Report: Global Operations and Strategic Analysis of Sasol Limited

This report provides a comprehensive analysis of Sasol Limited's global business environment. It begins with an introduction to the concept of the global business environment, emphasizing its impact on organizational decision-making. The report uses PPT screenshots and covers topics such as the McKinsey 7S model, the influence of global operations, and Sasol's adaptation to international markets. It applies Hofstede’s Dimensions of Culture theory, evaluates ethical and sustainable factors, examines strategic decision-making in relation to risk and diversification, and explores strategic global expansion routes. The report also includes a PESTLE analysis, key factors of globalization, the impact of digital technology, and challenges associated with globalization. The report provides insights into how Sasol navigates these factors to achieve its business objectives.

Global business
environment

Contents
INTRODUCTION...........................................................................................................................3
PART-1 (PPT Screenshots).............................................................................................................3
PART-2............................................................................................................................................9
SASOL applying McKinsey’s 7S model to the organization..........................................................9
An evaluation of how the above has been influenced by global operations and how the.........11
organisation has adapted to operating in a global market..........................................................11
Applying Hofstede’s Dimensions of Culture theory.................................................................12
An evaluation of ethical and sustainable factors that the organisation has to consider in.........13
a global market..........................................................................................................................13
Critical evaluation of strategic decision making in relation to risk and diversification in a
global context.............................................................................................................................14
Evaluation of the range of strategic global expansion routes....................................................15
CONCLUSION..............................................................................................................................16
REFERENCES..............................................................................................................................18

INTRODUCTION
Global business environment is referred as the environment of various countries with having
different exogenous factors in home environment of company that impacts on decision-making
process of organisation and their resources as well as capabilities. As the business environment is
divided in two part such as internal business and external business environment that includes
various factors which has power to impact on business functions and performance such as
political, technological, legal and cultural factors. In this report the chosen organisation is Sasol
limited which is an integrated energy and chemical organisation established in 1950. It is oil and
gas chemical company, headquarter situated in Sandton, South Africa. 30,100 employees are
working with organisation. In this report McKinsey’s 7s model, impacts of global operations,
Hofstede’s Dimensions of Culture, Hofstede’s Dimensions of Culture, strategic decision making
and strategic global expansion routes are mentioned.
PART-1 (PPT Screenshots)

Notes
As the business environment is divided in two part such as internal business and external
business environment that includes various factors which has power to impact on business
functions and performance such as political, technological, legal and cultural factors. In this
report the chosen organisation is SASOL LIMITED which is an integrated energy and chemical
organisation established in 1950. It is oil and gas chemical company, headquarter situated in
Sandton, South Africa. 30,100 employees are working with organisation. in this report Pestle
analysis of organisation, key factors of globalisation, impact of digital technology on
globalisation and challenges and complexity of globalisation is covered in this project report.
Apart from that MicKinsey’s 7s model, impacts of global operations, Hofstede’s Dimensions of
Culture, Hofstede’s Dimensions of Culture, strategic decision making and strategic global
expansion routes are mentioned.

Notes
It is the described as the interdependency of world’s cultural, economic and population as well as
cross border trade of organisational products and services, people, information and technologies.
Corporations in developed economies gain various competitive advantages by globalisation. In
this concept that referred to operate business activities and functions at international level that
includes world’s most economies working together in order to provide products and services to
customer worldwide. There are various elements of globalisation like import, export and
business locations (Anggadwita, 2017). It has various advantages and disadvantages of
globalisation on social, cultural and political growth and development of companies through
expending business in global business environment. Different type of globalisation is done in
current business environment such as financial, economic, technological, sociological, cultural,
ecological and geographical that facilitates business to perform business activities across the
border and attain higher market share.

Notes
Pestle analysis includes various factors that impacts organisational performance and
functionality. Any changes in macro environment factor directly affect the SASOL LIMITED
organisation. Respected organisation analyses all these factors properly and formulate strategies
in order to overcome the impacts of external environment. These factors are defined below:
Political factor: Political factors plays important role in analysing the factors that affect long-
term profitability of SASOL LIMITED organisation.
Economic factor: There are various economic factors such as customer saving, inflation rate,
economic cycle, interest and foreign exchange rate affect SASOL LIMITED organisation
performance and functionality.
Social factor: Social norms, values and trends influence organisational cultural and performance
effectively.
Technological factors: In current competitive business environment rapid technological
advancement, innovation, automation as well as technology diffusion take place across the globe
that enhance the significance in technological factors in decision-making process of Sasol
limited.
Environmental factors: There are various environmental factors that affect the business
performance and profitability.
Legal factors: SASOL LIMITED analyse all legal environment as well as regulatory structure
before entering into new market.

As the respective organisation operates business functions and activities. As the organisation
deals in oil and gas in various countries so, it must avail all political rules and regulations of each
country. Political stability, taxation politics, trade restrictions and legal framework are the
important factors that affect the business performance effectively (Arshad, Farooq and Afzal,
2018). SASOL LIMITED evaluate all these and develop proper strategies to overcome negative
impacts. All these factors defined overall economic environment so, these are considered in
decision-making process for gaining competitive advantages. Development of economy, GDP
rate and efficient labour market conditions and financial market efficiently influence the growth
and development SASOL LIMITED organisation.
Notes
As globalisation is defined as the reducing trade barriers across the national boundaries as well
as enhance integration, interconnectivity and interdependency of various production process,
flow of financial resources, capital and products or services outside the national borders.
There are various key factors that derive the globalisation and plays important role in growth and
development of SASOL LIMITED organisation. These factors are discussed below:

Online shopping is started by the organisation by which customers search for products, find out
prices and place the order than it shipped to customers at world-wide locations (Hemilä and
Salmelin, 2017). Technology ensures borderless transactions through e-commerce and electronic
banking. SASOL LIMITED use social media platforms to promote products and ensure global
reach that facilitates to globalisation.
It facilitates SASOL LIMITED to exchange foreign currency in home currency that make it easy
for customers as well to purchase products and services globally. The factor enhances financial
globalisation and there are various features like Pay Pal that brings innovation in online payment
system to transfer money globally
Respective organisation brings various innovations to sustain in competitive business
environment (Marano, Tashman and Kostova, 2017). Because of higher competition firs
searching news foreign market for enhancing foreign direct investment. It increases the value of
globalisation for attain higher profitability objective.
There are various modes such as joint venture, franchising and licencing to enter in global
markets or providing products to global clints. Through enhancing the trend of globalisation
international business and trade increase that plays important role in growth of SASOL
LIMITED organisational as well.
As globalisation is droves by various factors that are interconnected with each other and
facilitates the organisation to conduct business functions across national borders and enhanced
profitability and market share.
Digital revaluation: Internet facilitates the SASOL LIMITED to access products and services
anywhere in the world. Mobile phones are used by purchasing products through booking online.
Financial liberalisation: Interconnection among countries enhanced because of deregulation of
financial market.
Intense competition: As there are high competition is faced by the organisation in local market
area so, SASOL LIMITED looking new marketing areas across the nations border in order to
expand business functions.
Enhances international business and trade: In current business environment various number of
organisations are involved in importing as well as exporting of goods or services across national
boundaries.

Cost: It is an important factor that act as an essential driver of globalisation. It is essential for
SASOL to emphasise upon cost drivers in the process of planning before expansion in order to
ensure success of expansion process.
Market environment: This factor is one of the most important factors that significantly drives
globalisation. In this, it is essential for SASOL to emphasise upon external and internal elements
of market environment of host country in order to make expansion process efficient.
Competition factors: As per this driving factor of globalisation analysis of competition in
market plays essential role in order to execute business operations successfully. In context with
SASOL top executives is required to evaluate competitive rivalry in host country in order to
enhance effectiveness of products and services as to ensure more competitiveness in market.
Global commerce and trade : This factor mainly evaluates globalised nature of modern nature
of commerce. It includes elements related to information and currency, exchange of goods and
services. With the help of this, SASOL can evaluate extent of level of competition in order to
completive with local businesses through which they can ensure more growth and competition.

Notes
Innovations in technological factors reduce cost of transportation and communication across the
nation that facilitates the respective organisation for global sourcing of raw material as well as
other inputs. There are patent technology is being innovated that encourage the concepts of
globalisation as organisational owned the specific patent that can be exploited in foreign markets
without facing competition (Marques, 2017). Information technology encourage the emergence
of global village. There are world wide web that reduce the time as well as place barriers for
dealing business operations properly. Through using various websites buyers and sellers make
number of transactions from any part of globe at ant time. changes in technologies affect the
requirement of investment. Now these days technologies are transferable easily to developing
countries in which higher technologies are combined with lower wages.
On the other hand, there are various negative impacts of technology in the globalisation such as
because of automation number of employee loss their jobs and it reduces the requirements of
man power to perform organisational functions effectively (Paudel, 2019). SASOL LIMITED
organisation analyse all these impacts and develop effective strategies the enhance organisational
global reach and customer base as well.

Notes
On the other hand, there are various challenges and complexities that limits the value of
globalisation. These challenges impact on business performance and functionality. So, SASOL
LIMITED analyse all these challenges that formulated proper strategies and policies for
overcoming them effectively. Some challenges of globalisation are mentioned below:
For the SASOL LIMITED organisation, It become difficult to find and retain effective and
skilled employees and managers who enhance the organisational values and work efficiency in
global market place. Respective organisation analyses the capital needs before expending
business in global market.
It becomes difficult for SASOL LIMITED organisation to manage overseas payroll as well as
maintaining compliances in the situation of regular changing employment and taxation related
legislations (Rubel, Kee and Rimi, 2017). As respective organisation operated business activities
in multiple markets so, it creates more complexity for organisation to manage all business
functions efficiently.

As many organisational provides products and services at lower prices for attract customers and
enhance market share but the increase the level of competition in the market and organisations
searching cheaper labour resources to reduce cost of production.
Higher investment cost: Globalisation enhance the challenge to multinational organisation as it
requires higher investment to establish business in new country and need capital to build
effective infrastructure and to run business functions.
Payroll and other compliances challenges: It is the major challenge for the organisation to
perform all functions in global expansion.
Foreign worker exploitation: To sustain in competitive business environment, organisations
exploit their workers for the purpose of enhancing organisational efficiency.
Global expansion difficulties: There are various difficulties are faced by the organisations to
expand business in global market and countries.
Immigration and local job loss challenges: Political conditions of every country is different from
each other that creates for organisation to operate there efficiently.
International trade law:
International trade laws duly govern the manner in which states regulate and can restrict
trade in services and goods. It has been evaluated that international trade laws is an important
aspect that include local, federal and foreign rules, ordinances, executive orders and regulations.
There is direct and indirect impact of international trade laws upon business operations of a
company. It has been evaluated that international trade laws grants countries to expand their
business areas and access products and labor. Furthermore, it has been identified that
international trade laws lead market to be more aggressive. It lead towards offering high quality
products and services to customers in affordable price segment. It has been assessed that these
laws are having direct effect which social financial and political forces influencing the business
tasks. This has been assessed that, the custom and the obligations laws redesign the business
action from the overall levels allowing the associations to discover the supervises market and
facilitators being developed of the business generally. Essential freedoms and the overall
criminal law have been overall issues which has affected the worldwide business as various
violators being locked out from the ordinary trade affiliations. Comparable to this, it is
significant for SASOL to have comprehension of all the international trade laws and plan cycle