Globalisation on organisational Governance : Sample Assignment

GLOBALISATION

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 3............................................................................................................................................1
P3 Evaluate the influences of globalisation on organisational governance and leadership,
structure, culture and functions...................................................................................................1
P4 Evaluate the influences of ethical and sustainable globalisation on organisational functions.
.....................................................................................................................................................4
TASK 4............................................................................................................................................6
P5 Evaluate the different ways of decision making work...........................................................6
P6 Determine the various routes to internationalisation an organisation....................................7
CONCLUSION................................................................................................................................8
REFERENCES..............................................................................................................................10

INTRODUCTION
Globalisation is the process of interaction and integration of peoples, companies and
governments worldwide. It refers to the integration of market in the global economy and lead to
increase the interconnections of national economies. It is the ongoing process that is liking
peoples, cities, regions and countries much more closely together for work and promote their
relations at global level (Bende-Nabende, 2017). The present study is based on the “IKEA” is the
Swedish founded multinational group. That is design and sells the furniture, Kitchen appliances
and home accessories. It has been the largest furniture retailer company and this sells their
product and services. The company has the 208000 number of employees with the 1.46 billion
net income in 2018. Study lays emphasis on the global market and global operations influences
organisation by using McKinsey 7S model. Report will evaluate by the governances and
leadership of a multinational organisation within the international context. Study will use the
Hofstede's Dimensions of culture. The report will evaluate the influences of ethical and
sustainable globalisation on organisation function. This will also shows the different ways of
decision making work effectively in global context. It will also highlighted and determine the
various routes to internationalisation an organisation which are adopt by company with key
barriers.
TASK 3
P3 Evaluate the influences of globalisation on organisational governance and leadership,
structure, culture and functions.
Global market is very important and necessary for the business and its growth. It is the
process at there various economics and countries are integrated and established their relations.
The demand of customers are continuously enhance then globalisation is happens. The
globalisation is the business activities, this help to enhanced use of information technology and
the impact on IKEA on various areas. The company have to aware about their operational
strategies and work which is help to increase their profits at the global level and organisational
context (Cramer, 2017). By this company manager is able to sole their team issues and problems
either internal or external. By using the McKinsey 7S model is help to evaluate the global market
and global operations which are influence IKEA which are as follows:
McKinsey 7S model
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It is the important tool and techniques which is used by IKEA for taking quickly and
easily become a hard thing to control. This model is help to manager and owners to understand
aligned their organisation and their improvement area. This model is include by the 7S which are
help to manager for design along with understandability such as strategy, structure, system,
shared values, skills, style and staff. Each elements of this model vital for the success, needs and
attention to function properly. Each and every S are divided into two parts like hard or soft are as
follows:
Hard elements
This element is considered three factors such as strategy, structure and system that are
considered in that element. Manager of IKEA, is able to easily understand and quantify when
they are going with that factors. The descriptions are as follows:
Strategy
Strategies are very important part of the business because with the help of that manager is
able to growth their business at marketplace. This is refers the effective and valuable for IKEA
group to evaluate the factors which influences to business (Wright, 2016). For that manager
include innovation in their strategy for reduce that factor which are influences to company. For
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Illustration 1: McKinsey 7S model
(Source: 7S model's. 2017)

example: the accounting department can provide the accurate and correct data when it has not
affect to business.
Structure
It is another factor of hard element which is also important and helpful for IKEA to
understand their functions and employees. It is the outlines of the report which deals in terms of
whole organisation or simply the whole departments within the company. For example: in the
company have structure of work related to accounting in that manager are required a correct data
for better work and to understand global market (7S model's. 2017). For that manager have to
follows their structure to understand influencing.
System
System is the important part of each and every company because with the help of this
company is able to understand on regular basis to keep the business operations and move
towards the growth. It is the process, procedures and routines of the staff that is help to
characterise the job done or factors to influences the organisation by global market. It is very
important to understand process in follows. For example: accounting is the very important
process of company. For that make proper system to gathered informations from the global
market. In the absences of collecting system the work is not done in proper manner. For that
IKEA manager make process and system for collecting global market data for reduce influencing
factor. System of other country is affect to company's decision making polices because in that
company have to add their system in own decision making.
For analysis the culture of company the soft elements of McKinsey model are considers
which are as follows:
Soft elements
The soft elements are defined as the culture of company as per shared values, style, skills
and staff. Its description are as follows:
Shared values
The core values of IKEA which are reflect in the corporate culture and individual work
ethics. Share values to their employees are help to create effective work place and environment
at marketplace for that trust is very important factor (Sarti, R., 2016). For example: at the global
market company has work with their various employees in that they have deals with the various
rules or policies which are follows by the IKEA. In that manager have to share their strategies
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and polices of company to their each and every employees and trust them. Because without
knowing the culture, values and polices of company employees are not able to done work
globally. By this they are affected by the global market (Georgiadis and Mehl, 2016).
Style
Style is refers the two elements such as leadership and management style. both styles are
help to run their business in effective and calculative manner. With the help of those style
manager of IKEA is able to give the correct guidance to their employees for the best work of
result. For example: IKEA manager is follow the autocratic leadership style, they are take view
and ideas of employees. With this employees are feel they are part of the company and done their
job in effective manner.
Staff
staff of the company is also shows the culture of company like their performance, result,
behaviour and ethics. With the help of their team performance manager is able to understand
strength and weakness of company. Good leadership quality and skills are help to improve their
team performance for future growth and need. For example: company face the problem globally
in that manager have to guide them effective and correct manner which is help to reduce factor
which are influences company's culture and team work.
Skills
Skills are very important feature of manager and leaders of IKEA group because with the
help of skills manager is able to solve any problems which are related culture. For example:
company is take decision to transfer of their employees at other country then at that it is
important to give information related culture and work (Gunn, 2017). This will help to enhance
skills to perform their task at global level.
The hard elements are impact company's decision making process because structure,
strategy and system are different at each and every country. Other hand soft elements are impact
to the culture and shows it difference by the skill, values, staff and style.
Governance and leadership
The governance and leadership of multinational organisation within an international
organisation has impact and influence the organisations functions and their strategy decisions.
Governance are different at each and every country and it will influences the strategy, function
and decision because company have to follow this governance policy in their policies and take
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decision as per required. For example: governance of other country is different from the parent
company in that manager of IKEA have to take decisions as per that governance company have
to make new and further strategies for work. By this governances are impact and influences the
company and strategies. Other hand leadership is also impact to the company because every
place and company use their own leadership style to motivate and give direction for work. For
example: local company is use the democratic leadership style for the work in that leaders
include employees views and ideas. And other country manager is use the autocratic leadership
style in that leaders have to take decision as per own. This also influence company and its
decision making beaches as per that they have to take decisions.
Hofstede's culture model
this model is important for understand and know about the culture differences at the
national cultural can have impact the organisation. This model consists the five dimensions are
power, distance, individualism, masculinity and uncertainty of avoidance or long term
organisation. The national culture is diverse in the way they values and beliefs. IKEA is required
to understand the power of various factors that affect by the globalisation. For expand business
of IKEA they can go with the cultural and workplace. Power distance is correlated with the
income inequality and individualism is related to the work and growth of company which are
related with wealth of nations. Uncertainty of avoidances is related with the legal obligations for
develop the countries. Masculinity is associate with percentage of national income that is spend
on social security.
P4 Evaluate the influences of ethical and sustainable globalisation on organisational functions.
The IKEA group is use the democratic leadership style for taking their business operation
at global level. In that behaviour, culture, skills, structure and decision-making of leaders are
help to make changes as per requirements or situation. Those are effect to business operations
and its decision making. This leads the changes in overall task structure of company. The
concept of sustainability are used in several disciplines and it is required to the company
understand it very well before entering into new global market. Business ethics refers top a form
of applied or professional ethics that consists morale and ethics principles or problems that rise
in business environment. There are various factors which are influences the ethics and
sustainability of organisational functions such as behaviour of individual, loyalty, values,
personal goals, morale and personality are as follows:
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Loyalty
The loyalty is important quality of leaders and manager with the help of this customers
are attract towards the IKEA. For example: employees are not loyal and fair for their work this
will influences the ethics and suitability (Halina, 2017). For that manager and leaders always try
to give respect to their employees and also motivate them time to time. Lack of loyalty is
influences work and ethics of company. Employees have to loyal for the company and against
company or manager have to shows loyalty for them. Otherwise is is impact and influences
ethics and sustainability of IKEA.
Behaviour of individual
Behaviour of employees and individuals are also impact to company and its growth
because behaviour of each employees are different. This will influences the ethics of company as
per wrong behaviour. It can give negative and positive impact on the company and its functions.
For example: employees do wrong behaviour at the company and with its work then it will
impact to the company and its work in negative way. Other hand employees have positive or
good behaviour then it will give positive impact on the company because good behaviour of
employees are help rise productivity and customers base.
Morale and personality
Morale and personality is important for the company otherwise it also influences ethics
and sustainability of IKEA. Good morale of employees are always consider the good work and
result of work. Personality of employee is consider the positive reaction on work. It is effective
and valuable for the IKEA to boost their employees morale for best result of work (Hanson and
et.al., 2016).
Personal goals
Personal goals of employees are also influenced the ethics of IKEA group. Each and
every person have their personal goals of life. By this employees are not able to give their hard
contribution of work as per requirement. By this it will influence the ethics and sustainability of
organisation.
The business ethics like personal goals, morale and personality, behaviour of individual
and loyalty have give the positive and negatively influences on the functions of IKEA. The
company is deals in the furniture, kitchen appliances and home accessories all are important and
necessary for the customers. The factor which are impact tom the function of organisation by
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using strategies, environment harm, size of business and technology uses. Those are influence
the function of IKEA group.
TASK 4
P5 Evaluate the different ways of decision making work.
Globalisation is on major aspects which affect the growth and productivity of business an
its needs. Company has take decisions and make strategies for further growth and profit of the
company. IKEA decision making is depended on their goals and objectives. It can apply three
strategies for taking hard decisions at company (Hirst and Thompson, 2019). It will help to
company to take decision which are help to make their operational strategies effectively and
smooth level. With the help of this demand of the company as well as enhance their productivity.
Strategic decision making
The IKEA is a furniture company that needs to use different decision making for
handling different contracts with investors and suppliers. This strategy helps to IKEA to take
decision regarding the system, structure and system of the organisation is help to make the
effective and valuable for the business and its process. Those decisions are most important for
the business for growth and timely deliver their message to employees. With the help of proper
process of those are help to company to achieve their target as well as setting up their business
operations at international level. This will also help to impact of barriers to international trade
upon decision making. The presences of executive is also matters at the time of taking decision it
is the effective and best principle of leadership.
Operational decision-making
The decision making is important part of the company to achieve goals and objectives of
firm in effective manner. IKEA is consider the knowledge and information about the local
market, culture and many more factors which are influences the decision-making of the IKEA
group. As per that factor manager of IKEA group is make strategies for the internal growth and
production process of goods and services. With the help of operational decision-making process
company is able to take effective and best decision for the company. This will help to reduce the
impact of barriers to international trade upon decision making. For example: at the time of
production machinery is not work in proper manner in that manager have to take other option or
try to solve this problem like every day check machinery before starting work. This will help tom
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reduce barriers from their operational decision making. At the time of taking operation decisions
it is important to established own their words (Hopper, Lassou and Soobaroyen, 2017).
Tactics decision making
Tactics decision making is the includes the marketing mix, external and internal
environment of the company, competitors, suppliers, customers and investors but they are
influences the decision making. There needs and wants of the customers, supplier are also the
way of decision making. As per those factor manager of IKEA is make tactics strategy for their
external growth like satisfied customers needs and wants, supplier requirements. Those are help
to make the effective and valuable decision for their growth. This will help to reduce the impact
of barriers to international trade upon decision making. For example: if company is not able to
understand the needs and wants of customers then it will impact growth and profit of company.
Those are the ways of taking decisions in that principle of leadership are always matters..
with the help of this they are able to do their business and its effectiveness at the time of decision
making process.
P6 Determine the various routes to internationalisation an organisation.
There are various routes are available for IKEA to enter into the international market
such as strategic alliances, licensing, joint venture, franchising and acquisition etc. each and
every route describe at below:
Strategic alliances
It is the ways of entering into the new market and new country with the help of strategic
alliances at local partner of the foreign country. It is involve contractual agreement that is rise
between two parties. With the help of this IKEA can develop their route to come into the
international market and that provides various advantage to the IKEA such as that has help to
develop their business at international market (Krugman, 2017). This help to provide the their
services at their. It is important and valuable for the growth of company. That provide the
various advantage to the IKEA such as that help to build the understanding of local market,
culture as well as ways of doing business in particular market. There are some barriers is also
affect the decision making of company when they adopt this such as the high costing rather than
other method and integrations issues between two corporation cultures.
Franchising
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It is the easier way of entering into the international market for the rapid changes and
expand their business at internationally. It has the strong brand image under producing their
furniture that help to made easy entry in new market and provides various advantage to the IKEA
such as effective entry and low risk. There are many barriers for IKEA for global expansion.
With the help of franchising, IKEA company is able to expand their business at international
level. This can affect to company when they adopt this such as culture barriers is create the
different culture and language there is happens the communication gap between the employees
and staff members. And other barrier is to be currency create losses for the organisation because
of currency inflictions.
Joint venture
IKEA can expand their operation in global market with the help of joint venture. With the
help of this, IKEA expand their business operations with the other country by distributing equal
share and equal proportion of the profit. Company can access to new technology and adopt
management skills by joint their operations with other company in international market. It
provide advantage to IKEA such as gain local market knowledge and the company can get
maximum control their operations (Potrafke, 2015). company face the problem by this for
expansion o IKEA in global market such as higher risk due to unknown company as well as it
makes slow entry by taking setup time.
Those are routes for develop their business at global market in effective manner. With the
help of this company is able to promote their business at marketplace and global market for
serves their products and services to the local customers and global customers as well.
CONCLUSION
From the above study it had been concluded that the globalisation has important for the
business and growth of company in order to provide their all services and products to customers.
McKinsey model has help to understand those factors which to the global market. It has divided
into two parts like hard and soft elements like hard elements has effectively considered
strategies, structure and system. Those has important for the company to understand and done
work and soft elements has help to understand culture of company and country at global market.
Ethics and sustainability has influence global market and function of organisation. Behaviour of
individual, loyalty, morale and personality has considers the ethics those impact the global
market and manager of company. Report has covered by the different ways of decision making
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help to done work in effective and correct manner. Strategic, operational and tactics decision
making process those help to take good and better decision for the company. Report has covered
by the various routes help to company for established at international market and global market.
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REFERENCES
Books and journals
Bende-Nabende, A., 2017. Globalisation, FDI, regional integration and sustainable
development: theory, evidence and policy. Routledge.
Cramer, J., 2017. Corporate Social Responsibility and Globalisation: an action plan for
business. Routledge.
Georgiadis, G. and Mehl, A., 2016. Financial globalisation and monetary policy
effectiveness. Journal of International Economics. 103. pp.200-212.
Gunn, S., 2017. Globalisation, education and culture shock. Taylor & Francis.
Halina, W., 2017. The Interface Between Globalisation, Corporate Responsibility, and the Legal
Profession. In Human Rights and Corporations (pp. 495-538). Routledge.
Hanson, D. and et.al., 2016. Strategic management: Competitiveness and globalisation. Cengage
AU.
Hirst, P. and Thompson, G., 2019. The future of globalisation. In The Handbook of
Globalisation, Third Edition. Edward Elgar Publishing.
Hopper, T., Lassou, P. and Soobaroyen, T., 2017. Globalisation, accounting and developing
countries. Critical Perspectives on Accounting. 43. pp.125-148.
Krugman, P., 2017. Crises: The price of globalisation?. In Economics of Globalisation (pp. 31-
50). Routledge.
Potrafke, N., 2015. The evidence on globalisation. The World Economy. 38(3). pp.509-552.
Sarti, R., 2016. The globalisation of domestic service–An historical perspective. In Migration
and domestic work(pp. 89-110). Routledge.
Wright, S., 2016. Language policy and language planning: From nationalism to globalisation.
Springer.
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