Essay on Global Business Environment

Added on - 04 Jun 2020

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GLOBAL BUSINESS ENVIRONMENT
CONTENTSINTRODUCTION.......................................................................................................................................1TASK – 1....................................................................................................................................................1P1 Analyzing the key factors that drives globalization............................................................................1TASK – 2....................................................................................................................................................3P2 Explaining the complexity of strategic challenges faced by SME in a global environment................3TASK – 3....................................................................................................................................................5P3 Evaluation of influences of globalization on organizational governance and leadership, structure,culture and functions of SME manufacturing company...........................................................................5P4 Evaluating the impact of ethical and sustainable globalization on SME’s functions..........................6TASK – 4....................................................................................................................................................7P5 Reviewing diverse ways of decision making can work effectively in a global context.......................7P6 Determining and articulating various routes to internationalization SME manufacturing companymay adopt, including key barriers............................................................................................................8CONCLUSION...........................................................................................................................................9REFERENCES..........................................................................................................................................10
INTRODUCTIONThe term globalization defined the economy of world, which is generally viewed asinternational trade being taking place from past several decades. Many researchers understandand view globalization as a holistic approach that have some or the other relation with thegeneral systems of theory, wherein completion of one transaction in one domain significantlyinfluences the transaction of the other domain (Daniels, Radebaugh and Sullivan, 2013). Thus, itcan be said that it is a process through which people, government as well as organizationsinteract with each other. But operating business on the global platform is not easy, it brings uponvarious challenges and issues. Companies which are heading towards international markets haveto face many problems, especially when it comes to SMEs. Talking in relation with the small andmedium enterprise, they play an important role in the development of economy of UK. The SMEorganizations bring lot of benefits such as employment generation, foreign currency, investment,wealth and income distribution etc. Because of all such benefits, the economic growth of acountry is possible. There are many nations which are encouraging the setup of SMEs (Yip,2003).Relating to this, the present research report focuses on exploring the wider positions ofthe SMEs in the global environment. As an advisor to the board of directors of SME fast growingmanufacturing organization in UK, an analysis will be undertaken to realize the complexities ofoperating in the global market and will develop a comprehension of different means to cater withthese problems of globalization. for this purpose, the case of SME fast growing manufacturingorganization of UK is taken into consideration who has successfully expanded there reach in themarkets of Africa, North America and Asia. Now, the company desires to expand in other partsof the world. Pertaining to this, the current research report will significantly explore variousfactors that drive globalization as well as the significance of digital technology uponglobalization. The later part of the report provides the recommendations on ways of overcomingthese challenges and issues.1
TASK – 1P1Analyzing the key factors that drives globalizationGlobalization is being defined as a process or act of integration and interaction of people,processes, companies and government of different nations. It is a process which is being drivenby international trade as well as investment and is aided by information technology (Jansson andSandberg, 2008). For each and every company, whether small, medium or large, globalizationhas become an important need. There are many factors that drive globalization such ascommuting, technology, communication economies drive, world demand, environment, openmarket; however the most important factor among these are as follows:Cost– The current SME manufacturing organization of UK wants to expand in variousparts of the world so as to maximize their investment. Company is not able to achieveeconomies of scale and scope in the markets of one country. Most of the mileage can beachieved from the investment cost. In addition to this, promotion as well as advertisingwill incur heavy costs across boarders and thus, it is vital to expand in the market that caneasily be recognized by the people and have heard about the products and services of thecompany (Roth and Sinkovics, 2006). It is quite complex for the small and mediumenterprise to take important decisions about the right strategies, market segment, productpositioning and target group.Market– Comprehending about the advanced economies, the customers are now havingsimilar traits and behavior in relation with aspirations, education, income and utilizationof leisure time. Organization want to extent their share in the market and many a times itis possible that they trace out customers which have demand and high purchasing powerin a particular nation. On the other hand, it is also equal chance that company might farebest and flourishes more in the markets which are not as sophisticated as the markets ofUK. Thus, it can be said that if the company want to expand in other parts of the worldand have a global strategy than it does not depicts that they can serve the every part of theworld. In order to get success critical decisions as well as choices are required to beundertaken regarding the allocation of resources.2
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