Influences of Globalisation on Organisational Governance and Leadership, Culture, Functions and Structure

This article discusses the influences of globalisation on organisational governance and leadership, culture, functions and structure. It explores the impact of globalisation on the decision-making process, the development of a global mindset, and the need for cross-cultural communication and collaboration. The article also examines the challenges and opportunities that globalisation presents for organisations, and provides recommendations for effective global business strategies.

Global Business
Environment

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Key factors of cost, market, environment and competition which drive global commerce
and trade.................................................................................................................................1
TASK 2............................................................................................................................................3
P2 Complexity of strategic challenges which are faced by organisation when operating in
global environment.................................................................................................................3
TASK 3............................................................................................................................................5
P3 Influences of globalisation on organisational governance and leadership, culture, functions
and structure...........................................................................................................................5
P4 Influences of ethical and sustainable globalisation on organisational functions..............6
TASK 4............................................................................................................................................7
P5 Different ways decision making can work effectively in a global context.......................7
P6 Determine the various routes to internationalisation an organisation may adopt, including
key barriers.............................................................................................................................8
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................11

INTRODUCTION
International business environment defined as an internal as well as external aspects of
different nations that impacts on the business activities locally and globally (Laudon and Laudon,
2015). This will influence on the decisions of companies related to the capabilities and resources.
In the global environment two or more companies work together for earning mutual profitability
by trading with each other’s. This would help in developing dependency of all countries on one
another to make improve mental decisions for fast development. Every business requires to
understand changes of external environments and its impacts on business success in which the
co0mpany operates their operations. For this project report, C M Downturn Limited is to be
considered which is a leading logistic business of UK that is owned by Conrad Michael
Downturn since year 1955. But in 2018 company was acquired by Hong Kong private equity
investor Emerge-vest for the purpose of innovation and continual investment. Under this
assignment, key considerations of cost, environment, market and competition are determined
along with the influences over globalisation as well as strategic complexities which are directly
affect business operations at global level. Also, influences of globalisation on structure, culture,
leadership and governance of business are discussed along with the ethical and sustainable
globalisation. Lastly, discuss about the routes of internationalisation and decision-making
procedure.
TASK 1
P1 Key factors of cost, market, environment and competition which drive global commerce and
trade.
Globalisation refers to the interrelatedness of people, nations, business and government to
the political, social, economic, cultural over the international (Savrul, Incekara and Sener, 2016).
This is related to that kind of process that assists in increasing trade as well as technological
exchanges which is positively impacts on the developing and developed countries because
education technology as well as investment standards can be raised through the
internationalisation. Whereas, there are negative affects of globalisation as the richest countries
gets huge profitability due to the differences in taxation policies within different nations. There
are various key factors that is essential for the management of businesses which will drive the
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internationalisation process of business. With respect of C M Downturn, some of these factors
are as follows:
Cost driver: It is termed as an essential aspect for business functioning that helps in
expanding their operations at international level. With respect of C M Downturn, manager
expands business operations at international level so huge investment of money is needed. but
when the funds are not available on time when it requires that it can lead hamper productivity of
company (Voegtlin, Patzer and Scherer, 2018). Whereas, cost driver helps in facilitating the high
productivity and profitability of C M Downturn along with the good image as well as reputation
within the global market.
Market driver: Market is a place where buyers and sellers meet for exchanging the goods
and services in against of specific period of time. In order to expand businesses wither in local or
global nations it is essential to have stable market conditions that is crucial for C M Downturn
manager in analysing customers requirements. For the internationalisation manager of company
need to conduct proper and detail market research that will assist in gaining better satisfaction of
customers and accomplish economies of scale.
Environment driver: It can be defined as surroundings of human as well as non-human
beings that facilitate various conditions for the effective growth and development. While
expanding businesses, several environments needs to be evaluated such includes political, social,
technological, economic, cultural and so on. All these factors are essential for the clear
understanding of various laws and regulations that are followed in the different countries. This
will help manager of C M Downturn in designing appropriate strategies that assists in successful
expansion of business.
Competition driver: Competition is considered as an essential aspect that requires to be
evaluated by all the business organisations so that they can take advantage of global expansion.
In the context of C M Downturn, manager has competitive edge in the logistic operations over
their competitors (Zhang and Huang, 2019). Through the FDI the company raise their
interdependence within several nations that would assist in leading organisations in the
competitive way over its competitors. With the help of foreign direct investment C M Downton
increase their interdependence in various countries which would help in leading business in
competitive manner over their rivals.
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Significant impact of digital technology upon the globalisation of business operations:
Digital revolution is associated with the usage of digital technologies and equipment in
which internet is most useful that is used for processing information which could be concerted
into valuable data and effectively analysed and communicate with others by using digital
channels which has high influences on the internationalisation of CMD.
 By using digital technologies as well as equipment the manufacturing and distributional
systems of organisations become simple or easy and it will assist in making available
company’s offerings within the global marketplace (Amankwah-Amoah, 2016).
 Through the adoption or implementation of digital techniques for operating logistic
operations which is able to supply better products and services at lower costs.
TASK 2
P2 Complexity of strategic challenges which are faced by organisation when operating in global
environment.
Operating businesses at global level several challenges are faced by the businesses that
impacts on the operations of company’s performance and profitability. For analysing the
complexities of strategic challenges, the manager of C M Downturn use PESTLE analysis as a
strategic tool. That can be discussed as follows:
PESTLE Analysis:
Pestle analysis is used to determine insight operations that come up in front of an
industry. These are some challenges which are needed to be considered by company. The
understanding of all factors helps business operation in preventing from risk. This includes
political economic social technological environmental and legal (Epstein, 2018).
Political factor: The political factors include political regimes that are applied by
government. This develops suddenly from which survival chances of an industry is diverse. The
company needs to consider the stability of politics that occur within the country in past recent
years. They must aware about laws and legislation that occur within the country especially
related to business such as various contract law. As different country has some other system of
business that may affect business. The operation of business must identify the protection policies
in the country so that their business doesn't get harm.
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Economic factor: The economic factor includes interest rate, changes within rate of
inflation, other country exchange rate, etc. The company must aware about GDP growth of the
country that also affect expected growth in upcoming future of the company. The company also
needs to analyze the level of unemployment within the country which leads to higher supply of
jobs while spending lower wage to them (Hamilton and Webster, 2018).
Social factor: The social factor consists believe values culture and attitudes that holds by
population. The company needs to analyze demographic situation of population before investing
in other country. Each age and gender have different perspective from which different products
maybe not marketed to these people. The difference between marketers and market that are
targeted by businesses. So, the company needs to be careful by making coordination with
priorities and interest of market. The services of the company must target to their element
customer so that their profit can be increased.
Technological factor: The technology factor can develop rapidly change within image
and prize structure of company within a short duration of time. So, it is necessary to be
innovative within market that help company in becoming leader of the market. The company
needs to bring new technologies that result in more productivity and profitability of the
company. It also includes monitoring the popularity of other company that helps organization in
growing and distributing their services.
Environmental factor: The environmental factors unnecessary to be considered by
company which have aim for preventing the target of group of pressure that can be occur due to
lack of environmental consequences. If the company produces large number of waste then it is
required to manage environment properly. They need to consider climate change which prevents
them from wasting their products and services at globally (Kasemsap, 2016).
Legal factor: The legal factor helps in protecting data and loss of a company. So, the
company needs to maintain their data confidently so that their failure of chances can be reduced.
There are various laws are occurred which ensure about quality and price of products so that
their customer can be safe. The company needs to apply this is there company’s structure so that
their cost can be elevated globally.
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TASK 3
P3 Influences of globalisation on organisational governance and leadership, culture, functions
and structure.
The C M Downturn Ltd, plans to expand their operations at global level or want to
globalise their business for which they need to develop effective structure, culture, leadership as
well as functions that assists in better growth and success of company in future.
McKinsey 7S model for the structure of organisation:
This model is required to develop appropriate structure of business as the top level
management of C M Downturn is emphasise on implementing McKinsey 7s model (McKinsey’s
7S Model, 2016). It can be detailed discussed as follows:
HARD elements: Strategy: It can be used by businesses for dealing with the varied situations that are
occurs when company do the globalisation of business. Management of CMD should
design effective rules and regulations which will help in handling all the barriers and
rivals. Structure: As C M Downturn adopts functional organisational structure in which they
focused on grouping of employees according to their skill set and expertise. So, the
company need to follow same structure to get success in expansion of business.
 System: It is associated with the business pattern in which company operates their
activities so the CMD globalise their business that impacts on the system of business. For
this it is essential to develop effective system that meets all the business requirements.
SOFT elements: Shared values: The company emphasised on the values and ethics while performing
business activities. It can be viewed that there will be no effect of globalisation on the
ethics of businesses (Mamic, 2017). Skills: This is to be considered as an essential requirement for C M Downturn to hired
talented and skilled workers for managing the global operations of company. Staff: In order to operates business events company will need more employees or the
requirement of workers are increased.
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 Style: While the company do internationalization process, they will be used democratic
leadership style so that they can be able to maintain positive relations with their staff
members.
Using Hofstede's dimensions of culture.
In order to maintain positive culture at the workplace of international level businesses
company can use this model because types of cultures impact on the functionality and
accountability of businesses (Tallman, Luo and Buckley, 2018). In the context of C M Downturn
Limited, it is necessary to maintain better organisational culture so that company's efficiency as
well as productivity will be raised. Hofstede dimension of culture are as follows:
Power distance index: This kind of dimension is helpful for the CMD in order to judge
different types of inequality at the workplace or business. It helps in avoiding the usage of
complex hierarchy of organisation structure.
Individualism vs collectivism: With respect of C M Downturn, Company is adopting
collectivism approach for developing better structure as well as management at their workplace
so that the positive culture and governance will be create.
Masculinity vs femininity: Company use femininity aspect in order to develop effective
relations with the supervisor and seniors that helps in minimising the gap between the men and
women relationship for avoiding biases and unfair treatments (Woerkom and Zeijl-Rozema,
2017).
Uncertainty avoidance index: C M Downturn adopts this dimension in order to
acknowledge anxiety and misunderstanding in businesses and increase employee morale so that
globalisation can take place effectively.
Pragmatic vs normative: Company uses normative dimension by emphasising on the
rights as well as values of workers because people mostly prefer why instead of what is
happening which will help in growing others.
Indulgence vs restraint: With respect of CMD Limited huge indulgence supports
optimistic nature of workers which will provide freedom to them for speech with everyone and
develop communication skills as well.
Influence of globalization based on this model on the following features: Governance and leadership: Globalization has increased the level of interactions
between different cultures which means that the level of governance and leadership needs
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to be changed so that all the employees belonging to different cultures can work together
in an efficient manner. It is important that CDM use democratic leadership so that all the
employees can be involved in taking decisions and also to increase collectivism in
company. Structure: With globalization the organizational structure is changing so that the
organization can function in an efficient manner in changing business environment. The
organizational structure must be designed in such a manner that all the employees can
work together efficiently and collectivism can increase and all employees can be involved
in decision-making. Culture: It is related to the shared and common beliefs and values which are affected by
globalization as it is important that uncertainty avoidance can decrease and the equality
among workers can increase.
 Functions: With globalization the functions have also to be changed so that they can be
directed towards achieving company goals by increasing inclusion of employees.
P4 Influences of ethical and sustainable globalisation on organisational functions.
Globalisation can be done in ethical and sustainable manner which defines as a procedure
of transforming goods and services along with the information ethically at a time of operating
business operations at global level. In this assignment, C M Downturn need to set up some
strategic governance and corporate strategies by regarding the needs to internationalisation and
stakeholder’s interest and such other requirements as well (Caiazza, Shimizu and Yoshikawa,
2017). This would assist in operating businesses in ethical way and taking more competitive
advantages of internationalisation. Whereas, sustainable process of globalisation is essential for
businesses in order to develop and sustain for longer period of time in global marketplace.
Several types of ethical as well as sustainable factors are present in the global market that are
needed to be considered by C M Downturn Limited in the international market presence. Some
of these factors are discussed in detail as below:
Integrity in business relationship – It is considered as a sustainable aspect as most of
the businesses plans to expand their operations at international level. So that it is essential for
them to develop better relationship with other companies of global levels. As the company C M
Downturn have to develop positive and better relations with their stakeholders like customers,
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suppliers and competitors in order to survive for long period of time within the international
marketplace.
Treat workers fairly: It is termed as an ethical approach that helps in promoting well
beings of workers along with their safety and security while performing activities at the working
premises. In addition, ethical considerations can be termed that businesses have to pay basic
salary to the staff members as per their working style and hours. Thus, treating workers fairly
lead in maintaining better brand image as well as increase the goodwill of C M Downturn in
international market (Cumming and Zahra, 2016).
Engage in sustainable activities: It is also an ethical approach that is essential for
businesses in order to minimise adverse influences and outcomes from the operations of
business. The company C M Downturn Limited have to develop various strategies, policies and
regulations that will help in maintaining favourable environment at their workplace and leading
sustainable operations in international market place.
TASK 4
P5 Different ways decision making can work effectively in a global context.
Decision making is defined as a cognitive approach that assists in choosing effective
course of actions from many alternatives. The manager of C M Downturn emphasises on
employee performance mechanism, participation as well as stakeholder’s interests at a time of
making decisions at global level. In order to accomplish better sustainability at the marketplace
manager should be analysed market conditions appropriately and make decisions accordingly. In
C M D manager or leaders can apply decision-making at international context by following
ways:
Command: Manager of C M Downturn formulate appropriate decisions by involving
their team members because it is a best way to make decisions (Kasemsap, 2018). This will help
in making effective alignment in events and activities of workers in respect of globalisation as it
minimises the risk of uncertainty and failure.
Collaborative: It is related to making appropriate decisions by participating whole team
and consider their views or suggestions and accordingly made decisions by manager. In this,
leader gives huge importance to the feedbacks that are provided by the team members that assists
in making effective decisions by analysing all the choices of employees and succeed in the
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globalisation world. So that for the globalisation of C M Downturn, leaders make appropriate
decisions after considering all opinions of staff members and which should be considered for
making decisions according to the situations and solve all issues appropriately.
Consensus: In this kind of decision making approach manager of company formed
decisions on the basis of voting or poll and it is done on the mutual understanding of all members
or employees that are considered within the C M Downturn. It is considered as a best way of
managing business activities as well as procedures over the global level and helps in making
effective decisions (Noble and Nwanekezie, 2017).
Convenience: In this the manager or leader of C M Downturn delegate the power of
decision making to their employees so that the intellectual abilities along with the employee’s
morale can be increased. This will assist in developing better coordination so that all business
decisions are made with the collaborative approach or efforts. This helps C M D in order to deal
with the international issues along with the varied ideas of staff members.
Evaluation of different ways of decision-making
From the above ways of decision-making it can be said that collaborative way is the best
suited way of making decisions in company which work in global market as this can help in
increasing employee engagement which is essential in taking effective decisions. This also help
in considering the values and opinions of all workers which can help in innovating company
processes, products and services. This will also help in increasing strategic capability of
company as the skills, capabilities and resource can be utilised in a way that competitive
advantage can be gained. Democratic leadership can help in taking effective decisions in
company by inclusion of employees.
Approaches of handling risk:
There are various approaches to handling risks like avoidance, reduction, transfer and
acceptance. Avoidance can help in mitigating the risk which might occur due to certain activities
which must be avoided, reduction involves reducing the risk which might occur due to certain
activities and reducing them potentially. Transferring risk to other party can also help in dealing
with risk and acceptance of risk is dealing with risk in an efficient manner.
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P6 Determine the various routes to internationalisation an organisation may adopt, including key
barriers.
There are several barriers which occurred during the process of internationalisation that
adversely impacts on the C M Downturn. Some of these are as follows:
Financial barrier: for globalisation company suffers more from the shortage of money
that is defined as a common barrier which will adversely influences on C M Downturn in order
to get finance for taking appropriate decisions and budge or portfolio management that leads in
failure of formulating appropriate decisions (Uhl and Gollenia, 2016).
Managerial barrier: For the globalisation company suffers from the several barriers in
which the managerial barrier is common that brings difficulties in the management of business
activities. So that C M D has to plan changes in their present culture, structure and process which
will influence on making managerial decisions that will lead mismanagement of operations at
international level.
Routes of internationalisation:
Several expansion strategies and decisions are regarding the globalisation that assists in
reducing barriers (Taneja, Sewell and Odom, 2015). C M Downturn can adopt some strategies in
order to do successful expansion of its company in another nations. Some of the strategies are
discussed as below:
Merger and acquisition: It is termed as an essential strategy that is used for the
expansion of businesses in which merger refers to the combination of two companies and
acquisition refers to that term in which one business is acquired by another for taking their
market shares. C M D can able to get required resources as well as workers in order to work
effectively in the international market. In the merger and acquisition, manager of companies
suffers from the managerial barriers because sometimes it is difficult to manage. Yet another
barrier associated with this route to internationalisation is the difference in cultures of
employees. This needs to be taken into due consideration by CM Downturn in order to
effectively run within new nation.
Licensing: It is referred as a method of business expansion which can be opt by C M
Downturn in order to make legal agreements within the business operations that are already exist
in the marketplace. Through this, company can get license for using others brand name and they
charges some fees for the royalty (Lasserre, 2017). This would help in earning more income
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which is needed for the business expansion within the changing marketplace which also helps in
reducing the risk. By choosing licensing option for the globalisation, manager of company may
face financial barrier because it needs more money to take licenses. Further, the dishonesty of
licensee may act as yet another barrier that places impact over the functioning of CM Downturn
in the confines of new market place.
CONCLUSION
It can be concluded from the above report that business environment plays an essential role
in the internationalisation of businesses because there are various aspects that influence the
operations and activities of businesses. It can be analysed that internationalisation is essential to
raise the integrations among all the members and company over the international level as well as
there are numerous driving factors that will drive the business success through the globalisation
of business. It can also be discussed that cost is an important driver that plays a crucial role in
businesses and it a challenge which interrupts in the business growth at global level. In addition,
PESTLE analysis is to be done which helps in examining external aspects through which the
company’s future growth will be influenced. Several strategies and actions that could impact on
the business decisions at global level.
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