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

This report evaluates the influences of globalisation on organisational leadership, governance, functions, culture and structure. It also discusses the influences of sustainable and ethical globalisation on the functions of the organisation and critically evaluates the influences of globalisation in application to suitable models and theories linking to organisational culture and structure.

Global Business
Environment

Table of Contents
INTRODUCTION ..........................................................................................................................3
PART 1............................................................................................................................................4
PART 2..........................................................................................................................................12
Evaluate how globalisation influences organisational leadership, governance, functions,
culture and structure...................................................................................................................12
Evaluate the influences of sustainable and ethical globalisation on the functions of
organisation................................................................................................................................14
Critically evaluate the influences of globalisation in application to suitable models and
theories linking to organisational culture and structure. ...........................................................15
Evaluate the various ways of decision-making that can work in an effective way in the context
of globalisation. .........................................................................................................................17
Determine different ways to internationalization and barriers involved. .................................17
Critically evaluate the key barriers involved in internationalization and recommendations to
overcome it. ...............................................................................................................................19
Critique strategies that an organisation can be adopted while doing business at global level.
....................................................................................................................................................19
CONCLUSION .............................................................................................................................19
REFERNCES:................................................................................................................................20
Books and Journals:...................................................................................................................20

INTRODUCTION
The globalisation may be defined as the process of developing the different business
activities and operations at the international scale. Globalisation is not only help in the
interconnecting the different business organisation at the international level but also help in the
development of manufacturing of goods and services along with their trade at the international
level. Global business environment refers to an environment of different countries which have
different exogenic factor which not only impact on the decision making process of business but
also impact on their resources (Ali and et.al., 2020). The report is based on SASOL Ltd. that is a
fast growing chemical and energy organization. The headquarter of the company is in Cape
Town, South Africa. The company has a global presence in various locations such as New York,
Gabon, Mozambique, Australia, and Frankfurt with an addition to the UK. The report is
considering the different factors of market, cost, competition and environment that drive the
global trade and commerce. The company face various challenges and complexities when
operating their business in global environment (Aula and Mantere, 2020). It will also discuss
how globalization influences organisational leadership and governance, culture, structure and
functions. Further, it will show the sustainable and ethical influences on organisational functions.
There are different ways of decision-making that can work in a productive manner in the context
of globalization. Lastly, it will determine several ways to internationalization that a company
may adopt. It is consist with various barriers.

PART 1
Notes:
The company face various challenges and complexities when operating their business in
global environment.

Notes:
Cost: On the other hand, this factor also assist in providing the greater opportunities
which not only help in the development of the organisation but also help in generating higher
economics of scale at the international level (Dovis, Zaki, 2020). Through this factor the SASOL
can enjoy the higher profitability by having the advantage of cost at the international or global
level. The manager of the company is required to pay attention on the different activities of the
business successfully in a country where they can find the customer easily and different
resources at a very low cost. SASOL can do this by shipping their product across the globe in
bulk which reduces the cost of production and ultimately increase the profit margin of the
company.
Market: In context to SASOL the manager of the company is able to grab huge amount
of market area which help the organisation not only in attaining the higher profit but also assist
the long sustainability of the business in the marketplace. Hence it very important for the
company to pay high attention on identifying the new customer and also the requirement of the
market. Due to the they can able to satisfy the need and demand of the customer at the utmost
level and attain profit and sustainability for SASOL in the international market.
Competition: Competition between the firms who are operates in the same sector has
been increased at the global level marketplace because of the globalisation. In context to

SASOL, the company operates their business in the different parts of the countries and due to
which they have to face immense competition in the market at the international level.
Environment: Environmental factor include political, legal, social and technological factor
which have a major impact on the concept of globalisation (El Namaki, 2018). In relation to
SASOL, the manager of the company is required to pay attention on the framing of different
policies and strategies for the organisation. These policies should be effective for the company
which help the organisation to attain a sustainable position in the competitive global level market
for a long period of time. This drive of industrialisation help the SASOL in order to perform their
business activities or operations at the international level in a very effective manner and help in
attracting huge customer base towards the SASOL.
Notes:
Political factor: In context to SASOL, the government of the UK is very stable and impose
less tax which impact positively on the business at the global level (Haddud, McAllen and
DeSouza, 2018). So, the manager of the company has to focus on the rules and regulation of the
government so that they operate their business activities in a very effective manner and enjoy the
long term sustainability on the global market.
Economic factor: This comprises wages, cost, profit, gross domestic product of the country,
growth rate and many more. In relation to SASOL, as the company operates their work at

international level so they have to mainly work in that countries which have strong economic
background. This enhance the image and visibility of the company in the international market
along with their profitability.
Notes:
Social Factor: In context to SASOL, the manager of the company have to pay focus on
the needs and demands of the people of the society and provide quality of product which are
acceptable by the consumer (Igbinakhase, 2017). This help the SASOL in achieving a successful
position in the market and developing their business globally.
Technological factor: Organisation have to invest their amount in the technological
advancement in order to do their business activities effectively. In context to SASOL, as the
company operate their business at international level, they have to use the advance technology in
performing their different function. Due to this they can fulfil the demand of the international
market and earn higher profit.
Legal factor: In relation to the SASOL, the company have to focus on the different laws like
women empowerment, equity law and many more (Kasemsap, 2017) . The company also pay
attention on the health and safety of the employees along with their pay roll according to their
skill. By doing this they can run their business smoothly at international level.

Notes:
They can plan their strategies for long term basis. This will help the company to sustain in
the market for long term basis (Sharma, Kaur and Syan, 2021). On the other hand, it is very
difficult for the company to find skill and talent employees in the overseas market which
enhance the value and efficiency of organisation in the market. Along with this it is also very

difficult for the company to manage the payrolls of the employees across the globe and the
various tax rates of the country. So the company have to make proper strategies and policies to
overcome from these challenges.
Notes:
Entry fees: In terms of SASOL, the company have to focus on the export fees and the
franchising. The company can focus towards the opening of new outlet in the different nations
with the aim of generating more profit (Vought, 2017). But there is a chance that SASOL can
face the complexity in respect of paying entry fees for operating the business activities in their
nation. This directly impact on the profit margin of the business.
Losing of cultural identity: In respect to SASOL, it is very important for the company to
identify the different business environment which not only help them in achieving a successful
position but also help smooth running of business.

Notes:
Moreover, it is affected with a fear that it might lose its cultural identity. Sometimes, it
becomes challenging for the business to adopt new culture and surroundings in which they have
to conduct their business (Stanford). Hence, it is important for the business to have a clear
understanding of the culture of that specific country.

PART 2
Evaluate how globalisation influences organisational leadership, governance, functions, culture
and structure.
McKinsey 7s model is a useful tool that supports a company to analyse its
“organizational design”. The main objective behind this model is to show how an organisation
can achieve effectiveness through interactions of 7 key elements of model (Biloshapka and
Osiyevskyy, 2018). In case of SASOL, the influences of globalisation on organisational
structure, culture, leadership, governance and functions are discussed underneath:

 Structure: This element signifies a manner in which an organisation is highly organised.
In case of SASOL, it is very essential for the business to create and maintain a structure
so that employers and employees can communicate well with each other as well as
understand their roles and responsibilities with more clarity (Couston and Pignatel,
2018). The organisation is necessitate to have an effective organisational structure i.e.
divisional structure in which they can divide the areas of business which facilitates more
understanding of doing work even at global level. Strategy: This element in model represents the plan of an organisation which is prepared
and documented with an intent to have smooth flow of operations in business. In case of
SASOL Ltd., the manager is highly responsible to attain the aims of sustainable
competitive benefits that would further enhance the brand image as well as facilitates
higher profitability of the business. This could be done through creating an healthy work
culture within the company which will improve the motivation level of workers in order
to successful execution of the strategy. Skill: This signifies the various competencies and capabilities within the employees that
enables them to move forward to achieve the organisational objectives. With a reference
to SASOL, the manager formulates various rules, policies and regulations for the

employees' safety and welfare which satisfy each and every member in the company.
This will also help in the encouragement through which an individual can work hard to
complete the tasks with great competencies and productivity. This supports in attaining
business objectives and higher profitability (Crane and et.al., 2019). System: This element signifies that infrastructure and technicality of a company which
helps in maintaining the flow of business. In case of SASOL, the company is paying high
attention on the maximum utilization of latest technologies in order to have smooth flow
of operations at global level and regards the appropriate decisions in the accomplishment
of long-term sustainability. Staff: This element involves hiring, selecting, training and developing, compensating and
retaining employees within the organization who are capable and talented. With an
addition SASOL, the HR manager is highly focused on their employers and facilitate
them with appropriate training and developing programmes as well as enough
compensation so that they can stay longer within the company. This will enable to create
long-term sustainability by offering potential goods and services in the market. Style: Under this element, the senior executives of the company practices organisational
code of conduct in order to make effective decisions with suitable evaluation of each
aspect. In case of SASOL, the senior manager highly focused on the regulations of
business activities with democratic form of leadership style in order to provide a chance
to each individual so that can represent their opinions and views associated to the
decisions of business, linking to the globalisation (Ghani and et.al., 2018).
 Shared values: The vision, mission, values and goals of company are known as major
foundation of business along with possessing an effective role in the alignment of
business operations. In case of SASOL, the manager of company is required to create
vision and mission that leads employees of company to perform well in the organisation
even at global level.
Evaluate the influences of sustainable and ethical globalisation on the functions of organisation.
In globalization, the ethical factors refers to a process in which data, products, services,
information, technologies and many other factors are worked in an ethical and moral way
(Harun and et.al., 2018). The ethic is a term which explains the differences between what is
right to do or what is wrong to do. It involves a broad area of conduct in which employees,

customers, government, community, suppliers and many more. The key objective of doing
business in an ethical way is to improve the workers and employees with an intent to work
ethically, which also supports a company to have smooth running of business, along with this,
the respective company can create longer sustainability even at global level.
The factors related with sustainability refers to such variables that supports companies to
have a global presence as well as to accomplish the competitive benefits at global platforms. This
emphasis on the profitability of the organisation so that the company could survive in the global
market (Kasemsap, 2018). On the other side, it can also facilitate a growth, development and
potential to stand alone among the competitors at the global level. With an addition to SASOL,
the factors which can make a significant impact on the company are human resources, economies
of scale and advertising of goods and services. When the highly knowledge and skilled workers
makes a contribution in the new marketing strategies and innovation then it will improve the
customer base towards the brand. It will also affect positively on the profitability of the
company.
Critically evaluate the influences of globalisation in application to suitable models and theories
linking to organisational culture and structure.
The entry of new organisations into the market form the global market fateful. This
emphasis on the globalisation, not because of the limitation of domestic or local market. It
becomes a threat for the companies which deals in domestic market only (Liebowitz, 2020).
Underneath are the various factors of organisation which not only influences the globalisation
but also leads the SASOL Company for the growth and development: Political changes: The globalisation trend in the multinational market will socialize and
unite the various communities to deep-rooted the trade agreement. This create the
different business development opportunities for the SASOL Organisation. Development of technology: This is linked with the technological development within
the business. This not only make an ease in the flow of opinions but also assists in the
communication throughout the company (Venkatesh, Mathew and Singhal, 2019). Expenses: It is involved with trade of liberalisation as well as flow of investment in
specific areas such as global customer habits and attitudes, rising development cos and
the requirement for economics for sale.

 International business climate: It deals with the expansion of channels of
communication that makes a significant contribution in the process of globalization. In
case of SASOL, this will also facilitate the company with varieties of instruments in the
globalization process.
Application of Hofstede model of culture-
It is important to be noted that when an organisation turns their business at global level,
there are many promotional factors that influences the buying decision of consumer (Metaxas,
Chatzoglou and Koulouriotis, 2019). With the use of Hofstede model of culture, the impact of
various factors can be understood in the following way: Power Distance: This type of culture facilitates the strong hierarchies along with the
powerful and influential leaders. In case of the SASOL, the decision-making is done by
the seniors of the organisation which does not any involve any kind of discussion or
opinions of others. Individualism and communities: People throughout the world can be aimed through
promotion by considering how the products and services will facilitate benefits of
freedom and time-saving as well as appreciating for their effective group. Masculinity and trade role: Market can be differentiated in terms of their roles if they
have high masculinity culture. According to the certain market condition, it is important
that appropriate pattern is being used for every good to aim the marketplace. Tolerance and ambiguity: In this culture, tolerance and ambiguity are the main factors
which needs to be considered (Michael, Reisinger and Hayes, 2019). The respective
organisation determine their various forms of culture then tailored their promotional
activities accordingly. Long-term orientation: This type of culture not only support in focusing the customs and
traditions but also consider in weighing the link of past. In case of SASOL, the company
is abiding to follow long-term orientations if they want a successful promotion for their
traditional structure.
 Indulgence and quick gratification: Understanding the culture at high level facilitates
company a value for the rest of their time, otherwise if the company has low
understanding of the culture may create inflexible social regulations and rules.

Evaluate the various ways of decision-making that can work in an effective way in the context of
globalisation.
An organisation that wants to expand its business at global level requires to be competitive
in various aspects such as faster transportation facilities, utilisation of advanced technologies as
well as managing an effective communication throughout the world (Nikitina and Lapiņa, 2019).
In case of SASOL, in order to work effectively at global level, the company requires to make
various decision depending on the cultural aspects, time zones including different rules and
policies as well as norms of foreign market.
It is not simple to analyse and examine the various aspects of ambiguous foreign market,
therefore, different decision making should be made in a swift way. This kind of decision
making will enable a company to create opportunities worldwide before their competitors. In
context of SASOL, there are two ways of decision making in order to work effectively,
depending on the situation these decisions require to be made very smartly. Proactive decision-making: This kind of decision-making is considered as the most
strategic approach in an organisation. This enables the company to look for the solutions
which can be practical in real world and to make optimum utilisation of it. This will also
allow to utilise the experience and knowledge in organisation. Therefore, proactive
decision-making allows the company to choose more logical actions.
 Reactive decision-making: This refers to a stage i.e. a step up from being inactive. It is
not considered as the effective decision of time but it can be effective in few cases. This
only work when it is needed (Rosen, Luddin and Supriyati, 2019). Hasty decision
making can be a barrier for the company to lose several important opportunities for the
business.
It is observed from the above ways of decision making that when a company is active rather
than passive in the target market or it takes initiative to make practical actions rather than react,
then the company is making decisions proactively. Also, working in global market needs some
additional factors to be considered in the process of work.
Determine different ways to internationalization and barriers involved.
With an addition to SASOL, there are different routes to internationalisation which can be
used by a company to enter in the foreign market:

 Licensing: This involves, turnkey contracts or franchising. It also consists the term called
as contract manufacturing. It refers to the process of charging royalty for the utilisation of
company's name and its expertise. International agents and distributors: This can be referred as the initial step to put foot
in the international market. Agents can be a person or a company contracted with another
company to signifies a specific country representing more than one entrepreneurship
(Saad, Sudin and Shamsuddin, 2018). On the other side, distributors although linked to
the concept of agents, they own the products and also have a definite incentive on the
products. Joint ventures: This refers to a start-up business which is set up with other parties,
carrying out on the percentage of company. It is one of the common method to go
international in foreign market. Strategic alliances: It is states to contract between two parties in order to share resources
to start a mutually, precise benefited scheme. In the entire process, the company remains
independent. It has legal partnership among the companies. Moreover, it is less binding
and less involved then a joint venture.
Barriers to internationalization: Financial barriers: Generally, small companies face this kind of behaviour in foreign
market regarding physical and financial resources. Scarcity of resources, lake of sources
of finance, uncertain and unbalanced cost global market, limited access to capital and
many more. Managerial and market based barriers: This kind of behaviour is faced by almost every
company in foreign market (Saura, Palos-Sanchez and Correia, 2019). This majorly
consist behaviour and attitude of manager, lack of experience and knowledge in the
foreign market, lack of knowledge about government regulations, lack of skills and many
more include in the market and manager based barriers.
 Industry-specific barrier: This kind of behaviour are the most significant barrier that can
cause pressure upon the global companies in international market. Competitors in the
global market is one of the best example.

Critically evaluate the key barriers involved in internationalization and recommendations to
overcome it.
It has been evaluated that there are different ways through which a company can enter in
global market such as licensing, joint ventures, international agents and distributors and strategic
alliances. It is very important for the company to consider each method to internationalisation
and the barriers involved with such routes (Trad, 2020). Going internationalisation involves
usually three barriers such as financial barriers, industry-specific barrier and managerial and
market based barriers. It is important for the company to go through each of the barrier in order
to make strategies and plans accordingly.
Critique strategies that an organisation can be adopted while doing business at global level.
It is critically evaluated that there are various significant factors consists in the global
business environment which needs to be considered by the company (Vătămănescu and et.al.,
2020). Also, in order to enter in a global market and doing business operations in foreign market,
it is essential that ethical code of conduct must be followed by the company.
CONCLUSION
It has been concluded that import and export is very significant for an organisation as it
facilitates new opportunities for the development and growth as well as supports and
diversification in expansion of business. This will also help in increasing the productivity of
company and support in conducting smooth flow of business operations. With the significant rise
in digital technologies, a company have to take a varieties of decisions to its market expansion.

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