Internationalization Strategies for CAMECO

This report discusses various internationalization strategies that CAMECO can adopt to expand its operations globally. The company can consider equity modes such as wholly-owned subsidiaries, joint ventures, or licensing agreements. Non-equity modes include exporting, contracting, and outsourcing. Additionally, budgeting is essential for effective decision-making in global business. However, barriers to routes of internationalisation may arise due to financial, managerial, or market-based constraints. Understanding these challenges can help CAMECO make informed decisions about its global expansion strategy.

GLOBAL BUSINESS
ENVIRONMENT

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1. Influences of globalisation on governance, leadership, structure, culture and functions of
CAMECO....................................................................................................................................1
P2. Ethical and Sustainable Globalisation impacting CAMECO's Functions.............................3
TASK 2............................................................................................................................................5
P3. Ways in which Decision-making can work effectively.........................................................5
P4. Various Routes to internationalisation CAMECO may adopt...............................................5
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8

INTRODUCTION
Global Business Environment critically impacts the functioning of a business whether it
is a small, medium or large scale enterprise. This report aims to provide a detailed evaluation of
CAMECO's business premise in terms of leadership, ethics, sustainability among others and
provides recommendations thereof. It is an energy and chemical organisation headquartered in
South Africa. CAMECO has a presence on an international scale, specifically in Mozambique,
Canada, Gabon and Australia. This report includes a detailed account of globalization and its
influence on CAMECO's hard and soft elements using McKinsey 's 7S Model and Hofstede's
Model of Cultural Development. In addition to this, impact of ethical and sustainable
globalization, effective decision-making and routes as well as key barriers of internationalization
have been taken into account.
TASK 1
P1. Influences of globalisation on governance, leadership, structure, culture and functions of
CAMECO
Globalisation refers to the process by which an organisation may pursue expansion across
borders so as to generate its influence on an international level (Bartlett and Beamish, 2018).
Using McKinsey's 7S Model, one can provide an overview of CAMECO in relation to
governance, leadership, structures, culture and functions of CAMECO. These are as follows: Hard Elements: Strategy: CAMECO's strategy includes development of competitive advantage which
enables it to excel globally and become top supplier of energy and chemical based
products internationally. In order to achieve this objective, the company has setup its
businesses based on the resourcefulness of that place. For instance, Mozambique based
branch of CAMECO would be purely manufacturing or extractive based as compared to
Australia which may be more of an administration-centred. In dealing with competitive
pressure, CAMECO utilizes its innovative ability to constantly. In dealing with
competitive pressure, CAMECO utilizes its innovative ability to introduce highly
improved products to the world on a continuous basis. Structure: Being a global leader requires CAMECO to follow different set of
organisational structures in order to sustain as well as facilitate the work culture. In
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general, CAMECO follows a hierarchical matrix organisational structure, even though
these may differ from region to region on the basis of work culture prevalent in that
country, For instance, the offices based in Gabon are usually found to be of extremely
hierarchical nature with a definite line of authority and implicit communication practices
as compared to those situated in Australia which would have a flat hierarchical structure
prevalent.
 Systems: CAMECO's core systems include Financial, Production and Marketing systems
along with communication and document storage. The company has a centralized control
over its operations in all the countries where it is operational. It uses a reporting system in
which the line managers need to directly report to their supervisors on a regular basis. Soft Elements:
 Shared Values: Even thought the company has transnational presence, there are
common values that are shared among all. These include ethical practices, safety,
excellence, integrity and socially responsible demeanour among other things which
form the foundation for CAMECO's origination. Generally, the company has a very
open and dynamic culture that encourages a hospitable atmosphere for people with
diverse backgrounds coming together and working to attain a specific goal. The
corporate governance of CAMECO is of paramount importance to each and every
employee of the company as it helps in maintaining decorum and enables due
diligence.
 Skills: Every person has a distinctive set of skills that are helpful in execution of
various tasks or job roles. The strongest skills depicted by CAMECO include
adaptability and innovativeness which are seen in how agile it is in changing its
products in accordance with the customer preferences.
 Style: Having different functions in different countries would also call for different
structures and leadership styles. For Gabon, this would require a more centralized
leadership style or approach to be implemented by the higher authorities overlooking
its operations unlike CAMECO's Canada-based offices which would have more of a
democratic leadership approach adopted by its management.
 Staff: CAMECO's workforce is highly diverse in nature with varied work etiquettes
based on the cultures and ethnic make-up of that economy. For instance, an
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Australian worker would have a different workplace etiquette as compared to a
Mozambique-based Employee of CAMECO.
In order to evaluate these, Hofstede's Model of Cultural Dimensions has been undertaken
(Daniels, Radebaugh and Sullivan, 2013):
 Power Distance Index (PDI): CAMECO's overall organizational structure lies at the
mid-point of this index thus, indicating a moderate acceptance towards inequity and
power differences, bureaucracy as well as respect for rank and authority.
 Collectivism vs. Individualism: In comparison to both these aspects, collectivism is
given more importance. This means that overall well-being of the organisation is given
priority in comparison to an individual's self-image.
 Uncertainty Avoidance Index: The company possesses a low tolerance towards
uncertainty and risk-taking. This is achieved by CAMECO through implementation of
strict rules and regulations through its global offices and projects.
 Femininity vs. Masculinity: There is a combination of assertion and nurturing of gender
roles so as to attain a balance between quality of life and achievement of CAMECO's
goals.
 Short-term vs. Long-term Orientation: The company performs its activities by
adopting a long-term orientation, thus, focusing on sustainability rather than short-term
success.
 Restraint vs. Indulgence: CAMECO exerts a restraint demeanor while performing its
activities. This includes restrictive gratification of needs as well regulation of most of its
actions.
Hence, globalisation has helped in influencing the motives of organisations as far as
their overall functions are concerned so that they may be able to get more competitive advantage
through strategic placement of their offices.
P2. Ethical and Sustainable Globalisation impacting CAMECO's Functions
Sustainability, at its core, relates to the development in an organisation that lasts for
longer period of time (Dunning, 2014). It requires maintenance of a balance environment in
terms of technology used, functions performed, changes accepted as well as human needs met in
an harmonious manner. Whereas Ethics relate to the moral principles which govern an
individual's or organisation's behaviour such as CAMECO while performing a certain task or
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activity. By combining these two concepts with globalisation one can ascertain that Ethical and
Sustainable Globalisation is one which includes process or procedures that are implemented in
an organisation with a purpose to sustain development in an ethical manner across cross-cultural
borders. Here, Ethical Factors relate to CAMECO's pursuant code of conduct, corporate
governance whereas sustainable factors relate to the market image, performance, profitability,
productivity as well as market share captured by the business.
CAMECO's core functions include exploration, processing, generation and supplying of
energy and chemical based products to its users worldwide. Apart from this, the company also
carries out internal functions relating to planning, budgeting, organising, directing and
controlling of cash-flows as well as other valuable (non-)financial resources (Eriksen, 2014).
Through Ethical and Sustainable Globalisation, CAMECO can grow in a manner that would
have a positive impact on its top-line as well as bottom-line revenues in the long-run. For
instance, ethical values in addition with globalisation when implemented in CAMECO would
ensure that the company does not exploit the natural resources to such an extent which would
eventually harm the overall ecological balance of that country or the environment as a whole. No
matter how rich a place may be in resources used by CAMECO to generate end-products for its
target audience, the company will be called ethical only when it ensures that its actions do not
have a negative impact on others.
Its worthy to note that out of the three variables, ethics, sustainability and globalisation,
the latter is harder to control. Thus, one should ensure that ethical and sustainable actions are
taken while performing necessary functions. Here, Corporate Social Responsibility also comes
into play which is another important function carried out by organisations, large and small,
worldwide. Every country has a different set of values, beliefs and perception towards a certain
issue or opportunity. In order to depict a much better socially responsible image of the business,
CAMECO must ensure that the actions taken and functions performed do not contradict the
ethical values and beliefs of the country in which it is operational. Thus, facilitating a much
enhanced and sustainable development along the way (Hirst, Thompson and Bromley, 2015).
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TASK 2
P3. Ways in which Decision-making can work effectively
Decision-making includes formulation, selection as well as implementation of strategic
actions taken by the management of an organization in regards to routine and operational
activities. In order to analyse the effectiveness of decision-making in a global context, one can
look at the stages that contribute towards the formulation of strategic actions. These involve
developing the context as well as identification of issues which may impact the organisation in
an adverse manner, conducting performance and risk assessment at the time of implementation
of such decisions. This can also be done by way of budgeting which will help in ascertaining
whether the steps taken are in accordance with the goals set (Hitt, Ireland and Hoskisson, 2012).
In addition to the ethical and sustainable factors mentioned above, for creating effective
decision-making in CAMECO on a global level, the company can take into account the
following steps:
 Adopt a constructive approach wherein it can strive to develop an environment which
enables a democratic atmosphere, thus, encouraging participation from lower level
management.
 Investigate a given issue in a detailed manner so as to gain insights how it can be
resolved considering all aspects or things affected by it.
 Communication of decisions across all levels across its offices operational in different
regions in a uniform manner so that no distortion of directions take place. Thus, resulting
in prevention of mishaps and losses for CAMECO.
P4. Various Routes to internationalisation CAMECO may adopt
The process of internationalization has been scrutinized which mainly talks about the
process of enabling participation of entrepreneurs as well as organisations in the global market.
CAMECO may adopt a Non-Equity Mode to enter foreign markets which includes contractual
agreements and Exports/Import. The other mode is Equity Mode which includes wholly owned
subsidiaries and joint ventures (Pieterse, 2015). These have been explained below:
 Non-Equity Mode:
 Exports/Imports: These offer lowest risk and market control among all the options
taken into consideration here. This is the most common internationalization strategy
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adopted by businesses worldwide as companies can be directly involved here.
However, as international tariffs on such are high, it may result in increased prices
and taxation liability.
 Contractual Agreements: They include licensing and franchising which require
handing down the licensee/franchisor patent rights, copyrights, technical know-how
as well as trademarks of processes and products to a third-party. As this strategy tends
to encourage the technological injection in a foreign market, this internationalization
strategy is highly welcomed all around the world. On the other hand, licensee may
themselves become a competitor of the company.
 Wholly Owned Subsidiaries: This involves direct investment in a business which
involves complete ownership by way of common stock in the other (holding)
company by the parent company. It is a great route when a business is looking to
diversify its operations. However, it may result in complete reliance on the other
company's performance in the market which can hamper the parent company's image
too.
 Joint Ventures: These include joining hands with another business in order to share
each other's competitive advantage to finish a certain task for the purpose of earning
and sharing profits. Hence, they may bring in new expertise and insights as well as
better resources. Conversely, their temporary nature may result in high risk of default,
copyright issues and incurring of higher costs.
Hence, CAMECO can adopt any route coming under the purview of internationalization
in order to undertake expansion activities. The key barriers to routes of internationalisation may
be financial, managerial and market-based. Financial Barriers include availability of physical
resources, their allocation as well as accessibility to capital and credit. Managerial Barriers
include difficulties arising in terms of attitudes, lack of experience or skills and time
management among others. Lastly, Market-based Barriers would include lack of knowledge
about foreign markets, environmental perception, government regulation and cultural
differences.
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CONCLUSION
From the above report, it can be concluded that globalisation has had a vast impact on
how organisations such as CAMECO operate, govern, regulate and structurize their internal
systems. It goes without saying that ethical and sustainable globalisation is crucial to the long-
term service of organisation. The company may adopt budgeting to make effective decisions as
well as adopt either equity or non-equity modes to enter into foreign markets through
internationalization.
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REFERENCES
Books and Journal
Bartlett, C. A. and Beamish, P. W., 2018. Transnational management: Text and cases in cross-
border management. Cambridge University Press.
Daniels, J. D., Radebaugh, L. H. and Sullivan D. P. 2013. International Business Environments
and Operations. 14th Ed. Harlow: Pearson.
Deresky, H. 2014. International Management: Managing Across Borders and Cultures. 8th Ed.
Harlow: Pearson.
Guay, T. R. 2014. The Business Environment of Europe: Firms, Governments, and Institutions.
Cambridge: Cambridge University Press.
Hitt, M. A., Ireland, R. D. and Hoskisson, R. E., 2012. Strategic management cases:
competitiveness and globalization. Cengage Learning.
Peng, M. 2014. Global Business. 3rd Ed. Cengage Learning,
Pieterse, J. N., 2015. Globalization and culture: Global mélange. Rowman & Littlefield.
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