Cross culture management Essay Example | Topics and Well Written Essays - 500 words - 1

Cross culture management - Essay Example To cater for the supply in Europe, Africa, and Middle East, Nokia had established plants in Finland, Hungary and Germany. Nokia’s plant in UK produced Vertu. Nokia had mostly located its plants in low cost countries like Mexico, China and India in order to maximize profitability. Nevertheless, a vast majority of workers belonged to Western European countries like Germany and Finland. Despite that, the labor costs in countries like Germany were less than 5 per cent the product cost. Nokia had sales and marketing unit and a devices R & D team in Germany in addition to the production plant. Thus, globalization has encouraged Nokia to move its business totally to the CEE countries where it has to pay simpler and lesser taxes and increase profitability by paying low labor and non-wage labor costs. Ans. 2 Nokia’s plant in Germany accounted for no more than 6 per cent of Nokia’s global supply while the personnel costs matched 23 per cent. The high labor and non-wage lab or costs in Germany were not conducive for the desired profitability of production. Thus, Nokia decided to abolish its plant in Germany. Germany’s backlash upon Nokia was partly justified because of four underlying reasons: 1. Nokia was not going in loss in Bochum. It was making profit that was only increasing year by year. 2.