Since the advent of the North American Free Trade Agreement transactions across the border between the United State and Mexico have become more commonplace. This is not to imply that the cultural divide has diminished, as both countries take pride in their individuality. When working across borders, as is the case in “Mexico Venture”, taking account of cultural faux pas’ is of utmost importance; these negotiations involve risks that are not present in domestic partnerships. In this instance, Morgan, has to understand Martinez’s position to protect his interests, specifically those of cultural importance.
As evidenced by Trompenaars, Morgan is presumably walking into a trap, as the backgrounds of our protagonists are both highly correlated and highly divergent. The US favors individualism as opposed to communitarianism and specific versus diffuse work-life boundaries. And while the relationship between Martinez and Morgan is cordial at the moment, attempting to alter societal norms could affect the rapport and ultimately damage the business. Because the office in Mexico operates as a family, and all employees act as immediate stakeholders, Morgan has to avoid bringing in corporate changes that revise their perception of their hierarchical structure. In this case, changes to the communal commission pool or trying to hold individual people accountable for sales would be such an alteration. Morgan has to respect that Martinez blurs the separation between family value and work demands, he is willing to sacrifice a business decision for the benefit of his employees.
Another aspect of this case that openly infuriates Martinez is that at the onset of the negotiation, Algorithm USA chooses to price products in US dollars and not account for exchange rate fluctuations. This leads to a tremendous drop in sales. Commonly, companies will hedge this risk by entering into swaps, futures or forward contracts, a hedge that acts as a contingency...