Global Business Environment: Structure, Governance, Culture, and Strategic Expansion of SASOL Company

This report discusses the structure, governance, and culture of SASOL Company using McKinsey's 7S model and Hofstede's dimension of culture. It also evaluates the sustainable and ethical factors that impact decision making in a global context and critically assesses the range of strategic expansion routes available to the organization.

Global Business
Environment

Table of Contents
INTRODUCTION...........................................................................................................................4
MAIN BODY...................................................................................................................................4
Explain about the structure, governance and culture within SASOL company applying
Mckinsey's 7S model..............................................................................................................4
How the organisation has been influenced by the hofstede's dimension of culture..............7
Evaluate about the sustainable factors and ethical factors that organisation has to consider in a
global market and how this impacts on decision making in a global context........................8
Critically evaluate and assess of the range of strategic expansion route available to the
organisation............................................................................................................................9
CONCLUSION .............................................................................................................................10
REFERENCES..............................................................................................................................12

INTRODUCTION
PART 1(covered under ppt)
Part 2
INTRODUCTION
Strategic direction refers to those plans that needs to be implemented for an organisation
to progress towards the vision and fulfilling its goals. It ensures that management and owners can
communicate the significance of employees work and their contribution towards achieving
objectives of business. SASOL company has been taken into consideration in the present report.
SASOL limited is a company which is based on integrated energy and chemicals. This company
is headquartered in Sandton, South Africa. The purpose of this report is to incorporate theory and
factors that influence structure, culture and functions in the business. The report covers
discussion about structure, governance and culture within an organisation and also about global
operations that can be implemented in this global market. In addition to this , the report covers
discussion about Hofstede's dimension of culture to explain about in which manner organisation
has been influenced. Moreover, the report covers discussion about sustainable and ethical factors

that organisation has to consider in this global market. The report consist of range of strategic
expansion routes available in an organisation.
MAIN BODY
Explain about the structure, governance and culture within SASOL company applying
Mckinsey's 7S model.
Mckinsey's 7S model refers to that tool which analyses about company's organisational
design. The model covers seven elements in this aspect which includes structure, strategy, skill,
system, shared values, style and staff.
1. Structure: Under this head, it talks about the way in which company has organised which is
about accountability relationship and chain of command. The company's structure is basically
consist of various departments that contribute in terms of achieving company's overall goals and
objectives. The structure of SASOL company is basically organised into two upstream business
units which includes three regional operating hubs and four customer facing strategic business
units.

2.Strategy: It talks about the well-curated business plan which allows the company to
formulate a plan of action to achieve sustainable competitive advantage. The strategy used by
SASOL company has major focus towards performance chemicals portfolio on areas. They have
industry -leading proprietary technologies and competitive advantage.
3.Systems: System talks about technical infrastructure and business of the company
which establishes workflows and the chain of decision-making. SASOL commercialises and
develop technologies which includes synthetic fuel technologies and also produces different
chemicals, liquid fuels and electricity.
4.Skills: Skills form the competencies and capabilities of a company that enables its
employees to achieve its objectives. Sasol company requires technical skills and smart work in
terms of achieving goals and objectives of an organisation.
5.Style: Attitude of senior employees in an organisation depends on the code of conduct
through their ways of interaction and symbolic decision-making.
6.Staff: It involves decisions related to human resource management and talent
management as well such as training, recruiting and reward system.
7.Shared values: This head talks about mission, vision and objectives as well which
forms the foundation of every organisation and also act as important role in terms of maintaining
Illustration : Mckinsey 7S framework
Source : Expert program management

an effective organisational design. Culture and values of SASOL company is majorly focused
on safety and security of employees. Safety of employees is the first priority from view point of
company and they concern about their employees that they return back safely to their homes.
Company cares about the people, planet and communities. There is a culture within the
organisation that leaders care about their employees and employees care for each other. They
also care about customers and communities as well. The company is also inclusive, accountable
and also resilient in terms of nature.
Governance: The governance of SASOL company has been applied into the sound manner to its
structure and processes. The board considers this system important in terms of delivering
sustainable growth in terms of interest of stakeholders. The board of company considers
corporate governance to be on priority basis.
Mckinsey’s 7S model can be applied initially through shared values by identifying
consistency in structure, strategy and system. After that look at the harder elements whether they
support to each other or not. Next is about considering the soft elements which are leadership
style and staff. After that align and adjust the elements. This model can be used to analyse the
current situation, proposed situation and identify the gaps and inconsistencies between them.
An evaluation of how the above has been influenced by global operations and how the
organisation has adapted to operating in a global market.
The structure, governance and culture has been influenced by global operations into
strategic manner. The organisational structure basically determines about how a business
configures its operation units and in which manner they interact to meet business needs. The
governance plays a very important role in terms of providing global public goods particularly
peace and security. In addition to this, mediation system for conflict, functioning markets and
unified standards for trade and industry. Culture have a major influence on the outlook of job of
workers, individual inventiveness and group dependability. There is a presence of different
entrepreneurial factors which would encourage globalization as well as directs the company
SASOL Ltd. to attempt for the development of organization. These are mentioned below:
Political fluctuations: The trend of globalization would be common and socialising the
community at international level for making a trade agreement with mutual consent, that
permits company SASOL Ltd. for acquiring suitable opportunities from market which all
are significant to the company.

Technological development: This is concerned to the technological development as it
enables communication as well as computing system to enhance the work flow within an
organization as well as circulation of idea or information throughout the scope of
business.
Global business climate: This is concerned with an enhancement of communication
which contributed in the procedure of globalization, but on the other hand also furnishes
required instruments to the business of SASOL Ltd. which would support to the
procedure of globalisation
Expenses: This is concerned with respect to the concept of trade liberalization along with
an involvement of investment flow in a specific area such as increasing the cost of
development, habits of international customers as well as requirement of achieving
economies of scale within an organisation
There are certain forces of globalisation which affect operation management. It includes cheaper
and easier mode of international transportation, reduction in trade barriers, market saturation and
wage differential. SASOL provides various kinds of services to different countries through
proprietary technologies and processes. The main products produced by the company are
chemical components and co-products, fuel components as well. From these value-adding
services and main products, company delivers diesel, petrol, kerosene, liquid petroleum,
bitumen and fuel oil as well.
How the organisation has been influenced by the hofstede's dimension of culture
Hofstede's dimension of culture talks about the framework of cross-cultural
communication. It includes five main dimensions of culture which are identity, power, gender,
uncertainty and time.
Identity: The identity of an organisation in this international market plays a very
important role in terms of execution of its performance. The identity of SASOL company is
majorly depends on their core sole products which are built around hydrogen carbon atom
combination. The six atoms basically represents about their six business and product units.
Power Distance: It is the dimension which is comprised of low power indexes and high
power which involves the sound hierarchy along with contribution of influencing leaders. Apart
from this parameter, these decisions are developed by company head instead of team work or
from a discussion.

Individualism versus community: The promotion has been targeted in such a manner
that people encourage towards product development. This also the element ofg saving time,
recognising people for effective team work.
Masculinity and femininity: The market is having huge differentiation in masculinity
among their roles in order to evaluate the specific culture to get assured about the target
place & proper pattern of each item.
Ambiguity & Tolerance: This cultural dimension is dependent upon the ambiguity
whereas the different tries to neglect it. In case of SASOL Ltd., the company is required
to identify the form of culture so to customize the marketing according to it.
Orientation for long term: This involves an orientation with culture which would assist
to acquire a proper analysis which would be emphasised upon the present along with a
past. The company SASOL Ltd., is required to schedule these forms of orientation
through serving proper promotional ad well as traditional form or structure
Indulgence & fast gratification: It involves huge understanding of culture which would
offer value in future. The less level of indulgence within culture comprising the stick
societal rules as well as regulations. With respect to the business of SASOL Ltd. There is
a presence of low indulgence culture which may influence the benefits within a society
related to company products or services. This aspect has a utilization of how they could
be set fixed within present or future orders.
This model is important because it provides relevant information regarding the differences
between countries and in which manner these differences can be managed. There are three major
barriers to international trade which includes natural barriers such as language and distance, tariff
and non-tariff barriers. With respect to SASOL company, they provide their services into
different countries and they have managed these differences through analysing and evaluating
the needs and requirements of different countries. They try to understand other country’s policies
and rules and regulations and then accordingly they agree on a deal for future business
conditions.
Evaluate about the sustainable factors and ethical factors that organisation has to consider in a
global market and how this impacts on decision making in a global context.
In context to the management of the successful growth of the organisation in the global
market organisation have to focus on the key ethical and sustainability factors within their

decision making process. There are the various ethical and sustainability factors which have to
be consider by the SASOL Limited in their global market in context to the management of
smooth growth and development.
Social impact- One of the most important factor of the ethical consideration is the
organisation social impact, that what is the business practices and how this is impacting the
peoples and social environment. Because ethically organisation have to make sure that they can
not harm the environment and social aspects of the target market country. Organisation have to
meet the sustainability standards of good impact of the organisation on the society in order to
make sure the challenges free growth in the global market. SASOL Limited is the chemical
company which have to make the consideration of the each and every ethical aspects of the
social sustainability. Social or sustainability factor impact the organisation decision making
because organisation have to implement the environment and social sustainability measures.
Economical viability - This is another important factor which should consider as the
organisation sustainability factor. SASOL Limited have to consider this factor under the
decision-making process by evaluating the impact of the various economical effects that may
results from the implementation of the particular project. The global market project effects and
economical benefits should consider appropriately.
Workplace diversity- That is another most important factor of the ethical consideration,
SASOL Limited have to focus on the management of the divers group of the employees in
workplace equality. When the organisation work in the multinational level they have to work
with the employees of different culture and to get the bets performance from them organisation
have to make them satisfied and comfortable in the work environment. This factor impact to the
organisation decision making process of the polices development and workplace management.
Because HR manager have to consider the effective management of the divers group of the staff.
Religion- This is one of the key factor of the global business, which have to be consider
by the organisation in order to manage the smooth work without any conflict and issues, such as
if the organisation is working in the different country with the divers staff then they have to
make sure that they respect the religions and culture of the staff and treat them equally. along
with this organisation have to make sure that their should be cultural and religion occasional
leave. So this factor is impacting the organisation decision-making process as HR manager have
to consider the religion occasion in their leave polices.

Language and cultural values- The another key factor of the ethical and sustainability
consideration is language and cultural values of the global business. Such as SASOL Limited
have to manage the staff training about the multinational languages and cultural behavioural
according to which work and task is can be successful manage and help to achieve the business
goals.
Critically evaluate and assess of the range of strategic expansion route available to the
organisation.
There are the multiple strategies and way of the global business expansion which can be
sue to enter and grow in the global market with innovative and existing business plans and
strategies. SASOL Limited can make the selection of the expansion route on the basis of their
own available resources and type of the target market in the different country.
Franchising- This is the type of business expansion method involving the hand over of
organisation resource, name and business products and services to the other person, known as the
franchisor. Franchisor are the individuals who manage the business of the particular
organisation in exchange of some profit. This is one of the most effective strategies of the
global market expansion, SASOL Limited can use this to expend their branches and brand name
throughout the different countries.
Licensing- This is another most important tool which can be use as the strategies or
method of the global business expansion. Basically this is involving the organisation legal
registration and licensing with the aid of which organisation will become eligible to use the
resources of that particular country for their business activities and operations without any issues
and this will also help to reduce the charges of the suppliers. That is the best expansion way for
SASOL Limited because with the aid of this organisation will become eligible to use natural
recourse of the country as the other locals of that country.
Export – Another key process or strategy of the global business expansion is export,
basically this is involving the selling of the products from on country to the other country in the
B2B form. This is the effective expansion method because with the influence of this organisation
can achieve the best result, as they do not have to invest on the other country for their business
establishment and they just have to contact to the distributors of the global market and transport

their products. This methods of the business expansion is associated to the development of
goods and services in one country and its selling in the other country.
Collaboration- This is another most effective type of the global business expansion
method. This involves the partnership of the tow organisation of the different countries to share
their resources and assessment for helping each other in the business establishment and growth in
the different country. By the aid of this strategies SASOL Limited leveraging internal and
external connections to generate the business ideas and manage the work task in the global level.
CONCLUSION
From the above study it has been concluded that globalization refers to the process of
businesses around the world have become more connected politically, economically and
socially, business globalization is the operating of the country in the multiple countries. The key
model for the management of effective structure culture and the governance within the
organisation is McKinsey’s 7S. This tool helps to assess the well-being and the future success
of the company. It illustrate the seven important elements such as the strategy, structure, system,
shared values, style and staff and skills. Hofstede’s Dimensions is the tool helps to evaluate the
cultural dimensions of the organisation. Such as individualism, collectivism, power distance,
uncertainty, masculine feminine, high context lower context and monochronioc etc. the key
ethical and sustainability factors of the consideration in context to the global business are social
impact, economical viability, religion language and cultural values. range of the strategies for the
expedition of the business in the global market is can be franchising, licensing, brand
positioning, collaboration etc.

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