Table of Contents

LO3. Evaluate how operating in a global market influences an organization's structure, culture and functions. ................ 2
LO4. Evaluate the influence of globalization on organizational decision-making and strategy. ............................................ 2
 Assignment scenario. ........................................................................................................................................................ 2
I. Evaluate the influences of globalization on organizational governance and leadership, structure, culture and
functions. ............................................................................................................................................................................... 2
1. Discussing the McKinsey’s hard and soft elements of the company currently ........................................................... 2
2. Explain how globalization has impacted each factor ‘S’ of the company. .................................................................. 3
3. Evaluating which ‘S’ factor of the company has been impacted the most by globalization. ..................................... 5
4. Evaluating which is the most significant market influence(s) on the organizational structure and culture and
analyzing the opportunities and threats coming from the most significant market influences can bring to the
chosen company. ............................................................................................................................................................... 5
II. Evaluate the influences of ethical and sustainable globalization on organizational functions...................................... 7
1. Defining ethical globalization and sustainable globalization. ..................................................................................... 7
2. Explaining how the organization would carry out its main operational activities if it aims to be an ethical
corporate in a global market. ............................................................................................................................................ 7
3. Provide some ethical recommendations for chosen company to be ethical when operating in a global market. ... 8
III. Evaluate the different ways decision making can work effectively in a global context. ............................................... 8
1. Identifying which factors to be concerned for a business aiming for internationalization. ....................................... 8
2. Carry out a due diligence (i.e. the strategy diamond) of chosen company in a specific market where it has been
present and evaluate whether the strategic decisions the company made in that market is rational or not. ............. 8
IV. Determine and articulate the various routes to internationalization n organization may adopt including key
barriers. .................................................................................................................................................................................. 8
1. Discussing the main barriers chosen company is currently facing when it aims to enter a new foreign market
(based on CAGE or PEST/PEST framework). ..................................................................................................................... 8
2. Evaluating which barriers are the most important ones for chosen company to overcome when it wants to enter
that specific market. .......................................................................................................................................................... 8
3. Recommending tactical actions chosen company should do to overcome those key identified barriers. ................ 8
4. Making recommendations on international business strategy your company should take to enter that particular
market. ............................................................................................................................................................................... 8
5. Analyzing both advantages and disadvantages of each recommendation above. ..................................................... 9
6. Comparing the feasibility of chosen strategic expansion routes to make proposal for the most suitable route for
the organization to implement eventually. ...................................................................................................................... 9
Conclusion .................................................................................................................................................................................. 9
LO3. Evaluate how operating in a global market influences an organization's structure, culture and functions.

LO4. Evaluate the influence of globalization on organizational decision-making and strategy.

 Assignment scenario.
Assume that you are a business analyst at Planning and Investment Department of a multinational corporation
(MNC). Your company has been expanding extensively to foreign markets for the last few years. The department
head has requested you to carry out a report to evaluate the impacts of globalization on your organizational
structures, cultures and functions. As part of your research, you have to investigate how globalization affects
decision making and strategy within your global business.

You are free to choose the company (regardless the nationality) at which you are assumed to be working for (so
called the chosen company).

I. Evaluate the influences of globalization on organizational governance and leadership, structure, culture and
functions.
1. Discussing the McKinsey’s hard and soft elements of the company currently
The McKinsey 7S model describes seven variables, to realize the importance of an interactive relationship
that exists between all seven variables and its general form making it applicable to both manufacturing or
translating service companies (Channon, 2015). The limitation of this model is about the ability to handle external
environmental factors and performance-related issues. The main reason for this lack of completeness of the
McKinsey 7S Model lies in its origin. 7S model comes from reality contrary to theory. In other words, McKinsey's
7S model, demonstrating McKinsey's efforts to explain the operation of production and service companies. (Njeru,
2017)

The first variable is Strategy. Strategy is a plan developed by a company to achieve a sustainable
competitive advantage and successfully compete in the market. It focuses on making a plan to allocate the
company's scarce resources effectively as well as how to cope with the increase or decrease in demand for future
products and how to reduce pressure force from competitors. (Nejad, 2015)

The second variable is Structure. It often refers to the type of organizational chart or other document that
outlines who reports to whom and who is responsible for specific tasks. This structure can be solved in terms of
the whole organization, or simply refers to a part of the company like human resources. (Jurevicius, 2013)

The last element in hard S is System. Systems are the company's processes and procedures, showing the
daily activities of the business and how to make decisions. Systems that determine how a business is implemented
by the company. Managers often focus on this factor when the company decides to innovate and make a
revolution. (Bristoll, 2012)

The skill represents the capabilities that employees or even the whole organization are solid. Managers
will need to identify the core skills that the company needs to retain and reinforce as well as answer questions
about how to carefully monitor these skills or how to improve performance. employee work. (Kukreja, 2018)

Staff factors are concerned with the type and the number of employees an organization will need and how
they will be recruited, trained, motivated and rewarded. (Manktelow, 2017)

The style expresses the management style of cold-headed companies. In addition, it also partly reflects
the environmental culture that the company provides for employee factors. There are many different ways of
leadership, talented managers will know how to create a way of leadership in accordance with the common
environment and the needs of the group they lead. (Manktelow, 2017)

Shared values are the core of the 7S model. It represents the overall culture of the company as well as the
standards and standards of the organization. This factor leads and creates incentives for employees' behavior.
Shared values can be considered as an organization's background. (Epstein-Reeves, 2012)

2. Explain how globalization has impacted each factor ‘S’ of the company.
Founded in 1969, Samsung Electronics is one of the leaders in consumer electronics industry in an
international scale. The company employs 325,677 people in 80 countries and has more than 200 subsidiaries
around the world. The business is divided into three large segments – consumer electronics, IT & mobile
communications and device solutions. (Samsung, 2019)

First of all, globalization creates new opportunities and new challenges for any businesses. These
opportunities can be mentioned as: There is a large market for consumption of products produced in the process
of industrialization and modernization; attracting investment capital from foreign investors and development
sources of countries. Besides, globalization also facilitates businesses to receive production technology and
technology management through investment projects. Therefore, companies must have appropriate strategies
at a global level to create a competitive advantage for themselves. (Mahmutović, 2017) Samsung's business
strategy is largely based on market readers, ie replicating the initiatives made by market leaders about introducing
new products and / or adding innovative features. into new products. Big rival of Samsung, Apple may be
designated as Samsung company mainly replicated from. Moreover, Samsung's business strategy is based on
scanning and taking advantage of market opportunities and developing new products on a regular basis.
(Dudovskiy, 2017)
 Structure: When globalization takes place, most businesses choose to expand their business markets to
other countries. however, when operating in a new market, this requires businesses to adapt to new needs.
therefore, it is absolutely necessary to change the operational structure of the business. organizations will have
to decide to set up new departments and remove redundant parts. (Wengrzyn, 2014) Samsung's organizational
structure is the division and the company is divided into three divisions based on products: IT & Mobile
Communications (IM), Consumer Electronics (CE) and Device Solutions (DS). Each part is managed separately
according to the specific aspects and characteristics of the product. When the results of the optimal organizational
structure review were completed in April 2017, the senior management decided not to switch to the
organizational structure model. However, Samsung's organizational structure may change in a medium-term
view. This was due to a series of scandals that the company had to deal with recently, including Jay Y. Lee, former
Samsung CEO and founding family member for his role as bribe and embezzlement. (Dudovskiy, 2017)

Systems: Samsung's long-term growth prospects Depend on the smooth operation of a variety of systems.
These include staff recruitment and selection systems, team development and navigation systems, transaction
processing systems, customer relationship management systems, business intelligence systems, and
management systems. knowledge and other systems. Samsung conducts regular evaluations of its processes and
systems to find and use opportunities for improvement with positive implications. (Onodera, 2008)

Skill: Samsung values highly creative and innovative skills. The ability to work under pressure can be
designated as an important skill that needs to be mastered by employees to succeed at Samsung. This is due to
tight deadlines for most projects that employees at all levels need to comply with. (Samsung, 2018)

Staff: Globalization also affects staff. When globalization takes place, human resources from other
countries can be introduced into the Vietnamese market as well as foreign businesses can access human resources
in Vietnam. This creates a big change for businesses as well as employees themselves. Foreign language diversity
requirements as well as higher performance are set. (Tyson, 2017) Samsung employs about 325,677 full-time
employees equivalent to an additional 7,600 employees and equivalent temporary full-time contractors.
Approximately 110,200 of the total number of full-time employees are equivalent to working in the retail segment
55. In addition, Samsung is always looking for high quality human resources with good working performance as
well as good foreign language skills for intensive training with higher promotion ability. (Samsung, 2018)

Style: Democratic leadership style is the main leadership style widely applied at Samsung. Specifically, CEO
Kim Ki Nam participates in discussions and consultations with board members and stakeholders on a regular basis
and these are reflected in the company's strategic decisions. This is a fundamental change from a visionary, but
authoritarian leadership style implemented by Samsung's founding family and especially CEO Kim Ki Nam.
(Samsung, 2018)
 The Shared value of Samsung is “Inspire the world with its innovative technologies, products and design
that enrich people's lives and contribute to social prosperity by creating new future”. (Samsung, 2018)

3. Evaluating which ‘S’ factor of the company has been impacted the most by globalization.
It can be said that this innovation of Samsung seems impossible if it is not supported by qualified human
resources who have a good vision of the future. In the Samsung Group, one-third of the 1,000 directors are aged
40 or under. About 1,700 of its employees have been trained at the doctoral level and the number of 350
employees with an MBA degree. Most of them are educated abroad, like in the United States or Europe. Samsung
also revised the concept of Samsung, who emphasized more on creative individuals, has a broad vision and high
moral standards. (Studymoose, 2016) Lee Kun-hee, president of Samsung Group, talked about the thinking model
that emphasizes the development of the company by increasing the amount of Samsung disease. After conducting
a study, he found that 1,000 Samsung employees were busy fixing 20,000 broken Samsung products each year by
30,000 Samsung employees. This shows that this workflow is the most inefficient in the world. According to him,
making products fail like cancer and is a criminal act in management. Therefore, President Lee announced the
Quality Management Program and sent 850 senior Samsung executives to Frankfurt, London and Osaka to train
management quality so that Samsung executives recognize quality and how low their products are in the world.
Thereby, it can be seen that employee factors are the most important for businesses when operating under the
influence of globalization. (Lev-Ram, 2013)

4. Evaluating which is the most significant market influence(s) on the organizational structure and culture and
analyzing the opportunities and threats coming from the most significant market influences can bring to the chosen
company.
Opportunities and Competitive Advantages: In order for Samsung to achieve their competitive
advantage; they used their resources to maximize output or final product. Resources such as human resources,
money, machinery and materials are being strategized to take the lead and be the global market leader.
Samsung's first opportunity is excellent human resources. The company acknowledges the need for employees
to work in a favorable working environment. Samsung has created a working environment for family friends,
allowing team members to participate in developing and improving ideas. Samsung even sponsors their staff for
the MBA and PHD programs to develop and improve their personnel skills. As a result of years of human capital
investment, Samsung has a high concentration of skilled engineers and workers. The company can manage human
resources and knowledge that will directly affect Samsung's operations by creating higher productivity and quality
of products and services. (Zoro, 2017)
 Samsung's low-cost strategy allows them to be very competitive in the global market. Samsung's ability to
negotiate with suppliers gives them the advantage of raw material costs. Samsung has won a number of awards
every year since 1995 on the performance, quality and reliability of their products and services. Therefore, this
gives them the advantage to negotiate with suppliers to provide them with raw materials at the lowest possible
cost or even at high prices. (Zoro, 2017)

Samsung is a positive market reader. They are the first to adopt new technology and innovation, while
their competitors are still in the R & D process or even find the appropriate market to commercialize the product.
Samsung has a positive learning curve, which is an advantage and the ability to read market demand better than
other competitors. As a result, they can produce customized products to meet customers' needs. Samsung's
strong and stable financial portfolio has given them the advantage to launch and apply through aggressive
marketing and promotion. Samsung has been on the market since 60 and has been well established. Recognizing
and creating a competitive advantage ensures their dominance in the industry. (Zoro, 2017)

Challenges and Threats: Globalization makes scientific products - technology of rival companies, especially
Apple, strongly penetrate into the same target market, making the pressure on Samsung extremely large. In
particular, problems of industrial design disputes are always a hot issue. new models with new designs are
constantly being created as a competition always at its peak. While Samsung produces a wide range of products
with different price ranges to cater to the needs of a wide range of customers, Apple chooses to produce high-
end products. This sometimes affects the minds of consumers that Samsung is just a mass product and Apple is
superior. how to convince customers as well as to define their position as superior is always a big challenge for
Samsung. The contingent of specialized scientific staff, especially the leading scientists, is lacking when compared
to the rival Apple. The improvement of the quantity and quality of the scientific workforce cannot be done in a
short time but requires a lot of time and energy as well as significant challenges for Samsung's development. In
addition, according to user forums, Samsung is also considered poor design and lack of creativity. This is also a big
threat to Samsung's understanding when its direct competitor, Apple, constantly offers big breakthrough
products. (Oanh, 2013)

In addition, the chairman of Samsung's Lee Group predicts that the smart phone will really become a
commodity, just like the PC did in the 1990s. and customers are changing. Samsung developed in a globalized
market, it was threatened by other players in the market, especially from China because it would undermine their
smartphone market from Samsung to companies. Western and Japanese in the past. As President Lee stated Most
of Samsung's products today will disappear after ten years. (Zoro, 2017)
II. Evaluate the influences of ethical and sustainable globalization on organizational functions.
1. Defining ethical globalization and sustainable globalization.
Ethical Globalization: One of the positive effects of globalization is the screening of moral values in terms
of personal, personal qualities. But also, this positive side when being pushed up by humans will become negative.
(Bhandal, 2018) A sense of personal prominence, once absoluteized, leads to an individual overpowering the
community. That leads to putting personal interests above social benefits, taking personal interests first; at that
time, collective benefits will be overwhelmed, even abandoned, from which corruption and waste are increasing.
Therefore, ethical globalization standards are necessary. (Tanter, 2008)

For MNCs, there are five general rules just as five norms to help MNC stay ethically. The first is all the least
good individuals. In this norm, it alludes to at least ethical quality as a norm to not hurt somebody
straightforwardly and purposely and it applies to everybody in each class and in all countries. family. The second
norm depends on the first and it discusses moral conduct that must profit the host nation. In any event worldwide
organizations must have the base ethical quality for their nation and they should not take unfriendly activities for
the host nation. The third norm is about appreciation for human rights, human privileges of workers, clients and
representatives. They have certain rights in their lives and in their nations, so organizations or associations need
to regard it. The fourth norm depends on household and universal establishment to advance the improvement of
associations and organizations. Final norm is regarding the laws of a host nation just as the laws of different
nations when worldwide organizations need to take part. (Smith, 2018)

Sustainable Globalization: People are living in an era of globalization. However, the evolution of
globalization is very unpredictable. Since the end of the Cold War, the number of people involved in the world
economy has increased from about 1 billion to 4 to 5 billion people - this number has greatly increased production
forces, establishing the new production and service centers in developing countries, boosting demand for energy
and goods, creating tremendous opportunities to boost consumption. Many new savings funds are joining global
capital flows into investment opportunities in both emerging markets and transitioning developing economies.
The transfer of skills, technology, information and practical experiences is strongly promoted. Globalization of
sustainability is when people realize the value of natural resources, get new perspectives on racial, ethnic and
religious issues as well as towards common goals and eliminate individuals benefits in both society and business.
(Curran, 2009)

2. Explaining how the organization would carry out its main operational activities if it aims to be an ethical corporate
in a global market.
If an organization aims to become an ethical organization in the global market, first of all with respect to
human resource management, it must be clear in its recruitment policies as well as salaries set of candidates as
well as employees in the company. completely eliminates the behavior of racial, racial and religious discrimination
between members of the same organization.

After an article said that senior employees of the Apple store in Melbourne, Australia, dismissed a black
teenager because of suspicion that "he meant to steal something" was posted online, Tim Cook responded
immediately to this behavior and considered it unacceptable. Apple was quick to apologize and a senior manager
from the site visited the relevant students to assure them that they were welcome back to the store. This has
shown the spirit of Apple's top management always responding to the spirit of saying no to discrimination.
(Conditt, 2015)

3. Provide some ethical recommendations for chosen company to be ethical when operating in a global market.

III. Evaluate the different ways decision making can work effectively in a global context.
1. Identifying which factors to be concerned for a business aiming for internationalization.

2. Carry out a due diligence (i.e. the strategy diamond) of chosen company in a specific market where it has been
present and evaluate whether the strategic decisions the company made in that market is rational or not.

IV. Determine and articulate the various routes to internationalization n organization may adopt including key
barriers.
1. Discussing the main barriers chosen company is currently facing when it aims to enter a new foreign market (based
on CAGE or PEST/PEST framework).

2. Evaluating which barriers are the most important ones for chosen company to overcome when it wants to enter
that specific market.

3. Recommending tactical actions chosen company should do to overcome those key identified barriers.

4. Making recommendations on international business strategy your company should take to enter that particular
market.
5. Analyzing both advantages and disadvantages of each recommendation above.

6. Comparing the feasibility of chosen strategic expansion routes to make proposal for the most suitable route for
the organization to implement eventually.

Conclusion
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