Global Business Environment: Strategic Challenges and Impact

This report provides a comprehensive analysis of the global business environment, examining key factors driving global trade, such as cost, market dynamics, environment, and competition. It delves into the strategic challenges faced by organizations operating in a global context, including stakeholder interests, market competition, legal and governmental regulations, and economic fluctuations. Furthermore, the report explores the impact of globalization on organizational governance, culture, structure, and leadership, along with the influence of ethical and sustainable globalization on organizational functions. It also addresses effective decision-making methods in a global context and outlines routes to internationalization, including associated barriers. The analysis uses the example of Just Eat, highlighting the complexities and opportunities within the international market.

GLOBAL
BUSINESS
ENVIRONMENT

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Key factors of cost, market, environment and competition that drive global trade...............1
TASK 2............................................................................................................................................4
P2 Complexity of strategic challenges faced by organization while operating in global
environment.................................................................................................................................4
TASK 3............................................................................................................................................5
P3 Impact on globalisation on organization governance, culture, structure and leadership.......5
P4 Influences of ethical and sustainable globalisation on organization functions......................7
TASK 4............................................................................................................................................8
P5 Methods of making organization decision effective in global context..................................8
P6 Routes to internationalization for organization and its barriers.............................................9
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
Globalisation is all about exchange of goods or services across the international level in
order to acquire maximum return on their investment by satisfying client’s needs or
requirements. However, number of small or large organization is emerging at marketplace for
gaining high range of return on their investment. Just eat is well known medium size
organization by dealing with around 20000 restaurants across the international boundaries for
gaining maximum revenue (Cantwell Dunning and Lundan, 2010) . Basically, online service is
offering by this association by getting connected in almost 13 countries such as; Europe, Asia,
oceanic and Americas. Mainly, it’s a platform for customers where they found best options for
food and acquire qualitative items. Therefore, assignment is going to highlight the necessary
elements which are considered by firm while expanding their business across distinct global
marketplace. For example, number of factors are considered such as; cost, market, competition
and so on. Along with this various methods of launching new business at global place is also
outlining in this project for assisting company to extent their manufacturing business in various
new areas. Apart from this, challenges and barriers are also explained for guiding company
towards corrective path so that they can attain their set objectives.
TASK 1
P1 Key factors of cost, market, environment and competition that drive global trade
Globalisation is all about connecting with foreign companies with broader motives as
well as trying to establish a positive connection with other nations in order to gain maximum
advantageous. However, international marketplace is having numerous of options and
alternatives for making successful to an organization by showing best techniques of handling
business (Cavusgil and et. al., 2014) . Along with this, ideas are also emerging which aids
business entity in grabbing more or more knowledge for establishing their company image at
international marketplace. Just eat is already dealing in around 13 nations but dreaming
extending their business more so that they get succeeded in maximising their yearly turnover and
defeat their competitors with unique strategies. But at the same, it has been understood that
company needs to consider some of the major elements while managing each or every aspects
because global market is highly different from domestic one. For example; fluctuation in
exchange rate on monthly or weekly basis as it may hamper the future contract of an
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organization, surrounding of place and so on. Thus, some of the essential component which is
having major impact on company while involving in global marketplace is discussed as follows:-
Cost: - Capital is seen as most indispensable aspect for every organization either small or
large because overall business activities are based on funds. For example; raw materials are
purchasing through sufficient amount of capital, labours are also hired on salary basis and so on.
Thus, it has been understood that money is consider as lifeblood for overall industry as well as
either small or large business. Therefore, company needs to consider relevant elements of cost
such as; indirect and direct cost, variable and fixed cost henceforth. Mainly, variable one always
fluctuates due to changes in several other factors like consumer bargaining power whereas fixed
one is always fixed like rent henceforth (Colfax Rivera and Perez, 2010) . It means, manager of
Just eat needs to forecast all the indispensable elements of cost before involving in any kind of
contract because all this things are depend upon monetary factors only.
Market:- Just eat is expanding their business for maximizing their profit level by
fulfilling the client’s needs or demands but it is only possible if company can appropriately select
best market for expansion process. Thus, number of factors are analyse while extension process
from which market is one of the mandatory aspect because final users are identified there only.
Basically, it’s a part of promoting company goods in best manner by understanding the needs or
requirement of customers whosoever are interested in products. However, demand of online
services is increasing day by day due to establishment of modern world at marketplace. It means
company can easily analyse their current market for attaining set objectives or goals in various
manner. Mainly, some of the major element of markets is classified into various sections such as;
demographic, behavioural, geographical and psycho-graphic. Different kinds of market shows
that company needs to plan all the elements as per current market in order to understand choice
or preferences of various types of customers (De Jonge, 2011). For example; old age people
prefer hygienic foods whereas kids love to eat unhealthy foods and teenagers are also like to
enjoy junk foods henceforth. All these elements show the differences and several elements of
market which must be considered by organization while promoting their goods.
Environment: - Business surrounding is having major impact on company performance
because all the activities are depend upon external and internal elements. In fact, all the
organizational policies are depending upon various components in order to direct employees
towards corrective path for attaining set objectives or goals. Some of the essential elements are;
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external and internal. For instance; political, economic, technology, legal, social, customers,
suppliers henceforth. Major influence of these factors is discussed as follows:-
 Political:- According to this element political norms, rules and regulations are
influencing having major impact on company performance because it helps in suggesting
an organization about current policies which has been changed. However, Just eat need
to learn about government stability at particular nation wherever they are going to expand
their business. For example;VAT rate, rules and regulations and so on (Ferraro and
Briody, 2017) .
 Economy:- Inflation and deflation rate are having major influence on company
performance as it enforce them to set their price as per current market situations.
Therefore, it may affects the future and current contracts of an association.
 Social:- Final users are seen as most indispensable aspect for organization because
products are consumed by them only. It means, association needs to analyse the taste or
preferences of society in order to make positive relations with them.
 Legal:- Legitimate bodies was enacted number of laws and orders to prevent buyers and
sellers from getting misused. Therefore, Just eat is focussing on national legal norms
while involving in business with domestic company of any foreign marketplace.
Competition:- Number of food manufacturing companies are coming with outstanding or
qualitative goods for acquiring maximum benefits because consumer demands is maximizing in
coming time period. For example Amazon is one of the most leading organization engaged in
providing online services to their customers. On the other hand, various small companies are also
emerging for maximizing their profit level (Gecevska and et. al., 2010) .
Hence, it has been understood that expansion is not an easy task due to the involvement
of numerous elements and all of them are interlinked with each other. Therefore, managers of an
organization needs to focus on all the major components while establishing their new venture at
global marketplace.
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TASK 2
P2 Complexity of strategic challenges faced by organization while operating in global
environment
Global environment is full of challenges and difficulties due to fluctuation in several
internal and external factors which are having major impact on a company performance as well
as its functioning. In fact, customers are playing major role because products are consumed by
them. It means, assessment of clients choices and preferences is first or foremost challenge
which is encountered by company while operating in global market (Hamilton and Webster,
2015) . Apart from this, number of things are identified which is consider as complexity for
company while running their business in international market. Some of the major challenges are
discussed as follows:-
Broader range of stakeholder interest:- World is becoming more or more advanced
due to which company face problem while dealing with their stakeholders as they are demanding
more dividend. Along with this, their choices and interest is also getting broader which have a
major impact on company policies as well as act as obstacles. For example if shareholders are
demanding more then it may affects the profit level of an association. Apart from this, medium
size of business are not having that much opportunity because they are having very limited
contacts. Thus, it act as a major challenge for Just eat while expanding their business in new area
because shareholders are highly indispensable for running any corporations. It means, company
needs to make impressive plans or policies for capturing the minds of maximum number of
investors as per organizational terms and conditions (Kasemsap, 2014) .
Close substitutes:- Taste or preferences of clients are getting changed on daily basis
because they wanted to experience something new or unique instead of using single thing
regularly. In fact, number of companies are coming with qualitative goods and techniques of
facilitating consumers. Due to which, Just eat is encountering a major issue while operating their
business in international marketplace. However, company is also using modern technologies but
it is not easy to implement it at workplace. As a result, company needs to hire best employees
and skilled to handle these kind of problems as well as requisite to analyse the strategies of
competitors for defeating them by designing creative products as compare with rivalries.
Legal laws:- Legitimate bodies are liable for framing various significant laws and orders
to facilitate society with best services and trying to protect them from wrongful conducts. In fact,
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every nation are having their own legal norms and policies which is not acceptable by other
people (Laudon and Laudon, 2015) . Because of that company is facing a major problem while
establishing their new business at global market as they need to learn advanced legal norms for
running their business entity in ethical manner. Apart from this, it aids in preventing buyers and
sellers from misinterpretation.
Government:- Policies of governing bodies are influencing overall nation and companies
needs to follow all the indispensable policies while regulating their business. Their main
objective is to create a nation free from any exploitative activities by satisfying the needs of
distinct clients. For example; government was enacted one of the major norm that is free trader
policy. It shows that if any new company is establishing then they can easily enter into
marketplace without facing any additional charges (Louhiala-Salminen and Kankaanranta,
2011).
Social:- Society are seen as mandatory aspect for company because products are issued to
them and they are responsible for consuming products. Therefore, assessment of clients choice or
preferences is highly indispensable for company success because it aids in controlling
possibilities of losses.
Economy:- Inflation and deflation is having major impact on company performance
because it enforce company to set the price as per current marketing situations. However, it has
been assessed that economy of a nation is affecting company position in various manner by
satisfying clients needs or demands.
Technology:- Number of modern technology is identified at marketplace due to which
company needs to adopt advanced equipments for accomplishing business activities. But at the
same time handling of modern machinery is highly difficult because of its complex features. In
fact, technologies are also differ from country to country due to which organization needs to
focus on this element in order to acquire more benefits (Peng, 2016) .
TASK 3
P3 Impact on globalisation on organization governance, culture, structure and leadership
Exchange of goods or services across the international boundaries is not an easy task due
to the presence of various factors that are not controlled by an organization. For example; norms
of governing bodies, legal rules, environment changes, any sudden disaster, uncertainty and so
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on. All these elements are having major impact on organization governance, culture, its structure
and leadership quality. Basically, Just eat is expanding their business across distinct borders and
aiming to have maximum number of revenue as well as establishing company image at
marketplace. Globalisation market is changing due to the emergence of various companies which
is affecting company in various manner such as; consumer minds due to the availability of close
substitutes, emergence of modern marketing strategy and so on. Thus, influence of globalisation
on various factors of an organization is discussed as follows:-
 Governance:- As per this element control and management of an organisation means
governing of company which is based on its policies. Thus, if firm is entering into global
market then they need to consider international norms for governing their business and
act as per current trends. However, it has been understood that company is engaging in
using appropriate methods for fulfilling the needs and demands of distinct customers.
Apart from this, managers whomsoever is handling governance of association then they
need to make changes as per global market (Simic and Dimitrijevic, 2012) .
 Culture:- Just eat is offering online services to domestic as well as foreign clients which
shows that they are dealing with numerous of customers whomsoever are different in
terms of their culture. Additionally, they need to consider various types of culture which
is essential for company success as if company is failed in understanding the needs of
several clients then it may affect their sales volume. For example; while offering online
services Just eat is considering choice or preferences of society whomsoever are belongs
from various culture for acquiring their trust or loyalty.
 Structure:- Globalisation is coming with best method of structuring organization due to
which company get motivated in establishing modern technique of designing company.
Apart from this, new styles of designing company is also emerging due to which
organization get enforced to come up with creative ideas so that they can cope up with
their current competitors. Along with this, employees retention is also maintained if
structure of company can appropriately maintained as business activities are
accomplished by them only (Tarique and Schuler, 2010) .
 Leadership:- Leading a team is all about managing an association by motivating their
staff members towards their personal and professional objectives so that they can attain
their set goals in a desired time period. Thus, leaders needs to use modern method of
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leading a team in order to create a positive relations with their group members as well as
supports in enforcing them to perform assigned job in minimum time. It shows that
globalisation is influencing leadership also as it enforced various team leaders to deal in a
modern way so that employees also feel motivated.
All the above factors shows that expansion of business is highly big deal and other
elements of an association are getting affected by this in various manner. Due to which managers
of an association trying to consider necessary elements while establishing new oputlest in any
foreign marketplace (Trompenaars and Hampden-Turner, 2011) .
P4 Influences of ethical and sustainable globalisation on organization functions
Ethics is having major influence on overall globe because it aids in controlling
probabilities of mistakes and errors. Along with this, suggest an association towards corrective
path so that they can perform their organizational functions in proper manner. Moreover, defend
seller and buyer from exploitative activities. Thus, if there is a presence of ethics at global
marketplace then it helps an organization in promoting whole association by accomplishing
various business activities in suitable style. Additionally, morals implies standards and qualities
which are related with a business on which directors of an organization need to take a basic
audit. In this manner, business need to keep up suitable ethics and values in business at such
purpose obviously when they begin working at worldwide level. Along these lines,
administrators need to make every last operational moral in nature so better and suitable working
could be advanced. However, due to global marketplace an organization can easily expand
number of business sectors by considering several moral elements.
Morals need to get take after by each association in a proper casing generally their
business rehearses get affected. For making a notoriety and picture before clients, administration
need to take after and outline suitable techniques with the goal that better working could be
advanced. Practical globalization is the point at which an association suitably increase
appropriate piece of the overall industry so as to which they can contend into sharp market world
legitimately. Just eat need to take both of these globalization in thought legitimately with the
goal that they end up ready to bargain at showcase world appropriately. Impact of moral and
practical globalization had immense effect on hierarchical capacities which are useful to draw
suitable working (Werther and Chandler, 2010). Instead of this, some of the major elements
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which shows that impact of ethics and sustainable globalisation upon organizational functions
are discussed as follows-
 Company get succeeded in maintaining their positive goodwill at marketplace by
fulfilling the requirements of consumers in a defined time frame.
 Maintain the positive and long term relations with various domestic as well as foreign
clients.
 Prevent sellers and buyers from any exploitative and discriminatory activities.
 Accomplish all the business operations in perfect manner by considering necessary terms
and conditions.
 Promote towards globalisation which aids in maximizing organizational revenue.
Hence, all the above factors shows that ethics are having major impact on company
success and performance in various aspects. Sustainability is indispensable for overall nation due
to which company feel responsible and trying to promote sustainability through their products or
services. Basically, goods which is designed by Just eat is having a direct impact on company
performance and its image. Thus, it is essential to understand each or every aspect of ethics in
order to maintain company goodwill at marketplace. Along with this, corporate world is playing
very eminent role in developing the economy of a nation by coming with outstanding views and
thoughts which resulted in enhancement of economy.
TASK 4
P5 Methods of making organization decision effective in global context
Judgement process is a very responsible job because other people also get affected by that
due to which it is essential for organization to consult each or every member before making any
of the important decision. Almost every factors are interrelated with each other and having direct
impact on company performance because one decision can change the entire environment of
workplace. Just eat is dealing across the international boundaries and having its outlets due to
which they are dealing several types of consumers that are distinct in nature, culture,
background, taste and so on (Wild and Han, 2014) . Hence, it has been analysed that decision
making process needs to be very generic and clear which is only possible if managers are
adopting suitable methods by considering necessary facts or figures. Thus, an appropriate
methods of making decision are discussion as follows:-
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 Programmed judgement process:- As per this element managers of an organization
does not need to acquire consent from others because few decision are necessary and
regular. For example; handling of consumer complaint, modernization of current
enterprise, introduction of creative products and so on. All these decision doest not
require any agreement or approval because these are the part of company functioning
and need to be accomplished for attaining organizational goals. Although, it helps an
association while maintaining their positive image at marketplace which aids in attaining
set objectives or goals.
 Unprogrammed process:- In this type of decision company needs to make judgement
by consenting various other members like; employees, other managers, board of
directors henceforth. Their main objective is to control the possibilities of risk by taking
approval from all the significant members. Basically, these decisions are rarely taken
like occurred in once a month, half yearly, yearly and so on. Therefore, if any decision is
occurring after a long period then it will definitely consist of high range of risky
situations and its impact is also not controllable by single person. Due to that managers
is acquiring consent from other in order to reduce liability from them.
Hence, it has been understood that globalisation of business is all about unprogrammed
judgement where decisions are risky due to changes in other additional factors such as; norms of
governing bodies, management styles, competitors strategies and so on. It means, company needs
to focus on every terms and conditions while managing things because it aids in controlling
maximum chance of uncertainty. However, management team of selected firm requisite to take
logical decision instead of just doing things so that company can attain their targets in a defined
time frame. Apart from this, long term vision also requires to consider while expanding business
over the seas because it aids in directing the employees towards corrective path.
P6 Routes to internationalization for organization and its barriers
Internationalization is an effective method of introducing business at global market and
exchanging goods or services across the international boundaries (Globalization Challenges for
Businesses. 2018). Their main objective is to grab opportunity which is existing at international
market by understanding each or every aspect. But at the same time it is assessed that maximum
range of complexity is also identified while entering into new marketplace due to the emergence
of various other competitors. Apart from this, norms of governing bodies, legal rules and
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regulations, environment and several other elements also get changed. Thus, some of the major
methods which is used by company for entering into international marketplace are explained as
follows:-
 Joint venture:- Making connection with other foreign company.
 Direct export:- Selling directly to the international market
 Licensing:- Acquire license from foreign companies.
Apart from this some of the major barrier which is encountered by an organization while
involving in global market are:-
 changes in consumer choice or preferences.
 Currency rate.
 Governmental policies and norms.
 Environment.
CONCLUSION
From the above report it has been summarized that globalisation of business is a very
long and broader process because every thing has been changed as well as company needs to
deal in newly manner. However, international marketplace is all about modern things because
number of competitors and advanced companies are existing there with creative ideas for
generating maximum revenue. Their main objective is to promote economy of a nation by
motivating medium sized organization towards establishment of brand new outlets. Assignment
was showing the major methods of making decision at workplace while involving in a
globalisation. Just eat is a company which is engaging in expansing their business across the
borders for gaining maximum revenue. Hence, it has been understood that various other factors
also getting affected by arrival of new ideas and so on.
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