Unit 18: Global Business Environment - Sasol Globalization Analysis

This presentation provides a comprehensive analysis of Sasol, a merged chemical and energy company, within the context of the global business environment. It begins by defining globalization and its impact on businesses, followed by an overview of Sasol's operations. The presentation then delves into a PESTLE analysis to evaluate the external factors affecting Sasol and its industry peers. Key drivers of globalization, such as digital revolution, social-cultural happenings, international integration, financial liberalism, economies of scale, and intense competition, are examined. The role of advanced technologies, including the internet, web applications, and workflow software, in facilitating globalization is also highlighted. The presentation further identifies and discusses the challenges Sasol faces due to globalization, such as immature supply chains, high operational costs, and market complexities. Finally, it proposes future-oriented approaches to address these challenges, including interactive supplier sessions, economic policy adjustments, and the adoption of a triple bottom line outcome model, supported by relevant academic sources.

PART 1
Slide 1

Slide 2

Slide 3
Globalization is described as the growth of interdependence of the economies, populations and
cultures of the world, brought by trade of goods and services, investment flow, technology,
people and the information across the borders. It completely refers to the integration of societies
and economies all around the world. In contrast to businesses it means all the global factors
affecting the functioning of a business by influencing the decision-making. This can also lead the
developed nations by giving them a competitive edge and giving a chance to attract more jobs as
they can become more cost effective. Sasol is a merged, chemical and energy company which is
based in South Africa. It was formed in the 1950s and today is dealing in developing and
commercializing technologies including production of various kind of liquid fuels, electricity,
chemicals, and synthetic fuels. This presentation will be composed of all the details of the
company Sasol by critically evaluating the challenges and complexities of the environment. It
will comprise the detailed analysis and evaluation of key driving factors of globalization.

Slide 4
PESTLE analysis refers to the factors in the outside environment of an organization that affects
the smooth functioning of the organization's business. It includes all the political, legal,
environmental, economical, social and technological factors that exists in the same country in
which a particular business operates. Here, with the help of PESTLE analysis, it will be
determined what all external factors are affecting the functioning of the company Sasol and the
other companies from the same industry of oil and gas.
Political factors- Political factors are associated with the political environment of that particular
country in which the business is planning to operate. Sasol, being engaged in oil and gas
business in more than 12 countries should take measurable steps in order to avoid the exposure to
any kind of risk. The company Sasol and other similar organizations should analyse some factors
before expanding and globalizing by focusing on the political importance and stability, military
invasion risk, corruption level, level of interference of by the government, trade and tariff
regulation etc of that place.
Economic factors- This factor is linked with savings rate, rate of foreign exchange, inflation rate
and many other economic factors. Sasol and other similar companies of gas and oil industry can
consider growth rate, consumer spending, labour rate, interests rate and the industry economic
and inflation rate to forecast the scope of their business before planning to globalize.
Social factors-This factor is engaged to the cultures and traditions that a place holds. For a
business to determine the society's cultures and beliefs become very important in order indulge in
globalization. Sasol and other companies should completely analyse the attitude that the
population holds in order to design their marketing strategies. Some factors they should
concentrate on are skills level and demographics of the people, leisure interests, education rate
and class hierarchy, structure and power.
Technological factors- This factor is associated with all the new technological updates that are
emerging in the world at a very fast rate. When a company thinking to globalize, it should not

only analyse the technology but also focus on the speed at which the technology is disrupting the
industry. Sasol and the similar organizations should see how the use of new technology is
impacting on the product offerings, structure of cost, value chain and technological diffusion
rate.
Legal factors- These factors comprise all the laws and regulations a business follows in the
place of operating. There are number of places where the legal framework is not strong and is not
able to protect the rights of the businesses. Sasol and other companies should completely analyse
the country's market before expanding its business there are some factors they should analyse, of
which, discrimination laws, employment laws, data protection, patents and copy writes, heath
and safety laws etc are some.
Environmental factors- These factors refer to the condition and laws of that particular country.
The company Sasol and other similar companies before indulging in globalization and expanding
its business should analyse properly the environment of the place by looking at some factors like,
weather, laws that regulate environment pollution, climate change, waste management, green
attitude, endangered species etc.

Slide 5
As the economies were indulging themselves into various new practices and were expanding
globally by utilizing the resources efficiently. There has been a removal of the barriers which
used to limit the growth of globalization. By removing the trade barriers the scope of
globalization has widened up. Here are certain factors that drive globalization
Digital revolution- With the help of internet, trade is being done across the globe. By simply
placing and shipping orders digitalization is completely leading a way to globalization. Sasol
with good advertisements can also establish its new tie-ups with other countries online and can
spread its awareness across the globe.
Social cultural happenings- Due to socializing various trends of one country are getting famous
on the social platforms and the demand for that trend or fashion is arising in another countries.
These social bonding and sharing are making a way for that company of the following county to
globalize and start doing the business in other countries or partnering with another companies.
Sasol can also partner with some other countries by simply sharing detailed services of the
company on social platforms.
International integration- This is linked with integration the countries are doing with one
another. The removal of trade barriers has completely influenced the growth of globalization.
The parties do not have any obstacle in their way any more, so they are free to collaborate or
expand the business across the globe. Sasol can also take this as an opportunity and can pater
with the companies cross border.
Financial liberalism- This means getting the currency directly converted to other currency,
making investing in other countries easy. With the help of financial liberalization globalization
ha expanded beautifully. Sasol can also get started in other country with easy conversion of the
currency.
Economies of scale-This is engaged with minimizing the cost in order to compete in the market.
This factor of saving the cost has lead its way to globalization as there are lot of resources in

which a company can save its costing by simply exporting them from another country. Sasol can
also optimize its cost by importing the resources in South Africa and take the benefit of higher
profits.
Intense competition- As the companies face an intense competition in their area of operation, so
they plan to globalize their business or start a new business in a new country where there are
high chances of growth. This way leading to globalization Sasol can also make its way in new
areas of the new countries.

Slide 6
Advanced technologies directly help to reduce the cost of the communication and transportation
across the globe and also facilitates sourcing of the raw materials. A company having Patent
technology can boost the globalization as they can beat the competition in the foreign market
very easily. Digitalization can influence the economics of globalization in many ways. It can
lower the cost of many cross border trades which involves communications, transportations and
other ways in which a business can connect with other businesses and suppliers. With the help of
digitalization the online placements of orders can be made anytime and has completely avoided
the time bound issue. This has facilitated the business to take place whenever and at whatever
time, making the scope of doing business even wider than before. Evolvement of time has made
technological tools easy to adopt, as earlier they were expensive and were accessible only by the
rich countries. Here are some technologies which affected globalization the most
The internet- Internet has paved a way for globalization and there's no doubt in that, from
simply making a global visibility to actually doing a business online, it has made many
transactions very easy. The company can be present in one country but can expand and do
business in another country with the help of internet. Sasol by making good online relations with
the other countries can make its business reach good heights via globalization.
World wide web's and windows graphical interface- By designing such apps that works
across the globe, can efficiently frame a business. With the help of designed apps a particular
business show all the features of their products. Sasol if wishes can also make an app for itself by
mentioning all the dealings.
Workflow software- With the help of this software a business can easily manage its documents.
As digitalization has taken place, globalization has also expanded and no-more traditional
methods are used to keep records. Sasol can also start to indulge in these practices as this way it
will be more beneficial for the company to maintain its documents of the globalized business.

Slide 7
In the context of the chemicals and energy conglomerate 'Sasol', it has been observed that its
globalization activities have been affecting the company in challenging ways such as –
One of the key challenges is the undeveloped and immature stages of the product supply chains
of Sasol in its international markets. For instance, its Mozambique supply region needs to
develop a substantial range of informed local suppliers who are in the know-how of the product
awareness.
The second issue is that of the global economic dimensions that include high-end operational
costs of manufacturing and sales. This arises due to increase of global market players,
complicated value-added chains, higher product variability, and faster changing business
environment capabilities.
The third challenge regarding global complexities affecting Sasol is the ever-changing market
interaction among producers, manufacturers, and suppliers that hampers the organization's
decisive actions.

Slide 8
The following future oriented approaches can prove helpful in solving the dilemma of global
growth opportunities.
The challenge of embryonic supply chains can be addressed by carrying out interactive sessions
with the team of suppliers in order to impart the informative knowledge of product costs,
visibility, and logistics operations.
Secondly, the induction of newly created economic policies can help in driving down the
overhead costs along with using inductive rules of thumb at the fiscal frontier of the
organization. An example of this could be Sasol's conversion of its complex portfolio into a more
linear and market focused traditional economic system that strengthens its international ties
with global players in the industry.
The world economy in the chemicals and energy trade sector needs to be driven by global
externalities such as new decision making processes for dealing with complex issues. This can
be done smart initiatives such as Sasol's triple bottom line outcome model of 'People, Planet,
and Profit'.

Slide 9
Kavtaradze, M., 2022. Digital Globalization-A New Era of Global Streams. West East Journal of
Social Sciences. 11(1). pp.1-7.
Luo, Y., 2021. New OLI advantages in digital globalization. International Business Review.
30(2). p.101797.
Naz, A. and Ahmad, E., 2018. Driving Factors of Globalization: An empirical analysis of the
developed and developing countries. Business and Economic Review. 10(1). pp.133-157.
Opuene, E.D. and Egbuchu, S.A., 2019. UNDERSTANDING THE CONCEPT OF
GLOBALIZATION. Academic Journal of Current Research. 6(5). pp.19-25.