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Business Organisations in a Global Context Ref #: 3705
Table of Contents
Responsibilities of Operations on a Global Scale. 5
Different Strategies Employed by Global Organisations. 6
Impact of Performance of National Economy on Business Organisations. 8
How Governments Take Measures to Influence the Activities of Business Organisations. 10
Analysis of Global Business Environment in the United Kingdom.. 12
Activity 1
Business Organisations in a Global Context , The first activity requires analysis of the differences between organisations working in different sectors, industries and contexts on a global scale. Further, the responsibilities of organisations operating on a global scale and strategies employed by those strategies are also discussed in this activity. Keeping the requirements in mind, the activity is broken down into three sections respectively.
Differences between Organisations Working in Different Sectors, Industries and Contexts on a Global Scale
According to Malerba (2004), the two major sectors operating in each economy are services and manufacturing sector. The section highlights the differences between organisations working in these two sectors primarily. In the view of Ball et al. (2012), the management of an organisation operating on global scale is tough regardless of the sector, industry or context of operations of the organisation. This is due to the fact that major factors in each country including the macroeconomic factors affect the organisational performance.
Moreover, the organisational structure and operations of global firms also vary on the basis of sector and industry it is operating in. According to Brealey et al. (2012), there are several key differences between the businesses operating locally and on the global scale. First difference is based on the legal form of ownership because local businesses generally include businesses with all three legal forms of ownership i.e. sole proprietorship, partnership and corporations. However, Business Organisations in a Global Context most of the businesses operating in multiple nations are corporations. It is due to the fact that companies with high equity and asset base expand internationally and it is not possible to go beyond certain equity and asset level without going public.
One of the differences highlighted among the global organisations operating in services and manufacturing sector is in the terms of recruitment and employment policies. It has been theorised by Griffin and Pustay (2012) that global firms can have one of three strategies for their recruitment. Those include the geocentric (selection of most suitable candidate), polycentric (selection limited to host country) and ethnocentric strategies (selection limited to parent country).
It is found that the recruitment policy of the majority of manufacturing companies is found to be polycentric. The majority of their employees are from the host country as they aim to reduce manufacturing costs by utilisation of cheap labour. On the contrary, the majority of employees at service companies are hired on the basis of selection of most suitable candidate; therefore, the strategy can be termed as geocentric….
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