Globalization's Impact on Morrisons: A Comprehensive Analysis

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GLOBAL BUSINESS ENVIRONMENT

Contents
INTRODUCTION........................................................................................................................2
P3 EVALUATE THE INFLUENCES OF GLOBALISATION ON ORGANISATIONAL GOVERNANCE
AND LEADERSHIP, STRUCTURE, CULTURE AND FUNCTIONS....................................................3
P4 EVALUATE THE INFLUENCES OF ETHICAL AND SUSTAINABLE GLOBALISATION ON
ORGANISATIONAL FUNCTIONS................................................................................................ 6
P5 EVALUATE THE DIFFERENT WAYS DECISION MAKING CAN WORK EFFECTIVELY IN A
GLOBAL CONTEXT.....................................................................................................................7
P6 DETERMINE AND ARTICULATE THE VARIOUS ROUTES TO INTERNATIONALISATION AN
ORGANIZATION MAY ADOPT, INCLUDING KEY BARRIERS........................................................9
CONCLUSION.......................................................................................................................... 11
REFERENCES........................................................................................................................... 12
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INTRODUCTION
Globalization is a process where people, company and government of different countries
interact with each other and make efforts to form trade among them (Beck, 2018).
Globalization occurs when foreign companies sell their products in international markets
and try to make their presence globally. The report studies influence of globalization on the
culture, structure and organizational governance at Morrisons. Impact of ethical and
sustainable globalization on the operations of Morrisons is also evaluated in the report.
Various decision-making ways that should be adopted by Morrisons to enter the global
market are also discussed in the report. Lastly, different routes to internationalization are
determined by the company keeping in mind the barriers associated with them.
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P3 EVALUATE THE INFLUENCES OF GLOBALISATION ON
ORGANISATIONAL GOVERNANCE AND LEADERSHIP, STRUCTURE,
CULTURE AND FUNCTIONS
Globalization has greatly influenced the markets and has helped various companies to
expand its operations internationally. Governance and leadership reflects various values
existing in the society as well as different types of ownership structure, business situations
and competitive conditions prevailing in the market. Organizational governance, leadership
and structure can be influenced through globalization effectively. McKinsey 7s model could
be used to evaluate the influence of globalization on organizational governance, leadership
and structure. McKinsey model helps in determining and evaluating the internal factors of
the company so that it could come up in the global market effectively (Hanafizadeh and
Ravasan, 2011).
Figure 1 MICKENSEY 7S MODEL
Source- SMI, 2019
Strategy: The plans made by Morrisons focuses on achieving the objectives and goals
effectively. Various strategies and tactics are formulated by Morrisons keeping in mind
different market segments such as psychological, demographic and behavioural. Marketing,
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promotional and pricing strategies are used effectively by Morrisons so that they could
compete in the market and stand unique among its competitors (Deepak, 2018).
Structure: Decisions regarding globalizing the business largely depends on the structure
adopted by the company. Nature of the business, requirements and government rules are
kept in mind by Morrisons before forming the structure (SMI, 2013). At Morrisons, matrix
structure is followed wherein every department has managers who are responsible for the
work of the employees. This structure helps the company in maintaining the standardisation
globally and also helps in the free flow of information.
System: Here, system refers to the policies, working culture and various operations
undertaken by the company. The employees working at Morrisons make sure that their task
are completed on time and provide benefits to their customers. Various policies are also
formulated by the company which help them to grow and develop in different countries and
form a good reputation in the minds of customers (MSG, 2019).
Shared values: It includes the belief, perception and assumptions that are formed by the
consumer about the company. Shared values help in maintaining the reputation about the
company throughout the business processes (Deepak, 2018). The values stated by
Morrisons are clear which helps it in achieving the objectives effectively.
Style: Here the workings of the managers are identified. To develop and grow globally,
managers and leaders of Morrisons applies various styles in its operations that can best suit
the situation and also help in increasing the productivity of the employees (MSG, 2019).
These styles help the company in increasing its productivity and enter the international
market easily.
Staff: Morrisons have various schemes for their staff such as training schemes,
apprenticeship program, orientation programs through which they enhances and improves
the performance of the employees and also allows an organization to expand globally.
Morrisons make sure that the staff they appoint are well-educated and have knowledge
about cultures of different countries so that they can adjust well (SMI, 2013).
Skills: Organizational success mainly depends on the skills and techniques used by the
employees and therefore, proper training is provided by Morrisons to the employees
relating to their work which makes the employees satisfied with their job and improves their
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productivity. This in turn help the company to expand further effectively and efficiently
(Deepak, 2018).
Globalization also influences the culture and function of Morrisons apart from
organisational governance, leadership and structure. The culture which is followed by
Morrisons was power culture wherein the company handled various operations effectively
and efficiently (SMI, 2019). The rules, regulations and decisions of the company are taken
only by the managers and leaders while employees are bound to follow the decisions taken
by them. The managers at Morrisons could also form decisions quickly without taking much
time and hence it is one of the advantages the company have over its competitors.
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P4 EVALUATE THE INFLUENCES OF ETHICAL AND SUSTAINABLE
GLOBALISATION ON ORGANISATIONAL FUNCTIONS
Ethical globalization is the concept undertaken by various organizations for the rights of the
people and to make sure that the needs of the consumers are met effectively (PR, 2019).
Morrisons aim at contributing towards the welfare and development of the society which
also make the employees feel honoured and committed towards the work. Image of the
organization in society also attracts the employees as well as helps in generating loyal
customers and thus help them in gaining hold over the international market. Apart from
this, an ethical value system also allows the employees at Morrisons to make a better
decision for the growth and development of the company. Globalization can take place at
Morrisons either through business decisions, processes necessary for the production of
goods or through the expansion of the market (Goebel et al., 2012). Monitoring, managing
and reducing the risk of human rights in the supply chain are some of the ethical standards
the company deals in. The company is also engaged in various conducts such as ethical
trading initiative and food network for ethical trade which collaborates with various
supermarkets and helps in improving human rights. The marketing department of Morrisons
make sure that they market the products to the consumers ethically and at fair price.
Business ethics should be involved as the part of business strategic decision making since
this would help the Morrisons in gaining competitive advantage, good reputation and
recognition in the global world.
Increase in the international trade, investment, capital flow and technology is termed as
sustainable globalization (Blewitt, 2012). Sustainable globalization can also take place at
Morrisons keeping in mind the following features:
 Making use of the market
 Have a good hold over the decision-making processes
 Tackle the new technologies coming up in the market.
 Manage the business globally.
Providing better services to the customers will ensure long term business and would also
create loyal customers. The sustainability of globalization may vary and work differently for
various nations. There are countries where the local market may improve and lead to
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development and growth while some countries might face worsens circumstances due to
globalization. New technologies have helped Morrisons in maintaining electronic records of
the transaction and financial statements which would further help in legal requirements and
tax purposes (LM, 2019). The financial information can also be used for managing the
accounts and facilitate the senior managers to make plans and strategies globally. The
human resource department helps in the globalization by recruiting, selecting and providing
proper training to the employees and thus generates opportunities for employment for the
people (Maitreyee, 2019). The marketing department of Morrisons analyzes the market and
find out various needs and demands of the consumers so as to increase the sale of the
product and thus helps in the creation of an environment where the flow of capital and cash
can take place easily (LM, 2019).
P5 EVALUATE THE DIFFERENT WAYS DECISION MAKING CAN WORK
EFFECTIVELY IN A GLOBAL CONTEXT
The preferences and demand of the consumers are kept in mind by Morrisons while forming
decisions. The decision-making process is very important for the organization since it helps
in removing the structural and cultural differences between the host and home country.
Enough flexibility should be maintained by Morrisons in the local market to facilitate various
functions of the business effectively and efficiently (Noe et al., 2017).
The efforts of human resource management should be on recruiting, managing and
providing guidance to the employees of Morrisons (Marshal, 2019). Globally, the managerial
decision-making depends on three characteristics that support the process: interest in
adopting risk for the business, making a decision on the basis of concepts and tactics and
appropriateness of the decision. Managerial decision-making is important for the company
since it links to the choices that should be made strategically for the business to run
smoothly. The risk involved in the global market is high for the company as the activities are
uncertain in the global market. Following are the different ways through which decision-
making at Morrisons can work effectively:
 The managers of Morrisons should keep a regular check on the changes taking place
in the environment globally. They should also determine the variables and factors
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that can affect the performance of the company while evaluating the decisions
(Michael, 2019).
 Forming the decision appropriately allows Morrisons to expand its market globally
and help them gaining knowledge about new culture and techniques (Marshal,
2019). This is the opportunity for the company to grow and evaluate the market
carefully before making their presence.
 Morrisons, by forming decisions effectively can gain a competitive advantage over its
competitors and can make strong position in the international market (BJ, 2017).
 Morrisons can also make decisions regarding their operations and can come up in
such countries where labours are available at cheap cost.
 The company can also decide on opening its operations at those countries where
policies relating to government and labour are liberal (BJ, 2019).
 Morrisons can also decide on bringing changes in the structure of the organization
and therefore can manage the operations effectively across various countries
(Michael, 2017).
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P6 DETERMINE AND ARTICULATE THE VARIOUS ROUTES TO
INTERNATIONALISATION AN ORGANIZATION MAY ADOPT, INCLUDING
KEY BARRIERS
Various routes through which Morrisons can enter international markets are:
 Licensing: Turnkey projects, contract manufacturing and franchising is included
under licensing. Morrison can enter the international market either franchising the
brand in the international market with expertise and the same concept. Turnkey
projects are another way through which a company can gain market share in a new
market. Morrison can train and develop the employees where skilled labours are not
much available (MT, 2019).
 International agents and distributors: To market the products internationally,
agents are the main source for the company. Morrison can contact the agents who
can further market the products on behalf of it in a particular market. Such agents
take a commission on the goods sold and are not liable for the product of the
company (MT, 2019). Target and objectives should be clearly stated by the company
since agents cannot be committed towards the work always. Distributors can also be
contacted by Morrisons for the sale of the product in the international market.
Distributors are provided with incentives since they make sure the sale of the
product.
 Strategic alliances: It is another way Morrisons can enter the international market
with greater ease. Here the operations of Morrison remain independent and
separated from other company. Different relationship between the company and the
competitors could be maintained if Morrisons opt for strategic alliances (MT, 2019).
Morrisons can also get an idea about entering the international market through
Shared manufacturing or distribution alliances.
 Joint venture: Morrisons can join hands with a local company to enter and sell their
products in a new market. There are various advantages Morrisons would gain if it
enters the international market through a joint venture such as new technologies
and management skills could be gained from the ventured company. Various
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distribution channels could also be accessed by entering a new market as well as
research and development could also help the new company to expand further.
 International sales subsidiary or FDI: Oversea manufacturing plant can also be
owned by Morrison to make its position in the international market. The main
benefit of undertaking such practices is the business becomes localized and products
could be manufactured according to the demand of the local consumers. While the
disadvantage associated with FDI is the involvement of risk for the business.
There are few barriers associated with the entry of the company in the international market
such as:
 Financial barriers: Lack of financial and physical resources is the main barrier that
affects the performance of the company in the international market. Lack of
resources, cost of operations and limited use of the capital are some of the barriers
faced by the company for internationalizing its product (Al-Hyari et al., 2012).
 Managerial barrier: Problem coming up in the market due to lack of sufficient
knowledge base are related to the managerial barriers (IML, 2019). Managerial
attitude, lack of skills and experience, management of the activities, dedication and
difficulties faced between the partners are the barriers that are faced by the
company to enter the international market.
 Market-based barriers: Another major hindrance affecting Morrison's growth and
development is due to a lack of knowledge about the foreign market. Market-based
barriers include perception about the environment, various government rules and
regulations, insufficient knowledge about the market and culture as well as
stronghold of the domestic competitors.
 Firm-specific barrier: Many companies’ faces problem due to their limited size,
financial capital and limited availability of human resources (IML, 2019). Getting
loans for such companies is a challenge since the risk associated with the repayment
is high (IML, 2019).
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CONCLUSION
Form the above report, it can be concluded that globalization has a huge impact on the
working of the business. The structure, culture and organisational governance can be
influenced by globalization keeping in mind McKinsey 7’s model. Globalization influences
the operations of the company as well as the existing culture. Ethical factors should also be
kept in mind by the organization before entering the international market so that consistent
development and growth in the function could be maintained. Expansion of Morrisons and
gaining a competitive advantage over the competitors are some of the ways decision-
making can work effectively for the company. Lastly, various ways could be used by
Morrisons to enter the international markets such as licensing, joint venture or with the use
of agents and distributors. Few barriers associated with the entrance of the international
market are also discussed in the report.

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