Global Business Environment: Culture, Structure and Governance of Sasol

This report discusses the culture, structure and governance of Sasol using McKinsey's 7s model and the impact of global operations on them. It also evaluates the influence of Hofstede's dimensions of culture on an organization and ethical and sustainable factors considered by Sasol. The report is relevant for students studying Global Business Environment (Unit 18) in any college or university.

GLOBAL BUSINESS
ENVIRONMENT

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
MAINBODY...................................................................................................................................3
1.Introduction and purpose..........................................................................................................3
2.Explanation of culture, structure and governance of Sasol using McKinsey's 7s model.........3
3.Influence of global operations on above factors.......................................................................5
4.Impacts Hofstede's dimensions of culture on an organization..................................................7
5.Ethical and sustainable factors, that are considered by an organization...................................8
6.Evaluation of strategic decision-making..................................................................................9
7.Evaluation and assessment of routes of global expansion......................................................10
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12

INTRODUCTION
Globalization is a great option for the expansion and development of a business.
Globalization helps in expanding the business worldwide. Because it deals with other
organizations of the different and new countries in the world. SASOL is an energy and chemical
based organization. It is located in South Africa, and formed in 1950. SASOL's headquarter is
located in Sandton, South Africa. The reports is consists of introduction of globalization and the
structure and model of McKinsey’s, and its implication SASOL. The report also includes the
dimensions of Hofstedes culture model and its evaluation. The reports also contain the critical
evaluation of ethical and sustainable factors in a global market, and the assessment of strategic
routes for globalization.
MAINBODY
1.Introduction and purpose
Globalisation is a process of expanding the business world wide, it is referred to the
interconnection of organisations. It will help in the expansion and development of the country in
the world. The main purpose behind globalizing the business is, the providing the good and
services of the business to the world level. It helps ion the expansion of the business, and also in
the rapid growth of the business. Globalization also helps developing the economic conditions of
the organization s and well as of the nation.
2.Explanation of culture, structure and governance of Sasol using McKinsey's 7s model
Mckiney's 7s framework for SASOL
Strategy
Sasol gains competitive advantage by using the strategy of technological advancement.
They mainly focus on those areas where competitive advantages and industry's leading
technologies can be seen. The company always indulges itself in research & development
(Razmi, Mehrvar and Hassani, 2020). Sasol uses this that encourage them for creating a clear
path so that the company can achieve sustainable growth. It helps them in achieving higher

return from shareholders and increasing values for all the stakeholders. They managed to achieve
more of the production and increased their capital by their strategy.
Structure
The structure of Sasol is matrix structure. In this structure there are multiple superiors of
the employees and the organization contains more than one line of reporting managers. There are
different levels of management with Key Managerial Personnel’s (KMPs) levelled at different
stages according to their post. Sasol's structure is divided according to the different required units
of sales and production to provide better services with minimum resources.
System
The system of Sasol can also be called the culture of Sasol. The company's values have
always been helping them in connecting them to serve as they are obligated to serve better. Sasol
keeps the safety as their top priority in their organization (Cox, Pinfield and Rutter, 2019). It is
the core of their day-to-day business. They always provide safety to their employees and
members. Sasol has always been caring in nature they care for the environment and communities
as well.
Shared values
The company always tried their best to maintain their shared values. The company keeps
inclusivity in their work and for the members of the company. Sasol group always owns the
results of their work, and they believe that they are always accountable for their work. Their
mentality of being active and aware of their work builds more discipline in their organization.
Style
The company's style of participative leadership adoption is that they indulge themselves
in developing their employees with high calibre of knowledge. They incudes their members in
decision making processes (Shaqrah, 2018). Sasol's style of participative leadership is that they
unite with their people and create a positive relation with their employees which motivates the
employees in performing better for the company. The organization managed to create a style of
high performing employees by making them feel united with the company.

Staff
The HR strategies of Sasol always try to deliver effective employee powers to the
company. The staff of this organization is highly trained employees who are expert in their work.
Sasol trained their employees in a manner that helps the employees in performing better and
effortlessly. The staff of the Sasol is capable in handling their tasks effortlessly and creates clear
path for growth of the company. With the knowledge that is received by getting trained in this
organization the employees give their best towards the work.
Skills
The employees of Sasol are highly trained and skilled people. The employees of Sasol
group always indulge themselves in developing global talent. They are highly productive and
dedicated to their work (Nantavisit and Wongsa, 2022). The employees of this company are
capable enough to handle operations on a large scale. Company promoted their organizational
culture and diversity by providing their employees with skills and abilities.
Governance system of Sasol
The governance system of Sasol consists of many boards and executive committees
created in their organization. These committees create good governance in the organization by
obligating the employees and members of the company to comply with the rules and regulation
of the organization. The board of the company has always been adhered to the rules and
regulations created by the government of the country where the company is established.
3.Influence of global operations on above factors
The influence of global operations made an impact on the culture, structure and the
governance of the Sasol in both positive and negative ways (Bruch and et.al., 2020). As the
world is changing rapidly and the companies are trying their best to achieve a great result from
the influence of global operations. It made the Sasol group change their strategies and mind set
for improving their performance.

Culture
The culture of Sasol has been evolving as the global operations affected the culture of
this organization by making them invest more in their human capital managements. The global
operations influenced Sasol's culture by changing the cultural process of investment in human
capital resources. Through this change the work efficiency of the Sasol group improved a lot.
Structure
Structure of the Sasol company was already stable as it has multiple of managers and
other Key Managerial Personnels (KMPs). The global operations did not influence the structure
in any negative way as it was already at a peak of excellency (Chawla and et.al., 2021). The
group created more divisions and units to improve their performance and employed more
professionals to their units. Having such a great and strong structure helped the Sasol group in
achieving a great result under the influence of global operations.
Governance
Adherence to the rules and regulations is the most important part for doing business in
any country. Global operations influenced the Sasol group by creating a strict environment for
the compliance of rules and regulations. The Sasol group managed to improve their governance
by looking at the global governance. They were already in a good compliance of the rules and
regulations of their country. Now they are even more adhere to the global governance.
How the organization has adapted the change to operate in global market
As the world is changing and new technologies are coming day by day and helping the
companies in improving themselves. Sasol has been adapted the change to operate in the global
market by adopting the new technologies and digital solutions (Ruggie, 2018). The Sasol group
was already competitive to other brands but by looking at the demand of energy and chemicals
they started to boost their production. They started shifting their focus towards improving their
production by encouraging and motivating their employees to perform better. This adaptation
helped the Sasol group in achieving new growths and better sales of their product.

4.Impacts Hofstede's dimensions of culture on an organization
Hofstede's dimension says that national and regional factors contribute into the culture of
the organization, and these factors also influences the behaviour of employees in the
organization. There are five different culture models of Hofstede. They are as follows:
Power distance: it refers to the differences in the work cultures, as per the work division
among the employees of the organization. There are different levels in every organization, for
example the top-level, middle level and lower level, these three managements are divided as the
different jobs in the organization (Miroshnikova, and Wickström, , 2022). In respect to this level,
every level of management has its different work of culture. In reference to SASOL, the
employees will also response as per the delegated jobs to them. This model can influence
positively on the employees of SASOL, as it creates a sense of respect and efficient work
management into the organization.
Masculinity vs. Femininity: this model refers to the difference of male and female in the
organization, their values and the culture within the firm. There are many organizations, which
are male dominated and control by the main power of male. But there are many organizations too
which are empowered by the females, the most of the decision-making powers are in the hands
of the females of the organization. This model in SASOL will influence on the gender quality
and promotes the no discrimination among males and females. The no discrimination policy in
SASOL will result in great image building and high productivity by its employees. It is an
effective mode to be used by an organization in reference to its growth and development.
Individualism: this refers that organizations which are rely on teamwork and believes
that team work is an effective tool for achieving the output (Gritsch, Batchelor,. and Gonzalez
Castro, 2022). These organizations also believes that the results are always more, when
individuals exchange their ideas and discuss their opinions among themselves to come up with
more innovative ideas. SASAOL also involves opinions other organization and discuss their
views in order to achieve their common goal. SASOL believes in teamwork and respect the ideas
and opinions of other organizations, to attain the common objective (Shekhar, and et. al, 2022).
Teamwork is a good option for the growth and development of SASOL.
Uncertainty Avoidance Index: this refers to the uncertainty of unfamiliar or non-usual
situations that are presented to the employees of SASAOL. This observes the reactions of the
employees in the unfamiliar and unfair situations. SASOL make sure, that employees are being

prepared for the challenges to deal in with these types of circumstances. The organizations also
observe the level of tolerance of employees, that how they will behave in these situations.
Long term and short-term orientation: this factor refer to the focus of the organization
on the employees who has the aim to build the long-term relationship with the organization.
SASOL invest its more time and energy in those employees who focus on the long-term growth
with SASOL. On the contrary, if SASOL see the employees as short -term, will not invest in the
relationships, the organization will focus less on those employees who has the planning of short-
term investment in the SASOL, and can leave will another better opportunity arises.
Indulgence vs. Restraint: indulgence refers for the society that allows comparatively
free norms and offers the flexibility to enjoy and gave fun. Restraint stands for the restricted
norms and rigidity (McIntyre, , and et. al., 2022). Indulgence environment in SASOL, will
provide satisfaction to the employees in order to the completion of the desires and the flexibility
of living and enjoying the personal lives, this will increase in the productivity of work in the
employees.
5.Ethical and sustainable factors, that are considered by an organization.
An organization always considers the ethical and sustainable factors of a global market.
Considering these factors by the organization is helpful in developing the business opportunities
for SASOL. The consideration of ethical factors in business is very important. There are some
important ethical factors, which has to be considered by the organization. They are as follows:
Safe working conditions: the most important ethical factor, which is considered by
SASOL is, the safe working conditions of the organization. SASOL must take care of the safety
factor in the organization. A safe and secured working condition in organization, gives the
satisfaction to the employees of SASOL. This satisfaction leads to high productivity in the
employees of SASOL. By providing safe working conditions to the employees of organization
will result in great efficiency of work in SASOL. Safe working conditions also involves welfare
facilities like regular check-ups, vaccinations and providing some emergency medical services
by SASOL to its employees. SASOL makes sure the good working qualities like, clean working
space, normal temperature and communicative environment within the organization (Batut, and
et. al 2022).

Local community development: this term refers to the development and growth of the
local people community, of where the organization is operating its business. Community
development involves the investments in the local infrastructure. This means that SASOL should
spend some investment on the development local community, by providing employment
opportunities to the local people, providing some source of education and by investing in some
local business in respect to the growth and development of the local people and community.
Sustainable factors: a business must opt the sustainable factor in the organization. These
factors help in building brand image of the business, and also benefits the environment.
Sustainable factors involve those activities, which meet the need and wants of an enterprise and
of its stakeholders. This term means the protecting, sustaining and enhancing the human natural
resources, which are needed in the future.
Environmental sustainably: this refers to the natural resources, in which the humans are
living. A real environmental sustainability ensures the consumption of only natural resources,
such as materials, energy fuels, land and water at a sustainable rate (Domb, , and et. al 2022).
Development of this sustainable factor will help SASOL in the development and growth of the
business. Considering the sustainable factor in SASOL, lead to gain more customer because
development of sustainable factors will attract many nature loving individual, which results in
mouth publicity of the organization.
6.Evaluation of strategic decision-making.
The evaluation of strategic decision-making involves the study of strategy and then its
implication on the organization. In order to evaluate the strategic decision-making SASOL
should consider more focus on the long term and short-term orientation. SASOL can identify the
long term and short-term orientation in reference to its employees. Employees with long terms
plans with SASOL, are must be focused more in the organization, because employees with long
term plans with SASOL are important and results productive for SASOL. It could invest more of
its energy and time in those employees who are willing to have work for in long run in the
SASOL. The investment in those employees will result in rapid growth and development of the
firm. Comparatively, time and energy investment in those employees who are not much
interested in working for long run with the organization, they must consider for less by the
SASOL. Because focusing on the long-term orientation is the only goal and objective of the firm

(Shaheen, and et. al., 2022). SASOL can achieve its all mission by focusing on its long-term
goals and objectives. This will result in attaining the objectives of the SASOL.
There are also some methods and routes in order to expansion of the business at the global
level. The arranging licence, exporting good and partnerships (Hollifield, and Foley, 2022 ).
These routes are helpful in making the strategic decision making regarding the globalization of
the SASOL. Exporting the goods is the most suitable route for the globalization of the business,
because it is the most common and likely adopted by other organizations.
7.Evaluation and assessment of routes of global expansion
Licensing arrangements: arranging the licence is the most common method of
expanding the business. Before trading globally, an organization has to make arrangement of its
licence. Arranging licence is the key step in order to expand the business. The license
arrangement is the process of agreement between two parties or organizations (Dharani, and et.
al 2022).
Exporting goods: it is the most suitable way in which an organization can expand its
business. Exporting goods refers to the outside selling of the goods (other countries). This known
as the trading with other countries, in respect to globalize the business. An organization exports
its goods and service to other countries, and can make huge profits and gain more customers.
Adopting this method by an organization will result in rapid growth and development of firm and
also helps in the expanding the organization worldwide.
Partnerships: it is known as the agreement of doing business between organizations, but
in equal share of profit. It is made for a common purpose and it has mutual goals. Partnership is
the good option in terms of trading globally. But sometimes partnerships with new organization
in with new country has a risk factor as well. Making a partnership deed without knowing much
about the organization may lead to some fraud and cheating. An organization must be aware off
before making any partnerships (Palmeter,, Mavroidis, . and Meagher, 2022). Partnership
method is a nice idea in reference to the expansion of the business. But also an organization
should be very careful before making any deed or doing any commercial transaction with the
other organization of new country. It is important because it can create heavy losses and risk, if
any misshapenness occurs in a firm.

In reference to SASOL they must go with the exporting goods method route, because it is
has less risk involved as compare to partnership. This method will help in the growth and
expansion of SASOL. Exporting goods is the most common route in order to globalize the
business of SASOL. Because it is adopted by many organizations, as it is helpful in taking
reviews from other organizations, in order to make an improvement and no chance of mistake.
This helps SASOL in development and expansion of business at a global level.
CONCLUSION
From the above report it is concluded that, globalization helps a business in its expansion
and growth. The report also summarizes the structure, culture, and governance in an
organization, by applying the Mckinsey 7’s model and the evaluation of its influence on the
global operations. The report also concluded the Hostede’s dimensions of culture in SASOL
and the evaluation of ethical and sustainable factors that firm has to consider in a global
market. The report also concluded the evaluation of strategic decision making and the
assessment of range of strategic global expansion routes that are available to SASOL in
order to expand their business.

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