Business Organisations in a Global Context
Globalization is process that allows the firms in interacting with the rest of world. The man aim of this process is to connect world's market and business with each other, there are number of reasons that organisation go worldwide. Furthermore, report will explain the major difference between administration working in different sectors, industries. with the help of different strategies, companies will be able to utilize the resources in proper manner. It also describes the contribution of advance information communication technologies in the success of companies. At the end report will focus on the current business environment of US.
1.1 Major deviation between organisations working in different sectors, industries and contexts
Globalisation is a phenomena that is used to interact among different nations to develop global economy. The man aim of this process is to connect world's market and business with each other. There are different sectors such as private, public or non profitable sector, all these sectors have different roles and goals. Private sector have their own laws and regulations, they worked for profits where as public sectors are run by government of the nation(Palazzo and Matten,2014).
Many corporation needs to expand their business at global level in this context, Microsoft company which is trying to expand their business globally. Due to pressure of economy many firms are looking within their organisations how to improve operations and reduce costs. Organisations which are working in different sectors, industries are able to expand their business in different countries and also able to improve their brand image at global level. Along with this, the companies which are operating globally also may be open to growth on international financial market. For example chosen company run business portfolio and that involves approximate 50 countries. Where as Microsoft is a private American organization, it create, manufactures, permit, supports and sells computer software and services( Piekkari and Tietze, 2014). To expand the business this company trying to launch new products and services and also trying to operate in different industries and sectors. As chosen firm is famous software company but to expand the business in different countries this company trying to operate in different sector for example Microsoft company operate its business in hardware sector. Xbox video game consoles and the Microsoft surface tablet line up are the example of its flagship hardware products.
The key difference between organisation working as are-
- In this, public sector mainly focuses over serving the general public and looking after their interest. The main concern is about to have enhancement in profitability. Private sectors has to answer the customers and stakeholders. Public sector can able to survive without any effective flow of operation. In addition to it, without smooth flow of operation the sustainable condition fo entity can get affected. The voluntary sectors are not set up for earning profits in the enterprise they are made up for the social benefits to people.
- The private sectors set their own goals and targets and work as to achieve them. In this, aim are set with the object of achieving the profits and capturing the market share as the company strategy. Herein, public sectors faces pressed by legislative mandates, facing outsider forces and interest that conflict firm goals. Thus, Voluntary sector have their own power and perform the business function effectively.
1.2 Responsibilities of organisations operating globally
When an organisation or firm goes globally, they have to follow different responsibilities which are given below
In this, the responsibilities has defined in following context as are-
Responsibility to share holders- Shareholders are the main source of the enterprise and they provides money to start the business. It is kind of unavoidable responsibility that aids to focus on the way the shareholder want to control over the firm and creates the good value to it.
Responsibility to employees- The employees are the main part of the enterprise they are responsible to run the business function appropriately. The employees must have good working facilities, proper motivation, security and suitable support so that they can work optimistically.
Responsibility to customers- They helps to determine the success of the enterprise. Globalisation business people use to put their major consideration over the customer driven marketing policy.
Responsibility to environment- It is threatening day by day. Thus, it is the prime responsibility fo any enterprise to protect the environment. Business specially large firms that are operated at global level such as Microsoft needs to keep a watchful eye on the environment and its conditions this is because it is continually changing. To expand the business globally, firm needs to focus on environmental responsibilities which includes various elements such as competition, political factors, economic factor, social factor etc.
- Competition: To expand the business globally firstly, firms have to identify their competitors and their business strategies. This is because rival companies are continually changing their business structure. These rival companies offers products and services at low price, providing new technologies etc( Short and Ouellet,2015).
- Political factor: Laws and policies of government affects business positively and negatively. Corporation that want to operate at global level have to identify the political factors within the country. To expand the business in different country chosen company needs to identify the policies of government and their rules.
- Economic factor: This is another important factor which is included in environmental responsibilities. The economy consist of individual, government and business. Economy consists of many markets and these markets determines the price that business has to pay for its resources. Organisation are continually affected by modification in economy therefore, it is very necessary for corporation to determine this factor.
- Technology factors: Global companies needs to focus on the technologies to expand the business in different countries, firm has responsibilities to analysis that which technology will attract the customers. For example, in present more than 95% young people posses a mobile phone.
Ethical responsibility- In the era of globalisation, there are many unethical standards that spreads out quickly. In addition to it, firm must ensure ethical issues like not to give any defected products and not to take unethical price etc.
1.3The strategies employed by organisations operating globally
Microsoft and other large companies in order to expand the business globally and to operate globally for collection of profits and margins require solid strategies. With the help of different strategies, companies will be able to utilize the resources in proper manner. Chosen company used operation scheme, this plan of action mainly focuses on the resource utilization. With the help of this strategy cited firm are able to accomplish their objectivities in effectual manner. This is because employees of this company are able how to use resources in systematic manner(Barnes and Hunt, 2013).
- Human resource policy- The firm who is running their operation on global level make suers to build strong human resource management policy. It can be understood with example as Microsoft builds effective human resource management policy.
- Ethics policy- In terms to achieve the customer satisfaction, the firm needs to maintain the ethical factors so that customer can never get cheated.
- Collection of personal information- It helps to explain about the customer preference towards the product. IN order to maintain, this firm need to take survey for identifying the changing personal choices of customers.
- Use of modern technologies- In terms to welfare of the exclusive modern technologies the many enterprise has advanced their way of development.
- Reliable import and export processes- In this, consistent export and import policies work as to remove trade barriers and facilities to connect with other countries.
Different strategies which are adopted by globally organisations are as following
- Manufacturing strategy: According to Flaherty, different corporations have different process and methods of manufacturing. This strategy states that organisation needs to focus on low cost production along with high quality goods and services in order to expand the market globally. For this process, company needs to focus on the performance of employees and new technologies. For having the best quality products and services both labour as well as modern technologies are essential.
- Supplying strategy: This is one of the most important and bets strategy for expanding the business globally. According to this action of plan, corporation needs to focus on the supply chain management. It is because, supply chain management will enureses that goods and services are reaching to their target customers or not. With the help of this strategy an organisation will be bale to maintained the satisfaction level of customers.
- Production strategy: This action of plan states that firm that want to expand the business globally have to kept quality of products high and also need to focus on the other elements such as taxes and legal issues.
2.1 Impacts of performance of national economy on the activities of business corporation
The action of a national economy can have important affect on the development and growth of business. Economic factors includes various elements such as polices of government, rate of interest, foreign investment, per capita income etc. however, the economy of US is still poor as compare to UK. Along with this, real investment in US is just 40% and net exports of services and products is 30%. furthermore, the foreign market direct investment in the country is only 11% therefore the growth is very slow. Earning of the people of US are not high as compare to UK and other big nations. Apart from this government rules and regulations that direct the business when government changes that rules and regulations business will normally change the way they operate(Cimoli, 2013). In this context, Business of Microsoft company is vitally affected by the economic, technology and other factors. Economic factor includes different factors which are as following
- Market catalyst: Government have power to apply different policies that changes the cultural activity in the business concern. For example high tax rate on external products may boost local production of the same products and services. On the other hand high tax rate for raw materials bond domestic production.
- Political order: As government plan of action of any nation is depends on the political culture of the moment. US has a stable political system that can make business affable decisions and also boost the local business and attract international market. If nation does not have stable political system then they will not be able to attract foreign market and this will decrease the business.
- Interest Rate: High interest rate will decrease the production of any corporation. If there is high level of inflation then it will be not easy for business to grow in effective manner.
2.2Expalins The measures taken by governments
The policies and strategies of government influence on the activities of corporation, the government of any economy can play crucial role in raising the performance of business. For the betterment of companies and people government can take serious and important steps at any time. Moreover, if government of any nation find that workers of the business corporation are not treated well and are not provided safe and secure work environment then government can take step and can develop the rules for health safety at work environment. Government of any nation have power to ban the production of specific products and services In order to protect the community interest. If an organisation is operated illegally and cause harm to the people then government within the country can boundary the production of particular organisation(Coffey and Shields,2013).
Some different policies and rules of the US government are as following:
- Policy on international matters: Government of any nation have power to control the import and export of the country. They have build various policies and rules to promote trade and have established various policies to import and export of services.
- Policy regards region: Government of US supports the trade and commerce in their regional territory by providing the monetary resources. New industries are constructed in those fields so that unemployment can be controlled.
- Tax Regulations: Government of US use tax which are collected by the people of this nation for the state's social welfare and the general populations.
3.1 Implications of global integration on business organisations
Globalisation is a phenomena that is used to interact among different nations to develop global economy. The main aim of this process is to connect world's market and business with each other. The global market is made by full of the diverse suppliers and customers. To meet the needs and demands of customers this is very important to offer and launch new products and services. To attract more customer the best way is to offer high quality products and services. In the developing nation, cost leadership strategy is executable. Basically international trade is describes as the dealings of good and services between countries. In most countries international trade represents a significant share of gross domestics product. Through the global integration, different countries are able to gain products and services that are not presented in their country(Collings, 2014).
With the global international concept, business corporation are able to offer high quality of good and services they are able to buy the raw materials form the different countries at low price. With this process many corporation are able to reduce the production cost and able to increase their profitability. There are so many advantageous of global integration. Companies which are not able to buy raw materials because of high amount. Through the globalisation, small and large companies can be contacts with different suppliers of different countries and they can have various choices. Firms are able to expand their business in different sectors and industries. By providing the high quality products and services, enterprises are able to gain more benefits on regular basis(Ferraro and Briody, 2017).
The GDP of nation and facilitating business sector affects the corporation's operations. One of the most important advantage of this procedure is that one country can make good relation with another country. People of different nation are able to understand the different culture and giving respect to them(Fowler, 2013).
3.2The effects of global trade on outside products and services
Occupied association are not able bring benefits at their workplace. Business and their operations are expand by different strategies. Some companies such as Microsoft, Tesco are more efficient than others which makes them more successful(Waddock and McIntosh,2013). As efficiency of Microsoft company is deepened on high skilled employees and cost of resources. Chosen company are able to attract customers it is because they providing the best computer software with high quality and also expanding their business in different industries and sectors. If the division of labor of US country increases the economy wealth of that country should be able to increase. Global trade brings on depletion and decimation recognizing resources. Furthermore, this trade helps the nations to financial gain by increasing healthy involvement in items and firms in which they have a relative purpose of tendency over characteristic countries(Gereffi and Lee, 2016).
3.3A Review of the impact of the global economy on businesses
Global economy affects the business and economy of nations. Through the global economy sometime organisation have to pay extra tax which is used by government in welfare of people within the country. Moreover, there are some positive and negative effect of global economy(vom Brocke and Recker, 2013).there is positive impact of global economy as it helps in increasing the income level of people and their living standard is also increasing. People of different countries are able to get variety of products and services which is the ample benefit of free trade. Moreover, another positive impact of global economy is that an organisation will be able to expand their business in different countries and can make good reputations in all over the world. Through the import and export process at global level, corporations are able to increase their productivity and over all this process increasing the economy of country and helps in future development(Jimenez and Marchetti,2015).
Companies move to other countries to expand their business and to increase the profits. In this moving process, corporations face different challenges for an example meeting local customer's requirements, understanding the rules and regulations of local government. Generally three main problems are occurred in moving process which are social, culture and economic factors(Ulrich and Dulebohn, 2015).
3.4Role of ICT in globalization
The information and communication technologies like web, CSR, ERSP etc. changes the nature and business environment in positive manner. With the help of online networking on web influences the business advancements. Social media on internet helping corporations to promote their business in all over the world. Moreover, through the advanced information technology, firms are able to maintain their records about suppliers, products, customers, employees and many more. ICT helps corporations to bring efficiency at the workplace and it increases the over all performance of enterprises at global level. Moreover, technologies also carries creation in the products and services. Through the advance information communication technologies, such internet various corporations are able communicate with their suppliers of different countries. And this whole process will helps to improve the economy of globalisation(Johnson, 2014).
4.1 A reappraisal of the global environment within the US
The countries of US includes in the trade made payments with the exchange rates of their local currency with dollar. Moreover, several enterprises go to the developing countries because this save huge amount of money and production costs for the corporations. Internal and external audit is very important for association where the business is working for the primary monetary development(Matten and Spence, 2013). The GDP in universal enterprises sector impacts the evolution of the business. For example, GDP of Union States has coordinated development in European union. On the other hand this also increases the productivity and profits for the organisation. The foreign investments in US helps to stable the economy of country by creating new opportunities of employment. The political factor of union states includes the laws, regulations that help corporations in operating globally(Mendenhall and Oddou, 2016). The economic analysis of US includes culture, population, taxes etc. all these elements are needed for firms to be focused for operating globally. Analysis of social factor is also necessary it includes culture, population growth rate etc. government of US providing and supporting new technologies that shows the development of new opportunities and also helps the corporations to run operations and functions most effectively and efficiently. Moreover, there are various employment laws in the US. If association are not followed that rules then government of US has power to band those corporations and their products. According to the employment law of us very firm have to give same facilities and pay scale to the employees. According to the civil rights act 1964, all organisations and labor union have a responsibility to treat workers equally, without discrimination based on colour, religion or nation origin(Meyer and Steinbereithner, 2016).
4.2Proposed strategies to address issues affecting business activities within Union States
Organisation that want to expand the business at global level faces various issues such as legal issues, social, finance , technology etc. firm needs to understand the needs and requirements of local customers. At the same hand they ned to follow the rules and regulations of local government(Myers, 2013).
- Strategies relevant to industry: Due to competition in the global environment, new opportunities for the business person are available. On the other hand supply chain management also affect the business positively and negatively(Skene and Haynes, 2017).
- Trade bank: In the international market the enterprise faces the problem of rising finance. For the development and growth of the business funds are necessary.
- There are many strategies which have to follow by the chosen company to remove the issues. These strategies are manufacturing, supplying and production strategies.
- Strategies planing: It is the process which helps an organisation to allocate the resources to the employees in proper manner. Through the strategies planning, workers are able to use resources in systematic manner, and this process will increase the benefits and decrease the production costs(Temponi and Frein, 2014).
- In this, innovation of the newer technical advancement builds mass communication among the all level of individual. It also work as to decrease the difficulties of British people as well other nation people. In addition to it, they focus over the latest technologies and make demand for new products.
- It works as to creates and develops the new market for firms in order to full fill the preference of the customers.
- Organisational collects the personal information in terms to understands about the needs and demands of customers.
- The structure of the firm is also getting changed day by day. In this, shorter version of firms expanded their business activities.
From the above report it has been summarized that globalization is essential for the corporations in order to expand itself in all over the world for collecting profits, revenues, customer database etc.Furthermore, report also described different strategies like supply, production strategy etc. that needs to undertake by large companies for successful expansion. In addition to this, it also explained the positive and negative impact of economy of country on organisation business. Along with this it has also focused on the role of government in the business corporation. Apart from this report described the importance of information communication technology on the globalization. At the end report has focused on the business environment of US.
Books and Journals
Palazzo, G. and Matten, D., 2014. The business firm as a political actor: A new theory of the firm for a globalized world. Business & Society. 53(2). pp.143-156.
Piekkari, R. and Tietze, S., 2014. The multifaceted role of language in international business: Unpacking the forms, functions and features of a critical challenge to MNC theory and performance.
Short, J.L. and Ouellet, M., 2015. Codes in context: How states, markets, and civil society shape adherence to global labor standards. Regulation & Governance. 9(3).pp.205-223.
Barnes, S. and Hunt, B. eds., 2013. E-commerce and v-business. Routledge.
Cimoli, M., 2013. Developing Innovation Systems: Mexico in a global context. Routledge.
Coffey, J. and Shields, J., 2013. Human resource management: strategy and practice.
Collings, D.G., 2014. Integrating global mobility and global talent management: Exploring the challenges and strategic opportunities. Journal of World Business. 49(2). pp.253-261.
Ferraro, G.P. and Briody, E.K., 2017. The cultural dimension of global business. Taylor & Francis.
Fowler, A. ed., 2013. Striking a balance: A guide to enhancing the effectiveness of non-governmental organisations in international development. Routledge.
Gereffi, G. and Lee, J., 2016. Economic and social upgrading in global value chains and industrial clusters: Why governance matters. Journal of Business Ethics. 133(1).pp.25-38.
Hadden, J., Jimenez, M. and Marchetti, R., 2015. Global justice movement: Cross-national and transnational perspectives. Routledge.
Johnson, P.F., 2014. Purchasing and supply management. McGraw-Hill Higher Education.
Matten, D. and Spence, L., 2013. Corporate social responsibility in a global context.
Mendenhall, M.E. and Oddou, G.R. eds., 2016. Readings and cases in international human resource management. Taylor & Francis.
Meyer, M. and Steinbereithner, M., 2016. Nonprofit organizations becoming business-like: A systematic review. Nonprofit and Voluntary Sector Quarterly. 45(1). pp.64-86.
Myers, M.D., 2013. Qualitative research in business and management. Sage.
Skene, K. and Haynes, K., 2017. The circular economy: an interdisciplinary exploration of the concept and application in a global context. Journal of Business Ethics. 140(3). pp.369-380.
Temponi, C. and Frein, Y., 2014. A scenario-based stochastic model for supplier selection in global context with multiple buyers, currency fluctuation uncertainties, and price discounts. European Journal of Operational Research.233(1).pp.159-170.
Ulrich, D. and Dulebohn, J.H., 2015. Are we there yet? What's next for HR?. Human Resource Management Review. 25(2). pp.188-204.
vom Brocke, J. and Recker, J., 2013. Which cultural values matter to business process management? Results from a global Delphi study. Business Process Management Journal. 19(2). pp.292-317.
Waddock, S. and McIntosh, M., 2013. The United Nations global compact: Retrospect and prospect. Business & Society. 52(1). pp.6-30.