Management in Global Business Environment

This report analyzes the risks associated with overseas manufacturing in the global business environment. It discusses the rationale for additional research, risks associated with not undertaking this work, and presents a plan of how to research these issues.

Running head: MANAGEMENT IN GLOBAL BUSINESS ENVIRONMENT
Management in Global Business Environment
Name of the Student:
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Executive Summery
Overseas manufacturing, especially in the labor-intensive countries is becoming a popular
trend. The reason behind this is that the labor is cheap. Still, it poses certain risks that are
related to ethical standards and Corporate Social Responsibility. In order to determine the
best choice for the organization, an intensive research into the manufacturing process of the
shortlisted factories is needed.

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Table of Contents
Introduction................................................................................................................................3
Discussion..................................................................................................................................3
Rationale for additional research...........................................................................................3
Discuss the risks associated with not undertaking this work.................................................4
Present a plan of how you intend to research these issues.....................................................5
Conclusion..................................................................................................................................5
References..................................................................................................................................6

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Introduction
Global trend and business reports show that the organizations that are engaged in
international business earn more profit (Haley & Boje, 2014). The company concerned here
produces high quality men’s shirt. The closure of the local suppliers means that the company
will have to manufacture their product from factories located in India, Bangladesh and China,
where labor is cheap. Before the organization starts their business with any of the factories,
further research is needed for a deeper understanding of the possible risks and threats. In this
report, the rationale for further research and risks associated with not taking up the risk has
been analyzed. Moreover, a plan has been provided that will help in the research process.
Discussion
Rationale for additional research
Maintaining ethical standards has become important in every industry (Costa et al.,
2017). The social and environmental impacts that corporate industries have cannot be
overlooked. The clothing industry too, affects the environment and other social aspects. The
factories that have been located in China, Bangladesh, Vietnam and India though propose
lucrative quotations needs to be reconsidered before any final decision is taken. It is
necessary for organizations doing overseas business to align their own values with the
destination ethics. Every country has different practices when it comes to their Corporate
Social Responsibility. The universal standard for ethical practices is outlined by the ten
principles of United Nations Global Compact (UNGC) (Perry, Wood & Fernie, 2015). The
principles focus on human rights, labor standards, environment and anti-corruption. It is
necessary for organizations to ensure that the units that are manufacturing their products
comply with these principles. Additional research needs to be conducted on the labor

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practices such as forced labor. Child labor, job based discrimination and freedom of union.
The research will also reveal whether ensure human rights. The environmental
responsibilities like creating environmental impact plan, risk assessment, mitigation plan and
use environmental friendly equipment. Inclusion of these clauses ensures that they are using
ethical methods of production. Conforming to the human and labor rights as well as
considering the environmental impacts create a positive work environment and creates a
positive impression on the consumers. Along with these, the anticorruption measures ensure
that the company does not violate the governmental laws of the home and the host country
(Harris, Roby & Dibb, 2016). Thus, further research will also ensure that the organization
does not fall into any unnecessary lawsuit. Moreover, choosing the factories that uphold the
UNGC standards will also ensure positive media exposure, which will ensure larger target
market. Due to the emergence of several social and environmental awareness groups, the
media and the government of all the nations have become much attentive towards these
details and joining the company with any factory that fails to maintain certain standards will
be detrimental to the reputation of the company.
Discuss the risks associated with not undertaking this work
Without additional research on the factories shortlisted, the organization faces several
risks in future. These are:
 The reputation of the organization can be severely jeopardized. If the name of the
company is attached to any organization that has unethical practices and have
negative effect on global environment the buyers and the media will form negative
opinion that will seriously dent the brand value.
 Unethical practices of the factories may lead to lawsuits and compensation claims that
will impact the finance of the organization (Carswell & De Neve, 2013).

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 Without the additional research, the company risks losing control over the partner
factory which might be treat for future.
 Other competitors in the market will easily take over the market due to their less than
standard practices and open environment.
 The fire disaster in Rana plaza in Bangladesh that caused more than 1000 deaths
showed that their lack of ethics in manufacturing units was the reason for the tragedy.
Present a plan of how you intend to research these issues.
The research needs proper planning to be successfully executed. The steps include:
 Supplier’s list: the research team needs to compile individual supplier list. Using the
list they should find out about the ethical, health and safety, risk management and
CSR practices of the suppliers.
 The company should dive deeper to find out about the clients that the factories serve
and analyze the impact that might have in their business.
 The clients that the factories are related with should also be researched in order to find
out any frauds, scandals or bad practices that have been associated with them.
 The operation manager as well as past workers should be interviewed so that first-
hand information regarding their practices as well as employee mental health can be
determined.
Conclusion
The above discussion leads to the conclusion that additional research regarding the
ethical practices is mandatory to protect the brand image and reputation of the company. The
research plan will enable the research team to complete the work in limited time and extract
effective information.

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References
Carswell, G., & De Neve, G. (2013). Labouring for global markets: Conceptualising labour
agency in global production networks. Geoforum, 44, 62-70.
Costa, E., Soares, A. L., de Sousa, J. P., & Jamil, G. L. (2017). Information management for
network transformation in industrial enterprises associations: the case of the
internationalization process. In Handbook of Research on Information Management
for Effective Logistics and Supply Chains (pp. 415-436). IGI Global.
Haley, U. C., & Boje, D. M. (2014). Storytelling the internationalization of the multinational
enterprise. Journal of International Business Studies, 45(9), 1115-1132.
Harris, F., Roby, H., & Dibb, S. (2016). Sustainable clothing: challenges, barriers and
interventions for encouraging more sustainable consumer behaviour. International
Journal of Consumer Studies, 40(3), 309-318.
Perry, P., Wood, S., & Fernie, J. (2015). Corporate social responsibility in garment sourcing
networks: Factory management perspectives on ethical trade in Sri Lanka. Journal of
Business Ethics, 130(3), 737-752.