Global Business Environment: SASOL ltd. PESTLE Analysis, Impact of Globalization, Digital Technology, Challenges and Recommendations

This presentation explores the concept of global business environment with SASOL ltd. as a case study. It covers PESTLE analysis, key driving factors of globalization, impact of digital technology, challenges and complexities, and recommendations to overcome them. The presentation also discusses the impact of globalization on the decision making and resources of a company.

Global business environment

Contents
 Introduction
 An introduction to the concept of globalisation.
 PESTLE analysis of SASOL ltd.
 Key driving factors of globalization
 Impact of digital technology on globalisation
 Challenges and complexities which globalisation brings to an organisation
 Conclusion
 References

Introduction
Global business environment can be defined as the surroundings
or the environment that resides in the various sovereign countries
that also include various factors that involves the use and
capabilities of the resources. In this presentation, SASOL limited
is chosen as the organisation. It is basically a chemical and energy
integrated organisation which is based in Sand-ton, South Africa.
The organisation was founded in 1950 and headquartered in Sand-
ton, South Africa. In this presentation, it involves the concept of
globalization and Pestle analysis and global impact on the
organisation with key driving factors of globalisation and impact
of digital technology upon globalisation with evaluation of the
opportunities and challenges of globalisation and various
recommendations on how to overcome these challenges.

The concept of globalization
Globalization is defined as free flow of goods, services and people across the world in a seamless
and unified manner. It provides various advantages to the countries which are good at producing a
particular product and easily export it to countries in order to gain profitability. Here are some
features of globalization which are depicted below:
 Liberalization: This provide freedom to be an entrepreneur where one can establish any
business, industry or trade within their own country or abroad. The expansion of global market
liberalizes the economic activities of the exchange of goods and funds across the borders.
 Free trade: It states that free flow of goods, services, technologies, ideas, belief and cultures
increase the global interaction that cause to international trade freely.
 Globalization of economic activities: This help in the process of the integrating the domestic
economy with the world economy as both are governed by domestic market and world market.

Pestle analysis of SASOL ltd.
It is a strategic tool used to understand the macro environment factors that have a
great impact on the industry, businesses and its strategies. It help in analysing the
risk and opportunities for further growth of the organisation. With reference to
SASOL ltd. that is global chemical and energy company which commercialise
technologies and build world scale facilities to produce high value product stream.
The pestle analysis helps Sasol ltd. to make strategic decision according to the
macro environment factors which are as below:
 Political factors: This factor represents the involvement of government that
influence the company by their tax policies, reforms, trade restriction and so on.
 Economic factor: This factor refers to the economic growth of the company that
may be affected by the exchange rates, inflation, wage rates and so on.
 Social factor: It refers to demand and behaviour of consumer which includes
norms, values, trends, health consciousness etc.

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 Technological factor: This factor refers to the innovation, automation, research and
development that may influence the company' operations.
 Legal factor: This factors refers to the employment legislation, consumer laws, health safety
and so on.
 Environmental factor: This factor refers to surrounding of environment which include
weather condition, temperature, climate change etc.

Key driving factors of globalization
Globalisation has removed the barrier of trading and increase the flow of financial resources, goods
and services across the borders. Further, globalisation assist in expanding the markets and
increasing their sales and profits. The factors that drive globalisation are outlined below:
 Technological drivers: The advancement in technology and improved communication
facilitates the growth of various sectors of economies throughout the world.
 Market drivers: There are many firms that are involved in exporting and importing of their
good and services across national borders.
 Cost drivers: The firms looks for the ways of obtaining the benefits of cost savings to gain the
competitive advantage.
 Competitive drivers: There is intense competition among the firms in a country so organisation
are forced to play internationally.

Impact of digital technology on
globalization
The transformation of digital technology has influenced the growth of globalisation to great
level. The digital technologies have led to increased trade growth especially in service trade
and also helped developing countries to increase their market share of global trade. The
following technologies that had a significant impact on global trade are:
 Social media platforms: The introduction of social medial platforms has completely
changed the way people communicate with each other.
 3D printing: The introduction of 3D printing da completely revolutionised the
production and supply chain process and had a significant impact in boosting
globalisation process.
 Block chain: The disruptive technology refereed as block-chain has changed global
trade by completely revolutionising trade finance through digitisation.

Challenges and complexities which
globalization brings to an organization
 Tariffs and export fees: This is a big issue faced by the companies for their global businesses
as they have to pay high taxes for different countries according to their policies. With reference
to Sasol ltd., the company also have to pay higher taxes in order to expand its business globally
which compel them to sell their products at higher prices. So, the demand for their products
becomes low because of limited purchasing power of the people.
 Worker exploitation: Many companies outsource their production to the developed countries
to get the cheap labour source that creates tough competition among the organisations. In
relation to Sasol ltd., it also outsources their production to the other countries like china where
it gets the opportunities for cheap labour source to get their work done. But, the labour of their
country loss pay due to high demand of payment. These are the challenges that are faced by the
companies in the world of globalization.

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Overcome challenges
Sasol ltd. Can overcome these challenges by creating products and services that are ethical,
sustainable and affordable. Instead of outsourcing their production, they get their work done within
the country. This may help them to provide jobs to labour of the country that has positive impact on
both the growth of company and economy as well. In addition to this, it is important for higher
authorities of SASOL ltd to ensure following of all the policies and rules as well as regulation of
government as it help to avoid any penalty and tariffs. Moreover, it also allows company to
maintain competitive advantage ta marketplace.

Conclusion
From the respective presentation , it has been concluded that globalisation is one of the significant
and important aspect for the growth and success of an organisation and is thereby impacting the
decision making and resources of company. In addition to this, it is important for an organisation to
conduct internal and external analysis of company as it hep in developing effective strategies and
core competencies which is vital to attain competitive edge at marketplace. It is determined that
there are different key forces that impact on the global commerce and trade that is cost, market,
competition and many more.

References
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