Influences of Globalisation on Globalisational Governance and Leadership

This report explores the influences of globalisation on globalisational governance and leadership, structure, culture, and functions. It discusses the changes in culture, structure, leadership, and functions that occur when a business organisation expands globally.

Global Business
Environment

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
P1. Analyse key factors of cost, market, environment and competition that drive global
commerce and trade................................................................................................................3
TASK 2............................................................................................................................................5
P2. Explain the complexity of strategic challenges faced by organisations...........................5
TASK 3............................................................................................................................................6
P3.Influences of globalisation on globalisational governance and leadership, structure, culture
and functions..........................................................................................................................6
P4. The influences of ethical and sustainable globalisation on organisational functions......8
TASK 4..........................................................................................................................................10
P5. Evaluate different ways of decision making that can work effectively in a global context
..............................................................................................................................................10
P6. Various routes to internationalisation an organisation may adopt including key barriers11
CONCLUSION .............................................................................................................................12
REFERENCES..............................................................................................................................14

INTRODUCTION
The term “Global business environment” refers to environment where an organisation
performs operations across the borders with different aims and objectives. Basically, global
business environment consists of different elements like culture, economy, politics, and some of
other factors that may help a company in performing different operations with an aim of earning
profit. Over the years, many organisations has faced number of alterations within the
international market therefore it has become vital in today's time for companies to analyse the
environment in order to take decisions for their own betterment (Aithal, 2017). This report, the
organisation that has been taken into consideration is C M Downton Ltd. this organisation is
dealing in logistic industry and it was found in the year of 1955. Along with this, assignment will
put light on different key factors that mostly drive globalisation and helps company in reducing
different complexities of global business environment. On the other hand, this report will also
deliver the information related to globalisation is influence over ethical and sustainability. Lastly,
different ways of decision making and various routes of internationalisation will also describe
that can adopt by companies.
TASK 1
P1. Analyse key factors of cost, market, environment and competition that drive global
commerce and trade
The term “Globalisation” is referred to the element in which different companies conducts their
operations over different nations considering the trade related rules and regulations (Rupidara
and Darby, 2017). Has been analysed that, most of the business functions are affected by
globalisation of a business. If it is talk about C M Downton Ltd. then this organisation also got
affected by globalisation where some of the major factors are competition, environment, market,
cost and many more other and all of these driving forces are presented underneath:
Cost factor- This factor is considered as the primal force on the factor that drive
business companies towards globalisation. Basically, expense all things considered or benefits
contrast starting with one nation then onto the next. Cost drivers likewise incorporate expense of
crude materials, work and so on. Every one of these elements help a firm to be cost effective in
Market just as in advertise abroad (Soundararajan, 2018).. Worldwide sourcing is discovering
minimal effort different raw materials that logistic industry is importing and exporting around
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the globe. With assistance of it business benefits can be expanded through cost decrease and
expanded income in worldwide market. It is much needed by C M Downton Ltd. investigate
cost related elements cautiously before going for globalization (Vokoun and Daza Aramayo,
2017) Market Factor- Major forces that came in front is supply, demand, equilibri um, prices
of products and services of this factor. There are many reasons like saturation within domestic
market, companies within logistic industry collects a number of opportunities in rising
globalised market. If it is talked about C M Downton Ltd., then it is also dealing in the same
industry and got affected due to globalisationt. When companies go global, they will need
logistics to export their products. Downton is taking benefit of this market situation while
executing plans for expanding its operations to other countries (Trad and Kalpić, 2017).
Environment factor- The surrounding in which a business operates is called
environment. Environment consists of major factors which are social, technological, legal and
political. Downton took care of all these factors while going global (Wang and Peyvandi, 2018).
The rules and laws, social norms and government intervention, all these matters were looked by
Downton while expansion.
Competition- Another force, which majorly impacts upon company's productivity and
profitability. It made companies to gain ample number of strategic strategies to gain competitive
advantages. Under this industry some of the rivals like Wincanton plc, Purolator, CEVA
Logistics, XPO Logistics are some of the major competitors of Downton. Company critically
looks into working of all its competitors , their strategies and technologies used by them before
globalising.
There are various difficulties looked by organization going worldwide. Downton being a
logistical business organization have diverse arrangement of difficulties looked by organizations
managing right now. One of the significant trouble is providing to prominent and social
occasions. An appropriate store network must be set to meet explicit expectations of these
particular clients. These social occasions are remarkable tasks. Disappointment in conveying
these administrations could contrarily influence profitability and productivity of organization.
Alongside these difficulties C M Downton Ltd. and other logistic multinationals need an
accomplice to carry on their coordination’s business. Therefore, it can easily be said that
considering Globalization, it will be required by C M Downton Ltd. to look into some other
technological factors as well, so that it could reduce all the risks linked with globalisation.
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Under this, some of advancements that can be incorporated are gauging scales, IT improvements
and mechanical progression in company's warehouses and so on.
TASK 2
P2. Explain the complexity of strategic challenges faced by organisations
In present time, every single organisation goes through number of complexities while
developing various strategies at the time of globalising themselves (Aithal, 2017). Basically,
globalisation helped various business firms, where they have gained ample number of
opportunities to enhance customer engagement towards what they are offering to customers. It
has also been found that various companies within logistic industry who kept their focus on
expanding their business has raised job opportunities for unemployed population. Including this,
over the years globalisation promoted integration economies among different sections like
regional, national, and at international level (Bhagra and Sharma, 2018). In present context,
where C M Downton Ltd. is looking forward to expand their business at international level
would require to focus on a number of factors and some of these are presented underneath:
Technological Change- Primal change that mainly impacts upon expansion of a
company like C M Downton Ltd. It has been analysed that this change can put both negative or
positive influence over a company. Considering latest technologies, logistic company i.e. C M
Downton Ltd. Could effectively reduce communication along with the cost of transportation.
Away with this, companies like C M Downton Ltd if utilises electric trucks then it will directly
reduce the cost of supply and may also raise demand of their services. This will put positive
impact upon profitability and productivity of C M Downton Ltd.
Economies of Scale- It has been analysed that, economies of scale consists of different
challenges faced by C M Downton Ltd. where production unit mostly pulls both negative and
positive influence productivity. Under this, strategic challenge of business expansion of C M
Downton Ltd in a country that is holding a decreasing GDP rate, then it will be considered as a
negative point for the company. Therefore, taking right decisions in relation to globalisation in a
growing nation will lead C M Downton Ltd to gain competitive advancements (Charter and
Polonsky, 2017).
On the other hand, globalisation not only consists of benefits but it may also lead an
organisation like C M Downton Ltd to deal with challenges in relation to beliefs, culture,
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economy, regulations and so on. While globalising C M Downton Ltd might go through a
number of challenges and some of these are presented underneath:
Existing Monopoly- This is one of the significant factor, which can be considered as a
challenging one for a business organisation, who is focusing to business expansion. If it is talked
about logistics industry then Cargo shipment sub sector consists of Monopoly behaviour which
might create issues for C M Downton Ltd. While developing a whole new strategic plan for
business expansion (Chasdi, 2017).
Laws and Regulations: This is being considered as one of the crucial element, which
government of different nations controls. Basically, C M Downton Ltd would require to look
among different laws that may impact upon strategies of expanding business. This could be
understood with a good example where, labour laws, employment laws, and regulations in
relation to logistics industry of target market (da Silva Lopes, Lubinski and Tworek, 2019).
Communication and cultural differences- Another crucial challenge that may impact
upon C M Downton Ltd. business expansion related strategies where, the procedure of sharing
data or information in related with culture along with communication is said to be something,
that majorly impacts upon company's performance level. Including this, it can be said that an
organisation like C M Downton Ltd at the time of globalizing consists of a number of guarantees
that can be taken into consideration where miscommunication might take place. In setting of C
M Downton Ltd., it will be required by companies to enrol themselves nearby works any place
they start their business.
TASK 3
P3.Influences of globalisation on globalisational governance and leadership, structure, culture
and functions
When a business company is looking forward to globalising itself then there number of
changes that they see in relation to leadership, structure, culture and functions. If these changes
are not being made by them, then it is may be possible that an organisation like C M Downton
Ltd might go through various issues (Fabuš, 2017). On the other hand, if it is talked about
corporate governance, then it consists of various rules, laws and other regulations that are built
by government of a country which helps a business organisation in maintaining number of goals
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and objectives. These alterations requires proper execution within logistics industry and some of
these elements are described underneath in relation to C M Downton Ltd.
Culture: In present context, soft culture model in followed by C M Downton Ltd, where
both intangible along with the tangible elements or objectives are specifically been given with
equal opportunities and importance. While expanding business, it is may be possible that C M
Downton Ltd would require to hire a number of skilled employees that belongs to the same
country in which C M Downton Ltd. is looking forward to expand business (Ferraro and Briody,
2017).
Structure: Within C M Downton Ltd, top management to lower level management
structure is followed, which functions appropriately but as this organisation is looking forward
to expand it's business then it will be required by the company to consider matrix, where C M
Downton Ltd would require to conduct while expanding business at international level (Wang
and Peyvandi, 2018)
Leadership: Participative is being considered as one of the crucial leadership style that
leaders of C M Downton Ltd follows. It will not be required by company to alter this style,
because it is one of the best and suitable leadership approach, which most of the business
companies that has taken into consideration while expanding their business at international level
(Wang and Peyvandi, 2018)
Functions: C M Downton Ltd is dealing within logistics industry, which transport
products of different business organisations (their clients). Some of it's main business functions
are loading, transporting, packaging and unloading of client's goods. Considering different
methods which do not costs much to company and to consumers would lead them to reduce the
overall expenses (Gaganis, Pasiouras and Voulgari, 2019).
Governance: While expanding business, it is said that C M Downton Ltd would develop
a number of determinations along with the policies. On the other hand, if it is talked about effects
that this organisation is facing while running it's functions among number of parts of the world
then it can be both positive and negative in nature. Away with this, if it talked about C M
Downton Ltd then this company is expanding business within a nation, where corporate
governance gets changes, which may influence strategical approach utilised by C M Downton
Ltd, where it is may be possible that company would require to make appropriate changes.
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Hofstede's Model
Geert Hofstede found this model according to which culture is beliefs, practices,
ideologies which differentiate organisations from one another. At the time of expanding business
at international level, Hofstede's Model can effectively be taken into consideration, which
consists of different elements and some of these are presented underneath:
Masculinity vs. Femininity: In context of C M Downton Ltd, where this organisation
will be considering females as decision takers, within decision-making process. The reason that
came in front was company's high department has a belief that males determines or reach to a
conclusion considering an aggressive approach.
Power Distance: In present context, C M Downton Ltd. has kept their believes on
delegating powers among staff at the time of any uncertainties takes place. With the help of this,
employee engagement will effectively get improvised at workplace, which will reduce the
conflict related chances and may raise sustainability at workplace.
Individualism vs. collectivism: In terms of C M Downton Ltd., this business
organisation will effectively gain a number of competitive advancements through delivering
equal rights to every single employee. Basically, considering exchange of ideas including
opinions that number of staff members will give would directly lead firm to expand business of
the company at international market (Hamilton and Webster, 2018).
Uncertainty Avoidance: Another crucial element of Hofstede's Model, which would
lead C M Downton Ltd., to train itself and number of employees as well so that at times of any
conflict or unwanted situation appropriate action can easily be taken.
P4. The influences of ethical and sustainable globalisation on organisational functions
Different organisational functions will be influence by ethical and sustainable
globalisation. These organisational functions are as below:
Human resource management- A crucial business function of C M Downton Ltd.,
which may carry high influence over decision making of the company in relation to ethical and
sustainability. Basically, C M Downton Ltd. Management ought to adhere to all laws and
legitimate conventions in a much more ethical manner. Here, it is said that different laws and
enactments of targeted nation ought to consider and followed by C M Downton Ltd for strong
sustainability. With respect to organization, HR manager would require to keep on bringing right
policies so that qualified and knowledgable employees could easily be recruited. This could also
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be understood with a good example of Child labor related cases, where many companies within
logistics industry utilizing child labor and faced many penalties, and in order to reduce these
chances HR manager of C M Downton Ltd. would require to develop considering the children's
right and different rules and regulations like Factory Act (1833) and the Mines Act (1842).
Marketing function- Another effective function, which influences both sustainability
and help in conducting business in ethical manner. Basically, marketing approach that most of
the logistics business organizations that has been taken into consideration is social media as most
of their customers and public are connected to social media sites. In setting of C M Downton, in
the event that the administration of the organization while expanding business, at that point it is
much more critical for them to consider all the guidelines and enactment of performing business
in a foreign country, in term of supply and fare items and administrations, that are tools that are
adopted by particular country for promoting of items and administrations (Kasemsap, 2018). A
specific example that can be considered is of green-washing practice, where many of the
companies within logistics industry and others has performed this type of actions which
impacted negatively over different areas like productivity and so on. This is where, it will be
required by C M Downton to develop an effective marketing program which is not misleading
customers.
Finance function- Without this function, it can be said that C M Downton cannot expand
their business at international level. This department basically helps finance manager to develop
an effective budget for conducting every single function or to execute a plan in a rightful
manner. In present context where, C M Downton Ltd is conducting effective market analysis
where it is needed by C M Downton Ltd. to reduce the cost of extra efforts that they have made
in the past, will help them in taking right decisions in reducing the extra expenses. This would
lead firm to gain ample number of competitive advantages. Considering taxation as a crucial
element would lead C M Downton Ltd's finance department to take right decisions in order to
sustain within the market for a longer period of time.
Henceforth, above mentioned business functions of C M Downton Ltd. has helped
company in maintaining their presence among existing business market and also it aid C M
Downton in reaching to new heights in specified time frame. Including this, it is said that these
primal functions led C M Downton Ltd, to bring appropriate modifications as well within their
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present structure of working, which would lead firm to sustain within the market for a longer
period of time (Lewis and et. al., 2017).
TASK 4
P5. Evaluate different ways of decision making that can work effectively in a global context
While conducting business at international market, it is said that company would require
to take determinations so that it could sustain within the market for a longer period of time and
for gaining appropriate reputation as well (Pikhart, 2017). Basically, C M Downton, which is one
of the crucial business company dealing within logistics industry needed to improvise their
decision making process. Some of steps in relation to decision making process is presented
underneath:
Steps for improving decision making
There are a few stages that would b be able to embrace by C M Downton Ltd. to settle on
advancement and improvement in their dynamic. In initial step, the administration of all
organization can discover clear points and goals on which choices are based. Provided that the
objectives are clear and justifiable then choice can be taking in compelling way according to the
circumstance. In next stage, the manager can take choice to get over issues and arrange process
in satisfactory and proper way. After it, in next stage, the administration will assess choice to
examine that they are viable to determine complexities or not. It is significant for executive and
pioneer of C M Downton Ltd. to consider these stages with the goal that they can perform tasks
in a much more feasible way when they work their business in worldwide setting. With the help
of this, C M Downton Ltd., could effectively take right decisions at the time of expanding
business at international level (Rialp-Criado and Komochkova, 2017).
Strategic capability to handling of risks: It will be required by C M Downton Ltd. To
develop different range of strategies so that right decisions could be made in order to reduce the
risks to minimal. This could be understood with a good example of this company only, which is
dealing within logistics industry. Here, it will be required by company to develop strategies in
relation to merging with other companies that belongs to other nations in which company is
looking forward to expand its business. With the help of this, expansion related risks will be
reduced to minimal.
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Leadership to handling of risks: Risks can be reduced by adopting right leadership
approach within C M Downton Ltd. For instance, considering democratic leadership style, top
level management could take right decisions through taking suggestions from lower level
management. Through this, appropriate measure will easily be taken into consideration for
grabbing good position within the market and, it will also reduce number of risks related to
operations.
Also, it is said that considering an effective decision-making approach, would lead C M
Downton Ltd. In reaching to new markets where it could effectively sustain within the
competitive environment for a longer period of time, in global context.
Approaches to handling of risks:
Also, it has been found that there are number of approaches that are available in the
market to manage risks like Accepting the risk, avoiding it, transferring the risk, mitigating the
risk and lastly, exploitation of the risk would lead C M Downton Ltd. To reduce the number of
risks that are present in today's business environment.
P6. Various routes to internationalisation an organisation may adopt including key barriers
C M Downton Ltd., which is a logistics firm looking forward to expand it’s business
among different areas, where they could earn high profits consists of a number of routes that
would help organization to expand it’s business where some of these are presented underneath:
Licensing- under this type of internationalisation route, there are two parties stays
available where one is the licensor and the other one is licensee (8 Strategies to Enter a New
Foreign Market, 2020). Basically, licence is given to to another II company e to conduct
operations considering the name of the licensor. If it is talked about C M Downton, then this
company can effectively provide licence to to another business company where the licence will
be performing different number of tasks considering name of licensor i.e. C M Downton Ltd .
Primal advantage of this type of internationalisation root is that growth of the company will grow
in much more faster way. On the other hand, it can also benefit to the country as well through
developing job opportunities for the job seekers. Including this, this root also consists of various
disadvantages as well where all the actions and the developed objectives will be e developed and
done by licensor company only. Another negative aspect of utilising this approach is licensee
also would require to deliver much more benefits to licensor through paying extra for taking any
sort of independent decisions.
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Barriers to this internationalising process: Using this approach, it is may be possible
that C M Downton Ltd may only get a low level of control where licensee can also be considered
as a rival for licensor.
Exporting- C M Downton, which is looking forward to expand it’s operations can also
consider this type of globalising route. It can be said that, if this organisation takes into
consideration of this approach in order to globalise itself then, all the services they will be
offering to clients their logistics related services in all over the world. Customer engagement is
said to be the primal advantage that this approach is having, where C M Downton will
effectively enhance the number of customers because of the internationalisation. On the other
hand, barrier which can be face by them related to export legislation of the targeted nation in
which company is looking forward to expand the business (Reyes, Roberts and Xu, 2017).
Barriers to this internationalising process: It is maybe possible that C M Downton
would only get small profit of low value-added exports, which company is offering to customers
in all over the world.
Franchising- Franchising is the methodology through which firm permits and offer its
items to franchisee to use for determined time frame. This way prompts brand mindfulness, a
positive relationship and more business openings. Diversifying help firm to become quicker and
to acquire showcase. C M Downton can also consider this type of methodology.
Barriers to this internationalising process: High initial investment can be considered as
one of the issue that can be faced by C M Downton when it comes to serve the best to customers
at international level.
Management contract- This is specifically being considered as an arrangement in which
control of different elements like operations in relation to the enterprise develops a contract in
which separate enterprise specifically performs appropriate necessary managerial functions in
return for a fee. C M Downton will effectively reach to all new level within the international
market and in specified time frame as well.
Barriers to this internationalising process: One of the issue that came in front of
contract management is particularly being considered as an organization that has gives up a
considerable amount of control over the services that will be provided to customers.
Foreign direct investment- This is said to be another crucial internationalisation plan,
which may aid in investing in the form of a controlling ownership in a business in one country by
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an entity based in another country. With the help of this, C M Downton may effectively reach to
an all new level and may support company in enhancing the economic development stimulation.
Barriers to this internationalising process: FDI may occasionally affect exchange rates
to the advantage of one country and the detriment of another.
CONCLUSION
Considering the above mentioned report, it is summarised that proper analysis done by a
business company in relation to both external and internal environment would lead firm to gain
various competitive advancements. With the help of this, a company could effectively make right
decisions, which will help them in sustaining within international market for a longer period of
time. Away with this, there are different routes that an organisation may consider while
expanding business at international level like licensing, joint venture and so on. Including this, it
is said that Hofstede's Model would help a firm in examining right needs of employees, which
may lead firm to improvise engagement and develop a healthy business environment.
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Wang, J. and Peyvandi, A., 2018. OBJECTIVISM VERSUS CONSTRUCTIVISM IN
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Online
8 Strategies to Enter a New Foreign Market. 2020. [Online]. Available Through:
<https://www.bubblestranslation.com/8-strategies-to-enter-a-new-foreign-market/>.
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