Global Business Environment Analysis: A&R Cambridge Ltd Report

This report provides a comprehensive analysis of the global business environment, focusing on the case of A&R Cambridge Ltd, a British manufacturing company. The report begins by identifying the key factors driving global commerce and trade, including cost, market, environment, and competition. It then delves into the strategic challenges faced by organizations operating in a global environment, such as organizational structure and strategy, and evaluates the impact of globalization. The report also examines the influence of ethical and sustainable globalization on organizational functions, different ways of decision-making in a global context, and the various routes to internationalization. The analysis incorporates concepts like PESTEL analysis, Porter's generic model, and discusses the complexities of strategic challenges, providing a detailed understanding of the factors that impact global business operations.

GLOBAL BUSINESS
ENVIRONMENT

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Key factors of cost, market, environment and competition which drive global commerce
and trade.................................................................................................................................1
TASK 2............................................................................................................................................5
P2 Complexity of strategic challenges to be faced by organisation when operating in global
environment............................................................................................................................5
TASK 3...........................................................................................................................................7
P3 Evaluate the impact that globalisation would have on organisation.................................7
P4 Evaluate the influences of ethical and sustainable globalisation on organisation's functions
................................................................................................................................................8
TASK 4..........................................................................................................................................10
P5 Evaluate different ways in organisation's decision making can work effectively in global
context..................................................................................................................................10
P6 Determine and articulate the various routes to internationalisation for organisation.....11
CONCLUSION..............................................................................................................................12
REFERENCES .............................................................................................................................14

INTRODUCTION
Business environment consist of internal and external factors which is affecting on
decision making process of each and every corporation existing in UK. For a business
organisation, it is require that they build business structure globally to getting effective growth
and income easily (Asif and et. al., 2011). Business environment is a combination of two
different factors that influence operational and functional activity of an organisation. Each and
every organisation operate their business activity in global environment to getting higher growth
and profitability effectively. For an organisation, it is required that they analyse each and every
factors to expend their business in different countries. This project report is based on A&R
Cambridge Ltd which is British manufacturing of Hi-Fi Equipments based products. This
organisation was established in the year of 1976 by several students of University of Cambridge.
This is a small and medium enterprise. This research report include different key factors for
global trade, complexness of strategic situation faced by organisations and different influences of
globalisation. At last it includes Analysis for ethical and sustainable globalisation, different ways
of decision making and key barriers that routes for internationalisation.
TASK 1
P1 Key factors of cost, market, environment and competition which drive global commerce and
trade
Globalization is a concept of movement in different countries in order to exchange goods
and services, capital as well as commodities on international level. By globalisation process, an
organisation can get higher competitive advantages by introducing new products in target market
after implementing effective cost.
Factors that drive globalisation -
Technology – This factor has major influence in each field in order to rise import and
export services at international level. A&R Cambridge Ltd requires to consider technological
factor in their business while expanding their services in different countries (Bar-Isaac and
Shapiro, 2013) . through technology company can manage their global commerce and trade
because it involve several latest apps and equipments.
Competition – These are the existing organisation in target market that can be a major
competition for a new firm. For A&R Cambridge Ltd, it is required to identify their major
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competitors and its strategies before the movement in new country. If competition is increasing
then every company want to expand their business and start doing commerce as well as trade.
World demand – For a business firm, it is required to identify requirement of specific
product at global level because it influence in business procedure and activities at the time of
globalisation. If demand is increasing at world level then goods and services trade will also
increase for fulfilling it.
In the concept of globalisation, different key factors of an organisation helps to provide
effective services and contribution to manufacturing firm on global level. This process includes
four elements such as Cost, market, environment and competition which is also known as global
trade and commerce elements.(Adger,2013) These factors are required to manage in appropriate
manner or needs to utilise easily for getting desired outcomes. Frame work for those elements are
given below as -
COST
For A&R Cambridge Ltd, it is required to consider cost effective as well as cost
investment strategies while adopting globalisation concept for their firm. A single nation market
might not be enough for a business to grab possible opportunities for desired growth. So for this,
it is required for A&R Cambridge Ltd to scale up in different countries to make dramatic
changes in their marketplace. At the time of these occurrence the goal of firm should have to be
the maximisation of investment cost to attaining possible success easily. At the time of taking
global decisions, cost will probably leads to be a tough decision in order to making effective
strategies for market leadership. Therefore, to grabbing maximum opportunities A&R
Cambridge Ltd needs to provide their products and services to target customers on the leading as
well as lower prices (Boons and et. al., 2013) .
Market
Globalisation doesn't mean to serve services on entire globe, so for this A&R Cambridge
Ltd needs to cleverly deciding specific choice to spend their resources in desired countries. This
strategy is based on market condition and demand for organisation's product which helps in
providing growth opportunity to firm. For effective expansion, A&R Cambridge Ltd needs to
determining where they wants to invest capital for splitting their products and services near
target customers. This process requires a proper research which can be available on different
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sources on the basis of market condition, customer's demand, existing competitors and so on.
This can be a major factor that drives globalisation impact fully.
ENVIRONMENT
This is a most important factor that affect organisational procedures and activity
effectively. Environment is divided into two different elements such as internal and external that
affect decision making process of firm directly.(Cantwell, Dunning and Lundan, 2010) For this,
A&R Cambridge Ltd needs to build effective strategy to reduce adverse impact of those factors
at the time of globalisation. These factors are briefly determine as below -
Internal environment – These are effective factor that are already exist in organisation
such as employees, management, employees and investors as well. Internal factors helps to affect
working terms and effective procedure of A&R Cambridge Ltd at the time of globalisation.
Internal factors are controllable and organisation can easily control them through effective
planning strategy as per the affects of globalisation.
External environment – These are also known as macro environmental factor that directly
impacting on decision masking procedure of firm. These factors are beyond the control and
possibly exist in each country. Hence, A&R Cambridge Ltd requires to identify them at the time
of globalisation in order to reducing their negative impacts easily (Epifanova and et. al., 2015).
These can be identified through PESTEL analysis as -
Political factors – These factors are related to government, norms and law that they
regulate for different kind of organisation. For A&R Cambridge Ltd it is important to analyse
such factors as tax plan of action, marketing commercialism, political order, legal activity,
different rules for manufacturing organisation's, different tax policies and licensing process that
an organisation needs to get if they implement their procedure ion global market. For A&R
Cambridge Ltd, it is important to understand all these government norms and follow in their
procedure to getting desired outcomes easily.(Ferraro and Briody, 2017)
Economic factors – These factors are all based on economic stability of an country that
can affected through trade and commercialisation in market. For A&R Cambridge Ltd, it is
require to build their procedure effectively according to economic condition of a country that can
affect their operational activities directly.(Gecevska, 2010) Economic factors are include
economic growth, interest rate, inflation, direct tax, wealth tax, local and internation economic
policy that is usually based on trading process of an organisation.
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Social factors – These factors are related to culture and trend of economy that follows
by people. For an organisation like A&R Cambridge Ltd, it is important to understand social
economic factors of a country that can affect its marketing procedure directly.(Hamilton and
Webster, 2015) In globalisation, social factors play a most important role because it is all based
on market and customers demand and needs for a specific product and service from organisation.
Through this process they can easily implement just in time and quality product procedure in
their business activity to getting effective growth easily.
Technological factors - A&R Cambridge Ltd is a manufacturing organisation for Hi-Fi
Equipments based products. So for them it is very important to implement technological factor in
their manufacturing process to getting higher growth easily.(Kasemsap, 2014) Advance and
digital technology always build effectiveness to getting higher productivity and probability
through production services. These kind of terms introduce new and effective policy in
organisation that connect them with new generation.
Environmental factors – This factor is al based on environmental elements of a country
that can affect business procedure directly. In global business environment, this term is make
direct impact on manufacturing and production services of firm to create complexities. For this,
an organisation needs to understand that their product and services do not harm environment of a
country.
Legal factors – This is also related to government policy and norms that can affect
business procedure easily. For this A&R Cambridge Ltd needs to understand all law, ethics,
norms and act that regulate for manufacturing and trade organisation of a country.(Laudon and
Laudon, 2015) By implementing these policies in operational activity a firm can easily expend
its business structure in new market of a country.
COMPETITION
These are competitor rivalries of an organisation that provide same products to customers
and harm reputation and goodwill of a firm. (Cavusgi, l2014)For them A&R Cambridge Ltd
needs to build impactful strategy to build effective market value of organisation in front of
competitor firm customers as well. These Competition are include strong rivalries and substitute
production organisation that provide same quality services to consumers. Competition of market
never build threat but also provide various opportunity to getting effective advantages easily.
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TASK 2
P2 Complexity of strategic challenges to be faced by organisation when operating in global
environment
A&R Cambridge Ltd is a British manufacturing organisation which serves effective
services in market but they only deals with small scale firms. For them, it is require that they
understand macro environmental factor of market to getting higher growth easily.(Jonge, 2011)
In this process a firm easily face complexity of strategic challenges that needs to be implement
effectively to reduce its negative effects easily. So for this, they needs to make appropriate
research to analyse Complexity factor of strategic challenges when A&R Cambridge Ltd run for
their structural and operational activities in new and target market. There are some complexity of
strategic challenges are determined which are faced by A&R Cambridge Ltd in global market as-
Strategic of organisational structure
Size – This is the first and foremost factor of a business firm which is classify on the
basis of organisation types. For a small scale business, it is not requires to have a vast structure,
while as a large business organisation needs to carry a intense structure on the basis of their
resources and employees. At the time of globalisation, major complexity of strategic challenges
faced by small size firm due to limited number of employees, infrastructure, funds and resources
as well. Therefore, it can create complexity to stand with major competitors in new market
(George and Bock, 2011).
Strategy – Each and every business organisation creates strategic planning in order to
attain their business objectives and goals. A small scale firm as A&R Cambridge Ltd, it is
required to implement high-growth strategy that assist to adopt quick changes on the basis of
external environment. These kind of strategies assist to reduce complexity of strategic challenges
in the procedure of globalisation.
A&R Cambridge Ltd can faced major strategic challenges while they manage business
approaches at global level. Therefore, it is required to identify target market as well exiting
organisation's strategies in order to create possible planning for their own business. To identify
most effective strategy for A&R Cambridge Ltd, Porter's generic model providing identification
of major possible factors as -
 Cost leadership – in this strategy, company decide to reduce costs and produce goods
and services which are least in expenses so that market share can be achieved. A&R
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Cambridge Ltd can undertake this strategy for enhancing market growth or size with the
help of decreasing production costs and charge lower price on their products or services
at global level.
 Differentiation – In such strategy, company make decision to produce better quality of
products or services that differentiate them from other competitors. It support in
attracting more customers towards company due to different quality and featured
products as well. A&R Cambridge Ltd generally focus on particular research and new
innovation so that high quality of products or services can be sold to the targeted
audiences in international market (Isik, Jones and Sidorova, 2011).
 Focus - Company consider a particular area where they focus only on their target market
as well as niche market. They understand the specific market and try to find targeted
audiences so that they can fulfil their needs and demands with an efficient manner. A&R
Cambridge Ltd have to understand the global market and focus on specific group of
customers in particular area for the purpose of satisfying their desired needs.
Corporate structure : It generally refers to organisation of various department within a
company that depends on the nature of the business where it operates. Each department perform
different types of organisational functions with appropriate collaboration for achieving set
corporate goals and values. A&R Cambridge Ltd has various department including Human
Resource, Information Technology, Marketing, Accounting and Finance, production Research
and Development which perform different task so that better outcomes can be get. Company can
expand its business at global level by considering various functions and business activities that
assist in accomplishing goals.
Value chain: This is defined as high level of model for business process where they
receive raw material, other resources and add some value for the purpose of getting better quality
of products or services. They sell the finished products to the right customers for satisfying their
needs. A&R Cambridge Ltd conducts the analysis of value chain and inspect the entire
production procedure so that they can produce better finished goods with increasing efficiency of
chain (Li and et. al., 2011) .
Supply chain: It is considered as the network between suppliers and company for
manufacturing and distributing better quality and quantity of goods and services. Supply chain
play an important role in production process which represents the steps that are to be undertaken
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for getting goods and services. A&R Cambridge Ltd has required to undertake the supply chain
methods and its suppliers while dealing in international market. They have to find out another
suppliers when expanding business at different country so that they can achieve competitive
advantages.
Therefore, it can be said that dealing in global market is not so easy because number of
factors must be considered by the organisation while making decision of business expansion at
another place. A&R Cambridge Ltd have to understand such force and formulate effective
strategies for handling various kinds of circumstances in easy manner. Appropriate strategies and
action plans would be helpful in overcoming such factors with effectively (Onetti and et. al.,
2012).
TASK 3
P3 Evaluate the impact that globalisation would have on organisation
Globalisation is a process in which organisation start their working activity in different
country. These kind of elements are impact positively or negatively on various activities of firm.
For A&R Cambridge Ltd, it is require to make effective strategy to getting higher profit and
growth easily. (Peng, 2016)This is an manufacturing organisation and for them it is require to
manage their activities properly to in market. So for this, A&R Cambridge Ltd needs to creates
its personal values to mange them in particular or in exact manner. There are some elements of
this process are given below -
Governance and leadership: Organisation has require to follow various rules, regulation
and code of conducts that formed by the government in different countries. Governance is wide
term in which consider the over all management of company including shareholders,
stakeholders, employees, community and many others. They maintain the relationship of
businesses by formulating policies and regulation regarding business management. Governance
play a crucial role in shaping legal, institutional as well as regulatory framework within
governance system for development. Therefore, A&R Cambridge Ltd has required to undertake
several governance and leadership that are different in other countries. These factors have major
impacts on the organisation while running business so, company need to consider such forces
and study properly for achieving competitive advantages (Pikka, Iskanius and Page, 2011) .
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Corporate and business Structure: A Corporate structure contain different department
of company that assist in attaining mission and goals in an efficient manner. In this include
marketing, human resource, Finance and Information Technology. A&R Cambridge Ltd has its
own business structure in which board of director and CEO handle every department. There are
company president, autonomous and vice president who manage the work. Therefore, it is
necessary to consider these key people while expanding business at international level as this is a
manufacturing firm so they have to manage entire activities related to producing goods and
services so that they can achieve sustainability. Business structure included sole proprietorship,
partnership, corporation and limited company that depends on the nature.
Culture – These are most important element of a country in which culture and functional
activities determine their role. For this A&R Cambridge Ltd needs to understand that they
manage their business activity according to culture and function activities of a country (Simic
and Dimitrijevic, 2012.). there are various types of culture within organisation including
learning, proactive, role and person etc. These play an important role in making organisation
system and form culture so that employees can follow to work effectively. The organisational
culture should be effective as there are no any discrimination or gender issues at workplace as
per the regulation of government. Therefore, it can affects on the company during operating
business at international level.
P4 Evaluate the influences of ethical and sustainable globalisation on organisation's functions
For every business organisation, there is required to follow and consider the business
ethics while dealing in global market in which they interact with different cultures and
commercial systems that are totally different from home market. Therefore, ethical consideration
must be required for A&R Cambridge Ltd that support in maintaining reputation among
competitors. At global level, it has major impacts ons the organisation because ethical issue can
be occurred during expanding business at other countries (Rossi, Vrontis and Thrassou, 2012) .
Here are defined some importance of ethics within organisation such as: Treat employees fairly: It is necessary for every organisation that to be ethical and
consider the fairness of employees at workplace. It assist to employees in feeling safe and
secure while performing their task within company. A&R Cambridge Ltd can increase its
reputation by treating every employees fairly.
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 Engage in sustainable manufacturing practices: Ethical consideration play an important
role in minimising various negative effects in better manner. It helps in reducing the
environmental footprints as soon as possible. A&R Cambridge Ltd can also produce
effective goods and services bys undertaking this ethic which directly affects on its brand
image in the global market.
 Honesty: Ethics has significant impact on the business as it helps in maintaining honesty
and trust among employees as well as people who are workings within organisation.
A&R Cambridge Ltd can keep its information more confidential with the help of honesty
and ethical consideration in an appropriate manner (Schaltegger, Lüdeke-Freund and
Hansen, 2012) .
Ethical issues in business:
 There are various ethical issues of business that can affects directly on the performance
and goals because in this, it has been founded lack of proper direction that cause of
troubling due to some issues such as logic and reasons as well.
 The ethical issue of global business can be administration rules and regulation that
impact on the organisation and its operations. Many of companies are facing such kinds
of issue due to some management rules, regulation and code of conducts which must be
followed by the firm.
 Ethical issues are various as it includes professional ethics, employee right issue and
functional area of organisation. A&R Cambridge Ltd have to undertake such issues and
make better favourable decisions for getting success.
Therefore, there are described number of ethical issues which has major impacts on the
A&R Cambridge Ltd so it is necessary for them to formulate better policies, rules and regulation
while expanding business at another country and deal at international level. These issues can be
overcome through effective business structure and culture that facilitates in performing entire
activities nd operational in an adequate manner (Schneider and Spieth, 2013) .
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TASK 4
P5 Evaluate different ways in organisation's decision making can work effectively in global
context
For a business organisation it is require that they implement different kind of activities in
their procedure that help to build effective decision making process for A&R Cambridge Ltd. In
this process manager and leader of organisation can easily make different kind of strategy to
getting effective and desired outcome of their objectives. Through this skill, they both can easily
provide effective direction and guideline to employees for getting higher business success
appropriately. There are different kind of factors are determine that help to conduct effective
decision making procedure for organisation to expend their business globally as -
Decision making procedure:
 Analysis and examine the issues – This is a most important factor of organisation that
includes effective analysis of problems and issues that arises because of different ethics.
Through this process, they can easily get effective solution to resolve them easily. In this
process manager and senior employees of firm communicate with their employees to
observe their thoughts and feedback toward organisational procedure. This
communication help to build strong relation between employees and management of firm
and it is help to resolve issues easily (Seethamraju, 2012) . when doing business at
worldwide level then it is necessary to analysis and examine the issues at global level and
take major steps in relation of this.
 Determine solution – After analyse various operational and functional issues in
organisation that affect working approach, manager and leader take strong decision to
resolve them easily. All those solutions are based on strong communication that create
between employees and manager. These kind of things are based on strong analysis and
research for several problems. According to the problem its solution also be implemented
after keeping all the global level elements in mind.
 Evaluate the effectiveness – After providing effective solutions, manager and senior
level employees are analyse its effectiveness to implement them in business procedure
and activities. Through this all operational and functional activities of organisations are
directly affected at global level (Simic and Dimitrijevic, 2012). This procedure also
evaluate various paths of decision making to work properly in global manner.
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