You have been appointed as a market analyst in a small investment bank, which manages the wealth of many clients. One of your first tasks is to choose an organisation that operates internationally. This may be an investment opportunity for your employer, but you can choose a non-profit making organisation. In your role as a market analyst you will also need to understand the impact of globalisation on business organisations in general.
Don't use plagiarized sources. Get Your Custom Essay on
Open University Learning Space Free learning –
http://openlearn.open.ac.uk/course/category.php?id=4
Civitas (Institute for study of Civil Society) – http://www.civitas.org.uk/
Free Business Information – http://www.businessballs.com/index.htm
Awareness of current issues across the world –
http://www.newseum.org/todaysfrontpages/#
Culture and Globalisation –
http://www.globalization101.org/issue_sub/culture/cultureglobalization/
Global Market –
http://globaledge.msu.edu/academy/hpgdtmlh/32new/global%20market%20opportun
ity%20assessment/player.html
Financial Information – http://www.bloomberg.com/markets/ and
http://uk.reuters.com/
International Finance sites – http://fisher.osu.edu/fin/cern/cernpop.htm
Strategic Planning Society – http://www.sps.org.uk/
Interview with Michael Porter – http://www.youtube.comwatch/?v=mYF2_FBCvXw
Free case studies –
http://www.icmrindia.org/free%20resources/casestudies/Free%20Business%20Strat
egy%20Cases.htm
Kellogg video – http://www.youtube.com/watch?v=bqtFEJsXqeA&feature=related
http://www.oup.com/uk/orc/bin/9780199296378/01student/additional/page_10.htm
Video on International Strategy – http://www.youtube.com/watch?v=gwXYfGV25iI
MacDonald’s Case Study – http://studyshare.in/share/showthread.php?1785-
McDonald-s-Case-Study-Marketing-Analysis
IKEA Case Study –
http://www.youtube.com/watch?v=mL7nWwWqYx4&feature=related
Aims To explore the strategic responses of organisations to the rapidly
changing global business environment. To understand the
strategies and processes used to manage international businesses
in differing geographical and cultural situations. To understand the
importance of managing within a framework of corporate social
responsibility.
Unit Level 7
Unit Code R/503/5094
GLH 60
Credit Value 15
Unit Grading Structure Pass
Assessment Guidance Assignments in accordance with awarding organisation guidance
Learning Outcomes.
The learner will:
Assessment Criteria.
The learner can:
1. Be able to analyse the international
business environment
1.1 Review and assess suitable techniques to
analyse the business environment
1.2 Analyse the micro-environment of a business
1.3 Analyse the macro-environment of a
business
1.4 Analyse how the international business
environment impacts on an organisation
2. Understand the impact of globalisation
on business organisations
2.1 Analyse the extent of globalisation on
organisations
2.2 Assess the benefits, opportunities and
challenges of globalisation for an
organisation
2.3 Analyse the structures of different
organisations operating in international
markets
2.4 Critically evaluate the international
operations of an organisation
3. Understand the importance and nature
of Corporate Social Responsibility
3.1 Analyse the moral and ethical questions
facing organisations in an international
environment
3.2 Analyse the conflicts between corporate
strategy and ethical and social
responsibilities
3.3 Identify legislation, regulation and guidance
relating to corporate social responsibility
Level 7 Management Specification May 2014 1
Indicative Content
1. Be able to analyse the international business environment
Analysis techniques
Environmental analysis and diagnostics, environmental audit, Porter’s diamond (The
Competitive Advantage of Nations – Porter), PESTLE, ‘five forces’ analysis
External climate, economic, political and legal environment (national and
international), cultural environment, resources (capital, people and natural),
technology
International business environment, culture, CSR, politics, environmental issues,
globalisation
2. Understand the impact of globalisation on business organisations
History
Economic theory, dependency theory, non-western cultures, maritime European
empires, industrialisation, trade and empire, Bretton Woods, development of
communications, information technology
Extent of globalisation
Trade, labour movement, cultural exchange, technical development and exchange,
capital
Effects of globalisation
Effects on markets, business change, capital, jobs and outsourcing, cultural
dominance, natural resources, conflict; debates: benefits and challenges of
globalisation, advocates and critics
Structures
International business organisation, international supply chain management,
business structures, outsourcing, international communications
Operations
International business conduct, competition in different markets, international brand
development, protection of IP, trade partnerships, politics and regulation, security,
ethics
Level 7 Management Specification May 2014 2
3. Understand the importance and nature of corporate social responsibility
Moral and ethical questions
Organisation purpose, nature of business ethics, corporate responsibility, social
responsibility, corporate accountability, corporate governance, cultural conflict (eg.
nature of bribes and rewards), different economic models, different ethical
frameworks (theories: deontological and utilitarianism), Hofestede, Hall (monochronic
and polychronic cultures)
Conflicts
Current conflicts and issues should be examined. Examples include: climate change
and environmentalism, anti-globalisation and social responsibility, ‘Peak oil’, greater
insecurity, relationships with government, technological change and privacy
concerns, social media, intellectual property issues
Legislation
UK, European, global and other national legislation and guidance; global agreements
on carbon; legislation on pollution; agreements on issues affecting specific industries
e.g. fishing agreements; institutions; codes of practice and guidelines from
international (e.g. OECD, ISGN), and industry (e.g. ISAR) bodies, reporting
mechanisms (audit standards)
Level 7 Management Specification May 2014 3
Important Notes:
1. You must familiarise yourself with the Academic Dishonesty and Plagiarism
Policy of LQA and ensure that you acknowledge all the sources which you use in
your work.
2. You must complete the ‘Statement and Confirmation of Own Work’.
3. Please make a note of the recommended word count. You could lose marks if
you write 10% more or less than this.
4. You must submit a paper copy and digital copy (on disk or similarly
acceptable medium). Media containing viruses, or media which cannot be run
directly, will result in a fail grade being awarded for this module.
5. All electronic media will be checked for plagiarism.
Marker’s comments:
Moderator’s comments:
Mark: Moderated Final
Mark: Mark:
January 2015
Assignment
Unit:
Global Business Strategy
Unit 7.2 Global Business Strategy
Level 7 15 Credits
Scenario
You have been appointed as a market analyst in a small investment bank, which manages the wealth
of many clients
.
One of your first tasks is to choose an organisation that operates internationally. This may be an
investment opportunity for your employer, but you can choose a non-profit making organisation. In
your role as a market analyst you will also need to understand the impact of globalisation on business
organisations in general.
Activity 1
Your line manager has asked you to analyse the international business environment for your
chosen organisation and produce a report for him which includes.
a) a review of the techniques to analyse the environment and an assessment of their suitability.
b) an analysis of the micro and macro environments of the business using techniques reviewed
in the first part of your report
c) an analysis of how the international business environment impacts on your chosen
organisation.
d) an assessment of the benefits, opportunities and challenges of globalisation on your chosen
organisation
As you are nearing completion of this report, you receive a memo from your line manager which asks
for further sections to be included in the report. These additional sections must analyse
a) the extent of globalisation on organisations.
b) structures of different organisations operating in international markets
.
Assessment Criteria 1.1/1.2/1.3/1.4, 2.1/2.2/2.3.
Activity 2
You are now required to give a presentation to a group of managers on the importance and nature of
Corporate Social Responsibility to organisations operating internationally.
Your presentation must cover the following topics:
an analysis of the moral and ethical issues faced by operating in an international environment
an analysis of the conflicts between corporate strategy and ethical and social responsibilities
identification of the legislation/regulation and guidance relating to corporate social
responsibility for organisations
You will need to produce your notes for the presentation and have appropriate hand-outs for the
group detailing the topics covered.
Assessment Criteria 3.1/3.2/3.3
Activity 3
The group of managers who attended the presentation have requested a paper which critically
evaluates the international operations of your chosen organisation.
AC 2.4.
Guidelines for assessors
The assignments submitted by students must achieve the learning outcomes and
meet the standards specified by the assessment criteria for the unit. The suggested
evidence listed below is how students can demonstrate that they have met the
required standards.
Activity
number
ACs Suggested evidence
1 1.1/1.2/1.3/1.4,
2.1/2.2/2.3/
The report must identify a range of techniques for analysing the
international operating environment. These techniques must be
thoroughly reviewed and assessments made based on sound
judgements. The analysis should be detailed and cover the micro
and macro environment of the chosen business and clearly
demonstrate how the international business environment impacts
on the chosen organisation.
The report must also show that the learner understands the
impact of globalisation on business through careful analysis which
covers the extent of globalisation and the structures of different
organisation operating globally. The assessment must be
balanced and cover all the different aspects stated in the task.
The report should be in an appropriate business format.
2 3.1/3.2/3.3 The presentation should cover all the main topics stated in the
task , show analysis and identify relevant legislation, regulation
and guidance facing organisations.operating internationally. The
notes produced by the learner must show understanding of the
importance and nature of CSR to organisations. The handouts
prepared by the learner must be detailed with appropriate style
and content for the identified audience.
3 2.4 The paper produced by the learner must provide accurate, and
detailed information for the chosen organisation, The evaluation
needs to be balanced and provide reasoned judgements.
Coversheet (p.1)
5 Global Business Strategy (p.2-3)
GBS Sample 1/Name_ID_GBS Task 1
1 | P a g e
Global Business Strategy
Level 7 – Unit 7.2
International Business
Environment Analysis.
Report – Activity 1
Revised 18 Sept 2015
2 | P a g e
Contents
Section Details Page
Activity 1
Introduction Company profile 4
1a International business environment Analysis Techniques 4 – 7
1b Analysis of the micro and macro of Marks & Spencer‟s PLC 7 – 8
1c The impact of international business environment on Marks & Spencer‟s 8 – 9
1d What does globalization mean for Marks & Spencer‟s? 9 – 10
1a (2) What is the extent of globalization on organizations? 10
3 | P a g e
1b (2) Operating structures different organizations in international markets. 10 – 11
References 12
Introduction
Marks & Spencer PLC was founded in 1884.It has grown from a single market stall to an
international multi-channel retailer. They sell stylish, high quality value clothing and home
products as well as food, responsibly sourced from around 3,000 suppliers globally. Their
portfolio covers general merchandise, food, international and multi-channel across 54
international territories with nearly 86,000 employees.(Marks and Spencer, 2014).
International business environment Analysis Techniques
Business environment is the combination of internal and external factors that influence a
company‟s operating situation and the overall business. It is both Micro and Macro in nature.
Micro or internal factors are controllable and could include management style, organizational
culture, mission and value statement. Whereas Macro or external factors are uncontrollable these
Corporate Social Responsibility
On Internationally Operating
Organizations
What is Corporate Social Responsibility?
CRS or Corporate Social Responsibility
Its an unwritten understanding that assumes companies are Obligated socially to
look beyond only the objective of making profit
Socially obligated to support other principal groups in society out-with the
immediate needs of staff, shareholders and or stakeholders
Financial CRS, environmental CRS, and social CSR are often included business
strategies.
Moral and Ethical issues
Ethical issues affront international business differences areas, this could
include the laws, different regions cultures it can also cover economic
development and political systems.
Human Rights
Corruption
Moral Obligations
Issues within the environment
Employment practices
Human Rights
Basic human rights in the western world are by law
Rights such as freedom of association,
freedom of speech,
freedom from political repression
These basic human rights we live by are not by law enforced or respected in
many countries
What is the responsibility of a international company in a country where basic
human rights are trampled on?
Corruption
Throughout history we have been aware of the problem and impact of
Corruption across the world. Even in todays society where we have
regulations in place to prevent this it still occurs
Businesses across the globe have gained economic advantages though bribery
and back handed deals usually with government officials
The United States passed the Foreign Corrupt Practices Act to fight corruption
Outlawed the paying of bribes to foreign government officials to gain
business
Issues within the environment
Home nations Environmental regulations are often enforced.
Host nations regulations are usually inferior if at all
Issues arise as no one individual is responsible for the Environment, most of
the environment is public so who should be responsible for it?
The tragedy of the commons occurs when a resource held in common by all,
but owned by no one, is overused by individuals, resulting in its degradation
Employment practices
Minimum wage
Minimum age to work
Safe work place
Adequate breaks
Proper equipment to do the work asked
Corporate Strategy & Social And Ethical
Responsibilities
Corporate strategy
Corporate strategy involves long term company-wide decisions and actions
that can help an organization achieve its objectives. (Hill and Jones, 2008). It
takes into account the environment through its structure of resources and
competencies with the aim of achieving and exceeding the expectations of
the stakeholder.
Corporate responsibility
Corporate responsibility Is a company’s moral obligation and efforts that go
beyond what may be required by regulators or environmental rules. Its what
companies should look at beyond profit making.
Conflicts between corporate strategy and
ethical and social responsibilities
Shareholder
To make maximum profit
Stay within the boundaries of
the law
Increase business revenue and
size
Stakeholder
Increase company awareness
Increase popularity within the
local nation
Meet the needs of multiple
groups, staff, local population,
consumers
Shareholder v Stakeholder
Carroll’s Corporate Global Social
Responsibility Pyramid
Figure 1: Corporate Global Social Responsibility Pyramid
Corporate Social Responsibility
Pros & Cons
Pro’s of CSR
Improved innovation, competitiveness
and market positioning
Better risk management abilities as you
are more aware of the environment
and the full scope of the company
Improved reputation in the market
Better equipped to adapt to changes
More robust accepted in the community
as it shows an ethical side giving a
“social license” to operate
Cons’s of CSR
By utilising the recourses available to
you in society it makes for higher profit
It can give company’s too much power.
There is no one directly responsible for
CSR as no one in the company is
accountable directly to society
Legislation and Guidance
Legislation
These are regulations and obligations required by law that companies
must implement and abide by.
Guidance
Are what companies are influenced to do in order to go beyond legal
requirements
Legislation and Guidance relating to
Corporate Social Responsibility
Environmental CSR
Legislation
Environment Act 1995
Guidance
Considering land use/biodiversity
Reducing packaging/improve
labeling
Marketplace CSR
Legislation
Sale of Goods Act 1979
Consumer Protection 1987
Guidance
Promoting diversity. For example, by
promoting positive role models
Engaging in cause-related marketing
Legislation and Guidance relating to
Corporate Social Responsibility
Community CSR
Legislation
National Parks and Access to the
Countryside Act 1949
The Conservation of Habitats and
Species Regulations 2010
Guidance
Loaning facilities and assets
Liaising with local communities
Workplace CSR
Legislation
Employment Protection Act 1978
The National Minimum Wage Act, 1998
Guidance
Respecting rights to free assembly and
collective bargaining
Listening to and involving employees
Characteristics of Socially Responsible
Companies
Ensure a safe work environment.
Uses clear and simple advertising- don’t mislead.
Offers medical assistance.
Promotes recycling.
Helps displaced workers with placement.
Gives money to charities.
Sponsors educational causes.
References
Caroll. A.B (2003) Academy of Management Review: A Three-Dimensional
Conceptual Model of Corporate Social Performance
World Bank Group (2003) Corporate Social Responsibility Practice:
Strengthening implementation of corporate social responsibility in global
supply chains
Hill, C. Jones, G. (2008) Essentials of Strategic Management, Hill &Jones,
South-Western College Publishing
Finbar, M. (2014, December). Unit 7.2 Global Business Strategy. Lecture
conducted from Btec, Abu Dhabi.UAE
Hill, C W L (2013) International Business, The McGraw-Hill Companies, Inc
http://www.amazon.com/s/ref=ntt_athr_dp_sr_1?_encoding=UTF8&sort=relevancerank&search-alias=books&field-author=Charles Hill
GBS Sample 1/Name_ID_GBS Task 3
1 | P a g e
Global Business Strategy
Level 7 – Unit 7.2
By Xxx
2 | P a g e
Evaluation of the International
Operations of Marks & Spencer PLC
Report
Revised : 18
th
Sept, 2015
3 | P a g e
Contents
Details Page
Company profile 4
Strategic direction 4
Business strategy 4
Organizational structure 5
International operations 5
International performance 6
Future challenges 6
References 7
4 | P a g e
Company profile
Marks & Spencer is now a multi-channel retailer. It was started by Mark Marks and Thomas
Spencer. It started as a single stall in Kirkgate Market in Leeds in 1884. Over the 130 years it has
been in operation is has grown in to multimillion GBP business operating in 50 territories
worldwide with 86,000 employees. In 1926 Marks & Spencer became a publicly listed
company. From here it has slowly started to diversify, adding a food department in 1931. The
1930’s saw the introduction of cafés and the opening of their own research lab. Marks & Spencer
went international with their first stores in Europe in 1975. They continued to grow over the
coming years, opening up in Hong Kong in 1988 – the same year they acquired several American
companies including Brooks Brothers & Kings Supermarkets.
Strategic direction
Marks & Spencer’s Strategic direction is expansion by market development. Its aim is to expand
and open up in new locations and countries using the existing products and services to increase
market share. Looking at new areas geographically, once set up they will make changes to suit
the local market and consumers. Marks & Spencer has already successfully expanded into India,
Russia, China, the Middle East and Western Europe. This type of strategy is great for expanding,
growing market share and increasing competitive rivalry. It can however sometimes lead to
alienation of current consumers.
Business strategy
Marks & Spencer has a mix of focused & differentiated business strategy, concentrating on
product differentiation supplying a higher quality of product that was produced locally so at a
higher cost. They have recently changed to a new low cost strategy that they have named “Plan
A”. Plan A has highlighted five factors to achieve their business goal they are climate change,
waste, sustainable raw material, fair partnership and health. (Mark & Spenser, 2014). The plan
also highlights their aim to offer better quality products at a competitive price. The introduction
of this strategy has already increased sales by 4.2 %. This low cost strategy is one where the
company and its operations are run from a very well put together corporate strategy; meaning
that the internal operations, functions, departments and business units are running with the
5 | P a g e
highest efficiency. Market development and procurement are a constant in business strategy. To
achieve the best market knowledge and the lowest cost.
Organizational structure
Marks & Spencer have adopted a functional or flat organization structure. This type of
structure works well for the company as it ensures specialized groups of people in each area
making the most of the pool of resources. It has limited levels of management so allows more
direct dialog between employees and management. It allows each group to have control of their
area, having both responsibility and accountability. A flat structure means the whole organization
work with ease and less resistance. This works well, however due to Marks & Spencer’s plans to
expand and to continue to grow international this organizational structure will need to be looked
at as it is not suitable. They need to look at a geographical divisional structure which will allow
the company to adapt to the local needs of that area. It will make expanding in to new
geographical areas easier.
International operations
Value chain
activity
Analysis Details
Primary:
Inbound
logistics
Strength Successfully launched the new national e-commerce distribution center. This
continues to focus on the implementation of a single-tier network anddistribution
center. This is reflected on international markets also.
Operations Strength Continue to develop innovative packaging aimed at reducing their footprint.
Although not manufacturing the products themselves they are ensuring the best
practice
Outbound
logistics
Strength They have built the foundations of a robust infrastructure through new IT
systems and logistics developments. As they start to reshape the distribution
network to a single-tier network.
Marketing and
Sales
Strength M&S have a strong marketing campaign. They have re- branded and launched
Their marketing today is both interactive and multifaceted
Service Strength Increased number of retail staff has resulted in improved customer service.
M&S actively prioritized core customers and monitor customer service with
regular review of customer reaction to products, as well as in-store and online
experience through focus groups and in-house Customer Insight Units
Secondary:
Procurement Strength M&S has over 3,000 products, raw material and service suppliers with current
social compliance assessments covering many aspects of human rights listed on
the Supplier Ethical Data Exchange (SEDEX). Many suppliers are from
developing countries, which depend on Western companies for their contracts.
(M&S, 2014).
6 | P a g e
International performance
Marks and Spencer have been successful internationally. International sales rose in 2014 by
6.2% to £1.2bn, driven by strong growth in India, Russia, China, the Middle East and Western
Europe. In Europe sales rose by 3.9%, with the Netherlands and France being the focus areas.
Existing strategic relations continue to improve. Sales in the Middle East grew by 2.6%, with
stores opening in Lebanon and Cairo. Some areas internationally weren’t as successful, e.g.
China where they needed to refocus strategy on the main flagship stores due to poor sales. In
Ireland the decision was made to close four stores. The successful international growth comes
from all areas of the Marks and Spenser’s portfolio of Food, Retail and general merchandise.
The international team is structured in a way as to give a better understanding of the local
markets which enables to focus products depended on the area.
Future challenges
Main future challenges that Marks and Spencer will face include the reduction in demand for
food. E-commerce and online shopping is growing significantly with consumers preferring the
ease of this method. They will have to respond to the dynamic environment within which they
operate and their strategy to become a truly international, multi-channel retailer. Consumers are
more individual and fashion focused, meaning retail demand is higher and they need to keep up
with these fast paced evolving market trends. Increased competition from other competitive high
street retailers will always be a challage. There is always the risk of global recession, so M&S
will need to have a strong risk strategy and contingency plan in place.
Technology
development.
Strength M&S are slowly revamping their brand, including the introduction of technology.
Some 321 stores are equipped with 1,500 iPad and 40,000 store employees have
the skills to sell from the new website to maximize selling opportunities. (Mark
& Spenser, 2014).
Human
resource
management
Strength M&S have restructured their organization to be more flat and specialized. This
empowers employees and increases productivity
General
Administration
Strength Top management has recent restructured and it has put in to place plans to grow
their staff with them through training & development. M&S are Implementing
management training plans for all levels from graduate program to onsite
training.
7 | P a g e
References
Marks and Spencer plc (2014) corporate website (online) available from
http://corporate.marksandspencer.com/ accessed on Dec 22nd 2014
http://corporate.marksandspencer.com/
GBS Sample 2/Name – ID GBS Task 1
1
Statement and Confirmation of Own Work
StudentDeclaration
IhavereadandunderstoodATHE Assignment Submission guidelines and AcademicDishonesty
andPlagiarism policies.
I canconfirmthefollowingdetails:
ID No:
Name:
Programme Title: ATHE Level 7 Diploma in Strategic Management
Course Title: Global Business Strategy
Subject tutor:
Assignment No:
EnrolmentDate:
Due Date:
I declare that the work submitted is my own work andthatIhavenotplagiarisedanypartofit.
Ihavealsonoted theassessment criteriaandpass mark forassignments.
Signed:
2
Course Title: Global Business Strategy
ATHE Level 7 Diploma in Strategic Management
Submitted by: Xxx
3
Table of Contents
Section 1: Business Report – Analysis of International Business Environment 1
International business has grown rapidly in the recent years because of technological
advancements, cross border movements, liberal government rules and policies etc. and
consists of all commercial transactions between two or more countries.This report
analyses globalization and its impact on business environment. Nissan Motor
Corporation, a multinational automobile company is selected to carry on the study.
Nissan Motor Co. Ltd. was founded in 1933 in Yokohama City, Japan. At present, around
the world, Nissan has its manufacturing units in 20 countries including Japan and their
products and services are available in more than 160 countries around the globe. Nissan
Motor Co. Ltd. has a portfolio of three brands- Nissan, Infiniti and Datsun, which are
marketed in all major markets in the world. In 1989, in North America, Nissan launched
Infiniti as anexceptional brand. In 2012, the new global headquarters for Infiniti was
opened in Hong Kong with sales operations in over 50 countries. Datsun brand was re-
launched to the world in 2012 (Nissan Motor Corporation Annual Report, 2014).
1.2 Layers of the business environment
Any business organization needs to operate in an environment. A business environment
comprises of all the external and internal factors that effects an organization’s operating
conditions like, competitors, suppliers, government entities, owners, social, economic and
market trends etc. (Daniels, Radebaugh, Sullivan, 2009). In order to analyze the
environment, we have to understand the different levels or layers in which a firm
operates.
Figure (i): Layers of business environment (Johnson et al,2008)
6
The Macro-Environment consists of the external environmental factors that impact an
organization’s activities.Industry consists of organizations doing the same business.
Competitors and markets are the immediate layers surrounding the organization. The
concept of strategic groups can help identify an organization’s close and distant
competitors. Then there is the Organization itself. (Johnson, Scholes, Whittington, 2008).
1.3 Techniques to analyze international business environment
For an organization to operate successfully, it needs to identify and analyze its
environments and resources and devise a strategy accordingly.
There are two types of business environments namely Macro environment or external
environment and Micro environment or internal environment.
1.3.1 Macro Environment
The macro environment represents forces that impact all firms across all industries.Two
ways by which the Macro-Environment of a business can be examined are by using the
PESTEL analysis technique and Porter’s Diamond analysis technique.
The PESTEL analysis is a structure that classifies the Macro-environmental influences
as Political, Economic, Social, Technological, Environmental and Legal (Johnson et al,
2008).
The Organization
Political factors
o Attitude of government
authorities
o Political stability or
instability
Economic Factors
o Growth of the economy
o Monetary policies like
inflation, interest rates
etc.
Legal factors
o Employment laws
o Safety regulations
Social factors
o Changes in lifestyle
o Size and structure of
workforce
Environmental factors
o Environmental
regulations
o Environmental
contaminants
Technological factors
o Changes in information
technology
o New developments and
discoveries
Figure (ii): PESTEL
Analysis(Johnson et al,2008)
7
Advantages of PESTEL Analysis Disadvantages of PESTEL Analysis
Provides a simple outline for
analysis
Helps minimize impact of possible
threats to the organization
Needs to be done on a regular basis
to ensure effectiveness
Most of the data are based on
assumptions that proves to be
unsupported
Table (i): Advantages and disadvantages of PESTEL Analysis
Porter’s Diamond proposes that there are indispensable explanationsas to why some
countriesare more competitive than other countries and why is that a few industries in
these countries more competitive than others(Johnson, Scholes, Whittington, 2005).
Factor conditions: includes skilled resources, capital resources technology base etc.
Demand conditions: the more demanding local market is, the more it hints to national
gain.
Related and supporting industries: when a firm depends on the supporting competitive
local suppliers, it can enjoy more cost effective and advanced inputs.
Firm strategy, structure and rivalry: these often differ among nations. Domestic rivalry
brings in the best of a firm as they are under pressure to improve and innovate, thus
customers benefitting from getting better quality products and services at lower costs.
The role of the government comes in to influence these four factor determinants
positively or negatively(Johnson et al, 2005)
Advantages of Porter’s Diamond Disadvantages of Porter’s Diamond
Organizations can identify the
extent to which they can build on
home based advantage
Enables industries to develop a
globally competitive position
Capability of a firm to look into
location advantages of other nations
are limited
Significant lack of national
resources
Table (ii): Advantages and disadvantages of Porter’s Diamond
1.3.2 Micro Environment
The micro environment represents all the factors that have direct influence on an
organization’s performance and decision making liberty and these factors comprise of the
organization’s customers, suppliers, competitors, and the public (Johnson et al, 2008).
8
Porter’s 5 forces analysis was developed for conducting strategic industry analysis. In
this framework, one can analyze an organization’s competitive structure by looking at the
5 forces of competition that influence profit potential(Johnson et al, 2005).
Table (iii): Advantages and disadvantages of Porter’s 5 Forces
Mendelow’s Stakeholder Analysisis used to identify and investigate the expectations or
interest and power of stakeholders, who are the individuals or groups who has an
influence or is influenced by a business organization. (Johnson et al, 2008)
Under Mendelow’s Stakeholder analysis, these stakeholders are categorized into three.
Competetive
Rivalry
Threat of
new entry
into an
industry
Power of
buyers
Threat of
substitutes
to industry
products
and services
Power of
suppliers
Advantages of Porter’s 5 Forces Disadvantages of Porter’s 5 Forces
Provides useful understanding
about the forces at work in the
organization
Improved decision making and
competitive advantage, better
productivity and faster time to
market
The competitive forces are likely to
be different in each segments of the
same organization
The assumption that the buyers,
suppliers and competitors never
interact with and influence each
other
Threat of new entry:
Cost advantages
Economies of scale
Competitive Rivalry:
Customer loyalty
Quality differences
Power of suppliers:
Number of suppliers
Size of suppliers
Power of buyers:
Number of buyers
Size of order placed
Threat of substitution:
Substitute performance
Cost of change
Figure (iii): Porter’s 5 Forces (Johnson et al, 2008)
9
Connected stakeholders,are the organization’s customers, suppliers, and distributors etc.
who are closely related to the functions of the organization. Employees and management
forms the internal stakeholders who work inside the organization.External stakeholders
are the government entities, environment groups, media, investors, and local communities
etc. who are indirectly affected by the organization (Johnson et al, 2008).
Table (iv): Advantages and disadvantages of Mendelow’s Stakeholder Analysis
1.4 Analysis of Micro and Macro Environments on Nissan
1.4.1PESTEL Analysis of Nissan
The PESTEL Analysis of Nissan below has identified certain opportunities which Nissan
needs to capitalize in order to gain competitive advantage and as a result increase the
market share. However, the threats that have been recognized will have to be carefully
studied and appropriate strategies devised to mitigate the impact of these threats.
The details of Nissan’s PESTEL Analysis are mentioned below:
Political
Analysis: Threat
Nissan has manufacturing units in 20 countries around the world and therefore it needs to
deal with different political factors influencing its business operations. Some of the
reasons why Nissan sees the political factors as a threat are:
Governments of developing countries encouraging the use of local products. E.g.
Proton in Malaysia, Tata in India etc.
Strict government laws and regulations that can affect the automobile industry as
a whole, like the increase in taxes.
Advantages of Mendelow’s Stakeholder
Analysis
Disadvantages of Mendelow’s
Stakeholder Analysis
Enables to figure out the interest of
all the stakeholders who are related
to the organization
Enables an organization to identify
new opportunities during
implementation of a project
Analysis should be done on a
regular basis or continuously since
the stakeholders may change
rapidly
A productive collaboration with
stakeholder is missing
10
Economic
Analysis: Opportunity
The economic factors like global economic growth, business setting in the industry etc.
are considered as opportunity for Nissan. Few of those economic factors influencing
Nissan are:
Improvements in US markets
Slow recovery in Europe and Russia. E.g. Nissan’s sales rose 2.4% as matchedto
a 1.8% rise in the global market in Europe and Russia (Nissan Annual Report
2014)
Social
Analysis: Threat
Social factors also have an impact on automobile industry. These factors are considered a
threat for Nissan and they are:
Changes in buying patterns of customers, e.g. customers outlook towards vehicles
has changed from car being seen as a status symbol to focusing on features like
fuel efficiency, low emission cars etc.
Environment awareness of destructive emissions through vehicles
Government’s attitude to road safety in developing countries
Technology
Analysis: Opportunity
Nissan is constantly developing its technologies to make its vehicles better, more
economical and reasonably priced for its customers. Nissan considers technology as an
opportunity in its environment and below are few examples of how far Nissan has
exceeded in technology and innovation.
First automakers to road-test autonomous drive vehicles.
The Nissan LEAF is the world’s first mass-produced zero emission vehicles and
the best-selling electric vehicle with 45% market share (Nissan Annual Report,
2014).
Environment
Analysis: Opportunity
11
Customers these days are very much aware of the environmental effects of harmful
emissions from vehicles and this has put pressure on automobile manufacturers to
produce vehicles which are eco-friendly and fuel efficient. Controls on carbon emission,
eco-friendly and fuel efficient cars are the advantages of Nissan. Theseenvironmental
factors are considered an opportunity by Nissan as customers consider these as an
important feature while purchasing vehicles.
Legal
Analysis: Threat
Legal factors such as below are considered a threat to Nissan.
Tax increases in Japan would lead to reduction in consumer demand
Strong environment protection laws
Green movements that lead to increase in taxes
1.4.2 Porters 5 Forces Analysis of Nissan
Porters 5 Forces helps to evaluate the attractiveness of abusiness by examining various
threats like the treat of new entry, substitutes, buyers, suppliers and degree of rivalry
between competitors (Johnson et al, 2008). The Porters 5 Forces for Nissan mentioned
below analyses the level of threat for each factor.
Substitutes
Analysis: Low Threat
Other leading car manufacturing companies
Sports bike manufacturing companies
Government focus on public awareness about fuel emissions and thereby
encouraging to use public transport
Buyers
Analysis: Moderate Threat
Increase in bargaining power of buyers as a result of the increase in information
and knowledge about products in the same category
Switching costs are decreasing because of intense competition
Suppliers
Analysis: High Threat
12
Nissan shares its mechanisms with alliance partner Renault
Nissan’s concern over the quality of products ensures that they choose the right
suppliers and right costs
Competitors
Analysis: Moderate Threat
Nissan faces strong global competition in terms of prices, features, luxury etc.
Mercedes, Toyota, Audi in the automobile industry, Yamaha, Ducati in bike
manufacturing proves to be very competitive
New Entry
Analysis: Low Threat
Prospective competition from Chinese manufacturers
Technology advancement and environmentally friendly vehicles like the hybrid
cars. Although Nissan has developed in the same category, Toyota’s “PRIUS”
hybrid cars holds a good share in the market
1.5 Impact of International Business Environment on Nissan
Like any organization functioning in an international environment, Nissan too faces both
opportunities and threats due to the nature of its operations globally.
Environment
Analysis: Opportunity
Production of hybrid cars zero-emission technology is an advantage for Nissan to
focus on low CO2 emissions and fuel efficient vehicles e.g. Nissan’s LEAF, e-
NV200
Competitors
Analysis: Opportunity
Nissan’s competitors Toyota, Honda and Mitsubishi has jointly decided to set up
electric vehicle charging infrastructure in Japan
Nissan is utilizing this opportunity to increase its sales in electric vehicles.
Buyers
Analysis: Opportunity
13
Nissan’s market intelligence to track customer trends to ensure suitable models
for each territory or segment are offered.
Nissan is focusing more onareas like North America and China where the
company believes its most important market is currently and an opportunity for
Nissan to increase sales in these regions.
Suppliers
Analysis: Opportunity
Nissan’s exceptional partnership with suppliers for manufacturing their products
Nissan uses fair and impartial process in selecting suppliers and influences
supplier’s profits and businesses directly
Technology
Analysis: Opportunity
Zero-emission technology
First automakers to road-test autonomous drive vehicles
Political
Analysis: Threat
Government awareness and development of rules and regulations to use public
transport in developing countries
Political instability in countries, e.g. in the first half of 2013, Nissan’s sales in
China were obstructed by the islands clash (Nissan Annual Report 2014)
Economic
Analysis: Threat
Increase in rate of inflation
Exchange rate fluctuations
Countries imposing and increasing taxes on purchase of vehicles
Increase in prices of fuel and manufacturing costs could end in consumers opting
out of buying cars or buy cheaper substitutes
New Entrants
Analysis: Threat
Potential competition from Chinese manufacturers and hybrid vehicles poses a
threat to Nissan
14
Substitutes
Analysis: Threat
Government focus on using public transport awareness
High competition with Toyota and Honda
Sports bike manufacturing units
1.6 Benefits, Opportunities and Challenges of Globalization on Nissan
“Globalization refers to the broadening set of interdependent relationships among people
from different parts if the works that happens to be divided into nations, sometimes
referred to the integration of world economies through the reduction of barriers to the
movement of trade, capital, technology and people”. (Daniels et al, 2009:48)
Globalization has a great impact on automobile industry. Nissan has set a good model of
showing the world what globalization can get to an organization.
In 1990s, Nissan was almost at the edge of bankruptcy, when in 1999; Renault came up
with the take-over offer to Nissan. The current CEO of Nissan, Carlos Ghosn was sent to
Nissan by the Chairman of Renault to reorganize the company and make it profitable
again. Within one year into Carlo’s change plan, Nissan was back profitable. He brought
in noticeable modifications like changing the senior management of Nissan, closing down
5 of Nissan’s plants, laying off people from the manufacturing units and instead brought
small units in South and North America were labor was cheap. He diversified the staff to
bring in people with various backgrounds in culture, nationality, gender and education.
Benefits of globalization on Nissan
Cheaper and efficient labor
Bargaining power with suppliers, lower prices
Diversification- ensures to meet the diverse needs of customers
Sharing technology
Global plant floor- design anywhere, make anywhere, sell anaywhere
Brand reputation
Innovation- invest in R&D. e.g. development of Nissan’s LEAF electrical vehicle
Strong financial performance
15
Opportunities of globalization on Nissan
Increase in demand for environmentally friendly hybrid vehicles
Growth through strategic partnerships
Growth through multicultural and international associations
Increase in fuel prices rises the demand for hybrid and electric vehicles
Challenges of globalization on Nissan
Global competition in the automobile industry
Increase in fuel process
Increase in price of raw materials
Growing consumer demands
Exchange rates of yen
Decrease in fuel prices in future could make hybrid and electric vehicles less
attractive to customers
1.7 Extend of Globalization on Organizations
The extend of globalization of an organization depends on the organization’s mission,
objectives or values, resources used, the end products, rules and regulations governing
the organization etc.
Businesses whether big or small can have different strategies in place. Four basic
strategies that organizations follow to decide on how to run their operations thus attaining
their objectives and dealing with challenges are mentioned below:
1.7.1 Domestic Strategy
The organization pursuing domestic strategy assesses international businesses distinct
from its domestic business.
Products are often intended to meet the needs of the local market and not to be
traded in foreign markets
Domestic strategy usually is centered on simple exporting
1.7.2 Multi-domestic Strategy
The multi-domestic strategy alters its products, services and business activities to suit the
needs of the local region or country. (Daniels et al,2009)
16
Products are adapted to meet the requirements of local conditions
Minimizes political risk, given the local standing of the company
Some companies that followed a multi-domestic strategy are Johnson & Johnson and
Proctor & Gamble. The technology invented by the R&D unit in P&G’s Japan subsidiary
to reduce thickness of infant’s diapers without loss of any sponginess created high value
for P&G in Japan initially and later worldwide. (Daniels et al, 2009).
1.7.3 Global Strategy
A company adapting global strategy chooses to maximize integration. This strategy
forces businesses to manufacture goods for a whole market and presume that there are no
differences between countries regarding consumer tastes or preferences and assume that
consumers will sacrifice these to get their high standard products (Daniels et al, 2009)
These companies see the world as one market
Firms provide standardized products and uses standardized marketing tools
Examples of companies pursuing global strategy are Google, Nokia, American Express.
1.7.4 Transnational Strategy
A transnational strategy concurrently uses location economies, influences core
competencies and attends to local responsiveness (Daniels et al, 2009).
GE, Philips, Acer are companies that has transnational strategy.
Is a combination comprising the major advantages of multi-domestic and global
strategies
Focuses on standardizing when possible and adapting when required
1.8 Structures of Organizations Operating in International Markets
In order for an organization to carry out its strategy for an organization, there needs to be
a formal plan of relationships, roles and responsibilities within an organization. This
formal agreement or plan is what is known as an organization structure. (Daniels et al,
2009).
Determining the appropriate structure for an organization to ensure maximum efficiency
with distinct line of authority is a crucial operational decision. Factors like the
organization’s objective, values, the impact of international operations on the company
performance etc. often determine the type of organization structure.
17
1.8.1 Functional Structure
Figure (iv): Functional Structure (Daniel et al, 2009)
Functional Structure is the way how work is organized when an organization’s products
share a mutual technology and competitiveness for global strategy. This structure is more
popular among companies manufacturing narrow range of products. E.g. companies such
as Total or British petroleum have this structure.
Advantages Disadvantages
Efficient use of resources
Helps maximize scale economies
Inability to respond to
environmental changes
Poor communication among
departments
Table (v): Advantages and disadvantages of Functional Structure
1.8.2 Divisional Structures
Organization uses divisional structure format to lay down roles and responsibilities
between departments according to outputs.
1.8.3 Product Divisional Structure
Most of the companies around the world have Product Divisional Structure as these
businesses include variety of assorted products. E.g. Moet Hennessy and Louis Vuitton
two of the world’s famous brands merged to be one group known as LVMH. Since these
two companies had different products, the managers split them into 5 divisions each
division concentrating on a sole product. (Daniel et al, 2009).
Advantages Disadvantages
The most popular and well suited
for a global strategy as both the
domestic and international
Duplicate functions among product
divisions
No formal means of how one
CEO
Production
Asia
Production
Europe
Production
Marketing
Asia
Marketing
Europe
Marketing
18
operation of a product report to the
same manager
Enhanced coordination and better
assessment of manager performance
product division can learn from
other divisions experience
Figure (v): Product Divisional Structure (Daniel et al, 2009)
1.8.4 Geographic Divisional Structure
When organizations have large foreign operations that are not controlled by a single
country, they tend to use geographic division structure.
e.g. Nestle organization has a geographic divisional structure. It has more than 500
factories in nearly 90 countries selling 8000 brands worldwide. The drawback of this
structure is mainly duplication of work. In case of Nestle, their factories in US were
paying more than 20 different prices for vanilla to the same suppliers because of the lack
of coordination (Daniel et al, 2009). Nissan is another example of an organization
following the geographic divisional structure.
Advantages Disadvantages
Useful in a specific market rather
than on global market
Gives country manager flexibility
to adapt to local conditions
Duplication of work in many areas
Lack of coordination
CEO
Corporate
Managers
Divison A
R&D Marketing Finance
Division B
R&D Marketing Finance
Division C
R&D Marketing Finance
Table (vi): Advantages and disadvantages of Product Divisional Structure
Table (vii): Advantages and disadvantages of Geographic Divisional Structure
19
Figure (vi): Geographic Divisional Structure (Daniel et al, 2009)
1.8.5 Matrix Structure
Matrix structure gets the benefits simultaneously from both functional and divisional
structures.
ABB, Citibank, Dow Chemicals are organizations that adapted Matrix structure and soon
realized the drawbacks of the structure as they didn’t know who would handle
responsibility in a team and returned to structures that specified roles and responsibilities
(Daniel et al, 2009).
Advantages Disadvantages
Encourages each group to exchange
information without restrictions
Has dual reporting rather than
single line of command
More complex than other structures
like financial and divisional
structures thus leading to problems
in operations
Requires that group compete with
each other for resources, rewards or
risks
CEO
Europe
Diviosn
R&D Marketing Finance
Asia
Division
R&D Marketing Finance
CEO
Group A Group B Group C Group D
Country X Country Y
Figure (vii): Matrix Structure( Daniel et al, 2009)
Table (viii): Advantages and disadvantages of Matrix
Structure
20
1.8.6 Network Structure
An organization with a network structure outsources value activities to other firms.
(Daniels et al, 2009)
For example, companies like Nike, emphasize on their design skills and hires other
companies like Sanmina to make their products. Similarly, many banks, hotels, credit
card companies found that they can create more value by outsourcing call center
functions to those who has competency in that activity (Daniel et al, 2009).
Advantages Disadvantages
Helps organization to outsource
activities
More flexible
Disintegration makes it complicated
to develop control systems
Managers need to locate good
sources to outsource for the
organization’s operations to run
successfully
Table (ix): Advantages and disadvantages of Network Structure
1.9 Conclusion
Further to the micro and macro environmental analysis, a number of factors which could
affect the running of Nissan both positively and negatively were identified.
Consequently, the opportunities presented will have to be maximum benefited, while on
the other hand, the challenges has to be carefully tackled, with effective strategies,
making use of Nissan’s internal strengths and resources. Therefore, the effective strategy
for Nissan will be to orient the operations towards the environmental analysis results, by
effectively utilizing its unique resources and core competencies.
Company
Producers
Distributiors
Designers
Suppliers
Figure (viii): Network Structure (Daniel et al, 2009)
GBS Sample 2/Name – ID GBS Task 2 handouts
Activity 2
a) An analysis of the moral and ethical issues faced by organizations operating
in an international environment
A lot of changes have taken place in the way business is conducted in today‟s world.
These changes can be seen in all the areas and functions of any business, starting from
the nature and style of management to the motive behind operating a business.
The growing concerns against the negligent behavior of the businesses have resulted in
several changes being introduced in the last fifty years. Apart from making profits, the
businesses were expected to follow certain socially acceptable practices as well as they
were expected to be held morally responsible and accountable for their actions with
respect to the society, environment in which they operate and the overall well-being of all
those involved with the business. This growing concern has resulted in what is known as
business ethics in today‟s business world.
Since the last three decades, businesses have addressed business ethics in different forms,
like introduction of compliance programs and managers, development of codes of
conducts and also by providing training on behavioral issues. However, despite all these
efforts, the issue of ethics in business is still a matter of heavy debate and lots of studies
are being conducted on the various issues associated with ethics in business.
Understanding business ethics can be a difficult task. The field is very diverse and covers
a lot of issues like corporate governance, morality, reputation management, fair
laborpractices etc. In fact, business ethics addresses the entire scope of responsibilities
that a company has to each of its stakeholders, and it is also about the process of
management, the relationships between managers and the relationships between
managers and other employees (Harrison, 2005:12). Further, the concept of business
ethics incorporates the issues like corporate responsibility, social responsibility, corporate
compliance etc.
The ethical issues in international business are:
– Employment: work conditions of a company might be different in the host
country than what is in their home country. Company then needs to decide on
which work conditions they would like to implement- host country, home country
or something in between.
– Corruption: government officials are often paid bribes by companies to gain
business. The US Foreign Corrupt Practices Act was passes to fight corruption.
But what is considered ethical in one country cannot be treated as same in another. E.g. in
developing countries like India, China etc. it is common practice to bribe officials,
however this cannot be tolerated in other countries and businesses will have to face
severe consequences if they indulge in such practices.
– Human Rights: basic human rights are not accepted in many countries and are
taken for granted in many places which are not universally acceptable.
– Environmental regulations or pollution: when environmental regulations in the
host country is inferior to that in the home country, ethical issues arise in form of
high levels of pollution, overuse of common resources etc.
– Moral Obligations: companies are not free from fulfilling moral obligations.
Laws are one of the ways to make companies behave morally by returning
something beneficial back to the society.
Additional moral and ethical issues faced by companies in international business:
– Doing business transparently
– Abstaining from tax avoidance procedures
– Fighting against corruption and bribery
Triple Bottom Line
Organizations often think about how to serve their customers and society, but their focus
on business have always been on the „bottom line‟. Lately, a new observation to the
bottom line has emerged to what is known as Triple Bottom Line.
If organizations want to achieve success, they should consider the Triple Bottom Line:
economic, environmental and social which is also known as 3 Ps: Profit, Planet and
People.
An effective CSR must reflect the configuration of these with the organization‟s business
strategy, values and sustainability.
Ways to improve moral and ethical issues faced by organizations operating in an
international environment:
– Avoid any deliberate harm to the environment and society
– Follow the government regulations in the host country and cooperate with their
government
– Pay fair share of taxes in line with the tax regulations
– Respect the host country‟s cultural beliefs and norms
– Make contributions to the development of the host country
– Respect human rights of the company‟s employees
b) An analysis of the conflicts between corporate strategy and ethical and social
responsibilities
“Corporate Social Responsibility (CSR) refers to good citizenship by the firm- i.e., its
obligations to society, particularly when society is affected by the firms strategies and
practices” (Verbeke,2009:383)
CSR assist businesses to be like good citizens, i.e. to contribute to society in a beneficial
way, by avoiding any harm and ethically relating to their stakeholders, employees,
suppliers and the entire community.
Carroll’s CSR Pyramid
The components of Carroll‟s CSR pyramid are:
Economic Responsibilities
– Consistent performance with maximum earnings per share
– Maintaining a strong competitive position
– Maintaining a high level of operating competence
Legal Responsibilities
– Consistent performance with meeting expectations of law and government
– Complying with various legal authorities
– Being a law enduring corporate citizen
Ethical Responsibilities
– Consistent performance with meeting expectations of social and ethical norms
– Respecting the new and evolving ethical norms ibn the society
– Preventing ethical norms from being compromised
Philanthropic Responsibilities
– Consistentperformance with philanthropic expectations of society
– Importance of manager to participate in charitable activities
– Providing assistance to educational institutes
Roles of business in society
The Shareholder Model
As a business flourishes in a society, it needs to maintain a good relationship with its
stakeholders. Employees, customers and suppliers are the most influential stakeholdersof
a business with media, local residents, trade unions, government authorities having
extensive range of impact on business. Analysis of a society from a stakeholder point of
view often helps business to determine risk and future opportunities.
The Shareholder Model
This model focuses on the idea that the main purpose of a business is to make profit for
its owners thereby increasing the wealth of the shareholders.
This model believes that excessive legal regulations are not necessary while doing
business in a society and that their attempt to maximize wealth, the society at large will
also be befitted.
Advantages and Disadvantages of CSR
The incorporation of CSR in businesses is generally viewed as a positive object in many
companies. Apart from the benefits of increase in company transparency, a positive
consumer image of being a good corporate citizen, there are also certain disadvantages to
CSR.
Advantages:
– Better reputation
– Increased customer loyalty
– Greater worker productivity
Disadvantages:
– Difficulty in getting return on investments from social and environmental
programs
– Hesitance from shareholders to put in money in business for serving CSR
programs
– Expensive requirements on companies to focus on CSR
c) Identification of the legislation/ regulation and guidance relating to corporate
social responsibility for organizations
CSR activities differ among countries. What is seencommon CSR activity in one country
will not be seen as important and common in another country. The most common CSR
activities that companies indulge in are:
Leadership
– Involving relevant stakeholders especially employees in determining what success
will be and what their part would be in achieving it.
– Determining policies and procedures on specific concern areas like complaints,
environment, human rights etc.
– Providing essential training to employees to help them take the necessary action
including training on CSR and ethics.
– Fighting corruption and bribery especially if the business is operating in areas
prone to these.
Marketplace
– Providing clear and decent product information with regards to product quality,
safety etc.
– Ensuring that the products and services are safe to human health as well as the
environment
– Promoting environmentally friendly products
– Guaranteeing fair prices to all consumers
Workplace
– Attending the employees and including them in communication between
managers and staff
– Providing provisions for training and development opportunities for employees
– Encouraging a diverse workforce through training, providing equal opportunity
workshops etc.
– Ensuring equal benefits for all employees
– Providing flexible working hours
– Encouraging and promoting health and safety in the workplace
Community
– Helping charities and community organizations by giving gifts of cash or other
forms
– Sponsoring events, sports club etc. keeping brand promotion in mind
– Allowing employees time to do social work
Environmental
– Using green or more efficient technologies
– Reusing and recycling materials
– Minimizing packaging to decrease the amount of consumer waste
– Efficient use of transportation of goods and logistics
GBS Sample 2/Name – ID GBS Task 2
2.1 An analysis of the moral and ethical issues faced by organizations operating in an international
environment
International businesses may face many ethical issues that rise from differences in political systems,
economic development, government laws and regulations and also from cultural differences between
nations.
Ethical Issues in International Business
• Employment
Often when business start operating internationally, the legal employment requirements and working
environment might be different from home market.
• Corruption
Corruption is an ongoing problem in the society. If the company makes payments to secure business in a
market, means it is encouraging corruption through unethical manner.
• Human Rights
It is important for the organizations to choose to survive in a community that respects basic human rights
such as freedom of speech, freedom of association etc.
• Environmental Regulations or Pollution
It is not essential that all foreign countries have regulations on environment. It is possible that companies
may emit harmful materials into the environment to reduce their costs of getting costly anti-pollution
measures.
• Moral Obligations
Moral obligations or social responsibility refers to the idea that businesses should consider giving back
something beneficial to the society to enable them to flourish.
2.2 An analysis of the conflicts between corporate strategy and ethical and social
responsibilities
Governance Structures
The governing body of any organization is basically a Board of Directors. The main responsibility
of the board is to ensure that an organization fulfills the wishes of the primary stakeholders. These
stakeholders could be the shareholders in some private companies, while it could be some funding
body in a public sector company. These differences has led to how organizations operate and hoe
strategies are developed and also the composition of the boards.
The two most general governance structures are:
The Shareholder Model The Stakeholder Model
This model focuses on
maximizing profits for the
owners while minimizing the
importance of the firm’s
interaction with other groups
and its role in the society
This model recognizes the
importance of making profit
and at the same time
identifies the importance of
the firm’s relationship with
other groups- shareholders,
employees, customers,
suppliers and the society as a
whole
Corporate Strategy
Corporate Strategy is the direction and scope of an organization’s by which it creates value across different
businesses with the aim of achieving specific goals (Verbeke,2009).
Corporate Responsibility
Often referred to as Corporate Social Responsibility (CSR), Corporate Responsibility is the commitment of
the business to contribute to the society in which it operates by behaving ethically thereby improving the
quality of life of their employees and families as well as the society as a whole (Verbeke,2009).
Figure b.1: Carroll’s Corporate Social Responsibility Pyramid (Carroll, 1991)
Advantages of CSR Disadvantages of CSR
• Improves company profitability and
value
• Increases company transparency
with investors, media,
shareholders, society etc.
• Attracted by consumers for being
corporate citizen
• Resistance from investors
• Disproportional costs on small
businesses- not all business have
funds for implementing CSR
strategies in their organizations
• Greenwashing- those managers
who forsakes social benefits to
company profits have the risk of
losing their jobs as shareholders
see the responsibility of the
managers to maximize profits for
the company
Advantages and Disadvantages of Corporate Social Responsibility
The incorporation of CSR in businesses is generally viewed as a positive object in
many companies. Apart from the benefits of increase in company transparency, a
positive consumer image of being a good corporate citizen, there are also certain
disadvantages to CSR.
2.3 Identification of the legislation/regulation and guidance relating to corporate social responsibility for
organizations
Legislation: the responsibilities of a company that are required to be implemented by the law
Guidance: the options taken by the companies to go past the legal requirements of law
Main CSR Activities in :
Leadership:
Legislation
– UK Corporate Governance Code
– Companies Act 2006
Guidance:
– Incorporating CSR into corporate governance
– Fighting bribery and corruption
Marketplace:
Legislation
– Consumer Protection Act 1987
– The Enterprise Act 2002
Guidance:
– Avoiding confusing advertisements
– Responding to customer complaints
Workplace:
Legislation
– Health and Safety at Work Act 1974
– Employment Rights Act 1996
Guidance:
– Listening to employees and involving them
– Fighting bullying at workplace
Community:
Legislation
– Countryside and Rights of Way Act
2000
– Planning Act 1990
Guidance:
– Investing in social activities
– Coordinating with local
communities
Environmental:
Legislation
– Environment Act 1995
Guidance:
– Treating emissions
– Decreasing goods transport
GBS Sample 2/Name – ID GBS Task 3
1
Statement and Confirmation of Own Work
StudentDeclaration
IhavereadandunderstoodATHE Assignment Submission guidelines and AcademicDishonesty
andPlagiarism policies.
I canconfirmthefollowingdetails:
ID No:
Name:
Programme Title: ATHE Level 7 Diploma in Strategic Management
Course Title: Global Business Strategy
Subject tutor:
Assignment No:
EnrolmentDate:
Due Date:
I declare that the work submitted is my own work andthatIhavenotplagiarisedanypartofit.
Ihavealsonoted theassessment criteriaandpass mark forassignments.
Signed:
2
Course Title: Global Business Strategy
ATHE Level 7 Diploma in Strategic Management
Submitted by: Xxx Xxx
3
Table of Contents
3.1 Company Profile …………………………………………………………………………………………….. 5
3.2 Strategic Direction ………………………………………………………………………………………….. 5
3.3 Business Strategy ……………………………………………………………………………………………. 5
Investments in new futuristic technologies like hybrid, electric etc.
Procurement- Strength (Distinctive competency)
Benefit from coordinated and integrated procurement plan with focus to cut costs
Summary of Value Chain
Nissan’s competencies are its advanced engineering and technologies, innovative product
and styling and their global brand. Nissan is deeply committed to technological
innovation and Nissan’s autonomous driving technology is an example to this. Nissan has
positioned themselves as an affordable, durable and stylish brand in the automobile
industry as Nissan is well aware of its customers’ demands for variouskinds of vehicles.
9
Nissan ensures to offer models pertinent to each region or product sector. Technology is
the biggest opportunity and distinctive competency of Nissan and it can lead to the
possibility of using this competence in innovation and effective manufacturing
capabilities to meeting the global customer expectations.
Strengths and Weaknesses of Nissan’s International Operations
Strengths:
Brand power- mix of luxury models and competitive prices
Strong R&D department constantly working on innovation
Leadership in Zero-emission cars- Nissan LEAF is the best-selling electric vehicle
in history
Growth through business development–from a 4.6% market share in 1999, Nissan
achieved a record share of 5.8% in 2010 and aims at attaining 8% market share in
2016
Nissan has the competitive advantage of being the first Japanese automaker to use
autonomous drive vehicles. Nissan lately publicized that by 2020,it would be
ready with numerous, commercially feasible Autonomous Drive vehicles by
2020.
(Nissan Annual Report 2014)
Weaknesses:
Product recalls- e.g. Nissan North America recalled certain models of Nissan
Rogue vehicles that experienced an electrical short in the harness connector due to
a mixer of water and salt seeping through the carpet on the driver side door near
the harness connector which could cause a vehicle fire. Similarly, some of the
Nissan GTR and Infiniti models were recalled recently because of a steering
column issue. Although Nissan recalls are lower than that of their competitors,
this ruins brand reputation and causes negative influence on customer loyalty
(Joseph, 2015).
10
3.7International Performance
Global demand in FY 2013 reached 83.11 million vehicles, up to 4.8% from FY 2012.
Nissan’s global sales volume increased 5.6% to 5.188 million vehicles and global market
share was 6.2%. Net sales increased 1,805.2 billion yen for the year to reach 11,434.8
billion yen. Operating profit was 605.7 billion yen, for a profit margin of 5.3%. The
growing demand for environmentally friendly vehicles, increase in fuel prices and the
growth that Nissan attained from the partnerships were all opportunities that Nissan
grabbed to perform well in the market (Nissan Annual Report 2014).
3.8Future Challenges
Nissan expects constant sales development in the coming years, profiting from new
product introductions, which includes 10 new vehicles, the new Murano, the new Pulsar
in Europe, the new zero-emissions e-NV200 in Europe and Japan, several Datsuns, new
Infiniti models in China, and one ton pick-up trucks. Expansion in areas of light weight
vehicles, zero emissions will be continued by Nissan as usual (Nissan Annual Report
2014).
Political, economic, and social changes are challenges that should be tackled by any
organization. Nissan sees improvements in their US performance. Nissan’s US sales
increased to 11% in 2014 as compared to 5.9% growth in the overall US market. That
made the US Nissan’s largest market, with sales of 1.39 million vehicles (Kubota, 2015).
Europe, showing signs of recovery are positive. Nissan’s sales rose to 4.1% as compared
to 3.9% in 2013 (Nissan Annual Report 2014). As per Financial Times 2015, in
December 2011, Nissan announced that it would not take orders for some cars in Russia
due to the country’s financial troubles. Automobile manufacturers couldn’t adjust prices
to compensate that savings in Russian currency. However, Nissan increased its prices
between 5-8% for half its models sold in Russia to compensate the drop in value of sales
in Russian currency. So, Nissan is positive about the Russian market. A healthy sales
forecast is predicted in China market where Nissan’s fourth plant is opening in Dalian
(Nissan Annual Report, 2014). Collectively with all these trends, Nissan expects that this
11
would help balance any influencearising from the increase in sales tax in Japan, that
would reduce customer demand.
Another factor to be considered as a challenge will be the decline in fuel prices. A recent
study estimates that each 10¢ drop in fuel prices associates to 1% decline in customers
considering alternate fuel vehicles (Tuttle, 2015). This would cause less attraction to the
hybrid or electric cars as consumers would become cost conscious. Not to forget, the
competition from other automotive companies and increase in the price of raw materials
are all challenges that Nissan anticipates.
3.9Conclusion
Nissan is making satisfactory progress and believes to be moving in the right direction, as
reflected in the financial statements.
Nissan is an example of how business can benefit from globalization. With excellent
strategies in place, Nissan was brought back from verge of closure to profitability and
growth by capitalizing on the benefits and opportunities of globalization. Globalization
has been a critical success factor for Nissan also due to the opportunities made available
from the alliance with Renault.
Nissan is committed to going beyond customer, supplier, employees and shareholder
expectations by utilizing all the growth opportunities, continuing to focus on sales power,
innovation and sustainability globally.
What Will You Get?
We provide professional writing services to help you score straight A’s by submitting custom written assignments that mirror your guidelines.
Premium Quality
Get result-oriented writing and never worry about grades anymore. We follow the highest quality standards to make sure that you get perfect assignments.
Experienced Writers
Our writers have experience in dealing with papers of every educational level. You can surely rely on the expertise of our qualified professionals.
On-Time Delivery
Your deadline is our threshold for success and we take it very seriously. We make sure you receive your papers before your predefined time.
24/7 Customer Support
Someone from our customer support team is always here to respond to your questions. So, hit us up if you have got any ambiguity or concern.
Complete Confidentiality
Sit back and relax while we help you out with writing your papers. We have an ultimate policy for keeping your personal and order-related details a secret.
Authentic Sources
We assure you that your document will be thoroughly checked for plagiarism and grammatical errors as we use highly authentic and licit sources.
Moneyback Guarantee
Still reluctant about placing an order? Our 100% Moneyback Guarantee backs you up on rare occasions where you aren’t satisfied with the writing.
Order Tracking
You don’t have to wait for an update for hours; you can track the progress of your order any time you want. We share the status after each step.
From brainstorming your paper's outline to perfecting its grammar, we perform every step carefully to make your paper worthy of A grade.
Preferred Writer
Hire your preferred writer anytime. Simply specify if you want your preferred expert to write your paper and we’ll make that happen.
Grammar Check Report
Get an elaborate and authentic grammar check report with your work to have the grammar goodness sealed in your document.
One Page Summary
You can purchase this feature if you want our writers to sum up your paper in the form of a concise and well-articulated summary.
Plagiarism Report
You don’t have to worry about plagiarism anymore. Get a plagiarism report to certify the uniqueness of your work.
Free Features $66FREE
Most Qualified Writer
$10FREE
Plagiarism Scan Report
$10FREE
Unlimited Revisions
$08FREE
Paper Formatting
$05FREE
Cover Page
$05FREE
Referencing & Bibliography
$10FREE
Dedicated User Area
$08FREE
24/7 Order Tracking
$05FREE
Periodic Email Alerts
$05FREE
Our Services
Join us for the best experience while seeking writing assistance in your college life. A good grade is all you need to boost up your academic excellence and we are all about it.
On-time Delivery
24/7 Order Tracking
Access to Authentic Sources
Academic Writing
We create perfect papers according to the guidelines.
Professional Editing
We seamlessly edit out errors from your papers.
Thorough Proofreading
We thoroughly read your final draft to identify errors.
Thorough Proofreading
We thoroughly read your final draft to identify errors.
Delegate Your Challenging Writing Tasks to Experienced Professionals
Work with ultimate peace of mind because we ensure that your academic work is our responsibility and your grades are a top concern for us!
We Analyze Your Problem and Offer Customized Writing
We understand your guidelines first before delivering any writing service. You can discuss your writing needs and we will have them evaluated by our dedicated team.
Clear elicitation of your requirements.
Customized writing as per your needs.
We Mirror Your Guidelines to Deliver Quality Services
We write your papers in a standardized way. We complete your work in such a way that it turns out to be a perfect description of your guidelines.
Proactive analysis of your writing.
Active communication to understand requirements.
We Handle Your Writing Tasks to Ensure Excellent Grades
We promise you excellent grades and academic excellence that you always longed for. Our writers stay in touch with you via email.
Thorough research and analysis for every order.
Deliverance of reliable writing service to improve your grades.
