BUS301: International Business Environment - Report on Aston Martin

This report provides a comprehensive analysis of the international business environment, focusing on Aston Martin as a case study. It begins with an introduction to the key factors influencing international business operations, including political, legal, cultural, and economic risks. The report then delves into the application of business techniques such as SWOT and PESTLE analyses to evaluate both the internal and external environments. It assesses the impact of globalization and international trade on national economies, outlining the benefits, opportunities, and challenges. The organizational structures of businesses operating in global markets are examined, with a focus on different types of divisions. The report also evaluates the various risks involved in international operations, including strategic, operational, political, technological, and financial risks. Furthermore, it analyzes the micro and macro environments of Aston Martin, assessing its strengths, weaknesses, opportunities, and threats, as well as political, economic, social, technological, legal, and environmental factors. The report concludes by discussing the potential conflicts between corporate strategy and ethical, social, and sustainable responsibilities, as well as comparing and contrasting management approaches to sustainability in business organizations. The report aims to provide insights into the complexities of conducting business in the international arena, offering valuable information for students studying international business.

International Business
Environment

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
Evaluate the business techniques used to analyse the international business environment.........3
Assess the impact of globalisation and international trade on national economies.....................4
Breifing of the organisational structures of businesses who operates in global and international
markets.........................................................................................................................................4
Evaluate the risks involved while operating in the international environment...........................9
TASK 2..........................................................................................................................................10
International environment impacts on the success of an individual business organization......14
TASK 3..........................................................................................................................................14
Potential conflicts between corporate strategy and ethical social and sustainable
responsibilities...........................................................................................................................14
Compare and contrast management approaches to sustainability in business organisations.. . .15
CONCLUSION..............................................................................................................................16
REFERENCES..............................................................................................................................17

INTRODUCTION
International business environment refers to the factors which includes political risks,
legal risks ,cultural risks, economical risks, exchange risks in which the business operates as well
as communicate globally(Hamilton and Webster, 2018). Aston Martin is the British automobile
company which produces luxury cars and deals internationally. It was established in the year
1913 in London. The founder of the company was Lionel Martin and Robert Bamford and its
headquarters are situated in Gaydon, Warwickshire, UK. The study will include evaluation of
different techniques to assess the global business environment and also the effect of globalization
and global trade on the national economies. It will also explain the organizational structure and
various risks involved for operating in the global business. Further it will also evaluate potential
conflicts among the corporate strategy as well as social, ethical and social responsibilities and
different management approaches for the sustainability of the organization.
TASK 1
Evaluate the business techniques used to analyse the international business environment
The companies performs the task of analysing the external as well as the internal
environment to identify the possibilities of enhancing the potential of the company. To stand in
the global market the companies have to analyse the international business environment, which
provide the insight of plan smart and execution promptly. For this, some techniques is used to
analyse the international business environment, such as:- SWOT Analysis and PESTLE
Analysis.
In SWOT analysis the companies will analyse the internal environment and find out the
strength of itself which differ the company from its competitors, analysis the weakness which is
harmful for the company and analysing so, provides the company to know about the reason of
the competitor's success, analysis of opportunities which allows the company to create
favourable situations and to ensure the plan failure of its competitors, further to analyse the
internal business environment the analysis of threats is done to identify the unfavourable
situations to the company which affects the company negatively.
In PESTLE analysis the companies will analyse the external environment which also
affects the operations and policies of the company. In this business technique political,
economical, social, technological, legal and environmental factors are analysed. In political
factor analysis the company finds if there is any restrictions imposed by the political parties of

that country in which it is working, in economical factor analysis they analyse the fluctuation in
different rates such as growth, unemployment, inflation, exchange and interest rates and other
economical factors. In social factors all the customs, values and beliefs ate taken into
consideration. Likewise the technological, legal and environmental factors are analysed to
identifies the opportunities and problems of external environment.
Assess the impact of globalisation and international trade on national economies.
Globalisation and international trade both have their importance in world economy.
Globalisation stands for the integration of national economies in the global market, the
interconnections among different economies increases and they come together in global market.
Globalisation affects the national economy of UK as because of it the FDI (Foreign Direct
Investment) increases consistently with the greater rate, it also stimulate the innovation in
technologies as to compete in global market one should develops the technologies in an
innovative manner, because of globalisation the large industries of UK enjoys economies of
scale as the costs and prices are reduced because of bulk production. Globalisation also results
the interdependence, national sovereignty, and unequal distribution of equity.
International trade also has its positive as well as negative impacts on national
economies. Creation of jobs is possible because of engagements of company in exporting the
manufactured products and services, new opportunities are open up for domestic industries
because of international trade, the productivity of the company get increased as they have to
meet the international standards to be in international market. Some negative impact are also
there as the national human resources tends to move towards those companies who are engaged
in international business, it results the outsourcing of the jobs, as because the employees of
domestic industries starts moving towards companies who is dealing internationally.
International trade affects the domestic industries adversely, as all the domestic industries can
not enter in international market, because of that they have to face tough competition, as they
can't control the costs and prices of products and services as they are manufacturing in bulk.
Breifing of the organisational structures of businesses who operates in global and international
markets.
Organisational structure is followed by all the international business organisations. The
reason of following certain organisational structure is to ensures the processing of all the
processes of the company is follows in an uniformed and organised manner. Following of an

organised structure or a hierarchy will remove the confusion among the employees and it will
also helpful in the timely completion of the given tasks. There are mainly 5 kinds of
organisational structures which is followed by the different international organisations according
to their requirements(Kolk, A., 2016). These structures are explained as under:-
A) Global Functional Structure/ Division: In this type of organisational structure different
functional units of the company Aston Martin performs the tasks as per their department and
control the same functions around the world for which they are responsible and accountable. For
example:- the department of marketing will manage, monitors and controls all the activities
around the world which is related to the marketing.
B) International Division Structures:-
This structure is formed to have an eye on all the international operations of the
business. This structure is followed by those kind of international organisations which are not
developed yet. If the company Aston Martin is still developing its operations internationally then
it supposed to follow this structure(Cumming and Zahra, 2016)

C) Global Product Division Structures:-
The organisation Aston Martin have product differentiation then will follow this
structure. In this kind of structure the different product manager will manage the supply and
demand of their respective products around the international market.
Illustration 1: International Division Structure
(Source: Organisational Structure- International Business Management, 2018)

D) Global Geographic/ Area Division Structures:-
When the international business organisation controls and manage the business
operations on the basis of geographical location. If the company Aston Martin will deals only
with selected products and their dealing is depends on the location, then it have to follow this
kind of structure(Morschett, Schramm-Klein and Zentes, 2015)
Illustration 2: Global Product Division Structure
(Source: Organisational Structure- International Business Management, 2018)

E) Global Mixed Matrix Division Structures:-
In this kind of organisational structure three kinds of are included simultaneously
i.e; functional, geographical and product division structures. Hence, it is called as mixed matrix
division structure.
Illustration 3: Global Geographic Division Structures
(Source: Organisational Structure- International Business Management, 2018)

Evaluate the risks involved while operating in the international environment.
The company which will not afraid of risks, can enjoy the maximum profits. While
operating in international market the several kinds of risks a company has to face. Some of the
risks are explained as under:- Strategic Risk:- Under this kind of risk the company has to face the risk of making
strategies as because the strategies made by the company Aston Martin will impact its
competitiveness in the international market(Alcácer and et.al., 2016) Operational Risk:- This is the risk which the company Aston Martin has to face while
doing its day-to-day operational activities, such as, maintenance of machineries,
inventory management, productivity of the employees, fluctuation in supply and demand
etc. Political Risk:- The political instability in the country will create problems in the working
or in operations of Aston Martin. As political instability will impose adverse affect on the
efficiency of the company Aston Martin(Falkner, 2017) Technological Risk:- Everyday there will be the new innovation get introduced in
technology, everyday the updates are available in technology, if the company will not be
Illustration 4: Global Mixed Matrix Division Structure
(Source: Organisational Structure- International Business Management, 2018)

aware of these changes and updates then its products get outdated, which creates risk in
the operations of the Aston Martin while operation in international market(Tian, 2016).
 Financial Risk:- In international market the exchange rate of the currency are fluctuating
frequently, which is another major risk for Aston Martin to operate its activities
consistently, as the company then have to face the problematic situation while receiving
and making payments.
TASK 2
Micro and macro environment analysis of Aston Martin
Below discussed will be the analysis of Micro environment that is SWOT(Strengths,
Weaknesses, Opportunities and Threats) of Aston Martin(Strength, Weakness, Opportunity, and
Threat (SWOT) Analysis,2019).
Strengths
Aston martin have the strong heritage and brand name which has resulted to strong
customer networks. The company has strong engineering as well as designing team for cars that
Illustration 5: International Division Structure
(Source: Organisational Structure- International Business Management, 2018)

ensures powerful range and styles at the same time it provides best services and lavishing cars
with great comfort. Aston Martin uses innovative technologies and it promotes and markets its
brand through advertising.
Weaknesses
Weaknesses of Aston Martin is that it has less market penetration as compared to others
and its product portfolio is limited in the rapidly growing economies. The company is lacking
with skilled labors.
Opportunities
The opportunities for Aston Martin to expand its market in new geographical areas . Its
Strong legacy has an advantage to acquire more customers. Through increasing promotion as
well as distribution can result to more market penetration. The company can attract the
customers by setting the competitive pricing.
Threats
The threats for Aston Martin company can be increased cost regarding fuels as well as
strict government rules. The another threat can be other competitors dealing in automobiles like
jaguar, Rolls-Royce etc.
Macro environment analysis of Aston Martin that is PESTLE which includes (Political,
Economical, Social, Technological, Legal and Environmental) factors:-
Political factors
The political factors that can impact Aston Martin are the rise in export prices that can
impact the company to expand globally at the same time high emission for Co2 will result to
increased tax charges(Boddewyn, 2016 )
Economic factors
Due to increase in GDP and increased economic growth in UK have increased buying
capacity of the customers which have resulted to increased sales,profit and wealth of Aston
Martin. It also increased the opportunity for job sectors.
Social factors
Through recent research held in UK found that the majority of the population is above 45.
As Aston Martin produces luxury cars globally as the company should produce cars as per the
demographic factors like for nuclear family it can result to more customers and increase sales
from corporate as well as retail bodies(Hamilton and Webster, 2018)

Technological factors
By using innovative technologies as well as concentrating on R&D, Aston Martin have
introduced the team which is NAIGT (New Automotive Innovation Growth Team) which has
created the cars which is hydrogen propelled and Co2 emission free cars have positively
impacted on business environment.
Legal factors
These factors refer to the Laws as well legal policies that are obligatory and set by the
governments. There are legal policies that were imposed by the government of UK was the
monitoring systems for controlling Tyre pressures as well as fitment of stability control systems
compulsory for every car manufactured.
Environmental factors
Environmental factors that can influence Aston Martin is regarding Co2 emission,
gasoline as well as petrol usage. The government of UK has come up with the financial measures
in order to lower the emissions of Co2 otherwise it can negatively impact with Increased Tax
charges(Cumming and Zahra, 2016)
Assess the benefits, opportunities and challenges of globalization and international trade
Globalization has become very important in today's world that has increased the
integration among various economies globally by promoting goods , services, technology ,
information. It has enabled various companies like automobile industries to increase intensity in
respect to research and development and innovation as well. The globalization and international
trade has resulted to increase employment, GDP, competitive as well as economic growth for
various countries. Globalization has benefited Aston martin in the following ways:-
Improved living standards:- Globalization of Aston Martin have rapidly increased in standards
of living of not only UK but also at the global level. By using innovate and unique technological
features it provided ultimate luxury, infrastructure and comfort to the people that has increased
its brand value as well as the lifestyles of the people(Kolk, A., 2016).
Increased creativity:- Global competition have encouraged Aston Martin creativity as well as
innovation like highly skilled and creative engineers designed powerful, stylish, innovative high
range of cars and at the same time free labor and capital movement have resulted to increased
brand value as well as competitive advantage globally.
Opportunities of globalization

There are various opportunities for Aston martin in order to raise economy that can be by
providing autonomous cars as well as innovative and Eco-friendly vehicles . Other possibilities
are to expand the vehicles in geographic markets that can result to success , increases revenue as
well as business growth . The strong opportunity is their in those market where economic growth
is strong where income consistently rises which can result fast growth of business. The company
have the possibilities to produce the goods in those markets where cheap labor costs are their to
increase scale of the economy(Morschett, Schramm-Klein and Zentes, 2015)
Challenges of globalization
There are various challenges that can be faced by Aston martin can be other competitors
like Rolls-Royce, Jaguar Land rover and the restrictions on the work permits can be a challenge
for the company in order to hire skilled workers outside the European union and the company
will be unable to bring the investors or workers to UK that can decrease the investment and limit
the job creation. Improper planning can be a threat to future as well as for existing jobs(Hirst,
Thompson and Bromley,2015).
Benefits of international trade
The benefit that company can get from the international trade is that it will increase the
availability of goods from different countries that will give wide variety of choices that will help
to improve the quality as well as increase the economic growth. Efficient allocation and
utilization in respect to resources results to greater competitive advantage at the same time it also
promotes efficiency for manufacturing that helps to adopt the best methods to decrease the costs
in order to become competitive and increases market share. Through international trade creates
more employment by the emergence of new firms that leads to increase in demand and lowers
unemployment rates.
Opportunities of international trade
The opportunities for international trade can to diversify the automobile market in new
geographical areas and to innovative vehicles which are Eco-friendly. The new customers can
easily be acquired with the help strong brand value and legacy. Another possibilities are to
increase the market penetration with the strong distribution and promotion and can also attract
the customers internationally by setting competitive pricing,.
Challenges of international trade

The challenges of international trade can be the language barriers because different
countries have different languages and in order to sell and buy the goods globally it is must to
know the languages. Another challenge can be the transportation problem due to war or natural
disasters. The restrictions on import and export can be another challenge like high charge on
custom duties and high tariff rates on exports. Fluctuating exchange rates can create risks and at
the same time procedural difficulties for documentation in respect to export trade can be another
problem(Jones and Kierzkowski, 2018.)
International environment impacts on the success of an individual business organization.
The international environment can affect Aston market individually in so many ways. So
it is very important for the company to understand. Today the business is getting affected from
the global forces like regarding accessibility of raw material, reliability of supply chain as well as
labor supply, government rules and regulations and demand regarding the consumers can be the
global factors that can affect the business individually the awareness regarding these factors can
help the business in rapidly changing global business:-
 Government rules and regulations on national, local as well as on international level can
affect the business like imposed restrictions on some products to sell to other country can
be a difficulty for the organizations (Tian, 2016)
 Another global factors are the rapid change in technologies because today all business
depends on the computers, mobile phones, laptops and phones for majority of its
operations because it enables to spread the communications globally and increases
productivity. Avoidance of adopting latest technology can affect the business.
 Disasters can be another global environment factor that can impact the business like
occurrence of uncertain events like floods, earthquakes that can result to distribution of
raw material, supply chain of the products in order to reach the customers.
 Another factor that can affect the business is regarding the trade barriers and movement
of goods. Because increased barriers can negatively impact the business(Falkner, 2017).
TASK 3
Potential conflicts between corporate strategy and ethical social and sustainable responsibilities
As the business grows as well as generates profits but at the same time the business need
to contribute for the community and society as well(Boddewyn, 2016). The company need to
consider the corporate social responsibility and need to reduce the negative publicity in order to

improve the brand. The balance between corporate strategy and social, ethical and sustainable
responsibility will help the company to stand in the society. Otherwise, potential conflicts may
occur.
Each company prepares corporate strategies so that enterprises can generate more profit.
But it is also necessary to fulfill their corporate responsibilities significantly. There are many
situations when entity fails to generate profit if it follows CSR activities. For example, investors
want high return over their investment hence company makes strategy to raise its quality and
offer little costly products. But by this way entity fails to serve society members well which
create conflicts between both these elements. If enterprise invest such huge amount in
environmental protection activities then it would create problem in providing dividend to its
stakeholders hence all its stakeholders will become negative towards the brand which will create
conflict situation in the firm.
Compare and contrast management approaches to sustainability in business organisations.
Sustainability is very important for every business organizations and sustainability
management is increasing and has become widespread. Most companies fails to manage the
sustainability. there are some practices in order to improve the sustainability of the business
organizations are;-
Align strategy with sustainability: Management should ensure the strategy of the entity and
sustainability are matched. Divergence can breaks the sustainability because of lack of
commitment and priority. Like the company has set the ambition of reducing the footprint by
reducing waste in order to manage the sustainability. So its very important align the
sustainability with the strategy(Hamilton and Webster, 2018)
Compliance and then competitive benefit:- the very important thing the company is required
to address the compliance that relates with the regulations regarding human rights as well as
labor responsibilities. Compliance is the issue that fear investors. Improper handling with
compliance can result to poor sustainability.
Transparency:- it is the another management approach to improve the sustainability.
Transparency helps to build the clear idea that is open environment with the company and with
society can result to improved performance. The way the company can achieve transparency is to
make open communications that will help to manager sustainability for the long time(Cumming
and Zahra, 2016).s

CONCLUSION
From the above study its is concluded with the various techniques which included the
SWOT(Strengths, weaknesses, opportunities and threats) and PESTLE(Political, Economic,
Social, Technological, legal and environmental) factors in order to analyze the global business
environment and how globalization impacted on the national economies. It also evaluated the
risks that are involved in operating in global environment and the benefits opportunities and
challenges of globalization and global trade. Further it also evaluated the potential conflicts that
occurs between the corporate strategy and social, ethical as well as sustainable responsibilities
and best management approaches like transparency, aligning strategy with sustainability in order
to maintain the sustainability in the international business.

REFERENCES
Books and journals
Alcácer, J., Cantwell, J. and Piscitello, L., 2016. Internationalization in the information age: A
new era for places, firms, and international business networks?
Boddewyn, J.J., 2016. International business–government relations research 1945–2015:
Concepts, typologies, theories and methodologies. Journal of World
Business,.51(1).pp.10-22.
Cumming, D.J. and Zahra, S.A., 2016. International business and entrepreneurship implications
of Brexit. British Journal of Management.27(4). pp.687-692.
Falkner, R., 2017. Business power and conflict in international environmental politics. Springer.
Hamilton, L. and Webster, P., 2018. The international business environment. Oxford University
Press.
Hirst, P., Thompson, G. and Bromley, S., 2015. Globalization in question. John Wiley & Sons.
Jones, R.W. and Kierzkowski, H., 2018. The role of services in production and international
trade: A theoretical framework. World Scientific Book Chapters, pp.233-253.
Kolk, A., 2016. The social responsibility of international business: From ethics and the
environment to CSR and sustainable development. Journal of World
Business,.51(1).pp.23-34.
Morschett, D., Schramm-Klein, H. and Zentes, J., 2015. Strategic international management (pp.
978-3658078836). Springer.
Tian, X., 2016. Managing international business in China. Cambridge University Press.
Online
Organisational Structure- International Business Management. 2018. [Online]. Available
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management-tutorial-2652/organizational-structures-26914.html>
Strength, Weakness, Opportunity, and Threat (SWOT) Analysis.2019.[online]. Available.s
through<https://www.investopedia.com/terms/s/swot.asp>