Analysis of External Environment and Organizational Culture of Fonterra

Running head: BACHELOR OF APPLIED MANAGEMENT
Bachelor of Applied Management
Student’s Name
University Name
Author’s Note

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Table of Contents
1. Perform an analysis of the External environments of the business....................................3
2. For the chosen organization,...............................................................................................4
a) Identify its organizational culture...................................................................................4
b) Explain how this culture is shown in the organization...................................................5
c) Discuss how employees can learn the culture of an organization...................................5
d) Discuss how this culture impacts on the performance of the company..........................5
Learning outcome: 6..................................................................................................................6
Questions 3.............................................................................................................................6
a).............................................................................................................................................6
b).............................................................................................................................................6
c).............................................................................................................................................6
d..............................................................................................................................................6
Question 4...............................................................................................................................7
a).............................................................................................................................................7
b).............................................................................................................................................7
4c) Span of Control................................................................................................................8
4d) Benefits of centralised as well as decentralised organisational structure........................8
Reference List and Bibliography.............................................................................................12

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1. Perform an analysis of the External environments of the business
One of the top six dairy organizations in the globe, Fonterra is the leader in many of the
markets. The primary mission and the vision of the company are to lead in the dairy products
and sell the milk of the shareholder of the company (Pham Duy & Chau, 2015). The
competitive strategies among the global dairy industry are actually being driven by number of
complex situational factors. These include the consolidation of the base of the customer, the
protectionism and liberalization of trade and the increased requirement for the environmental
and the customer awareness.
There have been some of the significant barriers towards the entry of the dairy of the
industry. These include trade/political barriers, sale economies, access towards the
distribution of the networks, distance and the access to supplies.
The analysis of the environment of the business of the famous dairy company, Fonterra can
be done by PESTEL analysis for the analysis of the macro environment of the organization.
PESTEL analysis of the dairy company provides a detailed summary of the challenges and
the weakness the company has which is prevalent in the macro environment.
Political Factors – The political factors of the company includes trade barriers and the context
of protectionism that furthermore includes labeling, trademarks and arguments related to bio
diversity. Some of the other factors furthermore include free trade arrangements and
negotiation and deregulations of the dairy market (Dooley et al., 2017). Furthermore political
stability and the essentiality of the food sector towards the economy of the New Zealand
contribute to the political factor that tends to affect the organization.
Economic Factors – Macro economic factors including the rate of inflation, the savings rate,
the rate of foreign exchange and the economic cycle denotes the aggregate investment and
demand in the economy of the country. Factors such as the unemployment rate, educational

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level of the company, labour costs and the rate of the productivity of the company
furthermore contribute to the effect to the dairy company.
Social Factors – Some of the social factors contributing to the business of the dairy company,
Fonterra is the increasing demand of the market of the consumer and the growth of the
standards of labeling (Ngo, 2018). Factors such as growth in nutrition and bio markets
together with the cultural differences in the perception of milk are some of the social factors.
Technological Factors – Stocks for feed for reduced emissions and great productivity together
with the advanced ingredients and the reduction of the bi products and the consumption of the
energy during the process contributes to the technological factors of Fonterra
Legal Factors – The threats in connection to the legal challenges in the grounds of the
environment or the health together with the commissions of the anti-competition that allows
in increased environmental regulations are some of the legal factors of Fonterra.
Environmental Factors - Environmental factors include unpredictability of the climate, the
issues relating to GM and bio diversity. Furthermore seasonal nature regarding the milk
supply and intergenerational sustainability of the dairy farming of Fonterra contributes to the
environmental factors.
2. For the chosen organization,
a) Identify its organizational culture
The culture serves as the king over the strategy for the dairy company, Fonterra. The culture
among the organization and among the operational workers is generally challenging as well
as fun loving providing an essential sense of respecting and motivating each other (Dooley et