Impact of Global Business Environment on HSBC Holdings: A Report

This report provides a comprehensive analysis of the global business environment, focusing on HSBC Holdings. It begins with an introduction defining the global business environment and its impact on organizations. The main body includes a SWOT analysis of HSBC, identifying its strengths, weaknesses, opportunities, and threats. The report then examines how key drivers in the global environment impact HSBC's functional areas, specifically marketing and finance. The analysis covers how changing customer behaviors, technological advancements, and economic factors influence these functions. The report concludes by summarizing the findings and emphasizing the importance of understanding both internal and external factors for strategic decision-making. References to relevant books and journals are provided.

Global Business Environment

Contents
Global Business Environment..........................................................................................................1
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
SWOT analysis.......................................................................................................................3
Examine the ways in which these key drivers can impact upon firms functional areas........4
CONCLUSION................................................................................................................................5
REFERENCES................................................................................................................................6

INTRODUCTION
Global business environment can be defined as an environment among the different
independent countries which are affected by various external factors within the home country as
well as other countries (Rendtorff, 2017). The external environment has both positive and
negative impact on the organisation in terms of their utilisation of resources and capabilities
optimally. To manage the impact various external factors strategic decisions must be taken by
the organisation which enables them to carry out their operations without much influence. For
this it is important for the organisations to analyse the external environment on consistent basis
along with analysis of internal capabilities and resources. In this report, HSBC holdings are taken
into consideration which is a UK based multinational investment bank. The report includes
internal analysis of the organisation and the impact of key drivers on the functions of the firm
which were identified in the previous work.
MAIN BODY
SWOT analysis
With the help of SWOT analysis an organisation can analyse various internal strategic factors
such as strength and weaknesses combined with the opportunities and threats. The main purpose
of undertaking the SWOT analysis is to identify the capabilities of the organisation to exploit the
external opportunities by countering the threats with the help of strengths of the organisation and
minimising the impact of weaknesses (Kouatli, 2016). SWOT analysis of HSBC holding is given
below:
Strengths:
 High level of customer satisfaction: The focus of the company is on managing the
relations with the customer with the help of separate customer relationship management
department. This enables them to satisfy the customers and establish brand equity for the
potential customers.
 Better performance in new market: The Company has expertise in strategies to enter
into new market efficiently which enables them to easily expand their business (Hamilton
and Webster, 2018).
 Strong free cash flow: The availability of cash with the company enables them to
finance their new projects easily and to plan their expansion with adequate resources.

Weaknesses:
 High turnover rate: The turnover rate in HSBC is high in comparison to others in the
same industry due to which they have to spend more on training and development of the
employees that ultimately increases their cost.
 Poor marketing activities: Products of the company generate significant sales but their
unique selling proposition is not clear among the customers due to which competitors can
tap the market by attracting their customers.
Opportunities:
 Better Technology: The HSBC holding has opportunity to adopt new technology as with
this they can provide differentiated services to the customers and can attract new
customers which value oriented proposition (Lasserre, 2017).
 Reduction in transportation cost: It is an opportunity to enhance their market share to
the company by shifting the benefits of reduced cost to the customers as this will reduce
prices for them. With this they can attract a large number of customers to the company.
Threats:
 Intense competition: Due to stability in the profitability within the industry new
organisation has emerged and this put downward pressure on the profitability of HSBC
holding by affecting their sales.
 Changing buying behaviour of customer: With the emergence of various online
channels the requirement of physical infrastructure reduces and this has become a threat
for the existing physical infrastructure of the company (Gooris, 2016).
Examine the ways in which these key drivers can impact upon firms functional areas
Various key drivers are identified in the previous work that has direct impact on the
operations of HSBC holding. It is crucial for the organisation to examine the ways in which these
drivers can affect the marketing and finance functions of the company. The analysis of impact on
these two functions is given below:
Marketing function: With the changing needs and behaviour of the existing customers as
well as potential customers the marketing function of the organisation get affected as they have
to adopt new promotional techniques, new policies for enhancing the level of satisfaction of the
customer as per their choices and actions, etc. To support this they have to implement various
new and innovative means as well as technology for increasing their customer base by creating

awareness of their products and services (Tallman, Luo and Buckley, 2018). But while marketing
it is important for the managers to analyse the cultural factors of the particular country as it
varies from nation to nation due to which one marketing strategy may not be suitable for every
country. With this they can also minimise their weakness of poor marketing activities.
Finance function: On the basis of the analysis of key drivers is it analysed that being investment
bank they are severely affected by various political and economic factors within the economy.
Due to Brexit, the operations of the company were affected is it leads to cancellation of the
political deals, agreement and alliances with other governments in different countries in which
they have their operations (Chasdi, 2017). In addition to this the taxation policies of the
government affects the financial requirement while the rates related to the banking system
proposed by the government also affect the planning of the finance department of HSBC holding
as they have to offer their services as per the prevailing market rates such as interest rate,
inflation rate, saving rate etc.
CONCLUSION
It is concluded from the above report that an organisation need to consider various external
and internal factors so that they can determine their impact on the operations of the organisation.
This facilitates them to formulate various strategies that enables them to minimise the impact of
these factors. With the identification of key drivers their impact on marketing and finance
functions are analysed whereas the SWOT analysis facilitates to understand the capabilities and
weaknesses of the organisation so that organisation can accordingly plan their strategies and
actions.

REFERENCES
Books and Journal
Chasdi, R.J., 2017. Corporate Security Crossroads: Responding to Terrorism, Cyberthreats, and
Other Hazards in the Global Business Environment. ABC-CLIO.
Gooris, J. and Peeters, C., 2016. Fragmenting global business processes: A protection for
proprietary information. Journal of International Business Studies. 47(5). pp.535-562.
Hamilton, L. and Webster, P., 2018. The international business environment. Oxford University
Press.
Kouatli, I., 2016. Global business vulnerabilities in cloud computing services. International
Journal of Trade and Global Markets. 9(1). pp.45-59.
Lasserre, P., 2017. Global strategic management. Macmillan International Higher Education.
Rendtorff, J.D., 2017. Cosmopolitan business ethics: Towards a global ethos of management.
Routledge.
Tallman, S., Luo, Y. and Buckley, P.J., 2018. Business models in global competition. Global
Strategy Journal. 8(4). pp.517-535.