Global Business Management: Strategies, Stakeholders, and Cross-Cultural Management of Unilever in India

The report evaluates the international business of Unilever in India, covering topics such as global business strategies, stakeholders, cross-cultural management, and leadership. It also includes a PESTLE and SWOT analysis, as well as a comparison of Indian and UK cultures. The report is useful for students studying global business management.

Global business management

CONTENTS
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INTRODUCTION
Due to rising level of globalization, each and every company are planning to step-in
in different countries for expanding their reach and presence. However, multinational
organizations needs an effective business strategy which helped them to get ahead of the
competition they will going to face in those countries. Thus, it becomes very crucial for them
to manage their global business and gain acquaintance of their culture, international
strategies, trade, investment and marketing. Considering this, the main aim of the current
research report is to evaluate the international business of Unilever in different nation i.e.
India. It is one of the global leaders which are offering consumer, household, personal care,
food and many other products all throughout the globe. The structure of the portfolio will
include strategies for global business, stakeholders, cross-cultural management and
leadership. It will also going to throw light on trade, investment, marketing, strategic analysis
of the company and cyber security analysis. The final section of the report will include
recommendations, research findings as well as conclusion.
1. CONTEXT OF INTERNATIONAL BUSINESS
Global economy and competitiveness of India
Speaking in relation with the economy of the world, at present it is experiencing very
strong however uneven recovery. There are few major economies across the globe where the
growth is mainly concentrated and they are also lagging behind most developing as well as
emerging nations. Due to the impact of pandemic, low income nations are reversing their
prior benefits in compounding insecurity of food, reduction of poverty along with several
different enduring issues. Additionally, several multinational companies are undertaking
reforms which are enhancing their growth and steering the economy into developmental path.
Further, the economy of the globe is recovering from the recession being induced by
COVID19 and there has been increment of opportunity in global trade and investment in the
emerging markets as well as developing nations. Pertaining to this, it is crucial to analyse the
international business of Unilever in developing countries like India. Throwing light towards
the competitiveness of India, after the economic crisis, the nation initiated an important
reform in the year 1991 for improving production level, trade. Investment and
competitiveness. With each passing the gross domestic product per capital almost doubled.
However after the crisis of 2008, the growth remain stagnant. This recession has promoted
India to think again about its strategies and policies. In 2014, the nation has rebounded its
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growth and now, it is one of the fastest growing economies of the world. India is now at 69th
position among 141 nations across the globe in relation with competitiveness index.
Key economic data as well as trends
It is quite surprising to say that after China, Japan and East Asian miracle, there is
now miracle of India in the last fifteen years in relation with annual growth. According to the
World’s bank international comparison program, India is the third largest economy of the
world in relation with GDP and is ranked after US and China.
Figure 1: GDP India
https://data.worldbank.org/indicator/NY.GDP.MKTP.CD?
end=2020&locations=IN&start=1960&view=chart
In addition to this, the figure 2 depicts the overall contribution of competitiveness of
India over the period of time. It is clearly showing the diversity in trend over the last few
years on the varied pillars. For instance, talking in relation with health and basic education, it
has been developed across the decade. On the other hand, in regards with infrastructural
development, less improvement can be witnessed for the period after 2014 when there has
been augmentation in the public investment by the government for attracting private
resources. in addition to this, the institutional environment got worsen till the year 2014 due
to the fact that there has been growing scandals related to governance in India. Because of the
unmanageable inefficiencies, many businesses started losing faith in public as well as
governmental administrations. Nevertheless, it was also reversed after 2014.
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Figure 2: Pillar contribution to India’s competitiveness overtime
https://reports.weforum.org/global-competitiveness-index-2016-2017/box-6-ten-years-of-
competitiveness-in-india/
The macro-economic situations of the country monitored a same kind of path because
it managed effectively in current years. Finally, the financial market of the country also
presented a development sign since 2014.
2. STRATEGIES FOR GLOBAL BUSINESS
Strategic analysis
Pestle analysis
Political
Talking about the political factors, they directly influence the capital
market of any nation. India is being coming across with different political
issues from past several years due to the dispute with the neighbouring
nations. However, there has been improvement in this situation but still it
is a big matter of concern for the multi-national planning to explore India
markets. Further, the country also offers stability in politics which can
help Unilever to thrive their businesses. Different attempts have been
made for reducing interference of the government in businesses by
seeking help from privatization. Thus, this will support Unilever to grow
in this market independently.
There has been increase in the gross domestic product of India, which is
providing ample of opportunities for the businesses like Unilever.
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Economic
Besides, the liberal industrial policies of the nation has always made sure
that there is augmentation in the foreign investment. This has supported
in boosting the overall economy of India. Furthermore, the taxation
policies of the country is also favourable to the business of Unilever and
extensive domestic market also offers novel business opportunities to the
company.
Social
It is defined as a land where diversity persist and thus, it is crucial for the
company to remain aware about the local acceptability, culture, rules and
beliefs. Workforce are easily available within the nation due to higher
level of population. Multinational firms are favouring to step-in in this
country ad there is presence of massive domestic market. The lifestyle of
the people is changing and there has been increase standard of living as
well.
Technological Technological factor is very crucial as it can influence the business
operation of the company. The technological industry of India is growing
at a steady pace. Many overseas firms are making investment in the
nation. Moreover, the nation also has one of the most vigorous
information technology sectors which makes sure that there is regular up-
gradation as well as development in the software and development.
Legal
It is crucial for Unilever to abide by the nation’s laws and regulation for
smooth functioning of their activities. There has been recent alteration in
the laws related to employability, recycling as well as discrimination
which needs to be taken care. However, the foreign regulations and trade
policies of India is very flexible which provides opportunities to foreign
brands like Unilever.
Environmental
Because of the rising interest for environmental friendly products, the
companies are compelled to alter their strategies. Further, the climatic
conditions in India are unpredictable and this can harm the infrastructure
of the company. Due to mounting population there is a negative influence
on safety and health and thus, sustainability must be kept in intellect for
boosting company’s performance.
SWOT analysis
Strengths Weaknesses
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 Global brand strategy
 Focuses on mass marketing
 Global presence
 Strong portfolio of the company
 Company lacks major patent
 No presence in premium market
 Industry focus in lacking
 Sectorial involvement is fragmented
Opportunities
 Exploring developing economies
 Widening of base of consumers
 Mass market products
 Demand for the products of ageing
population
Threats
 Intense level of competition in the
international markets
 Negative publicity of the company
 Consolidation of the industry
 Products are private labelled
Strategic development
 Operational and distributional strategies – For managing its international business,
company has adopted different strategies. They have their own sales force, individual
agents, warehouses and retailers for distribution of their products. In addition, the
company also operate different warehouse and storage facilities. Unilever has also
adopted cross-market subsidization an offensive strategy to functional effectively in
multiple markets with multiple brands. Moreover, in the emerging economies such as
India, the firm operates based on the low prices. This is due to the fact that most of the
consumers in emerging or developing focuses on prices which might offer an
advantage to the low cost competitors unless firm finds a way to attract and bargain
prices along with enhanced products.
 Marketing strategies – In many countries including India, Unilever has amalgamated
its marketing strategy with social strategy or projects. In addition to this, for the
purpose of raising awareness in different nations, company makes use of educational
campaign such as Dove and close up. Furthermore, they are engaged into ore direct
brand concerned programs such as close-up project smile in Nigeria which has
utilized oral hygiene information. Besides, the successful brand innovation program
of the company is being backed with advanced level of advertising as well as
marketing activities which also includes mass media. Unilever has also increased their
investment towards promotion and advertising for supporting launches of their major
brands in international markets.
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3. STAKEHOLDERS IN THE INTERNATIONAL BUSINESS
When a company involves into an international business, it involves broad set of
entities as well as individuals. When talking in reference with the international business of
Unilever by considering the markets of India, there will be different stakeholders whose
interest might be impacted during this course of business. Some of the important stakeholders
in the international business of the company are as follows:
 Primary and secondary stakeholders – primary stakeholders have direct concern on
the affairs of the business and a company cannot survive without them such as
suppliers, employees, shareholders, society and consumers. Secondary stakeholder
does not have direct economic exchange such as competitors, unions, governmental
bodies etc.
 Core stakeholders – They are quite necessary for the survival of the business such as
clients and workers.
 Strategic stakeholders – They are essential for managing the threats as well as
opportunities of the business like suppliers, mass media and retailers.
 Environmental stakeholders – They are also which does not fall in the all groups of
stakeholders above such as non-governmental organizations and other environment
related associations.
 Legitimate stakeholders – These are the stakeholders which possess some power on
the business or the company and have legal rights to impact the functioning of the
business such as owners, customers as well as employees.
4. CROSS-CULTURAL MANAGEMENT AND LEADERSHIP
Cultural comparison
When a company operates in the international market, it is quite obvious to say that
there cultural background will be quite different. It becomes crucial for the company to
identify and manage these differences in order to have effective functioning. Considering the
Hofstede cultural model, a comparisons of the culture of India and the home country of
Unilever i.e. UK needs to be done for better management.
 Power-distance – The score of India is high which signifies that a top-down structure
is prevalent in society as well as organizations. However, the score of UK is bit lower
than India which means that inequalities is not acceptable in the society.
 Individualism – India has an intermediate score for this dimension which indicates
that this nation supports both collectivism and individualism. High emphasis is being
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given on social framework as well as one’s defined objectives. The score of
individuality is higher for UK which indicates that people are supposed to look after
by themselves and the route to happiness is only through personal satisfaction.
 Masculinity – India is a masculinity society which depicts that the community is
driven by achievement, accomplishment as well as competition. On the other hand,
UK is also a masculinity society which is also highly success oriented.
 Uncertainty avoidance – India is one medium low preference and thus, it means that
there is an acceptance for imperfection along with there is a high level of tolerance for
unexpected. On the other side, UK has a low score for this dimension that means
people are not afraid of what will going to happen in the near future and they just
want to live in present.
 Long-term orientation – India score high on this dimension which indicates that the
idea of karma majorly dominates the society and time is not linear. However, an
intermediate score in this dimension and thus, a dominant preference of the culture in
UK cannot be determined.
 Indulgence – This score of India is quite low and thus, people in such type of culture
does not pay attention on leisure and makes efforts to control the fulfilment of their
desires. This score of UK is quite high which means that the people in this nation are
eager to understand their instinct in relation with adoring their life.
Management of cross-cultural organization
Speaking in volume in regards with the cross-cultural management, it involves
studying about the manner communal culture will influence managers as well as management
practices. A culture can impact the processes, structure as well as management of the
organization and thus, it is necessary that it should be managed by effective leaders for better
efficiency and having a common goal. Some of the problems and strategies for managing
cross cultures are as follows:
 Communication as well as expressions – Language is important for communicating
with each other and expressing one’s viewpoint. However, body language and their
expressions such as eye contact, facial appearance, pitch, touching, volume etc. might
vary from country to country. For instance, in India thumbs up is considered highly
offensive whereas in UK it is a mark of doing something right.
 Work style – Each and every country have their unique style to work. Therefore, when
an organization moves in different country, they need to adopt and adjust as per that
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country’s working style. For example, in UK there is a no formal relationship between
boss and sub-ordinates and regardless of their age and position, each and everyone
needs to show respect to each other. However, this is not the case in India. There is
more authority in the workplace.
 Motivational factors – This is also being regarded as an important element of cross
culture management. Motivation and reward system might be different in varied
companies and nations. In India, people are more motivated towards work when
monetary rewards are offered. Nevertheless, in UK workers are motivated with non-
monetary rewards.
5. INTERNATIONAL TRADE AND INVESTMENT
6. INTERNATIONAL MARKETING
7. GLOBAL BUSINESS OPERATIONS
8. TECHNOLOGY AND THE INTERNATIONAL BUSINESS
9. CYBER SECURITY INITIATIVE AND BUSINESS POLICIES
10. CONCLUSION AND RECOMMENDATIONS
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REFERENCES
Books and journals
Online references
https://www.hofstede-insights.com/country-comparison/india,the-uk,the-usa/
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