Analyzing Business Strategies for Global Success

The provided assignment involves analyzing strategic challenges and opportunities in the context of business globalization. It requires an examination of frameworks such as McKinsey's 7s model to assess changes in business industries and identify opportunities for businesses to reach a global level. The task also involves reviewing relevant literature on topics like born globals, internationalization processes, and the garment industry in Laos. A systematic review of key international journals is also mentioned. The goal is to provide insights into the state of research on Africa in business and management and explore how these concepts can be applied to real-world scenarios. The assignment expects students to critically analyze business strategies and identify opportunities for growth and development.

Global business
Environment

Table of Contents
INTRODUCTION...........................................................................................................................1
Concept of Globalization........................................................................................................1
TASK 1............................................................................................................................................1
P1 An explanation on key factors of cost, market, environment and competition that drive
global commerce and trade.....................................................................................................2
TASK 2............................................................................................................................................3
P2 Define the complexity of strategic challenges faced by organisation when operating in a
global business environment supported by specific examples...............................................3
TASK 3............................................................................................................................................5
P3 An explanation of the structure, culture and governance of the organisation...................5
P4 Evaluation of ethical and sustainable factors that can influence globalisation on
organisational functions..........................................................................................................7
TASK 4............................................................................................................................................8
P5 Determine the several ways decision making can work effectively in a global context...8
P6 Determine and articulate the various routes to internationalisation an organisation may
adopt, including key barriers..................................................................................................9
CONCLUSION..............................................................................................................................10
REFERENCE.................................................................................................................................11

INTRODUCTION
Global business means international trade which is run across the world in order to
expand the business. Business environment is the collection of internal and external factors that
affects operational activities of business entities. Global business environment contains a place
where two or more entities works collectively in order to generate more profits by expanding the
business. It is used to gather the mutual profits through importing and exporting of goods and
services (Biloshapka and Osiyevskyy, 2018). The current project report is based on SASOL
Limited which deals in energy and chemical industry. The SASOL Limited is based on South
Africa who expands its business in different countries. The present report covered different
topics concept of globalization, driving factors, PEST analysis, impact of digital technology and
challenges of globalization that affects business. Moreover, the report will state Mckinsey's 7s
model, ethical and sustainable factors which can be consider in global market and these factors
affects the decision making in global operations.
Concept of Globalization
Globalization is a that term which define the interrelation among the people, companies,
and government of different nations. The element plays an important role in the free movement
of goods, services, technology, flow of finance, and people across the world. In context of
SASOL limits as they are expanding their business in various nations so they can take benefit of
this term. After globalization they can take advantage of others countries technologies, business
strategies, ideas and many others. It also helps them to increase their business in the all over the
world which result increasing profitability and productivity. On the other hand, globalization has
some advantage and disadvantage like it helps them to increase the job opportunities, easy access
of foreign culture and so on. But in has disadvantage like ruin job opportunities of high-wage
and well-developed countries because their production and ideas are moves across boarders
which can harm them in an effective manner.
TASK 1

P1 An explanation on key factors of cost, market, environment and competition that drive global
commerce and trade.
There are various factors which have the potential of influence the globalization across
industries, which are uncontrollable by individual organizations. In this section, the explanation
about these factors that how these factors play an important role in the globalization.
 Cost:- This is the main factor which can influence the term of globalization that defines
that cost is different in every country so the global firms can take advantage of it. If the
cost is higher of land, capital, and labor in the own country then SASOL limited can take
benefit from export from other countries (Danik, Duliniec and Kowalik 2016).
 Market:- At present situation domestic market are become more saturated so the
opportunities for development is limited. For overcoming this situation SASOL limited
can adopt globalization term which helps them to reach in the global market so they able
to increase their performance internationally.
 Competition:- After globalization competition will be increase for the SASOL limited,
for beating their competitors they have to improve their organizational performance
internationally.
 Environment:- Globalization is affected by so many environmental factors which
includes political and legal issues, these have the great impact on globalization. Other
factors are social, cultural, technologies, and many others which can impact the
globalization so the company needs to implemented their operational activities after
considering all these factors.
The significant impact of digital technology upon globalisation:-
The digital technology has great impact on the globalization as they help the business sot
grow more in the market. Technology helps the business to overcome from various issues related
to trade barriers, transportation cost, lack of common ethical standard, delay in information
exchange and many others. It helps SASOL limited to operate their operational activities
smoothly without any crisis which helps them to increase their productivity and profitability as
well.
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TASK 2
P2 Define the complexity of strategic challenges faced by organisation when operating in a
global business environment supported by specific examples
There are different types of business activities in global business environment that help to
face the global challenges as well as strategic challenges while conducting activities. There are
consisting of international trade, economics of globalisation and their environmental implication
as per the terms of challenges. It pose risk with several diversification policies, complexities of
global supply chain management and more. In the reference of SASOL Ltd, the company
mainly deals in chemical business which is considering as most complex problems that it may
face due to moving into new market place. It will be related to global supply chain management
which can affect to demand of sustainability in increasing way. To better understand of
challenges regarding to company of SASOL Ltd, there is required to apply the concept of
PESTLE as shown below:
PESTLE Analysis of SASOL Limited:
PESTLE Analysis is a depth analysis which is related to operating challenges of SASOL
limited which can face various competitive forces due to spread out their business in prevalent
macro environment. For instance, a business acquire more profits with the help of strong growth
trajectory but it will not be proven good for if it is conducted business in unstable political
environment.
Political: It involves tax rates, government policy, trade restrictions, tariffs and political
stability. SASOL limited is operating business activities in different countries through
transporting the goods. This factor can affect business operation of SASOL Ltd such as if
government has changed the trade policy and increase the tax rate then organisation has to pay
high amount that reduces its profit margin (Ermakova and et.al., 2016).
Economical: It considers various factors such as costs, interest rates, inflation rates,
government policies and management which impact on business organisation whether positively
or negatively. If interest rate has been increased then SASOL Ltd has to purchase raw material at
increased prices that impacts negatively. As result customers will not prefer costly products due
to increase inflation rates.
Social: This is variable factors which considers culture, taste of people, community,
society perception, religion, language and communication which can affect the operation of
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business entities. The changes in society culture and their choices impacts on SASOL Ltd such
as it need to focus on customer's demand and then produce products as they wants. If it does not
focus on these factors then it impacts wealth of organisation. As result low level of customer
satisfaction.
Technological: It involves new technology which can affect the business activities
within organisation. SASOL Ltd is a manufacturing company of chemical products that need to
accept the new technology in order to attract the customers. It affect the business such as
employees turns towards production when they are efficient. Advanced technology helps to build
a strong customer loyalty base and also aware the business transformational process.
Legal: It considers different laws and regulations such as minimum wages act, health and
safety act, consumer protection laws ect. It influences business organisation such as SASOL Ltd
is not following health and protection act which is needed to provide satisfaction to employees.
In this situation, employees can switch the organisation that can reduces the productivity of
business industry.
Environmental: It involves those factors which can impact on business organisation
such as mass production, climate change, atomic energy and green effect. If climate will be
change then SASOL Ltd will not manufacture products effectively. As result low productivity
and low supply of chemical products.
Challenges of globalisation and strategic challenges
In present, organisations are facing different types of challenges in globalisation that may
impacts on business. These are defined as:
Challenges of globalisation
Currency exchange rate: If currency has been changes in countries then SASOL Ltd
has to face face low productivity. As result it cannot enhance growth and productivity.
Governmental laws: If government has changed laws then it can not purchase or sell the
products out of nation borders. So it may be a challenges for SASOL Ltd to accept the new
policies and run a business.
Strategic challenges
Slow GDP rate: It may be a challenge for SASOL Ltd such as if economical growth rate
is low then GDP rate will be decrease. As result low productivity.
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Cost: Organisation prepares budget that help to make future planning for more
productivity. This is a challenge for SASOL Ltd to use cost optimally and maintain the liquidity
(Kasemsap, 2016).
Recommendation to overcome above challenges
To overcome the challenges it can be recommended to SASOL Ltd's manager to build
effective planning and make decision that help to run a business. The manager need to focus on
growth rate and economic rate by providing employment opportunity. Moreover, manager need
to make solid budget by utilising the cost of organisation that will help to expand the business for
long period.
TASK 3
P3 An explanation of the structure, culture and governance of the organisation
This structure, culture, and governance, these three elements can greatly influence an
organization overall performance. It is must for any organization to exploring the relationship
between the organizational structure and culture because these both terms are responsible for the
behavior of organization members. On the others hand, an organization needs to follow all the
rules and regulations of the government for preventing themselves from any dispute. As SASOL
limited is adopting flat structure in the organization that provides a great connection between the
managers and their subordinated which helps them to create a health environment in their firm
that motives their employee to achieve the organizational goals and objectives. For sustain their
employee in the organization for a long time they believe in adopting inspirational culture in
their organization which defines that trust, respect, and engagement in organization activities is
necessary. For succeeding in the market SASOL limited must have good understanding of the
internal organization which can be understood by the below given McKinsey 7S Framework that
ensure them to constant on their higher position (Knight and Liesch, 2016).
McKinsey 7S Framework
This 7S model has seven factors which are divided as hard and soft elements which are
describe below:-
Hard skills:
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 Strategy: It is main factor for any organization as it is related to the plan made by the
organization to remain competitive in its industry and market so they able to take
advantage of it.
 Structure: It is related to how the company is organized in order to their employees,
capital, and machinery. Moreover, it showcase the way organization is divided like it
explained who is responsible for the activities and to whom. Also, structure defines the
role and responsibilities of the employee according to their capabilities.
 System: This term can be defined by the processes and procedures adopt by the SASOL
limited to get higher success (Kolk and Rivera-Santos, 2018).
Soft skills:
 Skills: In this factor organization staff and management abilities, capabilities, and
competences are included which leads the firm in a higher position. If any changes occurs
in the organization so these skills help them to meet all the new strategies and new
structure.
 Staff: In this category SASOL limited have to concentrate about that what type of
employees they need and how they will be recruited, trained and motivated them.
 Style: It is related to the management and leadership styles which will help the SASOL
limited to tell that how company is managed by top-level mangers, how they interact and
what actions they should take for achieving their goals.
 Shared value: This is related to the overall performance of the companies. They are
defines as norms and standards that will help the employees that how to behave and how
to do actions in the company so they able to achieve their goals easily (Meyer and Peng,
2016).
Application: These above strategies helps the SASOL limited to evaluate their
organisation ability to perform and understand the current situation and future possibilities. In
regarding to achieve their goals and objectives within the organisation a person must have both
hard skills and soft skills. In the lack of appropriate skills and proper knowledge, the
management of SASOL limited will not be able to make effective strategies and plans which
makes difficult for an organisation to achieve growth and success at global level. If SASOL
limited wants to achieve their goals and objectives their management must have both the hard
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and soft skills which requires in implementation of strategies. This will help the organisation in
achieving their pre determine objectives with given time period.
P4 Evaluation of ethical and sustainable factors that can influence globalisation on organisational
functions
Globalisation is the process which is used to spread the products, services, information,
technology and jobs out of the national culture and borders. It involves ethical and sustainable
factors which affects the globalisation on organisational functions. Ethical globalisation refers to
the global economics, moral philosophy or behavioural practices that considers right and wrong
conduct. Sustainability globalisation states as the process of using those techniques and
processes which is beneficial for environment and community in order to run a business around
the global level. Sustainability does not harm any business environment or operations of business
entity. Herein, some ethical and sustainable factors are defined which helps SASOL Limited's
function to expand their business in wider market segment:
Human resource: This is the main function of any organisation which help to run a
business globally. This is important for SASOL Limited because it helps to introduce from
skilled and more experienced workforce that is required. It influences Ethical and sustainability
such as manager of SASOL Limited understand the employees problems and provide them best
solution with right conduct. On the other side, it influence the globalisation such as economic
growth increases during promoting jobs and stronger economy (Nolintha and Jajri, 2016).
Marketing: This is other essential function that helps SASOL Limited to identify the
needs and wants of customers and provide them satisfaction by providing chemical products. The
marketing manager makes effective marketing strategy that help to run a business successfully. It
influences ethical and sustainability globalisation such as marketing manager of SASOL Limited
analysis the customer's demand and supply the chemical products that influences customers to
buy the products. It increases the sustainability by providing better quality of products as it helps
to increase the brand image.
Finance: This is most important function of any organisation which is required to
continue the business entities. It influences the ethical globalisation such as SASOL Limited pay
tax amount and custom duty that helps in the development of country. It can increase the
business operation in different countries. Additional, sustainable globalisation influences
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organisation operation for instance, by providing sufficient funds company can expand the
business globally that helps sustain in competitive environment.
Therefore, above mentioned organisation function influences the ethical and sustainable
globalisation. Ethical globalisation is needed in individual life as well as in corporate world that
help to increase the market and production process. Sustainable globalisation influences he
social, economic and environmental factors of SASOL Ltd. Moreover, it helps to expand the
business according to culture and climate change (Peršič, Markič and Peršič, 2018).
TASK 4
P5 Determine the several ways decision making can work effectively in a global context
When a company enters into an emerging market, it is important for a business to provide
respond towards each factor that will influence business in a negative manner. According to this
process, a manager, as well as a leader, can play an effective role in the decision making the
process. They are preparing different types of strategies for different situations and implement
the changes as per the demand of globalization. To make a decision regarding changes need to an
analysis of their effect on staff members then accept the changes to deducting chance of its
resistance. For instance, managers of SASOL Ltd focus on their employees and provide training
regarding their tasks. A leader also directs them on every situation and help to sort out their
problems. As a result, employees are providing their best and accomplish long term objectives.
Different ways of decision making
 Visionary: The manager of SASOL Ltd has been set a vision of a company then takes a
decision to achieve a vision. After that information to staff members about vision and
apply the decision. It will help employees and all related staff members to determine
what company will obtain after entering business into a new market.
 Guardian: The particular model can help to make a healthy decision by concerning fact-
based information and produce a plan on the basis of globalizing the business in a careful
manner (Sanden, 2016).
 Motivator: This model states that a good choice for managers of SASOL Ltd to take an
effectual decision through persuasive related people regarding the requirement of changes
and develop organization accordingly.
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P6 Determine and articulate the various routes to internationalisation an organisation may adopt,
including key barriers
Routed to internationalisation is an important aspect for any business. If an organisation
want to expand their business globally and they want to enter in the international market then
they have various options. There are various factors which helps them to enter into international
market which are described below:-
 Licensing:- Licensing agreement is a written contract in which an organisation charges a
specific fee or royalty for the use of their brand, expertise and technology. In the
licensing includes franchising, contract manufacturing, and Turnkey contracts, these
helps the SASOL limited to enter in a international market.
 Join Venture:- Join venture is that agreement in which two or more companies are ready
to share their ownership, profits, governance etc. with each other for accomplishing a
specific task. This is the best way for the SASOL limited to enter in a international
market as it helps them to take benefits of another companies ideas, strategies, skills etc.
Because of join venture they can increase their profitability and productivity which leads
them to in a higher position (Trad and Kalpić, 2017).
 Acquisition:- This is the term in which a company buying all the another companies and
take the ownership of them. As SASOL limited wants to expand its business in
international market, so it is the easiest way for them to buying an existing company in
that country. They can take advantage of their brand name, their assets which ensure the
higher level of performance in the international market and they can get succeed more.
Barriers to internationalisation :- In order to expand their business SASOL limited have to
face various barriers regarding to their business objectives and goals. These barriers include
financial, marketing, managerial, and industry specific which are described below:-
 Financial barriers:- These barriers are always highlighted when any organisation want
to expand their business. Limitations of financial options, the cost of overseas operations
and lack of resources are the main problem which can arise in the internationalisation.
SASOL limited needs to concentrate on these barriers so these barriers will not come
between their operations within the organisation.
 Marketing barriers:- This the second most important barrier which can impact an
organisation. According to this, if an organisation wants to expand their business in other
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counties so first they should collect the proper knowledge of foreign markets which
includes government regulations, environmental factors, cultural factors, and customers
behaviour. So, SASOL limited needs to understand the impact of these factors on their
business so they can control them like religion and material culture can impact on the
consumers behaviour and buying capability. However, they needs to considered
customers choice, behaviour and all these above factors so they can reduce the impact of
these factors on their performance (Wry and Zhao, 2018).
 Industry specific barriers:- These barriers are related within the organisation that are
occurred due to business environment in which an organisation is operating. The main
example of this barriers is competition and technology which has great impact on the
business. As SASOL limited have to face tuff competition in the market because of the
globalisation because after globalisation import and export is easy which creates a great
competition. On the other hand, technology that is developed day by day have increased
the cost and investment that is not easy for every business which create many problems.
CONCLUSION
From the above report it can be concluded that Globalisation is the wider process of
expanding the business in many countries. It provides numerous opportunities to company in
order to run a business successfully in different market segment. It helps to increase the
productivity and profitability of an entire business. McKinsey 7s framework is used by entities to
assess and monitor the changes of business industry. Strategic challenges provides opportunity to
business enterprises to reach at global level.
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REFERENCE
Books and Journal
Biloshapka, V. and Osiyevskyy, O., 2018. Three value-focused strategic questions for
continuously updating your business model. Strategy & Leadership. 46(3), pp.45-51.
Danik, L., Duliniec, E. and Kowalik, I., 2016. THE POLISH BORN GLOBAL FIRMS:
FOUNDING PROCESSES AND MOTIVES OF EARLY
INTERNATIONALISATION. Transformations in Business & Economics. 15(2).
Ermakova, N. Y., and et.al., 2016. Business Administration as a Basis for Development of
Global Entrepreneurship. European Research Studies Journal. 19(2). pp.284-293.
Kasemsap, K., 2016. Promoting service quality and customer satisfaction in global business.
In Handbook of research on promotional strategies and consumer influence in the
service sector (pp. 247-276). IGI Global.
Knight, G. A. and Liesch, P. W., 2016. Internationalization: From incremental to born
global. Journal of World Business. 51(1) pp.93-102.
Kolk, A. and Rivera-Santos, M., 2018. The state of research on Africa in business and
management: Insights from a systematic review of key international journals. Business
& Society. 57(3). pp.415-436.
Meyer, K. and Peng, M. W., 2016. International business. Cengage Learning.
Nolintha, V. and Jajri, I., 2016. The garment industry in Laos: technological capabilities, global
production chains and competitiveness. Asia Pacific Business Review. 22(1). pp.110-
130.
Peršič, A., Markič, M. and Peršič, M., 2018. The impact of socially responsible management
standards on the business success of an organisation. Total Quality Management &
Business Excellence. 29(1-2). pp.225-237.
Sanden, G. R., 2016. Language: The sharpest tool in the business strategy toolbox. Corporate
Communications: An International Journal. 21(3). pp.274-288.
Trad, A. and Kalpić, D., 2017, June. A Neural Networks portable and Agnostic Implementation
Environment for Business Transformation Projects the basic structure. In 2017 IEEE
International Conference on Computational Intelligence and Virtual Environments for
Measurement Systems and Applications (CIVEMSA) (pp. 153-158). IEEE.
Wry, T. and Zhao, E. Y., 2018. Taking trade-offs seriously: examining the contextually
contingent relationship between social outreach intensity and financial sustainability in
global microfinance. Organization Science. 29(3). pp.507-528.
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