Impact of Globalisation on Corporate Structure of H&M

RESEARCH
PROJECT

Table of Contents
TOPIC:- ...........................................................................................................................................1
CHAPTER 1: INTRODUCTION ...................................................................................................1
Overview................................................................................................................................1
Background.............................................................................................................................1
Rationale.................................................................................................................................2
Aims.......................................................................................................................................2
Research Objectives: .............................................................................................................2
Research Questions: ..............................................................................................................2
CHAPTER 2: LITERATURE REVIEW.........................................................................................2
The concept of Globalisation..................................................................................................2
The major challenges faced by H&M while global expansion..............................................3
The influence of globalisation over corporate structure of H&M .........................................4
CHAPTER 3: RESEARCH METHODOLOGY.............................................................................4
CHAPTER 4: DATA ANALYSIS AND INTERPRETATIONS (1500)........................................6
CHAPTER 5: RESEARCH OUTCOMES....................................................................................17
Covered in PPT.....................................................................................................................17
CHAPTER 6: REFLECTION & RECOMMENDATION FOR ALTERNATIVE RESEARCH
METHODOLOGY........................................................................................................................17
Reflection.............................................................................................................................17
Recommendations................................................................................................................17
Alternative research method.................................................................................................18
CHAPTER 7: CONCLUSION......................................................................................................18
REFERENCES..............................................................................................................................19

TOPIC:-
“To identify the impact of globalisation over corporate structure of multinational organisation
and major challenges faced by them.” A study on H&M.
CHAPTER 1: INTRODUCTION
Overview
Globalisation is refers to the process of integration among business, people and
government throughout the world. In another words it can be said that globalisation leads to
integration of markets that help in smoothing up flow of trade and interconnect the economies.
Globalisation plays a crucial role within the growth and development of a company as it provide
a medium through which a business can target larger number of customer, be able to approach
untapped market which contribute toward improving its brand image at market place (McCann
and Acs, 2015). But apart from all this globalisation also have an influence over corporate
structure of an organisation as by expansion of business operations and manner in which they
operates get changed. Hence, it become very essential for an organisation to manage its corporate
structure much effectively by maintaining proper coordination among each department so that it
become easier to deal with challenges at global market with mutual efforts of various
department. In order to investigate this H&M organisation is consider which is a multinational
retailer that is headquartered in United Kingdom.
Background
Corporate structure is refers to the organisation of several different departments or
business unit in order to align the efforts of employees toward accomplishment of organisational
goals and objectives (Sethi, 2016). But their mutual efforts get disturbed while expanding
business internationally, hence it is very crucial for an organisation to maintain collaboration
among them in order to achieve corporate goals and objectives. For investigating the impact of
globalisation over corporate structure of multinational organisation and challenges that a
company have to face H&M is considered. It is a multinational retailer which operates a chain of
store throughout the world in order to offer fast-fashion clothings for women, men, teenager and
children. It is second larger clothing retailer in world and operates in more then 62 countries.
Hence to maintain its market position it is very essential for company to maintain its corporate
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structure effectively that support in dealing with challenges at global level (Monshipouri, Welch
and Kennedy, 2017).
Rationale
The main reason behind conducting this investigation is to determine several challenges
that an organisation has to face while expanding its business at global level. By performing
investigation researcher would be able to enhance knowledge in term of globalisation and
changes it bring within the corporate structure. In addition to this, the scope of research is very
broad as it can be used for academical purpose that help in students to learn about the manner in
which an organisation enter into global market by considering the experience of H&M.
Aims
“To identify the impact of globalisation over corporate structure of multinational
organisation and major challenges faced by them.” A study on H&M.
Research Objectives:
 To learn about the concept of Globalisation.
 To identify the major challenges faced by H&M while global expansion.
 To determine the influence of globalisation over corporate structure of H&M
Research Questions:
 Describe the concept of Globalisation ?
 What are the major challenges faced by H&M during the time of global expansion ?
 What are the influences of globalisation on the corporate structure of H&M ?
CHAPTER 2: LITERATURE REVIEW
The concept of Globalisation
According to the view point of Didem Buhari Gulmez, 2017 globalisation is the process
through which technology, product and services are spread all over the world for the purpose of
expansion of business. There is improvement in economic, financial and trade policies of
different companies. There is difference in working style of organisation at national land
international level. Hence there is integration of different resources such as financial bodies,
individuals, groups and governmental bodies. With working at international level, mangers of
H&M is able to expands consumer base but there is requirement of having knowledge about
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changes which are taking place in external market. There is free movement of products and
services from one place to another considering different working policies. In order to access
knowledge about globalisation, there is requirement of managers of H&M have to analyse which
market have scope for growth and then policies has to be farmed to implement it.
With working at international level, managers of H&M is able to achieve economies of
scale with analysing production cost. Production cost can be reduced with analysing labour cost
and cost of raw material. When consumer have more demand for product and services then
production increase and it assist in reducing overall production cost. When cost of raw material
and production is less, then managers of H&M provides it to consumers at cheap rate
(Bachmann, and Pereira, 2014). This is fruitful for growth and development of association. With
globalisation of H&M company will be able to operate its business in more than one country but
there are different aspects which gets negatively influence over its growth. This may include
legal barriers, difference in preference of customers, language barrier, cultural barriers etc. that
may influence the performance of company to larger extend.
The major challenges faced by H&M while global expansion
According to Olimpia and Stela, (2017), In the world of fashion marketing where
shopping is fast moving online, H&M is going in a downfall position day by day. They are
thinking about the expanding their business but because of various challenges they have to face
various difficulties. These challenges related to the high level of competition, changing
consumers demand, different tax structures, different rules and and so on. These challenges
create a big issue for them to expand their business in other countries.
As H&M want to expand their business but because of their rivals like Zara, Gap, M&S
and many more, they have to change their marketing strategies to beat their competitors. In the
world of online transactions they have to launch their own app from where they can attract
consumers from all over the world. They have to considered all the rules and regulation of others
countries if they want to prevent themselves from any disputes and want to sustain for a long
period of time (Scott, 2015). Moreover, if they want to compete their competitors at international
level then they should evaluate their consumers behaviour, choices, and pricing preference in
their production process so it will help them to meet from all the consumers demand and
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expectations. It will help them to increase their market value, productivity and profitability
which results sustainability in the intentional market for a longer period of time.
The influence of globalisation over corporate structure of H&M
According to Tan and Goh, (2014), Corporate management of H&M is based in the
Stockholm from which different departments of them managed and organised their work. It
includes designing of products, advertising and marketing, finance and accounts etc. through
which they complete their work with efficiency and effectiveness.
H&M is operating their business at global level which determines that structure plays an
crucial role for the globalisation or developing of them. They are operating their business in
different countries so specifically for each country office is responsible to manage and complete
the activities of different departments. Approximately in 16 countries H&M is successfully
operating their business due to 16 different departments of production are responsible to provide
and deliver their products among 700 independent supplier that works for the H&M. In present
market conditions all the organisation and industry are performing their operations at global level
(Weeks, 2017). Therefore H&M also expands their business at global level due to which they
also open their production in Europe, Asia and Africa because it helps them to manufacture their
at low prices. Along with this it also helps them to deliver their products with in minimum time
period as it assist towards the local growth of the company. H&M operates their business in 37
different countries which helps them to increase their market share and the number of customers
that increases their revenue as well as profits also. Further the other benefits is that it helps them
to recruit effective employees at cheap rates, Like in developing countries employees work with
more efficiency because of high income and low employment rate.
CHAPTER 3: RESEARCH METHODOLOGY
Research methodology is the process is used to determine, collect and analysis information. In a
research the methodology show the overall dependability and validity of study (Kennelly, 2019).
The methodology includes survey, publications, interviews and more techniques that are used to
gather both historical and present data. Some tools and techniques are as follows:
Research philosophy:- Research philosophy is very important part of research
methodology and a phenomenon by which data is gathered, analysis, and used. Some of the
philosophies are positivist,pragmatist etc. In this project research positivist philosophy is used.
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