Globalisation, PEST Analysis, and Strategic Challenges for Sasol

This report examines the concept of globalisation, defining it as the spread of information, technology, products, and jobs across national borders, particularly in the economic context of free trade and interdependence between nations. It uses Sasol Limited as a case study, highlighting its operations in various countries and the driving factors behind globalisation, including political, technological, competitive, and market drivers. The report then delves into a PEST analysis (Political, Economic, Social, and Technological factors) to assess the challenges and opportunities for Sasol in the global market. It discusses the importance of considering factors like economic conditions, consumer preferences, and technological advancements. The report recommends that Sasol Limited carefully consider all potential challenges when expanding internationally, emphasizing the importance of strategic planning and concludes that globalisation is crucial for business growth, but also presents complexities that require thorough analysis. The report also references the impact of globalization on various organizations and the factors which drive globalization like technologically drivers, political drivers, market as well as cost drivers. Also, a PESTLE analysis helps organisations in identifying various political, economic, social, technological, environmental and legal factors that can impact their operations either positively or negatively.

Business Environment

Globalisation
• The process of spreading of information, technology, products as well as jobs
around the national culture and borders is referred to as globalisation.
• In economic context, it implies interdependence of nations which is being
fostered by free trade.
• Sasol Limited is rendering their services in different countries like Australia,
Gabon, Canada and Mozambique.

Driving factors for globalisation
• The one which is liable for supporting firms within execution of operational
activities at international market within an effectual manner is defined as driving
factors.
• This enable within supporting free flow of services and commodities that are
beyond international boundaries.
• Along with this, it is also liable for contributing within the efficacious flow of
capital & foreign trades in national economies.

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• Political drivers: Due to deregulated as well as liberal trade laws, there is
a decrease within the tariffs.
• Technological drivers: They supports firms within free flow of services
and goods at global scale.

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• Competitive drivers: Competition is increasing with respect to day to day
evolution in needs of customers as well as market needs.
• Market Drivers: Increasing saturation in market has led to restricted growth for
firms. But Sasol Limited has made use of globalisation to develop their services
as well acknowledge different situations prevailing within market.

Pest Analysis and strategic Challenges
• Political factors: Sasol Limited is carrying out their operations within oil & gas
industry in different countries around the globe.
• Economical factors: The economic situations of country acts as an route-map for
growth as well as success of firm.
• Social factors: The altering preferences, trends and lifestyle of consumers incline
to reign the market in context of if firm fails to deliver their services as per these
aspects then their sustainability will be at risk.

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 Technological factor: The continuous developments occur which are confined to
each corporate sector.
 For example – Brand image of Nike was impacted hugely that the company made
use of low-wage workers in different developing countries. Also, if a country has
poor infrastructure, it will be difficult for organizations to conduct their business as
the poor condition of roads and heavy traffic will cause problems.

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• Also, many organizations may also face challenges relating to technology while
doing business in other countries as they are not completely aware of the
equipment there. There can be cases where the companies cannot rely on the type
of network available in a particular region.
• Vodafone also faced many challenges that limited it from becoming the market
leader in many countries as different countries have different rules and
globalization has also impacted them greatly.

Recommendations
• It is recommended to Sasol Limited that while expanding their business within
the international market, they must take into consideration all the challenges
which might occur. This will assist them to analyse that whether they can gain
success in future or will it become difficult to sustain within peculiar country.

Conclusion
• From above it can be concluded that, globalization is crucial aspect which is
important for all the industries as this will render them with an opportunity for
growing within the global market.
• There are different challenges like technological change must be considered
along with investment needed with respect to that.

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 Also, globalisation has impacted the operations of various organization greatly.
There are different factors that drive globalization like technologically drivers,
political drivers, market as well as cost drivers. Also, a PESTLE analysis helps
organisations in identifying various political, economic, social, technological,
environmental and legal factors that can impact their operations either positively or
negatively.
 Therefore, all the factors should be carefully analysed as globalization also poses
many challenges and complexities.

References
• Alkhafaji, A. and Nelson, R. A., 2013. Strategic management: formulation,
implementation, and control in a dynamic environment. Routledge.
• Amran, A., Lee, S. P. and Devi, S. S., 2014. The influence of governance
structure and strategic corporate social responsibility toward sustainability
reporting quality. Business Strategy and the Environment. 23(4). pp.217-235.