Business Environment and Globalization: A Study of SASOL Limited

This report explores the key factors driving globalization and the challenges faced by SASOL Limited, an integrated energy and chemical organization based in South Africa. It discusses the impact of operating in a global environment on organizational structure, culture, and governance, as well as the influences on business strategies and decision making. The report also examines the different methods of decision making and the benefits of joint ventures in international expansion.

Business Environment

INTRODUCTION
Globalization brings big opportunities for businesses in less industrialized countries to
tap into large markets across worldwide. It leads in increase competition related to the cost,
product, services, technologies as well as target market and price. Positive and flexible business
environment helps in facilitating their operations at global level and expand or grow in new
markets. SASOL limited is taken to studied the study of globalization concept and its challenges.
Sasol is an integrated energy as well as chemical organisation which based in Sandton, South
Africa, the company was established in 1950 and reinforced on procedures that were firstly
developed by the German chemists and applied scientist in early 1900s. In this report discussed
about the key factors of driving globalization and determined strategical complexity which are
related to with operating in international market. Also, discussed that how operating in global
environment impacts on the organizations structure, culture and governance as well as evaluate
the influences on business strategies and decision making.
LO1 & LO2
Covered in PPT.
LO 3
1)
Organizational structure refers to the activities that are focused towards the achievement
of aims and objectives. These activities include task allocation, coordination, supervision etc.
which effect company performance and actions (Beck, 2018). Whereas organizational culture
encompasses the values, beliefs and behaviours that contribute towards the social and
psychological business environments. Moreover, governance of an organization is the foundation
of sustainable business that provides extended condition of economic value to their workers and
stakeholders. As a value-based company SASOL limited is committed to high standards of
integrity and ethics of operational activities.
SASOL limited known as a advanced growing organization in South Africa, nowadays it
has successfully design a plan to take part in international trade and exploitation (Eriksen, 2018).
To measure the determinants of globalisation the company use McKinsey 7s model that can be
described below:

 Strategy: It can be considered as a arrangement that aids in obtaining competitive
advantages and with success keep the market state. SASOL attempts to formulate its plan
of action effectively in state to gain competitive benefits towards its structure, culture and
governance. Structure: This defines to the availability as well as structure of various divisions of
businesses to assure appropriate responsibility. SASOL operates in several location so it
needs to ascertained the different structures for assorted area (Pieterse, 2019). System: These are the processes of an organization that helps in reveal business activities
on daily basis and made effective decisions. Style: It shows the mode in which an organisation organised and well-managed by upper
level managers or it is related to the direction and management of business leaders. Staff: This is totally related to the employees of SASOL limited will essential and based
on how persons will be hired, trained, appreciated and rewarded (Prajogo, 2016). Skill: These are the abilities, competencies and capabilities that a firm employee
performs in well manner. Due to the changes skills are needed to accept the changes and
reinforce its new strategies or structure.
 Shared values: This considered as a core of McKinsey model in which norms and
standards are used to guide employee’s behaviour and actions of SASOL limited (Klein,
2015).
2)
Several moral and sustainable component that are viewed by SASOL limited within the
international marketplace. These can be described as follows: Treat employee fairly: This is considered as a ethical approach that helps in promoting
workers and facilitates safe and secure workplace where they perform business activities
(Bertels and Vredenburg, 2018). Also, ethical consideration should be needed in a
company to pay adequate remunerations according to the employees performance. This
will helps in making good value and image of SASOL at international level. Assert on unity in enterprise relationship: It is defined as a sustainable determinants
because of all businesses need to enlarge and grow its own business operations at
international level. This is used for the purpose of making better relationships with other

organizations, suppliers, investors and customers for long period of time survival in
global marketplace.
 Engaged in sustainable processing activities: Engagement is considered as a ethical
factor which helps in decreasing negative impacts and facilitates smooth business
operations (Channon and Caldart, 2015). SASOL limited deals in transforming natural
gas within energy and chemical products thus the company have to develop strategies and
practices to waste management for maintaining healthy and eco-friendly environments.
3)
This concept of cultural dimension was formulated in 1980 by Dutch administration
investigator Geert Hofstede. The purpose of examination was to ascertain the attributes in that
cultures deviate. Hofstede works on mainly six concepts which helps in determining the SASOL
culture can be described below: Power spacing index: It believes the degree to which difference and cognition are
endure and these are based on the lower level aspect. High level of power shows the
cultural prospect to promotes government officials and display high substances for
dominance (Favaretto, 2016). Whereas lower distance index indicates the culture to
encourage business constitutions which are decentralized determination duty, take part in
business administration and focus on power dispersion. Collectivism vs. Individualism: collectivism shows that an organization have high value
on objectives and well-being of the groups. Whereas, individualism think as a greater
value on achieving the personal mental object. Uncertainty rejection index: This indicator considers to the great extent that are
tolerated. High index of uncertainty rejection shows the depressed endurance for
uncertainness and risk attractive this can be decreased directs hard-and-fast rules and
legislations. Whereas, low level of index describes advanced temperament for expression
and risk pickings and openly accepted by relaxed rules and regulations (Beugelsdijk,
Maseland and Hoorn, 2015). Femininity vs. Masculinity: Femininity becomes with the numerous natures such as
unstable gender function, retiring, raising and obsessed with the life choices. Masculinity

brings from the distinct sexuality character, aggressive and accumulated on substantial
achievements and financial condition construction structure. Short vs. long term placement: Short term orientation focused on near forthcoming and
small duration success and placed strong focused on present rather then a future and
provides quick results. Whereas, long term positioning emphasized on future day by
achieving long period of time objectives for success (Bradford, Guzmán and Trujillo,
2017).
 Restraint vs. indulgence: Restraint specifies a society stamp down emotional state of
necessarily and modulate through societal criterion. Whereas, self-indulgence shows a
social group which allows independent gratifications affiliated to the utilizing living and
having entertaining.
LO 4
4)
Manager of SASOL limited is responsible for taking organizational decisions in an
effective and efficient manner. Results of managers decision quality in success and failure of
company and it is concerned with the planning, organizing, directing and controlling of decision-
making process (Zacharewicz, Sanz Menendez and Jonkers, 2017). As per the views of
Patterson, Grenny, McMillan and Switzler in that respect there are different methods of decision
making that can be described below: Command decision making style: This kind of decisions are made with no involvement
of any others, it can be occurrence in one of the two manners. Either external unit spot
determinations on them or bend decisions concluded to others and precede its lead. Confer with kind of decision making: Confer is considered as a procedures whereby
judgement creator ask for others to determine them ahead they shuffle their options. The
company can confer with experts, specialists, representative population that can be
prompt style of addition thoughts and decision-making process impressive. Voting decision making variety: It is best appropriate to determine where efficiency ratio
is the advanced worth and choosing from great amount of choices. It should never be in

use when group members disagree to assist whatever judgement is successful (Eiter and
Potthoff, 2016).
 Agreement style of judgements: This method acting can be both a outstanding approval
and discouraging curse word. It defines that the company managing director negotiates
until everyone candidly or frankly concord to one determinations then they make high
choice of decisions.
SASOL limited get benefited for using consult decision making style because it based on
the various alternatives and opinions and they have more options to evaluate and choose best
alternative.
5)  Joint venture: It is an international expansion tool that enables company to access
capabilities and resources to achieve the goals and objectives of global market. Joint
venture is a form of foreign direct investment that can helps in business growth and
increase the profits as well as productivity (Rosenau, 2017). The benefits of this is to new
market, distribution networks, increased capacity, risk sharing etc.
 Franchise: This defines as a enterprise plan of actions for acquiring and conformity
customers and selling system of rules for developing the company picture in the views of
actual and coming consumers just about their companies products and services. Provides
those products that helps in satisfying the customers needs (Aithal, 2017).
For the SASOL limited joint venture is useful for expanding their operations at
international level because of it helps in increasing the profits and growth by making foreign
direct investments.
CONCLUSION
It has been concluded from the above report that business environment plays crucial role
in globalization of an organization. There are several factors that effects the company’s structure,
culture and governances as well as various challenges are faced by the company while expand
their operations globally. Also, McKinsey model and Hofstede dimensions of cultures are used
to determine the structures and performances. Moreover, effective decisions are valuable for an
organization that has to be taken by using different ways which suited most for an organization.

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