The objective of this report is to evaluate global business environment as well as concept of globalization that can assist a small business firm to market expansion. In this regard, it is required to evaluate the factors of globalization that can affect business practices.
- Discuss the key factors which drive globalization.
- Evaluate the strategic complexities which are associate with operating in global environment.
- Analyze how operating in a global market may influence business culture, structure and function of PowerBar.
- Identify the influence of globalization upon business decision making of PowerBar.
Business environment can be termed as the condition in which the operations or activities of an organisation is carried out. This consist of combine form of external and internal elements which drives an influence upon their functioning in fundamental manner (Apăvăloaie, 2014). The report will aims on the PowerBar i.e. an American energy bars makers along with produce wide range of gels, Drinks and Pria bars mainly targetting to the women. Numerous complexities that are encountered through enterprise when deploying to international level will be recognised. Lastly, influence analysis of globalisation on strategy and decision making could be recognised.
P1 Analysis of factors which drive globalisation
Globalisation can be termed as the procedure in which communication and integration of individuals, economy and company of a country with the rest of the international market. In this context, business directs to expansion of enterprise's economy. This focus over creation of environment that direct to investment inflow so that profitability and growth can be conveniently achieved. Enterprise that adopt the techniques of globalisation is promoted through transportation and advanced technology along with further assistance in economies interlink on the economical and social grounds. This can affirm that several components which encourage global deployment of firm (Axelrod and VanDeveer eds., 2014). This is paramount to undertake each components in the adequate manner so that one can achieve effective outcomes. A brief explanation of major driver of the techniques of globalisation are discussed as beneath:
This affirms the amount that has been rendered through the company at the time of expansion of business at international level. The company before creating the deployment activities, ascertain the investment of their resources and time to recognise the viability of the concept as well as the procurement of equipment and machinery investment which are considered so that international demand level can be attained. Hence, such incurred cost of firm can be classified on two main grounds i.e. indirect and direct cost. Direct cost consist of rent, insurance, inventories etc. as it include direct connection with produced unit quantity. On other side, indirect cost include expenditure which does not consist of any direct connection with the produced quantity including elements like management, cost of conveyance and personnel etc. The key essential features is the deployment at international level assists in the achievement of cost efficiency. This whole procedure can aid in creating competitive edge and help portraying consumer with commodities which are manageable.
This can also be termed as the economy in which an organisation is aiming with their services and products. Key cause behind the saturation of present market is globalisation emergence. For instance, firm is operating their activities in UK economy and have managed decent development. A company don't posses any opportunities of development, therefore, business select the expansion strategy to the international level to achieve business growth and profitability (Belás and et. al., 2014). The enterprise require a proper deployment opportunities into certain market with appropriate marketing and selection strategies in order to get better incentives.
This can undertake the most essential two crucial elements which are political and technological drivers. Both of those elements are considered as the major phase of globalisation. The liberalisation and commercialisation of economies have conducted relatively for the company to roam or carry out operations into other country with the commodities. The company with the assistance of technologies and tools of digitalisation which can launch themselves in the better market in more significant manner. The state of United Kingdom have made this more easier for the business organisation to conduct and carry out the process of production of several different advantages which is catered by them. The other opportunity is virtual presentation in the country through the assistance of e-commerce etc.
It can be manipulated as one of the main key driver of the term globalisation. There are indispensable rise in the inter-organisational competition that carries the business into launching it at international level. Seth launching activity at global level is further promoted by FDI's and other interdependencies among countries by the market.
P2 Challenges which are faced by organisation while operating in a global environment
Regardless of size, numerous issues and challenges are encountered through the enterprise while functioning business at international level (Belás and et. al., 2015). PowerBar is the company i.e. managing different operations in the UK trade along with Asia and other nations. Several components that tend to impact on organisation's working in the global market which are discussed as below:
Regulation and Compliance:
It can be termed as the largest challenge of strategies i.e. identified through the company. The medium and small enterprise need to consider and conform to the regulations and compliance so that commodities which could be sold to the individual. Each nation posses their own laws set i.e. associated with the ethics and tax to manage operation which are followed through the company so that activities could be retailed in the competitive market for longer period of time. The another fundamental segment that is enhanced is export and import regulation of the nation that tend to impact inventories supply to a major extent. This can be refer as challenge that need to be overcame for operating busin