This report includes analysis of ASOL which is a multinational company operation in energy and chemical. It covers culture, governance, structure, influence of global operation, Hofstede Dimension of culture, ethical and sustainable factors, strategic decision making, and global expansion routes.
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Global business Environment
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Table of Contents TASK 2............................................................................................................................................3 INTRODUCTION..........................................................................................................................3 Explanation of culture, governance and structure within organisation like application of McKinsey's 7S model.................................................................................................................3 Evaluation of ways of influence of global operation and ways in which organisation can adopt these in global market................................................................................................................4 Application of Hofstede Dimension of culture and ways in which it is influenced..................5 An evaluation of ethical and sustainable factors that the organisation has to consider in a global market...............................................................................................................................6 Critical evaluation of strategic decision making in context to risk and diversification in global context.........................................................................................................................................7 Assessment and critical evaluation of range of strategic global expansion routes available in organisation................................................................................................................................7 CONCLUSION...............................................................................................................................8 REFERENCES................................................................................................................................9
TASK 1 (Covered in PPT) TASK 2 INTRODUCTION Global business environment can be described as environment of different countries that create influence over use and capabilities of resources(BĂTUȘARU, 2019). This report includes analysis of ASOL which is a multinational company operation in energy and chemical. This project report includes explanation of structure, culture as well as governance in organisation and evaluation of influence of global operation. Influence of application of Hofstede dimension of culture is also discussed in it. Moreover it also includes different types of global expansion routes in business. Explanationofculture,governanceandstructurewithinorganisationlikeapplicationof McKinsey's 7S model McKinsey's 7S model can be described as tool that assist firm to analyse design of organisation. Main goal of this model is to identify ways in which effectiveness of organisation can be attained(Bhagra and Sharma, 2018). There are seven elements of this model including structure, system, strategy, share values, staff and style. Explanation of these structure in context of 7S model is mentioned below: Structure:It provide a way through which an organisation is organised its chain of command and also accountability for relationship that develop organisation chart. SASOL is an organisation that organised its roles and responsibility that will helps them to get growth in international market(Kasemsap, 2018).
Strategy:Strategy can also be described as business plan that assist an organisation to develop an action plan for attainment of competitive advantage through reinforcing mission and values of company. SASOL is an organisation which is developing new strategies in order to compete 9in international market and also to attain goals and objectives of company. Systems:It includes technical as well as business infrastructure of company that develop workflow as well as decision making chain. SASOL has developed a system that allow them to make informed decision and also allow to includes other members of organisation to make decision. Skills:Skills can be described as capabilities and competencies of company that allow employees to attain its objectives(Bhasin and Garg, 2020). Managers of SASOL is hiring skilled and talent workforce that provide them competitive advantage in market and also allow them to attain their goals and objectives. Style:It is attitude of employees in an organisation to develop code of conduct with different ways of interaction as well as symbolic decision making that develop style of management of its leader. Managers of SASOL needs to develop different style in business that is essential in marketplace for getting success. Staff:Staff consist talent management as well as human resources that are related to decision of company like training, recruiting as well as reward system. SASOL is an organisation which is recruiting talent employees that can contribute towards growth of companies and also provide them timely training and development opportunities. Shared Values:Objectives, mission as well as values of an organisation form foundation of every business and also play essential role for alignment of different elements in order to maintain design of organisation. Evaluation of ways of influence of global operation and ways in which organisation can adopt these in global market Global operation in international market can be supported due to different elements that are present in environment including internal as well as external environment. There are various companies which are focusing in international market that are focusing on expanding their operation. There are different factors and different ways in which global business operation is influence with different factors that are mentioned below:
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Political fluctuation:In international market, companies needs to face political structure of more than on country that create influence over business(Liu and Yang, 2019). There are various positive fluctuation in business like increase in monetary policy that allow managers of SASOL to increase in their revenue as well as operation in international market. Technological development:Advancement and up-gradation in technology is a positive aspectfor businessin internationalmarket.It isimportantfor companiesto adoptnew technology in business as it allow them to take advantage in market. Companies use technology in order to conduct their operation in effective manner as for using and managing data of customers, understanding their preference, making purchasing process easier and other. Global business climate:Global business climate is also increasing at faster rate as it is important for business. It is essential for business that are operation in international market as it provideopportunitytocompanylikeSASOL.Therearevariouslargeorganisationin international market that is maintaining global business climate for development of major operation in contemporary world. Application of Hofstede Dimension of culture and ways in which it is influenced It is one of cultural dimension theory that was developed by Geert Hofstede in the year 1980. It provide framework for people to understand differences in culture in different countries and also identify ways that business can be done across different cultures(Nelson, 2018). It is also a framework that is used to differentiate among different national culture, assess impact of business setting and dimension of culture. There are basically six categories for defining culture which is mentioned below: Power Distance Index:It is a category that consist limit with which power as well as inequality can be accepted in an organisation. High power distance index shows that organisation is accepting inequity and power whereas low power index show that it is not accepted in organisation. SASOL is an organisation which has low power index. Collectivism against Individualism:It is another category that incudes level to which society as well as community can integrate into different group as well as perceived obligation on group(Singh, Verma and Verma, 2020). SASOL is an organisation which is emphasising importance on collectivism that allow them to attain group goals.
Index for avoiding uncertainties:It is a index that is considering level to which ambiguity and uncertainty is accepted in an organisation. There is low uncertainty avoidance index in an organisation that are accepting uncertainty and risk taking. Masculinity against femininity:It is a dimension that includes preference of society for their attitude, achievement as well as equality in business. SASOL is an organisation that is adopting both in balance way. Restraint against indulgence:It is another dimension that is including level to which society is fulfilling their desire and also revolve around ways in which society control desire and impulses(Supawan and Deebhijarn, 2020). SASOL is adopting indulge dimension in their organisation that allow society for free gratification in context of enjoying life and also having fun. Short term against long term orientation:It is a dimension that includes level to which society is considering time horizon. Focus on SASOL is one long term orientation as they are making efforts for long term success for company. An evaluation of ethical and sustainable factors that the organisation has to consider in a global market Ethical globalisation is related to those concept under which the management of the has applied combination ethics and transforming information in the functioning of their organisation. It is very important for the management of the organisation that they develop effective and efficient framework in their organisation so that the ethics and sustainability can be achieved. There are different types of peoples and resources are connected with the management of the SASOL. It is the duty of the managers that they focus on the human rights, working standards and other ethical issues in the organisation. These functions of the organisation has develop positive culture in the organisation which helps them to established their business in international markets. Sustainable globalisation is related to those concept under which the development in globalisation are made without sacrificing the development of the future. Sustainability is one of the most important aspect of the business because it helps the organisation to develop effective strategies and policies in relation to the expansion and other business function. Sustainability helps the organisation to make considerable development in their workplace so that the business can be spread in different countries of the world(Wei, Thurasamy and Popa, 2018. SASOL is an
organisation which deals in chemical products and the attainability in their business is very important because of their dangerous product range. It is very important for the management of such organisation that they perform only those function in their organisation which promotes naturalenvironmentandprotecttheirmanagementfromdifferenttypesofmalfunctions. Sustainability helps the organisation to increase their customers base because most of the customers in the market are attracted towards the sustainable organisation. The company is planning to enter in to global market by creating sustainable globalization such as minimum wastages, recycling resources, using scare resources appropriately, managing climate change that can help to maintain operation in international country. The influences of sustainable addition to ethical globalisation on functions of business are as follows: Finance:If the management of the SASOL wants to established their footprints on global market then finance is the most important issue which required focus from the management of the organisation. It is very important for the management of the organisation that that they focuses on development of different sources of funds which can be used in the expansion policy of the organisation. If the company wants to manage sources of funds then they have to use their resources optimum and with their greatest returns. If organisation does not have considerable funds then the policy of their expansion are not possible in international market. Marketing:It is one of the important factor for the attraction of customers towards the organisation. The marketing of the organisation plays a important role in the success of their policies. Critical evaluation of strategic decision making in context to risk and diversification in global context Risk is always present in market and this risk is also increase in international market and can crate impact over operation of company. In order to overcome of it, company needs to make effective decision for organisation. SASOL is an organisation which is taking assistance for strategic management as well as board of director that allow them to make different decision for company. In recent time, it is essential for companies to consider strategic decision making in order to make decision quickly and also to minimise risk present in business that allow them to get success in market.
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Assessment and critical evaluation of range of strategic global expansion routes available in organisation There are different method which is adopted by managers of a company for purpose of expansion of business. These methods has their own advantage and disadvantage. Explanation of these method in context of company is mentioned below: Licensing:can be described as agreement between licensor and licensee that provide right to licensee to produce as well as sell sell of licensor's products. This license provide permission to licensee to sell brand of licensor. It is method through which managers of SASOL can offer license to other party for purpose of expanding their business operation. Franchising:it is another method for global expansion in which products and service of franchisor who is developing trademark of business, is distributed and franchisee who is paying fee for taking right to carry out business understand name of franchisor. It is an effective method for purpose of expansion of business for SASOL as it mitigate risk of business. Exporting:It is one of method for purpose of expanding business at international level in which business is producing products and service in home country and then sell it to another country. It is a method that can be adopted by managers of SASOL for purpose of expansion of business and also allow them to avoid expenses of developing operation system in new country. CONCLUSION From above mentioned discussion, it can be concluded that global business environment is consisting different uncertainties and in order to overcome of it, business needs to use different tool. Mckinsey's model is one that allow diem to develop system and structure of company. They also consider culture dimension theory in their organisation in order to develop effective culture in company.
REFERENCES Books and Journals BĂTUȘARU,C.M.,2019.SUSTAINABILITYOFTHESMALLBUSINESS ENVIRONMENTINROMANIAINTHECONTEXTOFINCREASING ECONOMIC COMPETITIVENESS.Management of Sustainable Development,11(2). Bhagra, A. and Sharma, D.K., 2018. Changing paradigm of employability skills in the global business world: A review.IUP Journal of Soft Skills,12(2), pp.7-24. Bhasin, N. and Garg, S., 2020. Impact of institutional environment on inward FDI: A case of select emerging market economies.Global Business Review,21(5), pp.1279-1301. Kasemsap, K., 2018. Mastering business process management and business intelligence in global business.InGlobalBusinessExpansion:Concepts,Methodologies,Tools,and Applications(pp. 76-96). IGI Global. Liu, H.M. and Yang, H.F., 2019. Managing network resource and organizational capabilities to create competitive advantage for SMEs in a volatile environment.Journal of Small Business Management,57, pp.155-171. Nelson, J.A., 2018. Here be paradox: How global business leaders navigate change. InAdvances in global leadership. Emerald Publishing Limited. Singh, A.K., Verma, J. and Verma, R., 2020. Understanding role of market-orientated IT competenceandknowledgesharingmechanismingainingcompetitive advantage.Global Business Review,21(2), pp.418-435. Supawan,P. andDeebhijarn,S., 2020.FactorsAffectingBusinessPerformanceofThai Restaurants in the United Kingdom: A Structural Equation Model.Asia-Pacific Social Science Review,20(2). Wei, L.H., Thurasamy, R. and Popa, S., 2018. Managing virtual teams for open innovation in Global Business Services industry.Management Decision.
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