Global Business Environment Project | Assignment

GLOBAL BUSINESS
ENVIRONMENT

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
P1 Key factors of cost, market, environment and competition that drive global commerce and
trade.............................................................................................................................................3
TASK 2 .........................................................................................................................................5
P2 Complexity of strategic challenges faced by organisations when operating in a global
environment ................................................................................................................................5
TASK 3............................................................................................................................................6
P3. How operating in global market influences organisation's structure, culture and functions.
.....................................................................................................................................................6
P4 Influences of ethical and sustainable globalization or various organizational functions.......9
TASK 4..........................................................................................................................................11
P5 Different ways decision making works effectively in a global context...............................11
P6 Various routes and key barriers to internationalism on organisation ................................11
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................14

INTRODUCTION
A global business environment is defined as environment of different countries which
influences decision making. The global business environment consists of external and internal
environment. The organisations must understand the concept of globalisation while operating
globally or internationally. This report describes the various factors that influence globalisation
(Rowell, 2017). The company considered in this report for analysing global business
environment is CAMECO. It is the largest company that trades uranium. CAMECO corporation
is based in Saskatoon, Saskatchewan and founded in the year 1988. This report explains key
factors of cost, market, environment and competition that drive global commerce and trade,
complexity of strategic challenges faced by organisations when operating in a global
environment. It Influences of globalisation on organisational governance and leadership,
structure, culture and functions. It also describes influences of ethical and sustainable
globalisation on organisational functions and the different ways of decision making. In last part
of report various routes and key barriers to internationalism on organisation is described.
TASK 1
P1 Key factors of cost, market, environment and competition that drive global commerce and
trade
Globalisation is defined as the exchange of goods and services with foreign countries.
There are various factors that drive globalisation. Globalisation affects overall functionality of
business. The driving forces are market, cost, technological advancements, etc. which influences
a company's expansion globally. These factors are described below-
Cost factor- There is a cost variation in every country (Miller and Jentz, 2017). There are
other opportunities of Cost drivers that help in building economies of global scale and high
product development. Key factor is a limiting factor that for determining sales volume, labour,
production and materials. CAMECO considers all these factors while expanding globally.
Market factor- In recent years there is a saturation of domestic markets, it has given
opportunities for global expansion and overcome this problem. The opportunity for using global
marketing channels, having common customer needs and transferring of market are opportunities
of internationalism.

Environment factor- Environment is the surroundings in which business is operated.
There are various factors which influence globalisation like social, technological, legal and
political. These play an important role in developing and growth of companies at global level.
CAMECO formulates various strategies that help in operating business at foreign countries.
Competition- Competition is an important factor to analyse before operating in foreign
markets. CAMECO is the manufacturer of uranium and it has competitive advantage in mining
industry. The company has to adopt new technology and innovation in their functioning to be
competitive in market. CAMECO uses artificial intelligence for dealing with heavy equipment
that gives a great competitive advantage. Employees are treated well by this organisation. They
are given insurance policies, incentives, safeguards for supporting their workers.
PESTEL Analysis of CAMECO:
Political factors- Political factors are significant for determination of profitability of
organisation in other country or market (Saleem, 2015). CAMECO corporation is dealing in
industrial minerals and metals in various countries and it faces different political issues.
Companies have to analyse all rules and regulations of that country before expansion and
operation. CAMECO is affected by various political issues, laws and regulations.
Economic factors – CAMECO faces different economic factors while operating in
different countries like inflation rates, interest rates, savings rate, foreign rates, and economic
cycle that helps to determine demand and investment (Lewis, 2019). CAMECO considers
different economic factors before doing PESTEL analysis like type of economic system,
exchange rates, efficiency of financial markets, inflation rate, etc. If the inflation rate increases
company's product rates will go high.
Social factors- Societal culture affects the environment of organisation. Factors analysed
by CAMECO corporation while expanding globally are demographic and skill level of
population, culture, attitude, leisure interest, entrepreneurial spirit, class structure, hierarchy and
power structure. If population of any country is less, then CAMECO can enter that market and
make profits.
Technological factors- Technology is a rapidly growing and organisation should work
according to the new changes in innovation and technology. CAMECO corporation involves
different factors for conducting technical analysis like – impact of technology on product
offering, rate of technological diffusion, impact on cost structure, etc. As when their

development of database systems, CAMECO should use this to avoid redundancy in data and
information.
Environmental factors The organisations consider environmental standards before
entering into new markets. CAMECO corporation evaluates factors like climate, weather, laws
of environment pollution, ecological attitude, recycling, etc.
Legal Factors- The organisations should analyse and evaluate the laws and regulations of
countries they are operating (Laudon and Traver, 2016). A careful evaluation of legal policies is
analysed by CAMECO before entering into new markets. Different laws considered by
CAMECO are Anti-trust law in industrial metals and minerals industry, health and safety law,
data protection, etc.
TASK 2
P2 Complexity of strategic challenges faced by organisations when operating in a global
environment
Globalisation is defined as the exchange of technology, products, information and jobs
across international cultures and borders. Globalisation provides modernization, job opportunity,
and access to services and goods to developing countries. Globalisation is the process by which
different countries trade globally (Lasserre, 2017). Globalisation includes integration of national
and regional economies, culture and societies through the global trade, transportation,
immigration and communication. The driving factors that influence globalisation are listed
below-
Technological change- It is an important factor that influences globalisation. The
increase in technological change has minimised the cost of communication and transmission of
information.
Economies of scale- When the minimum efficient sales are increasing, domestic market
is not enough to satisfy selling needs of company.
Globalisation offers opportunities to increase revenue of the company but it has
disadvantages too. There are cultural differences among employees, it creates negative
environment at workplace and disturbs the employees’ performance. CAMECO has faced
various challenges while operating business at global level (Adekola and Sergi, 2016). These

challenges are culture differences, market expansion in new countries, etc. Challenges faced in
globalising by CAMECO are described in the following paragraph-
Monopoly situations- A situation for monopoly is beneficial for an organisation. When
company is the single manufacturer of the product then it is easier to make profits. In context of
CAMECO, they undergo research before expanding business in other countries. The company
considers environmental factors, laws, regulations of that area before operating globally.
Laws and regulations- There are different laws governed in different countries.
Organisations which expand their business at a global level analyse laws and regulations of that
area to avoid any legal issue that affects the reputation of the firm (Boshyk, ed., 2016). A
company like CAMECO considers various laws like labour laws, employment laws, wage law,
industry law, etc. before starting operations globally. Suppose in a country where wages law is to
give less labour wage, it is beneficial for CAMECO to start its business in that country.
Political risks- This includes various political rules, policies, regulations that are
implemented in business environment. These factors directly affect growth and development of
that company in different countries. CAMECO company is affected by various economic
policies like export import policies, fiscal policies, etc.
Communication and cultural differences- Communication is the way of sharing and
exchanging of information or data. A good flow of communication in the organisation will help
in making effective decisions. There is different culture followed in various countries. In
globalising companies ensure that there is no problem of cultural differences (Cassidy, 2016).
Employees of this company are trained to respect all cultures and work with every individual
effectively. In case of CAMECO, employees understand customer behaviour and make good
relations with colleagues.
TASK 3
P3. How operating in global market influences organisation's structure, culture and functions.
Corporate governance is the process which consists of certain rules and regulations by the
management team can guides and directs their employees. The effective governance can assist a
firm to attain their business goals and objectives.
 Structure: In CAMECO, structure is followed by the superior to subordinates, the flow of
structure is started from the management team. In this organisation structure, the

information is passes in horizontal way and the firm can take advantage of this by
utilising the resources in an effective manner. The structure of an organisation gets
affected when the firm wants to expand their business in global market and for this it is
necessary to enhance the knowledge of the employees and the firm can deal in more
effective way by hiring and selecting the new talented and highly skilled applicants for
their organisation.
 Culture: The CAMECO firm is using the soft culture model in which the firm pay
attention on all the tangible and intangible objectives of the company. Organisation
Culture is affected when the firm is hiring the new highly skilled applicants from
different culture for their enterprise. If CAMECO hire skilled employees, this will
increase efficiency of organisation and gradually profits of company will increase.
 Leadership: Participative type of leadership style is used by CAMECO, and by which the
leaders start creating the sense and support among all the employees. The leaders of
CAMECO are using this style of leadership as an innovative tool which develop their
opinion and viewpoint to enhance the productivity of the firm. Due to the effect of
globalisation, the firm has to change their leadership style from autocratic to
Transformational as this change is necessary because of change in culture differences.
 Functions: CAMECO is a chemical based company, they are used to produce the
chemical products and these products are used by other companies in order to
manufacture their finished products (Cavusgil, and Knight, 2015). Their main function is
to produce the chemical products. Due to the effect of globalisation, the firm is
examining the different market area in all over the world and then alter their products as
per the need of the different countries.
 Governance: For the higher success the management team of the firm is developing the
effective decisions and policies. In context with globalisation, it is state that the firm is
needed to follow all the rules and regulations of government of different countries.
Application of McKinsey's 7s Model on organisation structure in CAMECO
This model is a tool that assist the manager in analysing their business in an effective way
and they also analyse if any change takes place in the firm. This model consists of 7s into two
elements which are named as hard and soft (Cumming and Zahra, 2016). In regard with

CAMECO, the firm used this model to improve their performance. The two elements are
described as below -
1. Hard Elements: These elements have direct effect on the company and this includes
strategies, reporting, charts and statements, etc. Some of the hard elements are given
below-
◦ Structure – The firm CAMECO is using the divisional organisational structure in
which every organisation has their own functions which are to be managed and
performed by each of them, along with this in this the authorities and power of
CAMECO firm related to decision making is centralized.
◦ Strategy – The Leaders and managers have adopted the different strategies in their
firm. This uses accountability and CSR activity which is responsible for their fast
business growth in the competitive market.
◦ Systems – This element consists of those operational activities in which the
workers are included to get their work done (Hamilton and Webster, 2018). The
firm CAMECO is adopting that strategy where employees are doing the important
project on the priority bases.
2. Soft Elements: This element is too complex and have more effect due to the organisation
culture. Some of the Soft elements are outlined below -
◦ Skills – The firm is recruiting the applicants on the basis of their skills and
capabilities.
◦ Staff – The firm needs to recruit 20200 applicants to complete their staff and fro
this they are using the online recruitment and interview methods. The firm recruit
as per vacancies available which aids them in attaining their assigned task.
◦ Style – The manager of CAMECO is using the democratic style of leadership as
this style provide the equal rights and opportunities to all employees, which help
them in selecting the task as per their skills and then the manager is assigning
their role according to their capabilities to sustain in market for long time of
period.
◦ Shared valued – The employees, managers and leaders are following the same
belief and values which help them to perform their business in moral and ethical
way.

Hofstede's model
This model is founded by Geert Hofstede, in which organisational culture means all those
beliefs, practices ideologies which make an organisation different from each other. Culture of
workplace decides how an employee would behave with their colleagues as well as with other
external parties (Kirton and Trebilcock, 2017). Senior management of organisation made some
rules and regulation which has to be followed by the staff members of the company. The four
main elements of this model are as follows -
1. Masculinity vs. Femininity: In Masculinity vs femininity factor, the firm CAMECO states
that male employees take decisions in aggression, so to avoid conflicts among employees
they start involving females in their decision making process.
2. Power Distance: The managers and leaders of CAMECO should consider the power
distance factor of culture model for each employee and should give equal power and
rights to all the employees, no matter what is their post in organisation.
3. Individualism vs. collectivism: In the Individualism factor of Hofstede, the firm
CAMECO should give equal rights to involve in decision making process. Output of the
firm can be increased if each individual exchanges their ideas, thoughts with their
colleagues to innovate something new.
4. Uncertainty Avoidance: In this uncertainty avoidance index, behaviour of an individual
has been analysed in the situation of conflicts. CAMECO prepare their employees in such
a way that they will adjust themselves in any situation whether it is comfortable or
uncomfortable for them.
P4 Influences of ethical and sustainable globalization or various organizational functions.
Ethical globalization is a process of integration with economies, culture and societies at
global level in ethical manner (Slack and Brandon-Jones, 2018). Along with this, ethical
globalization encourages shareholders, customers, suppliers, government and society to follow
ethics accordingly. With references to this, it helps in achieving a long term goal which enhance
the growth and success of company.
Sustainable globalization is a concept of developing and expanding business at global
level as, it helps in enhancing the profitability and maintain sustainability at market place.

Along with this, it is a tool of transforming the pattern of doing business at global level
according to accepted framework of sustainability. In addition to this, for long term sustainability
of a company at global level they should have follow all legal formalities for their better survival
and growth (Stacey, 2016). It focuses on principle oriented which is based on value of services
and collaboration. There are various organizational functions which will affect by ethical and
sustainable globalization are described below
Human resource- In every organization the most important or valuable asset is human
resources as, they help in achieving an organizational goals and objectives effectively. In
addition to this, company should follow all the formalities in ethical way according to
governmental rules and regulation of the country (Taneja, Sewell, and Odom, 2015). In context
of CAMECO, it has been analyzed that mangers are adopting human practices for long term
sustainability of a company at global level. Along with this, CAMECO is giving rights to their
employees for maintaining an effectiveness of human resource in an organization for maintaining
business activities at global level.
Marketing- It is a crucial element for every single company as it helps in identifying a
need and requirement of customers. Along with this, marketing is also helps in promoting a good
and services for creating awareness and attracting customers towards their products. In context of
CAMECO, it is very necessary to promote their product at low cost with best quality which helps
in capturing a market share at global level. With addition to this, mangers should adopt effective
marketing strategies for increasing the sale of their product as, it will help in ethical and
sustainable globalization (Welford, 2016). Along with this, customers will not manipulate the
price of products also CAMECO mangers focuses only on those products which will help a
company to maintain sustainability and long term profitability of an organization at market place.
Finance- It help businesses to run their functions or activities smoothly and effectively.
In addition to this, the main motive of this function is to arrange or utilize funds for ruining their
business operation accordingly. In context of CAMECO, their finance managers should focus on
collection and arrangement of funds in ethical manner. With addition to this, it will help in
enhancing the living standard and commitment of their staff and workers towards company and
work.

TASK 4
P5 Different ways decision making works effectively in a global context
Decision making is a process which helps in selecting best alternative or solution for a
problem. It includes managing various things like employee participation, performance system
and interest of stakeholders. There are following ways by which CAMECO managers take
decisions-
Command- CAMECO leaders consults their team mates while taking decisions. The
activities of employees are aligned with global concern for reducing risk of uncertainty.
Collaborative- Leaders take collaborative decisions by taking suggestions and opinions
from team members. In CAMECO leaders give importance to feedback given by leaders and
then final decisions are made.
Convenience- In this case, managers and leaders delegate decision making power for
enhancing intellectual capabilities of the employees (Taylor, Doherty and McGraw, 2015). This
helps managers of CAMECO to handle all global issues and making innovative ideas for growth
and development of the company.
P6 Various routes and key barriers to internationalism on organisation
Internationalism refers to expansion of business at global level. Globalisation or
internationalism is the way of trading in foreign countries and making more profits by expanding
markets of other countries. The main aim of CAMECO is to capture market area of all countries
and provide services globally. CAMECO used various practices while expanding business
globally and these are described below-
Licensing- A license is defined as an agreement which is used when copying or reselling
of commodities take place (Waddell, 2017). This gives an opportunity for companies to have a
proper agreement which includes information about the trading details.
Franchising- This is agreement between two parties where one of the party gives right to
another party for using their trade name and selling products and goods. The major drawback of
franchising is high cost, restrictions, no proper ownership, etc.
Joint Venture- Joint venture is official collaboration between two companies for a
specific purpose. Both of the parties share profit, risks, ownership and governance. The
limitation of this are culture clash, profit risk, etc.

Barriers of Internationalism
Financial barriers- This is the main issue while expansion of business. A huge amount of
money or finance is required for expanding businesses internationally.
Managerial barriers- This barrier means there are various problems like lack of skills,
knowledge or efficiency of employees (Tregear, 2015). It affects business expansion badly and
creates problem in expansion and growth of business.
Cultural barriers- Culture is an important factor which is considered while operating
business globally. It is essential for managers to understand market and culture of foreign
countries before entering in their marketplace.
CONCLUSION
From the above specified report, it has been analysed that business environment is
essential for achieving objectives of the company in expansion in foreign markets. Organisations
adopts different strategies and policies for making profits while operating globally. The mangers
apply culture, norms, duties and structure for employees. This aids in maintaining competitive
advantage in domestic as well as international markets.

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