Designing a Global Business Organization - Assignment Example

? Global business Table of Contents Introduction 3 Designing a global business organization 4 Key characteristics of an effective global business 4 Strategic Plan 5 Initial planning 5 Market 5 Legal Influence 6 Economic Influence 6 Hiring 7 Production and sales 7 Management 7 Four Opportunities and Threats 7 Recommendations 9 Conclusion 9 References 11 Introduction The world of the 21st century exists in a highly competitive environment, which is filled with rapid paced development and is powered by fast growth. The high penetration of the internet in the last couple of years along with the fact of the rapid development of various kinds of technological gadgets has resulted in the process of faster and better connectivity in the markets around the world. The global connectivity has increasingly helped in connecting the markets around the world, and has successfully converted the globe into a single and well connected entity. It is of high importance to mention that the better levels of technology powered connectivity are resulting in the successful diffusion of various global trends, which emerges from various markets around the world. Because of faster evolution of the globalized trends, it can be said that the consumers are getting more and more aware of their needs and wants. It also has to be said that the better connectivity is helping the rapid dispersion of global trends from the well established markets to the emerging markets, thereby creating the opportunity for development of consumer demands. This entire cycle of increasing in consumer demand is having a direct impact on the part of the consumers in a circular manner. Faced by growing domestic demands in the marketplace, multiple companies located in various markets around the world are increasingly trying their level best to enter the new markets as they promote significant amount of business opportunity. It is important to state that because of the entrance of companies in new markets, two major changes are getting initiated which are highly interrelated to each other. The first change is that the entrance of new companies is triggering the level of market competition. The second change is that because of the increase in market competition, a major shift of power balances is happening in the markets from the sellers to the buyers. The shift is more happening because of the large number of alternatives that are being currently made available in the market. It is important to mention that apart from raising the competition and influencing the power balance in the markets, the entrance of new companies is also magnifying the challenges and advantages existing in the business environment. For this particular assignment, the focus is on developing a strategic plan for a global business which will be based outside the United States. Designing a global business organization The concept of a global business organization denotes the simple fact that the product or service offered by the company is accepted and is in high demand in multiple markets around the world (Adekola and Sergi, 2012, p. 59). However, in today’s world, in order to cater to the differing tastes of the consumers present in various international markets, the global organization all over the world are stressing on customizing their products and services to a certain extent. The global business organization that is being conceived here will be based in India. The global company of Indian origin will be focusing on providing technological services to the customers located in various international markets. In a more specific manner, it needs to be stated that the Indian global company will be designing mobile applications for the customers located in the global markets Key characteristics of an effective global business A global business has several important characteristics. The first one is the fact that the products and services of a global business can be distributed in various international markets while making small market specific modifications. The second characteristic of an effective global business is that they focus on implementing a fluidic structure of the business which has the ability to take shape as per the various market based requirements. The third and a very important characteristic of a global firm is that they focus on delegating the responsibility of conducting market specific research to the various subsidies present in the particular markets. However, the central control and responsibility of the research is managed by the global headquarters of the global business firm (Keegan and Green, 2005, p. 219). Now discussing in a brief manner, it needs to be mentioned that the domestic local business focus on expanding and developing its market in the local segment. As a result, the local business target local customers and manage their entire business structure in a very centralised fashion. It is however, important to note that many local businesses venture into new markets and focus on transforming themselves into global firms for various reasons which may range from broadening the market, seeking necessary raw materials, collaborating with international suppliers and boosting production based efficiency (Ehrhardt and Brigham, 2008, p. 589). Strategic Plan Initial planning While discussing about the initial planning for the global company, it is important to mention that the basic idea is to develop and design mobile applications for the customers located in various international markets. The company also has planned that once it develops a strong foothold in the mobile apps market; it will diversify itself and will focus on providing other IT enabled services. Market It is important to highlight that the market for mobile applications is global in nature. Since the services can be offered in the remote format, the customer base is not concentrated to a single particular country. The popular market research firm Gartner has highlighted that the revenue for mobile applications on a global basis will increase to 26 billion USD in the year 2013, thereby achieving an increase of rise of around 44% over the previous year. The firm has also predicted that by the year 2017, the global mobile application market will have a valuation of around 268.7 billion USD (Dredge, 2013). Legal Influence The influence of legal factors of the company is minimal in nature. However, it needs to be highlighted that since the company is developing mobile applications which require the users all over the world to disclose some personal information regarding them, the company should focus on following the legal guidelines that exist in the client’s countries in connection to collecting user information and other privacy issues of the consumers (Beesley, 2012). Economic Influence While discussing the economic influence on the business, it needs to be highlighted that the company will be catering to the clients located in multiple global markets. Hence, in this case, the global economic changes have to be taken into consideration. The first global economic change that has to be considered is the shifts of demography which is happening because of population growth, aging population, as well as increase in urbanization and a growing middle class in various markets around the world. The second major economic influence is in regards to the disruptive innovation that is happening in various markets. The technological innovations which are happening in various emerging markets are focusing on reaching out to the growing middle class and low income consumers in various markets around the world (ey.com, 2013). It needs to be stated that the shifts of demography along with the influencing trends of technological innovations will continue to create a strong demand for the mobile apps markets all over the world. Hiring In discussing about the hiring strategy of the company, the focus will be on people who have experience of around 1-2 years in development of mobile and software applications. The strategy behind opting for people with 1-2 years of experience is because of their high motivation, energy levels and relatively low cost. Also, another reason for opting for people with low experience is that they will be young and will be flexible enough and will be very adaptive for a new business environment. Production and sales Since the offering of the company is mobile apps, hence the production will be based in India and will be delivered remotely to the clients. The mobile apps will be produced by the developers who will be working for the company based in India. For sales, the company will be focusing on the process of getting new customers as well as retaining existing customers. For acquiring new customers, the company will be advertising its service in various technological forums and blogs. For retention of existing customers, the company will try to generate customer satisfaction for the services provided Management The top management of the company will comprise mainly of the co founders. Apart from the top management, there will be team leaders who will be responsible for managing the project specific client requirement as well as managing the team of multiple mobile app developers. Four Opportunities and Threats The first opportunity is that the mobile app market all over the world is growing at a very fast pace and it will continue to grow at a steady and accelerating rate over the next few years. The next opportunity that can be identified for the global company is the fact that since the company is based in India, it has the opportunity of attracting highly talented workforce at comparatively lower costs as compared to its rival peers. This undoubtedly provides the company with a tremendous competitive advantage. Now talking in regards to the threats, the most important factor that has to be considered is that since the company is focusing on developing mobile apps for international clients, it runs the risk of getting impacted by the currency fluctuations. The recent global fear of a possible US shutdown will greatly continue to have serious long and medium term impacts in regards to currencies all over the globe. Also, the ongoing fluctuations of the Indian currency because of various macro and micro based influences might have a strong negative impact on the profit generating abilities of the company. Another threat that can generate a tremendous negative impact for the company is the case of increase of cyber threats and brute attacks. Talking in a little elaborate manner, it needs to be stated that the mobile apps have become increasingly vulnerable to cyber attacks because of phishing and malware attacks. The rise of malicious attacks through mobile apps is increasing every day as the consumers of the world are increasingly shifting to new age Smartphones which have a highly flexible and open operating system like the Android. As per data provided by the popular antivirus firm Kaspersky, the android operating system accounted for around 94 percent of the total malware threats intercepts in mobile apps by the time period of late 2012 (cnbc.com, 2013). It is important to note that the rise of malicious attacks on the mobile apps designed by the company will seriously impact the credibility of the service provided by the company to the clients. Recommendations For the purpose of tackling the threats identified for the company in regards to currency fluctuations and cyber attacks on mobile apps, two very important strategies have been designed from the perspective of a global business manager. The first important strategy that needs to be highlighted is the fact that in order to protect itself from currency fluctuations, the company needs to adopt currency hedging practices. It needs to be said that the company while negotiating with the clients in regards to the prices for their contracts needs to fix a base point of the currency, depending on the current value of the base currency. This will help in safeguarding the losses of the company in regards to currency fluctuations because of macro and micro influences. The second important strategy identified for the company is to develop a mobile security division of the company which will be focusing on designing security solutions for the mobile apps of the company as well as for the open ended mobile operating systems like the Android. The division will be based in the Indian market since it will serve the dual advantage of getting talented developers and that too in highly comparative costs. The mobile security solutions that are being designed by the company might also be sold in the open market at a later stage depending upon the prospects emerging in the mobile security solutions market of the globe in the upcoming future. Conclusion On a concluding note, it can be stated that this project discusses about the strategic plan of an India based global company which will be providing mobile app development services to the clients based in international markets. The project also covers the four opportunities and threats and the possible recommendations from the perspective of a global manager that is needed to overcome the threats. References Adekola, A., and Sergi, B.S. (2012) Global Business Management: A Cross-Cultural Perspective. USA: Ashgate Publishing Ltd. Cnbc.com. (2013) Cybercriminals Are Coming After Your Mobile Apps: Experts. Retrieved from: http://www.cnbc.com/id/100755795 Ey.com. (2013). Tracking Global Trends. Retrieved from: http://www.ey.com/GL/en/Issues/Business-environment/Six-global-trends-shaping-the-business-world Beesley, C. (2012) Five Legal Issues to Consider when Developing and Marketing a Mobile App. Retrieved from : http://www.sba.gov/community/blogs/community-blogs/business-law-advisor/five-legal-issues-consider-when-developing-and- Dredge, S. (2013) Mobile apps revenues tipped to reach $26bn in 2013. Retrieved from: http://www.theguardian.com/technology/appsblog/2013/sep/19/gartner-mobile-apps-revenues-report Keegan, W.J. and Green, M.C. (2005) Global Marketing. 4th ed. India: Dorling Kindersley Pvt. Ltd. Ehrhardt, M.C. and Brigham, E.F. (2008) Corporate Finance , 3rd: A Focussed Approach. USA: Cengage Learning. Read More