Foreign Market Entry-Modes and Their Impact on Perceived Cultural Differences

It has been proven to be a strong correlation between choice of entry-mode and culture. Different entry-modes have also been connected to varying levels of integration in the foreign market. Based on these assumptions, this study examines how the choice of entry- mode and subsequently, integration level, has impacted companies’ perception of the host culture after their expansion to Japan. Through interviews with managers in charge of the internationalization process at three Swedish companies with varying entry-modes, we have identified similarities and dissimilarities in the cultural differences each company has faced. This enabled us to compare how these have taken form. Our results suggest there is reason to believe that entry-mode impacts the perception of the foreign culture as a consequence of the integration level. Furthermore, our findings indicate that the integration level affects the perception of cultural differences and also plays an important role when it comes to mitigating and managing the effects of cultural differences encountered.