Over recent years, the pace of expansion of businesses in an area has been faster than the pace of progress of output round the world as a whole. Almost all countries in the world are becoming ever more integrated with the planet economy. This process is called globalisation. Globalisation could signify for example that: almost all of the cloths we buy are made in another country; a country buys financial and legal services from other country etc Globalisation has many effects upon businesses/company throughout the world. The impact of globalisation is not evenly disperse. Some businesses have witnesses' remarkable changes because of globalisation of the organisation. This report clarifies the data of issues Arik Air is facing in functioning in global framework and review of the issues currently impacting on its businesses. Arik air is an Airline company located in Nigeria need to obtain another air travel in UK whish suggested to be called Arik Air UK and be a worldwide organisation
1. 1 ANALYSES OF THE KEY Distinctions BETWEEN ORGANISATIONS EMPLOYED IN DIFFERENT SECTORS, Market sectors AND CONTEXTS
There are different types of organisation which contain sole trader, partnership, private public relationship and limited company.
Sole trader; this is a business solely developed by one individual and possessed by one person with a number of workers. This sort of business can be classified as small range business.
The merits of only investor are;
Independent -the owner will have total control of the business enterprise.
Little capital -to create sole trading it cost less the owner did not need huge money, also lone trader need small loan that can be obtain from loan provider, family members and friends.
Sole owner of profit-the income belong to the sole trader, he will not share with anybody.
Business affairs are private- it'll be difficult for the competitors to know how much the sole traders gained because sole investor will keep all the affairs of the business enterprise private.
The demerits of single investors are;
Unlimited liability.
It sometimes difficult to get loan from banks as a result of nature of the business enterprise.
Lack of continuity if the dog owner dies
Partnership is when several people get together to form an enterprise, most partnerships are between two or twenty members.
Deed of partnership is set up by the collaboration this support the followings
Formation that will be use to talk about profit or loss incur during the business.
Amount of money to be contributed by each spouse to start the business.
The electric power of votes will be dependant on the percentage of capital provided by each lovers.
This is guidelines to be follows when consuming new companions.
Blue print out of the way the collaboration will be dissolve.
Disadvantages of collaboration are;
Workload using one partner will cause dispute on the list of partners.
Different direction of business from associates can cause disagreement.
Corporation -is a definite legal entity that is form through subscription process, this is a body that have right to enter contractor or get loan from financial institution, it can sue and sued, recruit employees and pay taxes. The business is different from the owner, corporation is bound liability dividend. The shareholders aren't liable for the business liquidation.
Limited company - An organisation which is liable to investor or customers. The buyer are limited by their investment or guaranteed to the company which the profit is talk about, its finances available different to his personal money.
Private company limited-when the company is liquidated they decided to pay specific amount to bailout the company.
Private unrestricted company- through the liquidation of the company the shareholders and mother board of directors are exclusively liable payment of arrears owed.
Public limited company- the company bought and sold publicly on currency markets such as London stock exchange, Nigeria stock exchange etc.
Public sector company -this is an organisation owned or operated by the government, Federal, condition and municipality, there aims and objective is to provide public amenities for the general public in conditions of services e g, provision of general public move, health, research non income making all the money made are rechanneled into the society.
Non profit company- this is an organisation that is set up for charity all the earnings make is channel back to the business to go after the goals and aim of the company. They create money through donation from federal government and public. They are really exempted in duty or duty deduction.
Global Context- international transaction between two organisations from two different companies, global context is a term used to collectively summarize all commercial activities of private and federal globally in conditions of sales, investment, logistics and transportation.
1. 2 Diagnosis OF THE RESPONSIBILITIES OF ORGANISATIONS OPERATING GLOBALLY.
The multinational company face a whole lot of challenges, the business have to obtain capacity to like money, connections to get into foreign land obstacles that will fit in a worldwide business framework. Three environmental factors that the company have to place into factors are;
Political economy-this is the insurance policies made by the government of the acquisition country for the new establishment also international business laws must be look critically before business into it.
The resource and marketing- the market and resources of the united states and host of these new business, the effectiveness of the business enterprise in the country.
Competition- There will be competition among the local business of the coordinator country, the local business will give them a lot of risk because the folks have already used to their local product, and in the meantime the business have to ensure that their service is unique to be accepted by the buyer in the number country.
Localizing strategies-The organisation need to know how to respond to the geographical opportunity and hazards because the culture different also the competitors risk must be resolved with the local organisation.
Sales and marketing strategy- must be looked at due to geographical different.
Supply chain- is another factor because it's different from one country to another.
Different in legal system-there different legal system, labour laws and regulations and distribution, development strategy must be considered when going into global business since it varies from one country to other.
International trade is a trade between several country, most private organisation call multinational undertake such exchange for profit making while federal do the business for income to increase their gross domestic product GDP or for political reasons, and this can be in terms of producing goods and services. The assistance may include financing banking insurance, construction etc. Organisational responsibility may be explained based on the next heading:
Shareholders - shareholders are investors of funds into the business, so they expect average financial profits; there will be interest on the money that may come in form of dividend. They can also be part of insurance policy making in the company.
Customer -they are like king in the complete issue, without the clients there will be no products. So, the organisation must responsible in providing value your money can buy they spent interims of sturdiness of the merchandise or services given to them.
Employee-the employees must be treat beyond the contract signed with them, treat them like they can be area of the business. They must be given adequate trained in new skill and solutions to have the ability to render a global standard of services and product to the clients.
Community - the company must be friendly to the people in the community where they operate.
Environment -they must carry out an environmental impact assessment (EIA) for new procedure also they must not pollute the environment with risk or dangerous harmful waste that can affect water agriculture, health of the folks in the united states.
Ethical concern - the honest issue is very important in business they need to pursue the ethics for the introduction of their company statues and permanent survival; they need to behave as customers, suppliers, rivals and the surroundings general.
1. 3 STRATEGY UTILIZED BY ORGANISATIONS OPERATING GLOBALLY IS;
Political - the political scene internationally must be embraced to help better trade between the government authorities of other country on the globe; a business contract must be signed between the organisation and the organisation in other country.
Economy - the organisation must prepare yourself to combine the economy coverage of another country their product or services attract lot of buyer in other part of the world.
Social - the organisation will recruit employees from other country they are employing and pay them good wages also support the city by providing CSR (corporate social responsibility) by giving scholarships etc.
Technology -the world is growth in terms of technology uses for a few times, the utilization of technology like internet can help global organisation in transacting their business fast to provide better and fast services.
Legal-the government plan of the other country must be recognised because the plan is used to safeguard the international trade against delivering of fake or out-of-date products or providing substandard services.
Environmental- the global organisation help out with providing sustainable job, like tree planting also caution in terms of amount of waste material released to the landfill they should also help in recycling of some product and assist in campaigning once and for all environment.
Analyse how the performance of national economy impact on the activities of business organisation using Airlines as a research study.
SWOT analysis can be involved in deciding the performance of business vis-a-vis it competition. It is broadly accepted way of undertaking such an research, other methods can produce similar (or better) results. SWOT links the data of today's bases of competition with market situations. The result of swot is shown SWOT desk below, which is a concise declaration of the situation where the organization or business company discovers itself.
An exemplory case of a SWOT desk for a no-frills air travel.
Strength
Opportunities
Weaknesses
Threats
Airports used are much better than those employed by the other no- frills airlines
Strong business demand for cheap air fares
Airport used are worse than those employed by the top carriers
The further entrance of subsidiaries of the best carriers
Management skills
Strong leisure demand for cheap air fares
Reputation for punctuality
Higher air-port charges
Lower cost than founded airlines
The interest
Cash flows
Ease of reservation flights
Many secondary air-port underused
No safely record yet established
Better than average employee relations
Poorer than average customer service
The characteristics of talents, weaknesses, opportunities and hazards and the associated analysis are referred to and the down sides in following a formal analysis are anticipated.
Many leader-managers think it is beneficial to encapsulate the positioning of their company in a concise assertion of its strengths and weakness vis-a-vis competition and the opportunities and threat that it faces in its environment. They do this by building a SWOT stand. A SWOT Desk offers a useful spring panel for their id of strategy, since it recognizes the weaknesses that require to be strengthened, the strength that can be used for competitive edge, the opportunities that can be used to the organisation's edge, and the dangers that it needs to guard against.
The impact of global factors on UK business organisation.
Businesses are influenced by an external environment all the as they are afflicted by the rivals. Global factors influencing business are legal, political, social, technological and economic. Understanding of these factors is important while creating a business strategy.
a. Friendly factors - These factors are related to changes in social buildings. These factors provide insights into behaviour, tastes, and lifestyles patterns of a population. Buying habits are greatly affected by the changes in the structure of the population, and in consumer life styles. Years, gender, etc all determine the buying habits and knowledge of such changes is crucial for growing strategies that are good market situations. In a global environment it's important that business strategies were created keeping in mind the social and cultural variations that change from Uk to other countries. Consumer religion, words, lifestyle patterns are all important information for successful business management.
b. Legal factors - These factors that impact business strategies are related to changes in authorities laws and regulations. For a successful business operation it's important that the businesses consider the legalities involved in a particular situation and really should have the capability to anticipate ways that changes in laws will affect the way they must behave. Regulations keep changing over a period of time. From the idea of view of business it is important they are aware of these changes in the areas of consumer security legislation, environmental legislation, health & security and employment legislation, etc.
c. Monetary factors - These factors require changes in the global market. A growth in living expectations would ultimately imply a rise in demand for products in so doing, providing increased opportunities for businesses to make revenue. An current economic climate witnesses fluctuations in monetary activities. This might imply that in case of a rise in economical activity the demand of the merchandise will increase and therefore the price increase. In case of decrease in demand the prices will go down. Business strategies should be developed keeping in mind these fluctuations. Other monetary changes that affect business include changes in the interest, wage rates, and the pace of inflation. In case of low rates of interest and upsurge in demand Businesses will be urged to expand and take dangers.
d. Politics factors - This refers to the changes in federal government and government insurance policies. Politics factors greatly influence the operation of business in the United Kingdom. It has gained significant importance of late. For instance: companies and businesses working in the UK have to adopt directives and laws created by the UK. The political world has an enormous influence after the regulation of businesses, and the spending ability of consumers and other businesses. Business must consider the steadiness of the politics environment, government's policy on the market etc
e. Technological factors - These factors greatly impact business strategies as they provide opportunities for businesses to adopt new inventions, and inventions. This helps the business to reduce costs and develop new products. With the advancement of modern communication systems, technical factors have gained great impetus available arena. . Huge volumes of information can be securely shared by means of databases thereby permitting great cost reductions, and advancements in service. Organisations need to consider the latest relevant scientific advancements for his or her business and to stay competitive. Technology helps business to gain competitive advantage, and it is a major driver of globalization. While creating the business enterprise strategies companies must consider if use of technology will allow the firm to create products and services at a lower cost. Firms can select new settings of distributions with the help of technology. It is becoming easier for companies to communicate with their customer in virtually any area of the world.
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Domestic marketplaces -is the goods and service producing in a country in just a 12 months. The of Country wide statistics make us recognize that survey of business that will include the activities of the airline operating within the uk. the uk economy became shrank toward the end of 2012, it goes down by 0. 3% within the last three months based on the official GDP statistics released, the short fall was not in Air industry by themselves but due to drop in mining and quarrying by ONS. This affect many stores, manufacturers plus some finance institutions that force banking companies to finished down as a result of the many people lost their careers, many consumers lower their spending even holiday that used air bus reduced due to cut.
Global market- is the procedure when the merchandise and services of your country or a business is been functioning in many countries. The global markets helps the establishments to go higher running a business. Uk English airways is example of British carrier. British isles airways sometime in November merge with some airline in other country. the merger make the British isles airline to become a recognised and the globe third largest airline on the planet and increased in conditions of Earnings among other flight in competitive market internationally.
Government policies-this is the law that the united kingdom government put in place to meet the standards in global market world, this are done both locally and internationally to safeguard the business world. They are as follows;
Security-internet scam has been checked by spending additional money on IT specialists to trail any business scams on line. Also terrorist this also very important just lately UK federal government send some troop of army to Mali to beat the terrorist network which may be treat to international business in future.
Air traffic policies-the UK government present a comprehensive and incredibly big whitepaper on air traffic from 180mppa 476 by 2030, to fulfill future need, also new runway, terminals and better on the management procedure.
Tax- recently the united kingdom government needed a severe measure against tax Evasion both locally and internationally, administration spend millions of pounds on watchdog to checkmate the activities of companies through HM income and customs. e. g. Yahoo, Amazons, star bucks coffee company lately penalised. (metro-Monday 17dec 2012)
Bilateral relationship
Health and Safety
Environmental policies-this policies is to regulate noise in the air by the airlines, also government appraise climate change impact.
Trade stop- this is hurdle to trade between two more countries, a group of countries within the geographical region may make a decision never to allow other country to import some goods to their region, some that are not of their country illustrations are EU and non EU members. EU is created to have single market because of their goods, services and labours they also created trade stop on the list of non EU. discriminatory trade plan.
Technology - in the past 20years technology has made an enormous effect on globalisation, it offers fastrack the growth seen in global business good examples are Email, internet and cell phones. Internet has managed to get possible for quick internal and exterior communication which managed to get to be the main marketing tool in global business. in the meantime using cellular phone to communicate surrounding the world which is faster and not expensive, this also avoid specific moving up and down while travelling. Technology not only helps global business in terms of development but also help the global company to become more effective in their business activities.
CONCLUTION - Subscription procedure for traders is very easy in united kingdom, it allow investors design the internal company rules so long as you have right to invest under its legislature legislation, the organization or company law of uk is pleasant development because they have the laws that protect the right of shareholders to independently trade their shares.
