Impact of Globalisation on Organisational Leadership and Governance, Culture, Structure and Function

This report discusses the impact of globalisation on organisational leadership and governance, culture, structure, and function. It explores the different factors driving global trade and commerce, the strategic challenges faced during globalisation, and the effects of globalisation on organisational leadership and governance. The report also examines the impact of globalisation on culture, structure, and function within organisations. Case study: CM Downton Ltd.

Global Business
Environment

Table of Contents
INTRODUCTION...........................................................................................................................1
LO1..................................................................................................................................................1
Different factors of cost, environment, market and competition which are driving global trade
and commerce:........................................................................................................................1
LO2..................................................................................................................................................2
Difficult strategical situations faced while globalisation.......................................................2
LO3..................................................................................................................................................4
Impact of globalisation on organisational leadership and governance,culture ,structure and
function...................................................................................................................................4
Determinant of sustainable and honourable globalisation on organisation's purpose............6
LO4..................................................................................................................................................7
Assessment of assorted ways for decision making that helps in efficacious working in global
scenario...................................................................................................................................7
Assorted path for group action of a system through considering different barriers...............8
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................11

INTRODUCTION
Global business environment refers to the different types of internal and external factor
which includes political, legal, cultural, economics and technological (Acquaah, 2013). All these
elements helps firm to evaluate overall situations of firm before applying new ideas and
strategies. If firm's operate their business more than a one country than they are needed to
review on these sorts of factors by which they can take better place on their business. Present
report is based on CM Downton Ltd., which is known as logistics and supply chain management
organisation was founded in the year of 1955 as an independent logistic industry. Moreover,
discussion will be based on different types of factors that all are responsible for managing overall
complexities and globalisation issues. There is sustainable effects as well as globalisation ethics
that influence globalisation routes and decision making process will get covered.
LO1
Different factors of cost, environment, market and competition which are driving global trade
and commerce:
Globalisation refers to the different types information, technology as well as job
opportunities across the globe. In the term of economy, it can be identified that interdependence
of nation across the globe always fostered by free trade (Al-Swidi and Al-Hosam, 2012). It
consist different types of functions like marketing, cost, competition within the environment.
These assorted factors of globalisation are mentioned below in detail:
Environmental Factors: It consist several kind of businesses practices which all are
operated by firms. There are different types of environmental factors such as political,
economical, social, technological and so on that has direct impact on working situations of firms.
In regards with Downton organisation government intervention and social norms have been
influenced during globalising. Thus, respective firm has been identified before going to develop
productive and profitable business. Downton will deliver keeping to this principle has visible
the commercial enterprise win and keep lengthy-time period contracts with essential global
groups and achieve steady, enormous boom for over a decade. Along with this, environmental
factor help company to increase their sales by protecting environment and providing better
services to the customers.
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Competition: In current scenario, competition is going rapidly between firms so this type
of situation does under control of firms. It is most considerable threat of firm, therefore firms are
needed to be aware about competitors like Wincanton plc, Xpo logistics and so on.
Considerable as largest rivals to Downton. In order to overcome competition respective firm
needed to follow different strategies before globalisation at marketplace. The enterprise has set
up itself at the vanguard of a relatively aggressive enterprise via supplying customers what they
cannot get from different companies: the infrastructure and scalability of a multi-country wide
3PL mixed with the power, agility and commitment to consumer care of a own family-run
commercial enterprise. Along with this, competition is a main factor that increases capability of
an organisation to attract large number of international client by providing better quality in
product and services at affordable price.
Cost Factor: It is most essential factor for firms in which price charged for a particular
goods and services. Reason being, there are several cost drivers that have different cost on raw
materials, labour, equipments etc. These are helpful factors for firms by which they can get
effective pricing strategies and achieve competitive advantages (Alon and Herath, 2014). For this
firms use global business sourcing factor to gain proper sales and profit with high revenue. In
regards with Downton, they have great presence of their goods and services across the globe that
gives them competitive price at marketplace. CM Downton achieved a document turnover in the
year it changed into obtained by means of EmergeVest for £75m, even though prices related to
the deal weighed on the firm’s annual income (CM Downton hit record turnover in the year it
was snapped up by EmergeVest, 2019). In the year to 30 June 2018, turnover extended 9% to
£127.3m (2017: £116.8m) debts filed at Companies House show. An increase in administrative
expenses related to March’s sale to EmergeVest ended in pre-tax income for the length status
45% lower at £2.8m (2017: £5.1m).
Market Factors: It comes under the equilibrium, goods and services, supply and demand
and many more. Impregnation of national market generally leads to an maximise opportunities
for proper growth of business within the global market (Wright, and Bennett, 2011). In relation
with Downton, they have been influenced by these factors as there is basic requirement of
logistic firms in order to carry forwards product and services. It will be beneficial for this firm to
exist within marketing situations.
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In relation with Downton, there are so many challenges faced by firms along with they
different as well due to logistics firm. Thus, there are huge challenges which are faced by them.
In order to overcome these challenges they are needed to develop effective project so that they
can make better strategies to achieve targeted goals in a perfect way. On the other side, business
of this Downton organisation can be work globally in a more better way by implementing on so
many effective tools and techniques to gain effective goals and objectives. Furthermore, as they
provide ware houses services, technological advancement and so on so that they can successfully
run their business globally.
LO2
Difficult strategical situations faced while globalisation
In order to carry forward business globally is known as globalisation. Globalisation
mainly provide several opportunities for developed and underdeveloped countries for their
successful growth. It brings, several kind of economies like international, regional and national.
There are few factors that affect globalisation, those are as follows:
Economies of Scale: It refers to the particular situation of cost advantage in which an
organisation is able to produce their goods and services in large quantity (Babatunde, and
Adebisi, 2012). There are certain goods and services that provides globally by firms. So this
strategy is used by China to develop business across the globe.
Technological Change: Advancement of technology always considered as a proper
globalisation. Updated techniques always helpful for firm to overcome high cost. If talk about
technological change so it directly influence transportation as well as communications
operations positively. This type of technological change also helps foreign exchange market. In
regards with Downton, they have limited technology in order to make their business better. On
the other side, globalisation have also brought in order to understand entire value or belief of
individual.
Within the discrimination at workplace always gives negative results as it can occur any
time. If the challenges do not resolve on time then it directly affect entire operations and
functions of firm. There are few challenges in regards with Downton, those are mentioned
below:
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Communication and cultural differences: It refers to the particular data which is
transferable from one person to another. It is important for firm to have smooth communication
flow towards work so that they can overcome communication difference from them (van den
Heuvel, Soeters and Gössling, 2014). Along with due to globalisation every firm needs to make
few strategies so that they can cope with difficult situation together. In regards with Downton,
they are needed to develop effective strategical goals so that they can understand employee's
wants and needs. In order to gain their confidence towards firm. It will helps them to overcome
cultural difference and communication difference within the firm.
Political risks: It can be come from different types of rules which is held by political
party within the nation. In regards with Downton, political risks involves import and export,
economic policies, custom duty and many more. These sorts of political element have direct
impact in the development of respective firm within a country. Therefore, it is necessary for
them to maintain good relationship with political party in order to gain foreign ease for
betterment of future.
Existing Monopoly: According to this, a monopoly can be exist when only one
organisation in which one firm can supply their effective goods and services due to essential
barriers to entry for any competitor (Belás and et. Al, 2014). In regards with Downton, as it is
logistics firm it face different types of monopoly situations within their cargo. On the other side,
cargo shipments always enjoy monopoly within large number of countries. While facing so many
issues and problems when they enters in market of several countries. Therefore, it is necessary
for management of respective logistics firm to develop few ways to reduce these assorted
situation. By reducing all these issues they can make their services better.
Laws and Regulations: According to this, there are different types of laws and rules
which all are helpful for business by which they can develop better ways to attain future goals
(Ulaga, 2011). In relation with Downton, there are large number of laws and rules which is
necessary for this logistic firm to make business that makes business attractive as they are able to
achieve huge profits of business.
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LO3
Impact of globalisation on organisational leadership and governance,culture ,structure and
function
Government play important role in maintaining and developing nations economy and
status. Corporate governance refers to rules and regulation, mechanism, policies, and procedures
under which business operations and activities are controlled as well as managed (Carneiro and
Brenes, 2014)). Discipline and ethics are maintained in firm which are guided by corporate
governance. With assist of corporate governance, management can regulate and develop the new
strategies and tactics which are essential for growth of business. Formation of corporate
governance is as described below-
 Structure- It refers to path or flow through which power, roles and responsibilities are
distributed in a firm. With use of structure, organisation can manage the subordinates in
an effective manner. In relation with DOWNTON, it follows the horizontal and vertical
structure both simultaneously which depicts balanced structure within the organisation. It
should be proper and effective because decision making is based upon formation of
structure and keeps management and subordinates in working order.
 Culture- Culture is important for everyone because they depicts the individual
personality and traits. In an organisation, it is important to focus on culture and
environment because employees’ stability depends upon culture formation. So,
DOWNTON follows clan culture in which collaboration revolves around within the
management and firm. Hence, everyone in entity enjoys the freedom of expression.
 Leadership- Leadership is important to manage and handle employee and firm activities
(Ladegaard, 2011). There are different types of leadership style which are used by leaders
in organisation such as autocratic, transactional, etc. In relation with DOWNTON,
supportive leadership is carried out by leaders that means employees can equally
participate in decision making and enjoys freedom of expression. So, a positive and
healthy relationship is maintained between firm, leaders and personnel. This leadership
keeps morale of employee at high level and efficiency of manpower is increased at rapid
rate.
 Governance- Every business wants to expand their business at international level. But
adopting globalisation process is not easy because of government rules and regulation
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which are different in every country (Cumming and Zahra, 2016). So, various types of
policies and procedures are adopted by company with motive to wider market area and
opportunities. Governance in business helps in maintaining the credentials and
subordinates information safe and secure. So, every firm should focus on policies and
procedures which are governed and controlled by corporate governance. DOWNTON,
should be active towards their guidelines. Functions- Functions are the base of the organisation through which business activities
takes into place. Function are heterogeneous in nature and provide a boost in business to
grow at rapid rate (Georgescu and Popescul, 2015). Different types of functions used by
entities are human resource, marketing, sales , finance, Information technology, etc. Each
functions contribute equal effort in business and operate according to the requirement.
So, DOWNTON is a leading logistics company in UK and currently focusing on using
effective measures, tools and technologies to provide services and products to clients and
customers at wider and appropriate manner.
Hofstede's Model
This model was established through Geert Hofstede by which firms can identify
organisation culture that consist ideologies, belief and practices. There are four elements of this
model, those are mentioned below:
Masculinity vs. Femininity: It includes different types of roles and responsibilities as
power of female that comes under the firm. In regards with Downton, they commonly gives
effective meals and combos for female in order to make female employees happy, so that they
can make better decisions.
Power Distance: This elements of model identifies several roles and responsibilities. In
regards with Downton, they generally follows different types of practices in order to save time.
Due to this they use perfect decision making skills that shows their power that can be used by
them.
Individualism vs. collectivism: According to this strategy of model organisation always
have responsibilities towards employee's working performance. In regards with Downton, it is
required for them to follow this step in order to make decision best. With the help of this, they
can increase overall input of firm along with able to develop new ideas and thoughts globally. It
will directly impact on firm's positively.
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Uncertainty Avoidance: This is the last factor of model which is necessary to use for
firms in order to find out issues and conflicts between employees. In relation with Downton,
there are different types of employees who might have some issues in regards with their work.
Therefore, in order to overcome these sorts of factors they need to develop effective tactics by
which they can sustain for long time at marketplace.
Application of Hofstede's Model to the CM Downton Ltd
Hofstede developed this cultural model first and foremost on the basis of differences
within beliefs and values about the work goals. Hofstede's framework is particularly useful for
CM Downton Ltd because it gives important data about differences between countries as well as
how to manage such differences. This is an effective framework for company to supply their
goods and services in different nation successfully. This will help them in increment of their
sales and improvement of brand image in international market.
Influence of ethical and sustainable globalisation
Business ethics are pointers for CM Downton Ltd managers to take ethical selections
which impact positively on society as well as surroundings. With the support of Globalization
exchange has multiplied and so has the obligations to have honest practices whilst handling
suppliers, customers and the personnel of the corporations. As globalization changes the
approaches of existence for people in each country, care need to be taken that the adjustments go
in a sustainable path. Another impact of globalization is the increasing recognition of local
currency areas to both foster worldwide change and decrease the probability of similarly
monetary crises.
Determinant of sustainable and honourable globalisation on organisation's purpose
Ethical globalisation refers to the different types of procedure on the basis of accurate
information towards product and services. On the other hand, ethical globalisation generally used
to motivates so many employees like shareholders, government, consumers and so many people
who work for firm to gain huge benefits (Hämäläinen, Näyhä and Pesonen, 2011). With the help
of having large number of people in firm they can achieve high sales and revenue.
In order to maintain sustainable growth of business it is necessary for firm to have large
number of assorted functions by which they can improve their overall delivery of goods and
services (Ladegaard, 2011). For long run sustainability at marketplace there are different types
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of legal laws and regulations that generally influence entire functions of firm positively. There
are different types of organisational functions, those are going to be discussed below:
Finance function: It is one of the most effective function of firm of every bsuienss.
Along with it is more helpful as it provide proper financial statement so that they can manage
their overall value of firms. In regards with Downton, financial manager always have
responsibility to collecting monetary resource in a ethical way. On the other side this function
also relate with marketing department in order to know entire cost of external analysis. Whereas,
firm should make effective supply material so that they can fulfil overall needs. Therefore, it is
more essential for firm to have this type of functions to achieve global business environment.
Marketing function: It is crucial for business every business firms in order to fulfil
consumer's demand and needs at workplace. Thus, it is necessary for firms to develop best
qualitative goods and services in an appropriate manner. In relation with Downton, it is
necessary to develop awareness within the society towards several goods and services. With the
help of this they can become more successful and able to opt so many legislations to run business
properly. In the case of delivering and export goods and services they are needed to have
effective ratio of profit so that they can achieve their targeted goals in an appropriate manner.
Additionally, it also increase their overall profitability at marketplace as well as their probability.
Human resource management: It is also another important function which is very useful
for firm to select and recruit high skilled employees for organisation. This always play crucial
role at firm as it has accurate information towards employees (Harison, 2012). Therefore, it is
easy for firm to select those people who can fulfil their requirements and needs on time. In
regards with Downton, there are large number of employees who are selected by their HR
manager in order to reach effective outcomes in future. Thus, main aim of HRM is to maintain
good relations with employees so that they can perform well and achieve targeted goals on time.
Now it can be said that from the above specified functions there are so many factors that
have direct impact on environmental conditions. Herein, the main function which is used by
Downton, is human resource management as it helps firm to select and recruit large number of
skilled employees for the betterment of future.
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LO4
Assessment of assorted ways for decision making that helps in efficacious working in global
scenario
Decision making considered as essential aspect for leaders within the firm of different
types of business operations in several ways. As per the decision making process firm is able to
handle every situation in a perfect manner (Kasperson and et. al., 2014). Therefore, it is
necessary for firms to predominant have good decision skills within and outside the organisation.
In regards with Downton, management team of this firm needs to focus on several aspects by
which they can examine large number of conditions within the organisation so that they can
make best ways to reduce errors from the firm and they can sustain for long period of time. For
better understanding of decision making skills respective firm is able to establish effective ways
to bring few modifications in work so that they can overcome complexities in a proper way.
Steps for decision making:
Within the competitive scenario there are large number of phases that could be adopted
by firms in order to make so many improvements towards decision making (Koh, Fichman, and
Kraut, 2012). Therefore, in this step Downton, always implements on clear ideas or thoughts so
that they can make better decisions along with able to overcome several issues and problems
from an organisation. By doing all these things, they can make better organisation or able to
increase working efficiency of workers. It will give good results in future so that they can
understand overall aspect of business and run their business successfully.
From the above specified information this can be said that, decision making refers to the
particular process by which firms are able to take better decision towards their effective products
and services. On the other side, they are able to achieve targeted goals without facing any issues
and problems at workplace. Therefore, it is necessary for firms to have such kids of decision
making skills.
Process and strategies of decision making:
There are basically seven steps of making an effective decision about the business. These
steps are identify the decision, gather relevant information, identify the alternatives, weigh the
evidence, choose among the alternatives, take actions and review decision. These are effective
steps that will be beneficial for Downton to take decision and enhance their business operations
and functions at international level.
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Assorted path for group action of a system through considering different barriers
In organisation, every business wants to access globally and internationally. Accessing
business globally assists firm to widen their market area and to explore more new opportunities
(Kirtiş and Karahan, 2011). So, there are various forms of mode of entry of internationalisation
which are m,mentioned below-
 Joint Venture- It is type of mode of entry in which two or more than two party come
together to join a business with mutual agreement. Joint venture mostly considered as
safest mode of accessing business globally (Kljucnikov and et. al., 2016). In context to
Downton, they are developing their activities at wider level. Many small retailers are
ready and targeting firm to adopt joint venture. Adoption of this will help Downton easily
to grab the market but value and positioning of brand might get affected if the other party
negative image in market. On the other hand, some of barriers that can be seen in present
context are: flexibility can be restricted, Clash of cultures and lastly, it is also possible
that exiting a particular partnership would required to be formulated because a
development of contract involvement.
 Licensing- Another form of path to internationalisation is licensing in which firm allows
other entity to use their product for specific period of time. Licensing results in losing
control in the organisation and product. Downton may use licensing to market their
product but as firm is at developing stage, it might lose its solely traits in market and
across the globe. But there are number of barriers that can be seen while utilising this
type of internationalisation approach, like relying on the licensee's ability to effectively
commercialise your patent, risk of poor strategy or execution damaging the product
success and poor quality management damaging your brand or product reputation
(Klapper and Parker, 2011).
 Franchising- This is another crucial internationalisation technique, that could help a
business organisation while expanding business at international level. In present context,
it is said that Downton, which is particularly looking forward to expand it's business,
while enlarging the business among new areas and considering this type of approach, it is
said that company could face a range of barriers and these are high initial investment,
limited creativity, lack of privacy, decreased profits, and shared information, which
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would lead them to deal with various issues like lack of time management system and so
on.
CONCLUSION
As per the above mentioned report it has been analysed that, global business environment
plays significant role within the every organisation in order to achieve targeted business goals on
time. There are different types of factors that are favourable or unfavourable that adopt so many
expansion strategies to run business successfully. Therefore, firm should develop effective plan
in order to attempt large number of strategical tools and methods to fulfil market needs and
wants. On the other side, manager of respected organisation should always adopt large number of
policies and norms so that they can operate business globally and achieve huge benefits while
spreading their business.
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Online
CM Downton hit record turnover in the year it was snapped up by EmergeVest. 2019. [Online].
Available Through: < https://motortransport.co.uk/blog/2019/03/01/cm-downton-hit-
record-turnover-in-the-year-it-was-snapped-up-by-emergevest/>
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