investment Promotion Commission, with an aim to encourage foreign investors to come to Nigeria and set up businesses, which they could have 100 percent control. The only condition was to provide relevant documents and the NIPC would approve the application for a business permit within fourteen days. Other declarations followed thereafter promoting and encouraging FDI into Nigeria with some having free regulations on dividends accrued from foreign investment. In addition, the Nigerian government adopted an Export Processing Zone to enable interested investors establish businesses and industries within certain zones (Ayanwale 2007, p. 24).
The FDI friendly policies adopted by the government of Nigeria saw a steady rise in the foreign direct investment flow into Nigeria since 1995 in different sectors. There was also a rise in the foreign direct investment in the mining industry in Nigeria, which followed the putting up for sale of the Nigerian national petroleum corporation together with its branches. The civilian administration that began in 1999 also inspired the deregulation of the oil industry, subsequently opening up the mining sector for more FDI inflows (Albaladejo 2003, p. 43).
The Dickens’ Framework
Having looked at both the Nigerian and Argentina’s policies on FDI, it is evident that both countries have had their challenges in the implementation of these policies. Considering the Dickens’ framework, the manifestation of conflicting interests and perception between citizens and the Multinational in the execution of mining projects is a confirmation of a dynamic collaboration and conflict between TNCs and the government agencies. According to Dickens (2003, p. 275), in the foreign direct investments both the TNCs and the host government need each other.
However, they admit that the ultimate objectives of the host government and the MNEs significantly differ. For example, the aim of a host government is to ensure an increase in the gross domestic product (GDP), while the MNCs principal aim is to maximize profits and increase the value of shareholders in the investment. In his framework, Dickens admits that in the foreign direct investments, multinational enterprises can have both positive and negative impacts on the host country’s social, economic, political and environmental conditions. They may exploit or expand national economies, distort or improve economic development, create employment opportunities or destroy jobs, introduce and spread new technology or prevent the wider use of new technology. The MNEs can also contribute to the destruction of the environment through pollution and destruction of the landscape through mining activities, or participate in the reconstruction and the creation of a sustainable environment through initiatives aimed at sustaining the environment (Dickens 2003, p. 277).
According to Dickens (2003, p. 278), there are six major areas in the host country’s business environment that MNEs may have an impact on, and these include the area of technology, employment and labor related issues, industrial structure, capital and finance, trade and linkages and the environment. In the area of environment, the impact could be increased soil, water and air pollution, effects on urban settlement, change the extent of natural resources use among other impacts. On the trade and linkages, the effects may include changes in the propensity to export and import resources and changes in the use of local suppliers.
Foreign Direct Investment
On the employment and labor issues, the effects could include changes in the volume of employment, type of employment in terms of skills and gender, wages and recruitment levels, labor relations and affect the stability of the labor market. On capital and finance, the impact could include changes in the initial inflow of capital, changes in the capital raised locally, profits retained locally and transfer pricing among other impacts. In the industrial structure area, the impact could be effects on the industry concentration, changes in the competitiveness of the local companies and impact on the creation of new local companies. Finally, in the area of technology, the impact could affect the extent of technological transfer, determination of appropriate technology and may lead to additional cost on the host nation (Yakovleva 2005, p. 45).
Dickens’ framework also has a mechanism for assessing the extent of impact of MNEs activities in the host nation’s economy. In assessing the impact of MNEs, Dickens looks at the level of control that MNEs have on the host, the increase or decrease in the general welfare, the overall macroeconomic conditions, receptivity, cultural, social and political conditions, capital mobility technology and stage development, and the extent of natural resources availability among other factors (Gibson 2006, p. 18).
The framework as elucidated by Dickens is quite relevant to the two scenarios presented both in Argentina and in Nigeria regarding FDI policies. In Dickens’ assumptions are in three perspectives, first, he assumes that in FDI deals, the government always represents the community and mediates the relationships between the MNEs and the Citizens. However, in most developing economies, this might not be the case because the community always are directly involved in the affairs deemed to directly affect their livelihood and environment (Epstein 2008, p. 113).
Several environmental studies reveal that the conflict arising when FDI deals are negotiated is because of the adamant tendency by the state and the MNEs to ignore the role played by the communities in this process. This leads to a direct involvement between the government and the MNEs, which most of the time leads to environmental and social inequalities (Martinez 2002, p. 19). In order to eliminate any conflict arising from the community, it is imperative for all the stakeholders to engage collectively in the assessment of the quality of the FDI in terms of scientific, MNEs, Community and government assessment. Any gap that continues to exist between the projects’ evaluation will make conflict resolution among these parties very difficult.
The second assumption by Dickens is that the ultimate objective of the MNEs is to maximize their profit and increase the value of shareholders. This assumption overrules the fact that some firms may also aim at strategic and ethical undertakings to do more proactive activities with the aim of maximizing their profits, as well as reaping benefits to the community and the environment (Vazquez-Brust et al. 2013, p. 7).
To bridge the gap between the divergent interests of the parties involved in the FDI arrangements, the government together with other stakeholders can develop a code of ethics to govern the conduct and activities of the MNEs. Similarly, the MNEs have a good avenue of mitigating the ill perception of the community by participating in the corporate social responsibility practices to give confidence to the community that their interests are considered. Corporate social responsibility is a very significant tool that firm can use to develop the businesses in the host country. By taking part in solving the societal problems, firms will not only build the confidence of the local people, but also create a sustainable environment in which they guarantee and secure the future of their businesses (Elliot & Cummings 2006, p. 87).
The third assumption Dickens is making in his framework is the existence of two variables that depend on each other, that is, the truncation effects and the increase/decrease in welfare. Truncation effects refer to cultural, economic and institutional aspects of the FDI policies that negatively affect the host country. The international economic analysis indicates that it is possible to reconceptualize truncation effects as institutional effects of the foreign direct investment, which contain robust effects on the welfare of the host country. They should be considered as influencing the welfare too rather than being treated separately from factors that increase or decrease the welfare (Stieglitz 2007, p. 43).
According to Mold (2004), the truncation effects can have an impact on the host country in two forms, that is, governance and social cohesion. Wealth and income distribution is one area where MNEs have a potential to bring social cohesion because research indicates that there is a strong connection between MNEs activities and the increase in the inequalities. This understanding of the inequalities has informed the engagement between the governments of Argentina and Nigeria and the MNEs in the FDI projects, in order to boost economic development and reduce the adverse effects of social and economic inequalities in their countries.
This analysis reveals remarkable undertakings of both Argentina and Nigerian government in trying to facilitate foreign direct investment in their respective countries. The policies the two countries encourage FDI in their mining industries with a view of exploiting the opportunities available and bringing in capital to their economies to the benefit of their citizens. However, there is still need to involve the citizens in the decision-making process and in the evaluation of the quality of the FDI in order to reduce the conflict arising from the community. The FDI projects could be good for the economic growth and development and may be well intended for the public, but failure to involve them in the evaluation of such projects is a recipe for misconception of the projects leading to resistance (Ali 2003, p. 72).
The mining industry is a very delicate industry in that its activities directly affect the natural environment before such activities benefit the society. This calls for a delicate balance between approval of mining projects and the execution of the same considering the need for a sustainable environment that will accommodate the citizens and the business for posterity. The bottom line of every government as representative of its citizens is to protect their interest of its citizens, which is what the government of Argentina and Nigeria is doing in their FDI policies.
Conclusion
The global economy is becoming more competitive and every nation intends to have a competitive edge in the market. Emerging economies such as that of Argentina and Nigeria with the massive endowment of the natural resources, but no capital to invest in exploitation have a responsibility to create an enabling environment. The enabling environment includes developing policies that encourage foreign direct investment to bring in foreign capital and help exploit the natural resources for economic development. Similarly, in order to have a successful FDI policy, all the stakeholders affected by such policies such as the community, the government and the MNEs need to engage collectively in trying to develop a common perception of the impact of any project before its implementation. By doing so, conflict of interest and varied perception on the quality of FDI will definitely be resolved. The MNEs too have a responsibility to embrace corporate social responsibility in order to protect the environment for a sustainable business.
References
Albaladejo M 2003, Foreign Direct Investment and Industrial realities in Nigeria: from bad to worse. QEH Working Paper, Number 102, Queen Elizabeth House, London.
Ali, S.H 2003, Mining, the Environment and Indigenous Development Conflicts. The University of Arizona Press, United States
Ayanwale A.B 2007, Foreign Direct Investment and Economic Growth: Evidence from Nigeria. AERC.
Auty, R.M. (2001). Resource Abundance and Economic Development. Oxford University Press, Oxford.
Dicken, P 2003, Global Shift: reshaping the global economic map in the 21st century, 4th ed., Sage Publication, London.
Elliot, M., & Cummings, G 2006, Exploring the risks: attitudes to risk in the global mining sector. Ernst & Young.
Epstein, M.J & Buhovac, A 2008, Making Sustainability Work: Best Practices in Managing and Measuring Corporate Social and Foreign Direct Investment, Environmental and Economic Impacts.
Gibson, R 2006, Sustainability assessment and conflict resolution: reaching agreement to precede with the Voisey’s Bay nickel mine. Journal of Cleaner Production , vol. 14, no.3-4, p. 334-348.
Johnson, A 2005, Host Country Effects of Foreign Direct Investment. The Case of Developing and Transition Economies. JIBS Dissertation series.
Mold, A 2004, “FDI and Poverty Reduction: A critical reappraisal of the arguments,” Région et développement, vol. 20, p. 92-120.
Mutti D., Yakovleva N., Vazquez-Brust D., & Di Marco M.H 2012, “Corporate social responsibility and Foreign Direct Investment in the mining industry: Perspectives from stakeholder groups in Argentina.” Resources Policy, vol. 37, no. 2, p. 212-222.
Stiglitz, J 2007, Making globalization Work, Sage, London
UNCTAD 2009, Foreign Direct Investment policy review Nigeria. United Nations: New York and Geneva.
Vazquez-Brust D., Yakovleva, N., & Mutti D 2013, Mining Foreign Direct Investment in Argentina: perceptions and challenges to sustainable development. University of Manchester, England.
Yakovleva, N 2005, Corporate Social Responsibility and Foreign Direct Investment in the Mining Industries. Corporate Social Responsibility Series. Ashgate Publishing Limited . England.
Ecommerce Industry And Competitive Environment Study
Ecommerce is not a new name for any of us and at the pace it is growing, Ecommerce is certainly proving to be the new face of how we to do business today. Before going into the details of Ecommerce industry study and its competitive environment, let us briefly analyze initially what Ecommerce is?
Ecommerce also known as Electronic Commerce is referred to the selling, purchasing and exchanging of services and goods over computer networks and all sales terms and transactions are performed electronically. It is believed that Ecommerce is referred to business done via internet only, which is not true as even before introduction of the internet, business to business transactions took place electronically via Value Added Networks (VANs) and Electronic data Interchange (EDI).
Ecommerce can be parted in mainly four categories
Business to business (B2B)
Business to consumer (B2C)
Consumer to business (C2B)
Consumer to consumer (C2C)
B2B category refers to companies doing business together in form of manufacturers selling to wholesalers and distributors and then to other retailers. B2C business is the best known form where businesses sell directly to customers. Whether you require to purchase a diary, a dress, a book or a toy, everything is available very easily on the net in a wide variety. B2C being a popular form of Ecommerce will be the main topic which will be discussed in this paper. C2B is referred to people selling their services to companies. For example companies on a budget post their job requirement along with their budget on special websites on which potential service providers bid to perform the job. The company then selects from scrutinizing candidates. C2C is referred to direct consumer to consumer selling in bidding sites or on auction sites. Many websites today offer the facility to directly post ads by consumers for consumers. These sites serve as a mutual trading location for sellers and buyers.
There are also other forms of Ecommerce too such as Government to Government (G2G), Government to business (G2B), Government to Employees (G2E), Business to Government (B2G), Citizen to Government (C2G), Government to Citizen (G2C) and several other types of other Ecommerce classifications.
Historical Ecommerce Industry Overview
The very initial instances of Ecommerce appeared in the initial phase of the internet in 1970s when electronic transactions began taking place in business networks designed specifically to simplify and modernize certain processes of a business such as sending invoices and filling of orders by customers. Ecommerce however became popular when electronic transactions became possible and home computers became common. Businesses availed this opportunity and the early birds are among the highest profit reapers online today.
With a history dating back to a few decades only, the growth experienced in computing technology and networking is exponential and even with a slumping global economy, the sales related to online retailing has is ever increasing.
One prominent name in Ecommerce is Amazon.com which presented the first full scale model of Ecommerce business in 1995 after the World Wide Web was introduced in 1990 by Tim Berners-Lee. 1994 and 1995 were the years that initially saw third party services being introduced in online sales in form of credit card sales.
The next name prominent in Ecommerce history is eBay. As Amazon introduced to the world a common platform practicing B2C Ecommerce practices, eBay levelizing the concept proved that one is not required to be an established entrepreneur or an existing online business to sell goods online. eBay paved way for C2C type of Ecommerce. Today people can buy almost anything online from home goods to shoes, fitness products and even a real shark tooth and all this owed initially to Amazon and eBay who paved the base road for Ecommerce merchants of today.
Although Amazon and eBay are the biggest and famous names that arose as first examples of Ecommerce sites, however they were not the first. The first reported Ecommerce site that initiated the online transaction process was Netmarket, and was the first online retailer that conducted the first secure web retail transaction. The transaction took place on the 11th of August, 1994, where Netmarket sold a Sting CD copy of the Ten Summoner’s Tales. The transaction amounted to $12.48 exclusive of shipping. Similarly the first online bank that performed financial transaction online was on October, 1994 when the Stanford Federal Credit Union offered internet banking facilities to its customers.
Assessing Ecommerce Industry Based on Michael Porter 5 Forces
The model depicting the intensity of the five forces in terms of Ecommerce industry highlights the Rivalry and Buyer power in Red depicting higher levels of intensities compared to substitute threats in Orange.
five-forces-analysis-porter
Model 1 – Michael Porter 5 Forces Analysis of Ecommerce
Assessing Ecommerce on the five forces defined by Michael Porter namely degree of rivalry in an industry, threat of substitutes, barriers of entry, supplier bargaining power and buyer bargaining power allows us to better understand the underlying situations of the industry and accordingly a brief analysis of the industry in terms of the 5 forces is given below.
Rivalry in Ecommerce is great owing to several sellers or players in a single field competing against each other to attract more and more customers. Competition among Ecommerce site is fierce especially with regards to prices as even a small shift in price goes a long way in defining the sales of a particular site within the whole lot.
The threat of substitutes is also relatively higher in the Ecommerce industry owing to a million different players offering the same or somewhat same (substitute) form of goods and services. Since the web has in fact transformed the entire globe into one single market place, this makes availability of substitutes even greater as newer techniques are defined every day that can easily and effectively replace older one, thus turning the strength of a seller on a single day into his weakness on the other. Staying updated constantly and continuously is a prerequisite in Ecommerce industry.
There is literally no barrier of entry in Ecommerce industry. Barrier to entry formerly in brick and mortar industries was associated highly to expertise and capital which has transformed into the least of new entrants worries today. This however does not mean that everyone who enters the industry will get noticed too. In a particular sector of Ecommerce where an old player has invested in time and money along with required knowledge, skill and capability, entrance for new potential sellers is not an easy task. For example any business that has heavily invested in EDI and is using it, will automatically create a barrier for new entrants in the particular trade center. However conversely, owing to the advancements in technology, new ideas emerge every now and then paired with the fact that need to invest heavily in infrastructure is also eliminated, it becomes easy in several sectors of the industry to enter, for example online banking. Since physical buildings are not required, through using advanced internet technology paired with an excellent marketing plan a very unique and successful online banking service program can be initiated.
Bargaining power of suppliers is great in Ecommerce in sectors where relatively low number of suppliers exist such as specialty products. However since generally a lot of suppliers are available, supplier bargaining power is compromised. Every business would want the best bargains from its own suppliers and lot of competition between suppliers equals to reduced bargaining power and vice versa. Also if any supplier is not enabled electronically, automatically its bargaining is reduced.
Bargaining power of buyers is immense in Ecommerce industry owing to the need of keeping production and management costs as low as possible to stay profitable at maximum levels. Also in terms of competing with rivals, Ecommerce businesses require to be as efficient as possible. Also the bargaining power of buyers in any particular sector of Ecommerce is associated with two factors the supply of the product and the number of competitors in a market. With a larger competitor count, buyers bargaining power is at maximum and vice versa. Similarly a surplus in the supply of goods in the market leaves the buyers at a higher bargaining power position. Citing the present Ecommerce scenario, buyers are by far in a much higher bargaining power in a majority of Ecommerce sectors.
Ecommerce Supply Chain Model
Typically an Ecommerce site’s supply chain can be broken down into Customer’s Demands and Feedback, Research Team Proposals, Manufacturers/Suppliers, Ecommerce Business, Digital Financial Institutions, Shipping Companies, Consumer.
Ecommerce Supply Chain Model
Model 1 – Ecommerce Supply Chain Model
Owing to the abundance of competition and the soul nature of Ecommerce industry as being closer and more aware of customer’s requirement, makes awareness of customer’s demands and receiving of feedback regarding product or service a prerequisite in many sites that operate online. Many of the top sites online follow the system of collecting feedback data from customers to device products accordingly to customer’s demands. Although there is a lot of other technological advancement and expert analysis going on in between the main players involved in the Ecommerce transactions as everyone wants to offer the best goods to customers in the easiest possible way however here we will be discussing the above mentioned cycle in particular. For a complex picture of the supply chain in Ecommerce industry refer to the Model 3 at the end of the report.
The normal transaction in an Ecommerce site starts from the manufacturer producing and presenting for sale a particular product that is designed according to present market demands. The products is then priced and presented online to be viewed by customers in the most appealing way that compels them to purchase it. One a purchase is done from a site; the next involved party is the financial institution that will take care of the transfer of funds from the purchaser to the seller. Finally when the customer is done with the buying experience from a site and receives the product, the last step is a feedback which every customer is asked to give regarding the experience and the product/service.
To particularly explain the buying experience of a consumer on Amazon, to better understand the working facet of Ecommerce sites, let us analyze a case study where a particular customer wishes to buy an iPod from Amazon.com. The very first step to shop online and benefit from eShopping facilities is to visit the Amazon.com site and search for the desired product (iPod in this case). The customer has three options to find products related to iPods purchase. Firstly he can find the iPod section on the main page of Amazon or search for it in the “shop all department” or simply visit the electronics category and find the iPod section. As soon as the customer reaches the iPod section, a wide choice of different types and makes of iPod will be available to choose and from them the customer can decide on the one that he wants. The customer will then select that product and add it to his shopping cart on Amazon. If the customer wishes to buy any other thing he can go for it before the payment options appear before him. Once the customer is done with his shopping, he will then proceed to checkout where he will have to go through the membership option if he is a new customer, whereas if he is not he will enter his email ID after which he will be giving all relative details including name, address, postal, etc.
After the shipping details are done with, the customer will then choose the shipping mode he prefers from the various different options provided by Amazon before moving on to the payment mode selection part. Amazon allows you to choose from whether you will be paying through your bank account, your credit card or through the Amazon.com store card. Next you can enter the promotion code for the product and after confirmation of the details being valid, the customer can finally once again confirm the order and the purchase is complete.
Manufacturers today are engaging more and more with their potential customers to offer them exactly what they want, as only those can compete in the industry that are fulfilling the demands of the customers. Knowing what a customer wants previously was associated to very few ways such as surveys, etc. Today however, finding out the preferences and demands of customers is easier as technology has enabled every business to reach out to its customers via social networks and direct online interactions. The supply chain of the Ecommerce industry has thus changed a lot as initially the manufacturer paid more attention on the emerging trends and produced products which were then sold to the customers and feedback was received. Today the supply chain starts and ends at the customers. Manufacturers today interact with potential customers to inquire and know more about their expectations and demands and then accordingly move on to the production phase.
One such example is Amazon itself which sores all data of the customer’s visit and the products they purchased, every comparison they made. Etc. Amazon literally stores in all information coming from every click of every visitor that visits the sites and through compiling these date along with the customer reviews, Amazon.com knows perfectly what a customer wants, prefers and demands.
Once this phase is completed, presentation of these products on the online site is the next place that is evolving through time. Initially sites that offered services or products for sale use to present simply the description of the product or a photo of it to its customers, however today technology has enabled Ecommerce sites to upgrade to phenomenal levels. Not only does these sites regularly upgrade what they present rather a very thorough description and closer to reality images of the product present the same feel and look that is offered in a brick and mortar store. Today you can investigate every corner of a product before purchasing it. In terms of prices, there are several sites that offer services in comparing what a site offers in contrast to others and based on features, effectiveness and price comparability one can easily choose the best service or products for themselves.
Next comes in the financial institutions that play a major role in transforming the Ecommerce industry today. Almost every bank operates online today offering online banking solutions. Ecommerce sites in order to facilitate customers offers a variety of online financial solutions to choose from. You can pay easily through credit cards, direct online transfers or also through online financial institutions such as PayPal. Every Ecommerce site offers a variety of payment options so that customers from the world over feel easy to purchase from that site.
In the past banks have been slow in introducing mobile banking payment options however today they too realize that it is the need of time and more and more banks are introducing mobile payment options. These options today are not only found in form of mobile banking apps but also non-banking players are moving in this area of providing NFC (Near field communication) services of payments to customers.
One latest example of NFC services incorporation with mobile payments is the Apple Pay. Recently Apple has announced its new payment feature, named Apple Pay, which is a NFC compatible system that will allow the iPhone 6 and 6 Plus users to make their payment at more than 200,000 US retail locations. Apple has also boosted up its security features addressing some of the top mobile payment concerns of the consumers. With this massive mobile payment option, the world of mobile wallet is expected to boom to new heights.
Mobile payments are not still very popular as at the end of 2013, according to a survey only 6% of adults in US claimed to have used a mobile payment option at the payment terminal however the percentage is expected to grow by 33% by the end of 2014. Mobile wallet adoption is at a high and the new millennial (individuals aged 18 to 34) are the top users of mobile wallets. The newly arising in-app crowd that is allowing a bypass payment terminal for users to make purchases via their phones is promising a fundamental change in how we pay in restaurants and bars making the whole process completely software driven.
Shipping companies or courier services are also a major part of the supply chain as the assuring processing of the goods to the customers in the shortest possible time effects the whole purchasing experience tremendously. Earlier on a few shipping options were present only and normally companies used to cater to local markets only, however today the scenario has changed completely. Companies today cater to international markets as well offering competitive ways to ship products to purchaser.
Lastly the process of receiving feedback which can also be termed as the initial part too is critical to the whole process as special research teams analyze the feedback and accordingly not only improve and enhance services and products but also the purchasing experience of the customer.
Through time as lot of change has been seen in this typical Ecommerce supply chain as earlier on the number of online financial solution providers was limited whereas today several different options are available. User interface has been improved tremendously owing to technological advancements and international shipping companies have made international shipping affordable and a pleasurable experience opposed to a few years ago.
Ecommerce Industry
Earlier on in Ecommerce scenario, the product was the main focus of attention for a buyer as they were more interested in the quality and price of the product, however with the increased competition online, a buyer can easily find today, the best product and prices and so the concern of customers has shifted considerably towards the best shipping and secure financial dealing options. The widespread of the internet has also conjured up a lot of fraudsters that are always after tricking people off their money and financial institutions to overcome this fear of shoppers regularly update and ensure safe and secure transactions of finance and related information. The margins of Ecommerce industry although do focus on the product and service however a shift towards secure financial options has been observed and the online financial institutions seem to be in a bliss of time currently in terms of earnings online.
Companies that offer secure financial transaction ability, diversity in product portfolio and a diverse selection of shipping options today are gaining that competitive edge over competitors. Owing to the same fact new payment options such as Apple pay or other forms of mobile payment will further revolutionize the online financial sector and the already blooming segment of Ecommerce industry is expected to see more enhancement and progress through introduction of more secure and easier payment options.
The supply chain network of Ecommerce industry is continuously showing shifts as initially the Ecommerce sites through a variety of low priced and competitive products were luring customers towards themselves and earning more money. However today with more and more easy mobile payments, big companies like Apple can reap benefits of the financial payment methods and sell their products easily to customers. Although sites that offer diverse products are the high earners today, the trend is definitely shifting.
Domino’s Pizza is a company that has been in existence since the 1960s and has used various marketing strategies in order to ensure it achieves its marketing goals. The organization’s logo was initially planned to include another dot with the expansion of each new store, yet this thought immediately blurred, as Domino’s accomplished quick development. Reflecting Domino’s development, the organization had extended to 200 saves by 1978. During 1975, Domino’s confronted a claim by Amstar Corporation, the creator of Domino Sugar, asserting a trademark encroachment and uncalled for rivalry. In May, the Court of Appeal in the New Orleans found for Domino’s Pizza. This strategy helped protect their market and customers from copyright infringement.
Evaluation of current competitive advantage
In evaluating the current competitive advantage for Dominos, it is quite imperative to understand the company’s current market and how it has survived through the market to gain its marketing niche. Evidently, the company has achieved great success in its current market due to various marketing strategies such as the use of SWOT analysis to help in ensuring it identifies its strengths and weaknesses in order to carry out its activities in an effective environment.
SWOT Analysis
Strengths (S)
The company has a competent leadership that will steer it towards success through effective marketing.
The provision of after sales services and other support services for the clients will give the company a competitive advantage such as Pizza deliveries
Weaknesses (W)
The company is venturing into new territory with no prior experience. This might work as a disadvantage to them as they might not know how to handle any arising issues due to lack of experience.
The company could face challenges in the lack of enough finances to propel the strategy and goals of the company.
Opportunity (O)
The company’s employees and management can engage in tactical marketing by promoting their services in the local newspapers.
Threats (T)
Dominos faces threats from the bargaining power of its suppliers. This makes it challenging for the company to grab a large market share.
In May 1983, Domino’s got to open its first worldwide store, in Winnipeg in Canada. Domino’s also opened a 1,000th store. In 1985, they opened the first store in the UK in Luton. In 1985, Domino’s had the first stores in Tokyo, Japan. By 1996, Domino’s had stretched to 1,200 global areas. In 1997, Domino’s launched its 1,400th universal area, opening seven saves in one day over five continents. Between 2007 and 2012, Domino’s bit by bit secured the vicinity in India with no less than 1,000 zones by 2012. By the start of 2014, the organization had developed to 6,000 worldwide areas and wanted to stretch to the pizza’s origination, Italy. President Patrick Doyle during May 2014 said the organization would focus on its conveyance demonstration there. This paper seeks to look at how Domino’s will use the various marketing strategies in their African outlet in South Africa.
Domino’s Mission Statement
Dominos has a simple and clear mission which states, Sell more Pizza, have more fun!
Reasons for choosing South Africa
South Africa is situated as an upper-focus wage economy by the World Bank and is viewed as of late industrialized country. Its economy is the second greatest in Africa and the 28th-greatest on the planet in the extent of buying. South Africa has the seventh most elevated for every capita for each wage in Africa, notwithstanding the way that poverty and predisposition stay in all cases, with around a quarter of the masses unemployed. In any case, South Africa has been perceived as a middle power in worldwide issues and kept up huge territorial effect (Blecker, 2006).
Market Analysis Summary
South Africa comprises a mixed economy, the second greatest in Africa after Nigeria. It similarly has a reasonably high GDP for each capita stood out from distinctive countries in Sub-Saharan Africa. The food business in South Africa has united liberally starting late, and today a discriminating number of the greater pizza makers have budgetary associations or key plots with the critical South African retailers. The pizza industry, on the other hand, has greatly improved altogether. So have the five greatest retailers, and together this record for about a large portion of total retail bargains in South Africa.
The Pest Investigation
Political
It suggests the courses in which the government can intercede in an economy in regards to natural and work laws, obligations, exchange confinements and obligation methodologies. It moreover exhibits how the organization can impact preparing and prosperity and how it will impact the base the associations. As a South African government Plan follows, the structure of the economy will be changed over through industrialization, wide based dim budgetary fortifying and bracing and broadening the piece of the state in the economy. The company currently has a soft landing due to the implementation of various government strategies to the South African market. In order to achieve the best service delivery in the market, the firm has come up with the best strategies that can be used to ensure that the marketing environment favours them. Additionally, the government tariffs in South Africa are affordable for the company hence allowing it to carry out business activities effectively without having to face strict policies (Stevens, 2007).
Investment Factors
South Africa has jumped over two spots to transform into the thirteenth most-appealing end of the line for outside quick financing, according to a late survey by overall guiding firm AT Kearney.
The outcome of the 2014 Foreign Direct Investment Confidence Index, which takes in the viewpoints of senior executives from 300 of the world’s heading associations in 26, separates countries. South Africa being one of the best performing nations in Africa, investment factors directly favour the company hence allowing it to have as much outlets as it can manage.
Economic Factors
Strong economies have more money being differentiated in a given gathering; there are various financing assumptions that impact retail arrangements, and these need to get explored with a determined eye. One of the best-budgetary parts that impact retail arrangements is occupation open entryways, which particularly prompts the included discretionary pay of people that imagine that it hard to contradict inspiration buying, and who have no issue gathering gigantic charge card commitment to keep up a certain lifestyle. South Africa’s economy is seen as “unobtrusively free,” being surveyed as the 74th autonomous economy of 177 countries. It is situated sixth, out of 46 countries in sub-Saharan Africa. The economic factors in South Africa are quite useful since they have allowed the company to gain popularity and increased the earnings of the company over time (Stevens, 2007).
Target Segment and Marketing Strategies
The target of Domino’s pizza is to serve the locals with a grouping of types of foods that they encounter issues finding in one spot at any supportive time. We will serve every ethnic gathering with a blended pack of pieces of foods depending upon their feelings. These business segments get underserved in the noteworthy retail outlets. In South Africa, the potential for the clients to purchase will be higher. Since it has a marginally lower unemployment level as contrasted with other African nations consequently, they can buy our items
Market Needs
Domino’s Pizza needs to ensure that it carries out an effective research on the market needs of various prospective buyers by including its list of preferred products in the brochures that should be distributed to the customers within the shortest time possible. In addition, identifying the market needs will also help the firm in ensuring that it achieves the best competitive advantage strategies that will help in making sure its marketing strategies are effective.
Market Trends
Practicality is basic to the organization’s long haul achievement. It has risen up out of the need to certification it continues succeeding inside an unquestionably pressurized and eccentric nature, by making fitting abilities and breaking points. The manageability wander has helped the social event expand a deeper understanding of nature’s turf in which it meets expectations, clearing up the specific internal and outside issues most separating to long term viability. Moreover, the approaching examples and change in plans that will help Domino survive is its values and takes after styles and new examples among youngsters (Pliniussen, et al., 2002).
Market Growth
The GDP in South Africa annually was about 0.6 percent during the first three months of 2014 over the past quarter. GDP Growth Proportion in South Africa found the middle value of 3.16 Percent between 1993 and 2014. The growth proportion in South Africa is encouraging since it encourages investors in South Africa. As a result, it is quite imperative to help in ensuring that the market is fully occupied by their products in order to gain access to more customers. Marketing being one of the factors that guide the development of a firm’s products or services, there is need to help in ensuring that the products will lead increase in profitability.
Marketing Strategies
Domino’s competitive position in 3 years’ time
In the next three years, the company aims at covering the best market share and giving the best services to their customers. As a result of intense marketing strategies that involve proper market research and consumer acceptability, the firms aims at being one of the largest in the South African market. Additionally, it is apparent that proper market analysis and use of Porter’s Five forces of competitive advantage will allow the firm to gain the best customer trust. It is also evident that firms need to ensure that they give the best services since there is need to have as many customers as possible.
Industry Analysis
In order to achieve the best competitive position in the next three years, the company needs to ensure that it works with the industry analysis to ensure that it identifies the gaps in the market. Our thorough appraisal of South Africa’s working surroundings and the viewpoint for its heading divisions are structured by bringing together an abundance of information on worldwide markets that influence South Africa, and in addition the most-recent industry advancements that could affect South Africa’s commercial enterprises. This interesting coordinated methodology has provided for us an impeccable record of accomplishment for foreseeing imperative movements in the business sectors, guaranteeing we are mindful of the most-recent business open doors and dangers in South Africa before our rivals (Kim, Fiore & Kim 2011).In the year under audit, South Africa was a solid entertainer regarding the matter of getting credit (first), securing financial specialists (tenth) and instalment of assessments (32nd). It got positioned at an impressive 39 for managing development allows, and beginning a business in South Africa is additionally simpler (53rd). Moreover, the best approach to powerful arranging is using a showed wanting to look at your product’s marketability (Stevens 2007).
Main Competitors
Understanding the major competitors is important in helping the company chat its way towards the achievement of its marketing goals. Knowing our competitors’ sales technique and the apparent nature of their stock will help us know how to come in, as a new Pizza business. Dominos is the largest pizza manufacturer in the country. It supplies major retailers such as Woolworths, Truworths and Econ. Domino’s has been experiencing financial difficulties since 2008, this provides us with a good opportunity Armani is financially stable (Okonkwo 2007).
Pricing Strategy
Pricing is a part of the advertising blend that decides your organization’s profit potential. In a focused business sector, the objective is to offer what clients need and to set costs that the market is ready to endure (Engle 2008). We will utilize different estimating routines as part of the request to draw in our clients. By using the most favourable prices, the company aims at becoming the customers’ most preferred outlet in South Africa and the African continent.
Competitive Pricing
A pricing strategy involves setting your apparel prices below or above the competition. As a firm that needs to build the best marketing strategies, competitive pricing is one of the most preferred strategies that the firm seeks to use in order to gain the highest market share in three years. In addition, the firm seeks to provide special services that are not offered by other firms in order to gain more customer loyalty. In three years, the firm seeks to include delivery services to customers who might need the products of the company but are not able to reach the firms premises (Mills, 2002).
Markup Based on Cost
A mark-up-based-on-expense procedure considers the assembling expense of a thing and the most-elevated value the business sector can stand to return adequate net revenue. In three years, the firm seeks to come up with the most effective way of attaining customer trust by selling its products such the high quality pizza. Regularly evaluating involves multiplying the assembling expense of a particular thing to yield a real or proposed retail cost. In order to become the best firm in South Africa, Domino needs to utilize this strategy in order to gain the highest number of customer.
Discount Pricing
There are a few approaches to Discount Pricing to expand client loyalty and helps guarantee overall revenues, for example, by offering coupons, gift certificates, occasional deals and in-store cross-promotions (Harrison St. John, 2008).
Clear recommendations on what the company needs to do to achieve the three strategies
In order to achieve the above strategies, the company needs to use Porter’s five forces of competitive advantage. Ideally, the strategies will help in ensuring the company attains the best in the market in order to beat its competitors and gain the highest market share.
The first force I would look into is Supplier Power: Here I would assess the ease of driving up prices by suppliers. Under this force, I would asses various suppliers and their prices. In addition, I would evaluate their effect and control on the business the management is intending to buy. The lesser the supplier choices the business has, and the more the business need the help of suppliers, the more powerful our suppliers would be (Blecker, 2006).
The second force is Buyer Power: under this, the company should ask the ease at which buyers can drive prices down. Moreover, this force would be driven by the number of buyers, as well as each buyer’s effect on the business that the management intends to buy. If the company deals with few buyers, who are powerful, then the buyers can often dictate terms to the business.
The third force that I would use is Competitive Rivalry: here, it is essential to look at the capabilities of the firm’s competitors. If the firm’s competitors have high quality products that are of more friendly prices, then I would advise the management not buy the business. On the contrary, if the firm has weaker competitors with low quality goods and services, then I would advise the management to carry out the purchase.
The forth force that I would consider Threat of Substitution: This factor is mainly affected by the customers’ ability to find an alternative source of what the company supplies. If substitution of the firm’s goods or services is easier for the consumers and substitution is viable, then I would advise the management not to buy the business since this would weaken the power of the firm. The last force, according to Porter, is the Threat of New Entry: this is looked in the perspective of other firms entering the market. If the business would cost little time, legal requirements or money to enter our market and compete efficiently, then I would advise the management to buy the new firm. In addition, if the economies of scale are few, then I would advise the company not to purchase the business since that would weaken the company power. In case the business has strong and durable entry barriers, then I would advise the management to take advantage and purchase it. This would eventually have a great impact in helping the company gain the best market share.
Another major factor that needs to be used in order to access the largest market share is technology. Specifically, the firm can use technology in advertising and making good use of its available computers to reach customers via the social media channels and other technological adverts. As a result, the company will have better access to the best clients who will help in improving its profits and marketing strategies (Kalb, 2007).
Recommendation
Domino’s Pizza needs to ensure that it implements all the strategies mentioned in the paper in order to achieve its marketing objectives and in order to get a larger market share for its products. In addition, the company needs to ensure that it works towards achieving the best sales from the products due to better pricing and marketing techniques. Besides, Domino’s has to come up with the most achievable objectives that will help it work towards maintaining the current marketing position. This can be done by opening a number of international branches. The South African branch should, therefore, work with other branches to help Dominos become successful in its marketing strategies.
References
Harrison, J. & St. John, H (2008) Foundations in Marketing Strategies. Mason, OH: Thomson/South-Western.
Kalb, I. S (2007) Fundamentals of High-Technology Marketing Strategies: What Marketers Need to Know. Los Angeles: K & A Press.
Mills, G (2002) Retail Pricing Marketing Strategies and Market Power. Melbourne: University Press.
Stevens, R. E (2007) Marketing Strategies Opportunity Analysis: Text and Cases. New York, Best Business Books.
Schindler, R (2012) Pricing Strategies: A Marketing Strategies Approach. Thousand Oaks, California Sage Publications, Inc.
Blecker, T (2006) Marketing Strategies, Customer Interaction and Customer Integration. Berlin, Gito
Pliniussen, J. Jones, T & Cram, W. A (2002). Business Case Analysis Process: Workbook With Software: Broadening the Perspective. Concord, Ont., Canada, Captus Press.
Cultural factors in diagnosis and treatment are highly imperative. This paper includes critical thinking on the perils of using mainstream methodology with non-Western cultures.
Cultural factors have deep roots in the clinical psychology. Cross cultural psychology has now become an inseparable idea in clinical psychology. Culture cannot be avoided in order to make a precise judgment on mental problem. The paper is based upon literature review on various academic articles and books written to cover the significance of culture in clinical psychology. It offers systematic review based upon authentic basis regarding psychological treatment considering the cultural factors involved in diagnosis. Efforts are expected to focus on accurate judgment, suitable therapeutic process and an eventual release of the painful feeling.
The capable psychoanalysts must be devoted, and eager to understand the cultural backdrop, past experiences and its correlation with the psychological diagnosis and handling of the case. Also a patient from non-western cultural background must be treated with extreme care while considering his cultural beliefs as important indicators to achieve optimum output; an ultimate relief for the patient.
Respecting the consensus developed by historic and contemporary professionals, a psychologist can enhance efficacy of the treatment and avoid the perils of the mainstream methodology in treatment of non-western cultures.
Cultural factors are one of the most significant variables in the field of clinical psychology. A clinician cannot aim for precise diagnosis and appropriate treatment without considering the culture of the patient as a guiding principle, as many of the psychological behaviours are directly influenced by the cultural norms.
The paper presents a review of different cultures and their requirement for the diagnosis of treatment on mental health problems. It will also highlight potential harms of applying mainstream methodologies on a non-western client. A detailed literature review will explain the main aspects of non-western culture and culture related attitude on mental health.
While treating the mental disorders, it will be useless if a general method is applied on everyone, without studying the socio cultural background of the client and salient features of the specific culture. We can explain its importance through an example; drinking habit may be a serious issue in a culture and may demand psychotherapy to get rid of it, but it is possible that it is considered as a normal thing in another culture.
Also shyness of a female towards the males can be considered as a psychological problem in the western culture, though it may be considered as a normal behaviour in non-western traditions. Any diagnosis cannot be appropriate unless it is seen through the lens of the culture. Every psychological disorder has a deep connection with religious beliefs, ethnic norms, and native environment.
An expert clinician has to identify that root first before making a professional judgment on the problem, type of treatment and therapeutic process required, and mannerism of the sessions, and required cultural sensitivity aspects during the therapies. The need of cognitive testing can only be identified after thorough analyses of the cultural factors behind the problem.
Cultural factors in psychological diagnosis and treatment; an overview
Psychological diagnosis is very much dependent on the symptoms in human behaviour. Talking about the general perception on mental illness or disorder, anything different from a usual behaviour is referred as a psychological disorder. These perceptions are closely related to the culture possessed by the patient and also the interpretation of any behaviour as according to the cultural norms.
We can understand this phenomenon by an example of some sort of mania. Mania is almost a common problem found in almost all the cultures, but the clinician must be very careful in diagnosis, as there is a probability of confusing the culture related expression of distress as wrong diagnosis of mania. We can observe cultural diversity in stating the depression, but it may be under diagnosed, usually on initial stage and careful measures are not taken.
It is true that somatic characteristics may be identical in all the cultures, yet, it is critical to differentiate physical descriptions of a sentimental situation. Generally ways of expressing depression are different in all the cultures, however, sad mood, unwillingness in enjoying something, nervousness, and feeling energy less are common symptoms of depression. Culture cannot be neglected for any sort of psychiatric treatment like, while classifying depressive disorders, for example, we have to consider both internal factors within the individual and external factors related to the culture of the subject (Cowen P. et al. 2012. p212).
In the discussion, as it follows, various culture factors will be elucidated as they influence psychological diagnosis and treatment in various situations. It is also important to know how the treatment can cause harm instead of healing the suffering if a client from non-western culture is dealt in mainstream methodologies of diagnosis and treatment.
Cultural diversities and mental health
Culture is an inherited asset which travels from generation to generation. This is a factor which has direct influence on all aspects of the lives of human beings. As far as the approach on mental problems is concerned, it varies from person to person, family to family; various ethnic groups, culture to culture and country to country.
It has been observed that culture and religion have a strong influence over the mental health of a person, and initiation of mental illness. Also cultural mannerism of responding towards such problems, determines the extent of agreement of the patient for mental sickness treatment and consistency in this regard. It is very important to understand that representation of mental wellbeing service demands cultural sensitivity for improving acceptance and awareness on the use of these services.
This will help to reform approach about mental illness, as it is different from the one customary in the west. We can review a case study to understand this difference. This comparative study was conducted by universities in India and America, to compare behaviours in India and USA. It was found that the students from India perceived depression as an outcome of the factors like, being unsuccessful in achieving goals, or else which can easily be controlled by them individually, and felt that only way to manage depression is to ensure social facilitation and religious practices. They suggest that understanding and treating depression must consider diverse point of views on mental illness for enhancing the efficacy of mental wellbeing plans (Nieuwsma, J.A.et al. (2011). p 539-568).
Relationship of psychology and culture has been discussed by many expert psychologists, according to Triandis H.C. quoted by Kitayama S. and Cohen D. (2010), history of psycho-cultural tendencies have shaped the contemporary approaches of cultural psychology, and the future of this field is also based upon the same.
He emphasizes on the close connection of the language; a salient feature of each culture, and psyche. He believed that language is the key to understand the thoughts of the speaker. Due to interaction of various people within the same culture, many agreements are found on the ways to behave collectively. These practices by the time shape the mind accordingly, thus we can say, an individual expresses his culture which he has been brought up (Kitayama S. and Cohen D. 2010).
Mental illness as a stigma in various cultures
Perceiving mental disorder as a shameful fact may be due to many reasons, for example, any of the apparent reason of the sickness. Many studies have reported other major distinctions in behaviour towards mental illness amongst cultural groups in the USA. Carpenter-Song et al. (2010) performed a thorough, one and a half year long culture based study.
The subjects for the study were 25 patients with critical mental illness. These were European-American patients engaged in regular treatment by expert psychiatrist, inclined to state convictions about mental sickness associated with medical viewpoints about the illness. Contrary to this, people belonging to Africa, America or Latin patients were more liable to highlight non-medicinal explanations about the signs of mental disorders.
Though, all the subjects from 3 cultural clusters shared about some sort of stigmatization because of their mental problems, this very shamefulness sentiment proved to be a main part of the African-Americans reactions, hence it was not focused in case of European-Americans, instead they inclined to consider mental problems as major and most important side of the human requirements on health.
As far as African-Americans were concerned, they were frustrated when the clinicians emphasized on the need of medication. In case of Latin persons, they generally considered diagnosis of mental sickness to be a severe damage to their social image and status; they focused on stating the sickness on a very low severity to stay safe from extreme stigma (Carpenter.S. E. (2010) p 224-251).
As argued earlier, when we talk about stigma, its severity may be different in different individual cultures, which refers to a diverse nature in western and non-western cultures. In the non-western culture, sentiment of dishonour linked with mental disorder is very high. In such cases a mental situation, in which the patient thinks as if he is humiliated or not cared by anyone, leads to extreme loss of self-belief; thus the symptoms of mental sickness may even enhance.
Another evaluation of the association between ethnicity & cultural beliefs and mental disorders is conducted by Abdullah et al. (2011). This study illustrates thoughts on broad diversity of culture related ideas embedded in mental condition. For instance, a number of the cultures may not regard mental disorder as a cause of disgrace, some of those only focus on the extreme problems but others may feel shame on disorders of any level of problem. Generally, non-western people are highly anxious about their traditions, self-control, individual associations and expressive connections, mental illness is taken as shameful dilemma, not only for the specific person, but for the whole immediate and extended family. (Abdullah et al. 2011)
Resistance from the patients
Bailey et al. (2011) have shred about reluctant behaviours regarding mental treatment. He notes that sense of being ashamed, religion related misconceptions, lack of trust on the clinicians and language barriers and communication issues may be the reason behind this resistance in opting for mental health treatment as required (Bailey, R.K.et al. 2011 p 548-557.) In certain cultures clients show a lot of resistance just to satisfy their self-respect that they are normal and it will be real dishonour if they admit and accept need for mental treatment.
That is the main reason behind the concept that understanding culture of the client is very important, so as to understand the root causes of the resistance and reluctance. During the therapies, the clinician must develop a good rapport with the client, which is only possible with some awareness on the culture of the client. An expert clinician must focus on building a good relationship with the client during a few initial therapeutic sessions.
It may be performed through friendly discussion demonstrating interest in getting awareness on the client’s culture, which must be complemented through attempts to gain knowledge on the same through books and other sources, such as, friends and family of the client, other members of the same community and other internet sources.
This way the client will share many thoughts from his subconscious, and the root may be identified, along with a great control over the expected resistance from the client. Especially when we talk about non-western culture; as argued earlier; their stigma may be a great source of resistance. This can be overcome, if the client receives friendly signals from the clinician, and a sense of trust worthiness for thought sharing.
Cultural sensitivity while treating non-western clients
Generally, Non-western clients, especially Muslims adhere to their religious beliefs; therefore, it is crucial to be aware on the cultural heritage, and religious background of the Muslims for the contemporary psychologists, so as to ensure efficacy of the treatment, as this group of clients is rather difficult and needs to be understood properly. We have a discussion about the Muslim cluster in the non-western culture as it the biggest majority group in the non-west representation.
Considering religion, as a central point of the human life, makes it possible for a practitioner to manage therapeutic process with a high level of skill and anticipation of the optimal output, when tackled in religious framework. Religious beliefs, spiritual thoughts and mental health have an interesting correlation to apply for treating several mental disorders efficiently. Keshavarzi H. and Haque A. (2014) in an article highlight the need of improving the psycho-treatment procedures with the help of its integration with the culture and religious values, while treating Muslims for psychological disorder.
Religious faiths about the reason of mental sickness are typically unconnected to biological systems. Most of these are considered as a curse due to any bad deed in the past, or due to some spirits. However these symptoms may be different in the young and old generations. Also the nature of sickness differs in the native non-western client and second generation borne in a different culture. (Keshavarzi H. and Haque A. 2014)
Keshavarzi H. and Haque A. (2013) also quote Veling et al., (2008) who have highlighted non-western tendency of community based culture. It is a general norm that Muslim are fond of replication of a community environment similar to the native culture, wherever they live, such as community centers, caring for right of neighbours, selfless attitudes, mutual reliance and family values. These strong bonding practices generally tend to reduce chances of mental problems.
Cultural Factors Psychology
Lack or absence of cultural knowledge, especially on religious faith, norms and practices by non-Muslim therapists may be a hurdle in creating a remedial association with the client. It is important to be aware of certain practices which are extremely conflicting with Muslim cultures as observed in the west. Male and female interaction can be one of the examples, which is extremely prohibited in Muslim culture, though considered a normal matter in other cultures. This can lead to a serious problem during the sessions, if not understood according to the cultural requirements. For the therapist, it is also recommendable to make collaboration with religious leaders, so as to enhance religious understanding on the Muslim psyche and Islamic modes of treatment (Keshavarzi H. and Haque A. 2013).
We see that there is lack of sufficient materials on culture specific treatment methodologies for non-western clients. Many therapeutic concepts cannot be applied on the non-western client the way these may probably be efficient for the western client. Treatment of non-western client, though complicated, it also holds many helpful resources within its roots.
As we see that in the non-western culture, family values and social relationships are highly cherished. These may a helpful tool for resource mobilization. To cope with language barriers family members can be a helpful resource. Another precaution is also recommended by Cowen P. et al (2012) that assigning a translator during sessions also demands special care about the selection of the person to interpret. As a general observation it is a fear that involving a translator, other than the therapist himself, may cause difficulty to achieve specific results, besides ever-increasing the duration of the meeting. Mare transformation of the language may not be helpful while the person is not a health expert, sometimes the spirit of the conversation is lost while translation process.
This problem can only be conquered with the help of same community members, close family relation, or assigning a professional psychologist, the responsibility to communicate and interpret with the non-western client, and then be a part of diagnosis and therapeutic process. These dissimilarities are not exclusive for Muslims only; the other representatives of the non-western culture, such as Hindus and Buddhist are also different in terms of their traditions, norms and their approach towards mental illness, from the western culture. The same requirement of studying the specific culture persists for the therapist for a patient who belongs to any of these cultures (Cowen P. et al 2012).
All these arguments on the study of clinical psychology elucidate that dealing mannerism must represent adaptability according to the requirement of the culture when handling patient from a culture, which the therapist does not belong to. It must be understood that mainstream psychological methodologies might not fulfill the extraordinary needs of the situation.
It is also quite natural that a single person may not possess the knowledge about each and every culture in the world, which makes things more complicated for the psychologist to have the anticipated outcomes. In some cases patients may even assume biased behaviour from any person or a group, financial stress, and a feel of inaccessibility to services if he is uncomfortable in any other culture, this might transform into the symptoms of mental illness later on. As a general observation, most of the cases of migrants emerge due to adaptability issues and may become severe if not handled on time with due diligence (Cowen P. et al 2012. p. 26. Ch 3).
As argued earlier, mental health issues with the systematic application of connection with the clients may notably increase because, most of the issues come forward because of cultural intricacy. Even the best knowledgeable practitioner may not be able to ascertain mental well being of a patient, if, he does not make himself well aware of the culture; the patient is coming from, and all probable cultural approaches which may be contributing in increase of mental illness motives in the subconscious of the patient.
The contemporary studies emphasize that culture has unambiguous connection with psychological problems. A psychotherapist must not stress on conservative systems of treatment, and bring in inventive thoughts in accordance to the requirement and judge diverse features of cultural psychology (Tseng W.S 2008).
As we learned from Keshavarzi H. and Haque A. (2014), that initial effort for applying the psychological approach is the precise judgment of the issue and the performance level of the patient. In this regard, the therapist has to collect information which is essentially required for treatment. If the judgment indicates a high tendency of the client towards religion, the therapist must take that into account. This may be evaluated during initial informal discussions through the use of terminologies and his general approach.
The clinician must have an intention to develop an understanding with the patient on how the objective of the treatment is set. Later, a detailed session should be conducted to assess how he expects the improvement as a result of the therapeutic process. If the patient does not take interest in self-actualization, and wants focused attention to the specific problem, therapist must not resist, and make the client comfortable, removing discomforts of cultural difference (Keshavarzi H. and Haque A. 2014).
When we talk about the cultural beliefs in Arabian culture we cannot exclude religious and traditional methods of the psychotherapies. The majority of the Arabs rely on conventional healers, also referred as faith healers, such as experts of herbal medicines, religious elders of the region, healing through rituals. Unfortunately the initial level of mental disorder is assumed to be an assault of evil spirits such possession of the body, which can just be treated with the help of rituals. Treating the mentally ill person is believed as a punishment for the patient, that might mark him as a crazy or abnormal person forever, thus restricting hi normal movement in the in the society for the rest of his life (Parekh R. 2013).
The most complex idea about this subject is the command of a clinician about the features of every culture. Though it is not simple but the clinician must be open to learn about the cultural features which truly have an effect on the healing procedure. Cultural knowledge compliments the success of the healing procedure by demonstrating respect for the patient and the culture. The most important aspect of the point is that a proficient psychologist must be impartial, enthusiastic, and considerate on the cultural surroundings, the history and its link with the course of analysis and therapy.
The whole discussion stressed over an idea that culture and psychology cannot be viewed in isolation; we cannot suppose on the performance of brain and a culture bound psychosomatic approach, linked with one culture and expected to apply in any other culture, these aspects must be taken into account during therapeutic process.
While treating non-western clients, we must be clear on a few general distinctions in the culture, Such as:
Adaptability issues
Effect of religious beliefs on psychological beliefs
Strong family bonding
Reluctance of women on open communication with a male therapist,
Entirely different social environment
Less preference of psychological treatment as compared to physical issues.
Language barrier
Keeping all these aspects in mind, a clinician has to show respect for that cultural characteristic to develop outstanding professional relationship with the patients. Talking about sentimental problems in a responsive manner may help in this regard, because, general tendency of the non-western clients demonstrates shyness in discussing personal events, which may point towards the roots of the problem which may be linked with the cultural beliefs. Thus, to discover secrets of the subconscious, information on the patient’s culture is unavoidable.
As we have already discussed that family bonding and social relationships are very strong in the non-western culture, these may also give rise to some problems related to the expectations associated with these values. These false expectations may give birth to a feeling of disappointment or betrayal from a close person. It also makes them feel that those people have wasted their sacrifices and have not cherished their support. This leads to anger and fury for their own selves as well as for others.
This also gives rise to hopelessness, and trust over others including their psychologist. It can also result into discontinuation of constructive attitude; which generates dire need of family support, counselling and cognitive therapy with individual. A feel of being deprived regarding marital rights can be an example of such cases. These sort of cases are culturally sensitive and may be dealt with high care, after acquiring sufficient knowledge of the specific cultural values and norms (Keshavarzi H. and Haque A. 2014).
Mainstream methodologies: Benefits and Perils
Before concluding the paper, we must focus on the perils of the mainstream methodologies when applied in non-western culture. During our argument, one thing has been concluded that we cannot study psychotherapeutic treatment in isolation; culture must be included in the analytical process. We can classify the type of clients in two culture specific groups:
Western culture
Non-western culture
Both have very clear dividing lines for general understanding on cultural beliefs. As we conclude that cultural beliefs play a major role in psychiatric diagnosis and treatment. The very first step involves the basic understanding on the culture of the patient and to what extent these beliefs and norm influence his cognitive behaviour. Though these are the two basic cultural groups, the non-western cluster may further be divided into more clusters based on religion and geographic trends.
Muslims; the largest group in the non-western culture are more influenced by the religious education, rituals, spiritual treatment and other limitations. The beliefs of the patients may not be agreed by the practitioner, however it is important, not to argue with the patient, and give him a feel that the practitioner believes him and respects his point of view. Other clusters within the non-western cultures should also be dealt accordingly. Suspicion on the clinician, being afraid of the treatment, being afraid of racist of discriminatory approach, language and communication barriers, and cultural & religious issues may hinder the successful treatment (Keshavarzi H. and Haque A. 2013).
This reaches the following understandings:
Considering culture is the most important aspect in psychological treatment.
Initial meetings should be focused on gaining awareness about cultural and religious tendencies of the patient.
Physical interaction between male and female is strictly prohibited in non-western culture; this must be avoided at any condition.
General methodologies may not be applicable to all the patients. In the study of psychology, every client has his unique identity, he must be dealt individually. The approach that proved to be successful for treating depression of a western women, may not work for exact replication for a non-western woman.
The clinician must not try to influence patient’s cultural beliefs.
The clinician must show respect for the culture to develop mutual trust and good professional relationship.
Mare translation is not enough for the sessions, the interpreter must be a professional therapist, or a family or community member of the patient if the first option is not possible.
Consultation with the family is also recommended when possible. This may also help to overcome stigma and seek early healing of the problem rather that making it worse due to delayed treatment.
Depressive disorders may be similar in different cultures, however, the therapist must study, what is hidden behind the symptoms, inside the cultural context.
Conclusion
As a concluding note we can easily claim that psychiatric diagnosis cannot be made leaving the cultural factors behind. Making an attempt to do so may lead to commit wrong diagnosis and ultimately a wrong treatment. In advanced clinical psychology, wrong diagnosis and treatment is as dangerous as an unnecessary medicinal injection.
A clinician has to demonstrate high level of professionalism and skill to handle the case with careful cultural sensitivity. There may be chances to disagree with the client belief, and also his cultural belief may be opposite from the therapist’s cultural norms, yet, he must not mention so in front of the client. There is high probability for resistance from the client and he also may show distrust on the treatment, however, the therapist has to be unbiased and temperamental. He has to make the client feel that his opinion is respected; being a leader or teacher may not be an appropriate approach, rather than being a facilitator.
As any unnecessary medicine may cause harm, in the same way, wrong approach towards cultural psychology may be equally harmful. A uniform methodology may not be applicable in all cases. If the client is under strong influence of religion and other features of the culture, it may not be ignored. A good rapport with the client is a half way towards the successful psychological treatment, and understanding the Cultural Factors is the map to reach this destination. .
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