Globalization in Business: Analysis of Strategic Challenges

This report provides a comprehensive analysis of globalization within a business context. It begins by defining globalization and exploring the factors that drive global commerce, including advancements in technology, transportation, and communication, while also examining the influence of cost, market dynamics, environmental considerations, and competitive pressures. The report then delves into the challenges and opportunities presented by globalization, such as economies of scale, technological improvements, and the ability to expand a company's customer base. The report uses PESTLE analysis to address the political factors impacting business operations and examines supply chain management, including its five key steps, and strategic challenges, such as global trade wars, climate risks, and raw material shortages. Overall, the report concludes that globalization is increasingly important for businesses, highlighting the need for companies to carefully consider various factors before engaging in international trade and effectively managing supply chains to maintain profitability. The report also includes references to books and journals on the subject.

Globalization
in business

 Table of Contents
 Introduction-
 Task 1-
 P1- Analyze of cost, market, environment and competition that drive
global commerce and trade-
 M1 Critical evaluation of key factors of business environment
related to challenges and opportunities-
 Task 2-
 P2- Complexity of challenges faced by organization when it
operates in global environment-
 M2-Evaluate strategic challenges in context of risk and
diversification strategies and the supply chain flow.
 Conclusion-
 References-


 Introduction-
 This presentation is based on global business
environment. When an organization is able to
develop the international influence and starts
its operations on international scale then it is
known as globalization. Now-a-days
globalization is in the trend. Every company
wants to capture global market. Detailed
discussion of globalization is discussed in this
presentation.

 Task 1-
 P1- Analyze of cost, market, environment and
competition that drive global commerce and trade-
 Globalization-
 Globalization is defined as a process by which goods,
ideas and services are spread worldwide. It is used in
economic context in order to describe the integrated
economy which is market by free trade, free flow of
capital and use of foreign labor. It maximizes the
return and benefits of the common goods.

 Factors that drive globalization-
 There are many factors that drive the globalization. In
this part major factors that helped in globalization are
discussed. Main factor that drive the globalization is
advancement in technology. Technological
improvement of the companies increased the
globalization. In recent years, technological
improvement in transportation and communication
helped companies in driving the globalization.
Container ships helped in shipping. Container ships
reduced the cost of transportation and increased the
pace of globalization.

 Factors related to cost, market, environment and
competition-
 Cost-
 Globalization and cost of products and services has
positive correlation with each other. With the help of
globalization products and services can be sold at the
lower prices. If a company wants to sell their product in
other countries then it has to pay the environmental
cost, tax competition and avoidance. Every country has
different tax rates. Developed countries have more tax
rate then poor economic condition countries.

 M1 Critical evaluation of key factors of business
environment related to challenges and opportunities-
 Business strategies include both challenges and benefits.
Benefits for the company of global activities are
economies of scale, technological improvement and
employees work in the chemical company. Company can
improve its sales with the help of globalization.
Globalization helps company in covering the large
number of employees which further helps in improving
the profit margin of the company. It is also using
innovation which helps it in improving its customer
base. Company also provides quick and reliable services
which helps company in capturing the market base.

 Task 2-
 P2- Complexity of challenges faced by organization when it
operates in global environment-
 Company needs to face some strategic challenges when it
wants to expand its geographical area. For example-
 International trade and its impacts-
 International trades help company to expand its business
and allows the products and services to come into the
market which are not available domestically. Result of
international trade is that it makes the market competitive. It
further results in providing more competitive pricing and
cheaper products can bring to the home. When two
countries can exchange their service and product then it is
known as international trade.

 PESTLE Analysis-
 Political Factor - It plays crucial role in determining the
factors that affect the SASOL limited. It operates in
more than dozen countries that’s why it is facing
political issues. Every country has their rules and
regulations and company needs to follow that. As the
changes in tax rate affect the company and it has to pay
the taxes accordingly. Geopolitical and escalation of
trade sessions by government is threat for the company.

 Supply chain management-
 It is defined as handling the flow of goods and service
within the organization. From raw materials to the final
product delivery to consumer. There are 5 steps of
supply chain management which includes-
 Planning
 Sources
 Making the product
 Delivering
 Return

 M2-Evaluate strategic challenges in context of risk and
diversification strategies and the supply chain flow.
 With the help of robust supply chain company can
maintain its growth but there are challenges too. It
includes the global trade wars, change in climate risk,
cargo theft, safety recalls, shortage of raw materials
and uncertainty of economy. All these are major
challenges face by the company. Company needs to
cope up with all these challenges in order to maintain
its profit.

 Conclusion-
 From the above presentation, it is concluded
globalization is increasing as the time changes.
Globalization is very important for company as it helps
in increasing the profit margin. PESTEL analysis of the
company is discussed in the presentation and it is
analyzed that company needs to take care about many
factors before going for an international trade.
Company should know about the threats and
opportunity about the target country. Supply chain
management also become complex when it come to an
international trade.

 References-
 Books and Journals-
 Gopinath, C., 2018. Globalization: A multi-dimensional
system. Edward Elgar Publishing.
 Salles-Djelic, M.L. and Quack, S., 2018. Globalization and
business regulation (No. ARTICLE).
 Tsiklashvili, N., Chanidze, K. and Surmanidze, Z., 2019.
The Process of Internal Migration of the Adjarian
Highlands To The Modern Stage. Globalization & Business.
 Kourula, A., Moon, J., Salles-Djelic, M.L. and Wickert, C.,
2019. New roles of government in the governance of
business conduct: Implications for management and
organizational research.