It is important for every company to understand the operating environment of the business as it keeps changing with time. A case study of how to operate a business in Saudi Arabia is needed before setting a business in this country. The strengths and weaknesses should be keenly analyzed to ensure maximum profits. The Java Lounge was started in Jeddah in 2003 by four young Saudis. They believed that the idea of a restaurant that served the affluent by westernizing some of the services would be well embraced in the Arabic country. However, before venturing into the business, they hired two Lebanese researchers to find out what the Arabian society thought about lounges or restaurants. After the research, the young men found that the environment was conducive to their business. The following is a SWOT analysis of the Java Lounge Case- Adjusting to Saudi Arabian Culture.
Strengths
Saudi Arabia is a business-oriented country with many paradoxes and contracts. It has super modern cities, and it allows foreigners to do business. The best thing about Saudi Arabia is that some of the operational rules are flexible. In a case pertaining borrowing a loan from a bank, one is not expected to pay back with interest as the Islam law prohibits the act. In the case of accidental insurance, prohibitions have been removed by the government are accidents occur on a day-to-day basis. This is despite the Islamic law prohibiting insuring against accidents as these accidents are pre- ordained by God.
Weaknesses
Saudi Arabia’s cultural practices and religious beliefs leave people confused on what is accepted business and personal behaviors. The country does not encourage a lot of male-female contact. For this reason, the research conducted by the Lebanese was difficult as most of the people failed to answer questions based on family. Most view the act as rude and a total invasion of privacy.
There is much discrimination against women in Saudi Arabia. The Java Lounge for example only has male employees, as women are not allowed to work alongside men in such a field. The fact that only 7% of the women are in the current workforce with only 20% of the businesses being owned by women proves that there is women discrimination (“Case: The Jave Lounge- Adjusting to Saudi Arabian Culture”). There is also the strict separation of sexes in shopping malls and restaurants. People from regions where religion is less active consider the practices in Saudi Arabia perverse.
There are limitations to play live music and sell pork products. The Java lounge, for example, does not sell pork nor does it play loud music. Alcohol is also prohibited, and people are often inspected to ensure that they do not bring alcohol into the lounge.
Opportunities
The country has cities that have great businesses opportunities. The four Arabians realized that they would bring home the idea of building restaurants, as there were people who embraced the western culture. Jeddah, for example, is a port city is a city exposed to foreigners. This is because the people in the city are less conservative and receives less religious patrols.
An investor can get a business opportunity in Saudi Arabia as long as they are willing to follow the strict state and cultural laws. In the Java case, the investors decided to establish the lounge in a city that was less conservative. However for businesses such as the MacDonald’s’, they adjust their schedule depending on the customers to get their goodwill. They stop their operations during the five-time prayer session and in periods such as the Ramadhan; they open businesses in the evenings as people fast during the day (“Case: The Jave Lounge- Adjusting to Saudi Arabian Culture”).
Threats
There are harsh legal sanctions that traumatize foreign workers. Such penalties include governmental beheadings and arrests for holding hands in public places. Practices such as homosexuality are also highly prohibited and punishable. Three men were previously beheaded by the government for being homosexuals. Such laws make potential investors fail to invest in Saudi Arabia, as they do not feel safe (“Case: The Jave Lounge- Adjusting to Saudi Arabian Culture”).
In conclusion, it is evident that doing business in Saudi for a foreigner or a citizen who has traveled to the West can be difficult. The best solution is adjusting to the operational environment so that the business can do well. The country should, however, drop some practices such as discrimination against women and beheading for crimes that are not as highly punishable. In the Java case, however, they opted for an environment that was less conservative, and that is how the business prospered.
Works Cited
"Case: The Jave Lounge- Adjusting to Saudi Arabian Culture." Comparative Environmental Frameworks n.d.: 45-48.
