Analyzing SASOL's Global Operations: Strategies and Cultural Impact

This report provides a comprehensive analysis of SASOL's globalization strategies, focusing on the application of the McKinsey 7S model to explain its structure, culture, and governance. It evaluates how global operations have influenced SASOL's organizational structure and cultural dynamics, including the impact of Hofstede's dimensions of culture. The report also addresses the ethical and sustainable factors SASOL must consider in the global market, along with a critical evaluation of strategic decision-making related to risk and diversification. Furthermore, it explores the range of strategic global expansion routes available to the organization, providing insights into how SASOL can effectively navigate the complexities of the international business environment. Desklib offers this assignment solution and many other resources for students.

GLOBALIZATION

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
PART 1.............................................................................................................................................3
PART 2.............................................................................................................................................3
Explaining structure, culture and governance within SASOL by applying McKinsey 7's model.
......................................................................................................................................................3
Evaluating how structure, cultural and governance in the organization has been influenced by
the global operations and how the organization is adapting to operating in global market.........5
The ways in which SASOL has been influenced with application of Hofstede dimensions of
culture..........................................................................................................................................6
Ethical and sustainable factors that the organization has to consider in a global market............8
Critical evaluation of strategic decision-making in relation to risk and diversification in a
global context...............................................................................................................................9
Range of strategic global expansion routes available to the organization.................................10
CONCLUSION..............................................................................................................................11
REFERENCES................................................................................................................................1

INTRODUCTION
Globalization is the process of interaction between the people all over the world where
they can start and expand their business at global level. The purpose of conducting this report is
to demonstrate the understanding of the globalization and its different strategies which is
essentially required to be considered by the individual organization while expanding their
business in global market (Stonkutė, Vveinhardt and Sroka, 2018). The company SASOL limited
is a chemical company based in Sandton, South Africa where they want to expand their business
in global market. This report will illustrate the different models and frameworks in relation to
globalization and also provides the knowledge of the ethics and sustainable factor which an
individual company should consider. Also, the report will mention some relevant expansion
strategies which will help the organization to grow and develop at successful manner.
MAIN BODY
PART 1
PART 2
Explaining structure, culture and governance within SASOL by applying McKinsey 7's model.
The McKinsey 7S model is define as a tool that helps in analysing organizational design of the
company and make them to stay align while achieving the organization goals (Kumar, 2019).
The goal of this model is to achieve the effectiveness and the efficiency in the organization
through seven very important elements and that are as follows (Salvarli and Kayiskan, 2018)-
The Hard Elements The Soft Elements
Strategy Staff
Structure Style
System Staff
Shared value
The hard elements are as follows-
Strategy-

The strategy for the company SASOL limited in clearly identified and communicated to
the all the people working in the organization. This is basic thing that helps organization in
taking guiding goals that will in turn improve efficiency for the organization. SASOL limited
also considers the strategic competition using tools and tactics for ensuring that SASOL limited
keep updating with the new trends and the demands.
Structure-
SASOL limited has clear defined hierarchy to support employees and manage inter-
departmental coordination easily in the organization. The organization has built the structure that
is systematic so far, and which helps organization in monitoring different departments and
coordinating them. This organization also follows both centralization and decentralization
models in the process of decision making. The job roles at SASOL are designed such that the
employees carry their goals with responsibilities.
System-
SASOL limited has well demarcated and defined system such that it helps in ensuring
that all the operations of business are managed effectively and chances of disputes and conflicts
decreases in the organization. SASOL limited has large department such as human resource,
finance, marketing, etc. not only demarcating different system the SASOL Limited has also
designed such techniques that it helps in evaluating the performance of employees working in the
organization.
The soft elements are as follows-
Skills-
The company SASOL has been able to define clear job roles in order to hire, train and
develop an employees according to the job requirement. SASOL limited is paying attention for
ensuring that the employees working in the organization has all the skill to perform the job that
has been assigned to him (Cabral and Dhar, 2019). This is the reason that SASOL tries to provide
growth opportunities for the employees by different training and development process.
Staff-
For years SASOL has been working with sufficient number of employees across the
globe the manage its operations. For different job roles and the positions different employees are
hired that can be though internal as well as external recruitment process. The employees working

in SASOL limited comes from different countries according to the demand of organization. The
human resource in the SASOL aligns all the departments in order to fill the gape.
Style-
SASOL limited has great leadership style and this has been reason that the organization is
able to manage and engage their employees in decision-making process. The SASOL leadership
is important because SASOL works globally and only an effective leader that regularly interact
with the employees will be able to make employees to feel part of the organization so that they
actively participate in suggestions, feedbacks and in the inputs of the organization for making an
cooperative and cultural environment.
Shared values-
The core values at SASOL limited is defined in such way that it forms an supportive and
creative organizational structure. The supportive organization structure provides employees the
motivation to work for the job that brings commitment in employees. Core values of SASOL
limited includes creativity, honesty, trust, quality etc. This values encourages cultural diversity
and the cultural value to stand globally in the international market. This is also to ensure reliable
and the honest brand image of SASOL.
Evaluating how structure, cultural and governance in the organization has been influenced by the
global operations and how the organization is adapting to operating in global market.
The global market is the market Where the goods and services of countries are exchanged (De
Loecker and Eeckhout, 2018). Because of the global operations by SASOL in the global market
the organization has been influenced and has undergone significant change in its structure,
cultural and the governance policy.
• Organization structure is define as the action process where the organizational activities
are being performed. Organization structure is greatly influenced by the different
technologies operating world wide that helps an organization changing to the more
appropriate technology (Iyamu and Batyashe, 2020). As the market changed from
domestic to global SASOL products have also changed to reflect the needs of the
consumer. For capturing global market its unique proprietary technology has also worked
in the company's favours.

• Cultural structure of the organization is referred to the aspect of human relationships.
SASOL being global company has been able to exchange and enhance social diversity in
the organization by hiring different employees from different countries (DiMaggio,
2019). Cultural organization helps company in reaching different consumers and
influencing them to buy company's product. SASOL easily built the cultural space by
building “can-do” spirit in the organization and by continuously evolving and improving.
• Governance of any company refers to the rules, regulation and processes in which
business operated, regulates and is controlled. For operating in the global environment
SASOL is offering growth to all the stakeholders around the world in order to attract
more consumer for more profitability in the business. Its value- driven and code of ethics
culture has been improved in order to serve the needs of governance processes. SASOL
high business integrity is enhancing governance structure and its processes to reflect
international best practices.
The ways in which SASOL has been influenced with application of Hofstede dimensions of
culture
The Hofstede model of culture is a model that illustrates the management concept in
detailed manner by elaborating the basic six issues that should be measured while preparing an
organized business entity. Each dimension that has been involved within this model illustrate the
culture of the pre-existing organization along with the reason due to which external factors
affects the company behaviour (Heydari and et.al., 2021). The six major dimensions has been
highlighted in detail below which represent the overall idea regarding the SASOL company
regarding their company culture:
 Power distance index: this element highlight the level of inequality that occurs among the
employees of the company. As per this model, the PDI score indicates that the
establishment is having an unequal hierarchical distribution of power. However, if it is
low, the power is shared equally among the members. Hence, the low level of PDI has
been recommended because of equal distribution of power. In context of SASOL, the
company has loose hierarchical structure along with less dissimilarities in accordance of
power and authority among their subordinates and superiors. The structure of the
company is also democratic in nature, less fear among employees for their superiors and

most importantly top management personnel consider each other to be equal members of
the company. Thus, SASOL has low PDI.
 Individualism Vs. Collectivism: It is relatable to the relationship among top managers and
other members in the company. It is also considered as IDV and at high IDV there is
interpersonal relationship between people and each one like to work individually with
forming a group. On the other hand, low IDV put emphasis over building skills in which
people work for intrinsic rewards. In context of SASOL, its employees display
individualistic kind of characteristics as they are expected to take initiatives and self-
reliant. They share strong work ethics and highlight singular achievements with strong
goals. Here employees are more independent in nature.
 Masculinity Vs. Femininity: This element illustrates the acceptance of male and female
values in the culture. The society in which the male values are prioritised are more
competitive while feminine society look forward for modesty, quality of life, humble
attitude and more valuable in nature (Pelau and Pop, 2018). In accordance with SASOL,
company exhibits their masculinity values into their culture as employees are extremely
competitive and motivated to perform their part. Hence, the overall culture is competitive
in nature.
 Uncertainty avoidance: It has been highlighted as an extent in which people become
uneasy along with try to avoid situations that are unclear and unpredictable in nature. The
culture of SASOL displays openness towards new ideas and opinions. Employees do not
get easily stressed out when faced with uncertain conditions. They are more tend to come
up with innovative ideas and new processes for business operations.
 Long term Vs. Short term: Long term orientation highlights nurturing in a way through
which one can aligned towards future rewards while short term is related to past and
current rewards. SASOL company adopts short term approach because of the frequent
changes into external atmosphere. Although their business is inclined towards future
growth.
 Indulgence Vs. Restraint: This is the new dimension and negatively connected with short
and long term orientation. Indulgent society is the one in which members enjoy their lives
by free pleasure while restraint allows to indulge into instant satisfaction. The culture of
SASOL is indulgent in nature through which employees receive benefits of flexible

working hours, in premises facilities, bring children to work some days as well as paid
leaves of up to 2 months and many more.
Ethical and sustainable factors that the organization has to consider in a global market
The organization SASOL is already dealing internationally whereas nowadays with this
rapid growth and development of the business areas, the company wants to expand their
organization in the global market more efficiently from where they can obtain more growth and
reputation in the business market. However, it becomes important for the SASOL to consider and
understand the ethics and sustainable factor which is essentially required to be obtained by the
company from where they can expand their business in successful manner. Operating into global
market, the company should follow some ethics such as employment practices, human rights,
avoidance of corruption and environmental norms as well. It is significant for the SASOL to
understand and gather the information related to the ethical considerations where it will help the
business to obtain their employee in effective manner (Upadhyay, Mukhuty, Kumar and et.al.,
2021). At first, the company is required to follow and practice the cultural equality at their
workplace from where they can communicate and interact with the customers and clients of the
global market in definite manner.
When so ever, an individual company expands their business in global market, they are
required to consider the government rules and regulation in relation to exports and imports tax
areas and even social areas where the business can be able to grow at definite level. The SASOL
company has to follow the ethics like workplace diversity, equal opportunities, working
standards, human rights and such more from where the employee can work accordingly.
However, the company also required to consider the sustainable factors while entering into
global market which will also provide them a profitable outcome.
Social: In the social factor, it includes the areas of health and security, labour rights, standrd
working conditions and such more where the company is required to follow all such factors to
grow and develop in definite manner at global market.
Economic: SASOL organization also requires to consider the economical sustainability at their
workplace where it will support long term economic growth without negatively affecting the
other cultural and social aspects.

Environmental: The environmental factor is the significant aspect, the SASOL company
essentially needs to consider and follow at international level (Diez-Cañamero, Bishara, Otegi-
Olaso, and et.al., 2020). For the better growth and development of the company in global market
area, the SASOL has to take decision where they do not and less harm the natural surrounding
and become a sustainable business in the market field. The company advancing the chemical and
energy solutions that thriving the planet and society in effective manner.
Critical evaluation of strategic decision-making in relation to risk and diversification in a global
context
To expand any business in global market, the company should critical evaluate their
strategic decisions in relation to risk and diversification where these are the major issues the
company or a business has to deal with in global market area. A proper and effective strategic
decision-making process has to be adopted by the company from where the SASOL can deal
with the competition in the new market and can grow and develop themselves accordingly. The
SASOL can mitigate their competitive risk by priorly identifying and understanding their
competition in the new global market where they can use the unique and different strategy to
deal with the competition in effective manner.
Also, the SASOL can get the risk of cultural differences as it has been commonly known
that each individual place and people have its own cultural practices where the company also has
to learn and adopt the knowledge of that particular place culture and also can recruit and hire the
candidates of similar culture which will also overcome the language barriers and provide the
effective outcome (Gardner, Benzie, Börner and et.al., 2019). However, the recruitment process
should be adopted by the SASOL where they can understand the customer's and client needs and
requirements essentially and can provide the services accordingly. The limitation of the resources
also occurs while expanding the business in new global market, as it is not quite always possible
for the company to expend the finances as per the needs and requirements as they also have to
maintain the budget in cash flow as well. For the limitation of the resources, the company can
create a budgetary plan and can manage the finances accordingly.
Expansion of a business in new market, also requires identifying and understand the rules
and legislation of that particular place from where only the company can follow the rules and
regulation in definite manner and can obtain the appropriate outcome and grow in global market

area (Oliveira, 2020). Managing a global team is also very challenging or risky for the SASOL as
if they hire and recruit the new candidates which will create a diverse workforce which enable
the difficulties for the company to manage and tackle the employee and staff members in
efficient manner and can cause risk in relation to diversification. However, to run any kind of
business, they always face some issues and risk where the company requires getting prepared on
previous basis where they can mitigate and deal with the various expansion risk in global market.
Range of strategic global expansion routes available to the organization
Expansion of the business in global market areas requires a wide range of strategies
where it is not easy for any business to expand the company or a business without any
implementation of the strategic planning and process. However, the company SASOL also has
required to understand and adopt some relevant and useful strategic global expansion strategies
and methods at their business which will help to grow at definite and successful level.
Exporting: Exporting is one the best way to enter in at global market where it is most simple
entry mode which can give the SASOL a great reason to expand their business in new market.
SASOL organization can utilize this mode of expansion of their business at definite level as they
can have the contractual agreements with the marketing agencies, supply chain people and such
more where their product and services can be sold in appropriate manner and also can market
them which will put the positive and great impact on the organization and within the market as
well.
Licensing: The licensing method is a low-mode risk method of the global expansion where the
companies are able to utilize the intellectual property (Alos-Simo, Verdu-Jover and Gomez-Gras,
2020). The SASOL company can franchise their business model and name also can put the
private labelling on their products and services where the foreign firms and organization can sell
their products and services with the name of the SASOL organization name accordingly.
However, this method can provide help and support the company to grow in new market
efficiently.
Partnership: There are many business, who use the partnership method or a strategy to expand
it in global market area where they can easily grow and develop their organization in successful
manner. Partnership is based on mutual profit where the partners can bring the value in the
venture and can grow financially and successfully (Mezzanatto-McNair, 2019). SASOL

company should utilize this method of expansion as it is quite safer and profitable for the
organization as the decision-making power will be divided upon the business partners along with
investment and productivity. It will be beneficial for the organization as it will allow the SASOL
company to invest the finance in limited order and also get the partial power of decision-making
and ownership.
Mergers and Acquisitions: In this method, two similar firms and organization collaborates with
each other to expand in wider manner in international level and can obtain the higher amount of
productivity and outcome efficiently. The powerful firm undertakes the small firm in definite
manner which enable them to create and develop the reputation and can obtain the successful
results.
CONCLUSION
The above mentioned report has concluded the concept of globalization where it has
overall brief about the global market strategies and expansion areas. This report has mentioned
the purpose of this report and a well-structured explanation of culture and governance within the
relevant model. Also, it has conducted an evaluation of how it has influenced the global
operations. In addition, the model has been performed to discuss the cultural dimensions from
where the mentioned organization has been influenced and mentioned the ethical and sustainable
factor the organization should consider. Thus, it has also mentioned the strategic decision in
relation to risk and diversification and provided the wide range of global expansion routes
available to organization.

REFERENCES
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