Unit 18: Global Business Environment Report for Business Development

This report analyzes the global business environment, using SASOL as a case study. It begins with an introduction to globalization and an overview of SASOL, an integrated energy and chemical company. The report then applies McKinsey's 7S model to analyze SASOL's structure, strategy, skills, systems, staff, style, and shared values. It evaluates the impact of global operations on the organization and how it has adapted to the global market, including political changes, technological advancements, international business climate, and expenses. Hofstede's dimensions of culture are applied to show how the organization has been determinative, considering power distance, individualism, masculinity, uncertainty avoidance, long-term orientation, and indulgence. The report also evaluates ethical and sustainable factors, and concludes with a critical evaluation of strategic decision-making in relation to risk and diversification, and an appraisal of strategic global expansion routes available to the organization. The report concludes with a summary of findings.

Unit 18 – Global
Business Environment

Table of Contents
INTRODUCTION...........................................................................................................................1
PART 1............................................................................................................................................1
PART 2............................................................................................................................................1
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
An explanation of structure, culture and governance within an organization such as...........1
SASOL applying McKinsey’s 7S model to the organization.................................................1
An evaluation of how the above has been influenced by global operations and how the......3
organisation has adapted to operating in a global market......................................................3
Applying Hofstede’s Dimensions of Culture to show how the organisation has been
determinative..........................................................................................................................4
An evaluation of ethical and sustainable factors that the organisation has to consider in.....5
a global market.......................................................................................................................5
Critical evaluation of strategic decision making in relation to risk and diversification in a
global context.........................................................................................................................6
An appraisal and critical judgment of the scope of strategical global expansion routes........6
available to the organisation...................................................................................................6
CONCLUSION................................................................................................................................7
References:.......................................................................................................................................8
Overcome the Challenges of Globalization 2022. [Online] Available through:
<https://www.linkedin.com/pulse/20140727113820-62636860-overcome-the-challenges-of-
globalization#:~:text=To%20overcome%20the%20following%20common,profitable
%20ventures%20within%20the%20global>./.................................................................................9

INTRODUCTION
Globalisation is the process of increasing enterprise in global country that have an
opportunity to connect with respective businesses operations, along with that development by
paying immense importance on the business deals. Essentially, it act as a marketing research
for development of industry process and other operations of company. This assist in raising the
independence of global economy, culture, trade,details, technology and many others. The report
is based on Sasol Limited, it is an integrate energy chemical company based in sandton, south
Africa. It was founded in 1950 in sasolburg. The report will explain the concept of globalisation,
after that it will describe the external analysis. Further that it will elaborate key factors of
globalisation. It will include the importance an effect of digital technology on the globalisation.
In last it will recommend that how to cope up from the challenges.
PART 1
Covered in PPT
PART 2
INTRODUCTION
Globalisation points to a process of improving expertise relationship with people, companies
and government at multinational platform. The current section of the project explain regarding
the influence of internationalisation on governance, culture, leadership and management of
Sasol. This also includes an application of McKinsey as well as handy model of culture with
respect to an organisation which can assist them in having effective decision. In last, it will
explain various ways to moving in marketplace which a company can implement at the time of
going along with some barriers that brings obstacles in systematic operations of company.
MAIN BODY
An explanation of structure, culture and governance within an organization such as
SASOL applying McKinsey’s 7S model to the organization.
The influence of globalisation on the various components of internationalisation in order
to SASOL is justified with an implications of McKinsey model -
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This model explains to a tool that assists in outlining the business. The major aim of using this
model by SASOL is to have huge effectiveness in an attainment of business aims. The
applications of Mckinsey Model in relation of Sasol. Further detail is discussed in below section.
 Structure – This signifies a mode in which an industry is hugely structured. In regards of
Sasol, it is very important for the company to make and manage a structure so that
workers and manager can communicate well with each other along with that it
understands their duties and obligations with more clarity. The company is essential to
have an effective business structure that is divisional structure in which they can separate
the regions of company that serves more understanding of operations at worldwide.
 Strategy - this factor in theory presents the strategy of an industry which is created and
documented with an intent to have systematic functioning in company. In relation of
sasol, the management is responsible to achieve the objectives of sustainable rivalry
benefits that will raise the brand value as well as serve high rate of profits of the
company. This can be done with making an happy working surroundings within the
company which will develop the motivation level of employees in order to successful
execution of the strategy. The strategy which is followed by the company is cost efficient
value chains in order to project with good rate of profits in company.
 Skill – This factor signifies the different competencies and ability within the workers
that able them to move forward to attain the business aims. With a references to Sasol,
the manager designs different rules, policies and regulations for staff members security
and welfare that make them feel satisfy within the company. It will motivate employees
to work best at their level. This encourages in achieving business aims and high
objectives.
 System - This element justifies that infrastructure and technicality of a company which
aids in managing the flow of business. In relation of SASOL, the company is focusing
high attention on the maximum use of current technologies in regards to have systematic
functioning of activity at worldwide level and respects the accurate decisions in the
completion of long term sustainability.
 Staff - this factor includes selecting, hiring, training and development, compensating
within the business who are capable and talented. In relation of Sasol the human resource
manager is highly concentrated on their workers and serve them with accurate training
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and development plans. As well as they provide them flexibility in working so that an
employees can have long term sustainability in company. This will able to make long
term sustainability by providing potential goods and services in the market.
 Style – In this factor senior subordinates of the company practices business codes of
conduct in regards to create effective decisions with correct evaluation of all aspects. In
relation of sasol, the top level manager is highly focused on the regulation of business
activity with democratic form of leadership style. As well as they regards to give a
chance to every individuals so that the can present their views and thoughts related to the
company, linking to the globalisation.
 Shared values – Vision, mission, values and goals of company are known as main
foundation of company along with possessing an effective responsibility in business
activity alignment. In relation of Sasol, a manager is required to improve some vision
and mission that guides or navigate company workers in operating their tasks effectively
along with that this helps in accurate functioning of operations in company at global
reach.
An evaluation of how the above has been influenced by global operations and how the
organisation has adapted to operating in a global market.
Coming of new companies into the market make the global market inevitable. This is not
due to the regional market restrictions as of moving in new marketplace. The share of domestic
market in the worldwide market is in threat. Through not only business get the success they also
gets the development in business activity . Some points in consideration of Company is listed in
below-
 Political change – The culture of globalisation in the global market will unite and
socialise the various community to introduce the trade agreement. This produce the
different market possibility for sasol.
 Improvement of technology - it is completely link to the development of techniques
within the company. This not only assist in raising of innovation in the company
operations. It not only aid in detailing the flow of thoughts in industry on the other it also
helps in communicating the details across the company.
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 International business climate - This components is completely link to the expansion of
communication channel that contribute in the globalisation process. It also assists
various tools which serves the sasol in the globalisation procedure.
 Expenses – This components is not only link to the business of liberalization but also
with the flow of investment in the particular areas just as growing values of goods,
global buyers habits and requirements for economics for sale.
Applying Hofstede’s Dimensions of Culture to show how the organisation has been
determinative.
When an industry move into a global market there are various promotional components
which attracts the decisions of buyers. With the aid of Hofstedes dimensions culture methods the
impact of the factor is listed in below -
 power distance – The culture which have high power distance have the strong hierarchy
as well as the powerful and strong mentors. The company Sasol, has the loose culture
structure with in the company, as well as there is the less difference in terms of power
and authority among subordinates and superiors. Details sharing and consultants are
regular, whereas informal communication, that is more direct and participative is basic in
the company.
 Individualism and communities – individualism refers to a preferences towards a
society where in particular are more inclined to looking after themselves ad their
immediate families rather than the society at huge. Whereas, communism states a society
in which particular consider themselves gathered into units. The company Sasol, values
their freedom and self experiences also exhibit an increased drive for attainments, during
concentrating more on their personal goals in comparison of there company goals.
 Masculinity and trade role- This dimensions describes the acceptance of male and
female values in culture. A community that embraces masculine values concentrates
more on success, individuals accomplishments and income. Whereas a society where
feminine values are crucial, places emphasis on the factors of care and a better quality of
life. The company Sasol, focus on improving their social benchmarks and celebrate
monetary rewards rather than non monetary ones. Basically, these individual are
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aggressive and ambitious. These are appreciated by the company and are included as
essential.
 Uncertainty avoidance – It can be explained as the extent to which people become
uneasy and practices to neglect condition that are unclear, unassuaged and out of the
ordinary, by strict codes and rules. Cultures with strong avoidance are unwilling to accept
new intercultural connections. The culture of Sasol, presents clarity towards new
thoughts and ideas. There is a high tolerance of deviant thoughts that go against the rules
of the company.
 Long term orientation – This culture not only assists in concentrating the traditions
abut also helps in analysing the connection of compound. The company sasol, have the
long term orientation approach which more focus on their future goals and do not expect
to see immediate outcomes and quick wins. Market can be differentiated in terms of their
roles if they have high trait culture. It is evaluated that long term orientations are more
likely to have innovation adoption and improve long term human resource for global
joint ventures.
 Indulgence and quick gratification – These dimensions are on the basis of current
world values survey sources. An indulgent society that permits its members to enjoy life
by free gratification of natural human desire. The culture at Sasol, is also an indulgent,
employees receive advantages just as flexible working hours as well as the option of
remote working as long as it does not impact the quality of operations.
An evaluation of ethical and sustainable factors that the organisation has to consider in
a global market.
The ethical components within globalisation states process in which details, data,
products and services, technology and some things are traded with quality as well as in ethical
form. The term ethics explains to an analysis of what is correct and what is unfair in company.
This depicts a broad area which considers various investors like community, government, staff
members, providers and purchasers. The major aim of a ethical components is to grow business
and employees so that they can function in proper way towards the completion of aims and
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objectives. Operations by considering different valuable factors assist business in having
systematic functioning of company to attain of long term sustainability especially in global level.
The sustainable component of globalisation states determinants that drives business to
have international level presence and achieve high competitive benefits in the international
market. On the other side it also gives a growth and potential to face complex global market
rivalry. This motivates users as well as attracts more workers to work with company for long
term. Whenever the skilled and expertise employees are dedicated towards the brand that tends
to attract more and more customers easily and make them a loyal customer of company.
Critical evaluation of strategic decision making in relation to risk and diversification in a global
context.
According to the above study it is examined that it is highly important to create strategic
decisions as this helps in diversifying their span of control as well as business particularly when
going internationally. Through this business are able to add competitive benefits and huge
market share at global level. Having impressive and sound business decisions can leads to have
a great amount of profit in company. In relation of SASOL ltd, it helps them in mitigating
various external as well as informal components which can have the smooth functioning in
company and its accountability. After researching the market conditions helps in making an
effective decisions that aids in attaining company goals as well as this also assist in expanding
business systematically and according the market condition of location where business is going
to be introduce.
An appraisal and critical judgment of the scope of strategical global expansion routes
available to the organisation.
It is analysed that there is a presence of various range of global expansion ways via
which SASOl, can be able to create its global presence and benefits of having higg
competitiveness. Their are many ways that are accessible in company to enter in other country in
order to expand business that are listed in below report.
 Licensing – it justifies to a route which a company gives agreements and licence to
another company through which a company acts entrepreneurial operations in the name
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of company who has given a licence. It is shown as an highly effective policy that us
conscious to help sasol for expanding its business at global level. In context of sasol,
the company use to charge some amount that is in a form of luxury for using their name
and services in various nations market. This improves chance of jobs in host location
where a license operates the business. It is advantageous to company as it has low cost
of registration and launching business.
 Exporting – it is a process in which business export its manufacturing and services to
certain other party in overseas market. Exporting is being classified as one of the best
global way, with this business can have direct sales without introducing their company.
This also help in achieving huge benefits of competition in worldwide market. In
connection of Sasol, the company can export their goods and items so that it creates the
business growth and expansion in other country. That outcomes in earning of profits and
raising brand value in international market.
 Strategic alliance – It is the term to contract two parties in order to share resources
independent. It has legal partnership among the companies. Moreover, it is less attractive
and less included then a joint venture.
From the above report it is suggested that Sasol, must adapt a licensing for expanding a
business in international market. As it is better and ethical way to move in international market
as it requires a proper paper work before moving in market . As well as it is register by the name
of the owner itself. It also provides an intellectual property to the licensee. Along with that it
required a low capital to invest in supply. They have a ability to produce passive revenues via
royalties.
CONCLUSION
It is concluded from above report that a company focus on the business improvement vis
various organizational culture, governance as well as leadership. This assists business in
achieving of business aims as well as competitive advantages at worldwide level. The report
further acknowledges different terms that assists company in making effective business
decisions by considering components at global reach. This gives helps in accumulating
knowledge link to the application of Mckinsey model in order to analyse governance, structure
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and culture that Is shown with in the business because of which company is capable to manage
efficiency and effectiveness during making decisions. The above explained report also gives a
detailed analysis of sustainability as well as ethics that is required to be shown at worldwide
activity. Here are various modes which a company can move into other international marketplace
just as licensing, exporting and various others. Opting best way to enter in international market
is essential for company as this can impact the global presence and the company sustainability
in such market.
References:
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on teachers’ intentions to use educational technologies in Chinese universities.
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Online :
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Overcome the Challenges of Globalization 2022. [Online] Available through:
<https://www.linkedin.com/pulse/20140727113820-62636860-overcome-the-challenges-
of-globalization#:~:text=To%20overcome%20the%20following
%20common,profitable%20ventures%20within%20the%20global>./
UNDERSTANDING OUR BUSINESS 2018.[Online] Available through:
<integratedreport.sasol.com/understanding-our-business.php>./
Hofstede culture model of Sasol Ltd 2021.[Online] Available through: <
https://www.essaypandas.com/essay/Sasol-Ltd-15427-Hofstede-Cultural-Model>./
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