Global Business Environment - Book Report/Review Example

ITM Table of Contents Introduction 3 Literature Review and Critical Analysis 4 Task One 4 Task Two 9 Conclusion and Recommendations 12 References 14 Introduction Global business environment is becoming highly competitive as several leading domestic and multinational organisations are trying to implement unique strategies in business operation process in order to gain potential competitive edge over their rivals. Several leading organisations around the globe are trying to capitalise on the potential business operation opportunities that have been developed due to globalisation and technological advancement. It is highly important for the organisations in this modern world to innovate new ideas and strategies to gain competitive advantages. It is true that several organisations are implementing new strategies based on the application of modern and advanced technology in order to compete with their rivals. Rapid technological change and competitive business environment made it important for the organisations around the globe to develop the potentiality of innovation within the firm. Demand for differentiated and high quality products and services have increased significantly among the consumers across the world right after the Second World War. Concept of globalisation has been introduced in this world in post Second World War era. Each and every organisation is trying to develop consumer centric business operation strategies as the business environment has become highly competitive since the end of Second World War. Presence of huge competition has forced the management of several leading domestic and multinational organisations to develop and implement innovative ideas to get success in business operation activities. Innovation in business operation process helps an organisation meet customers’ level of needs and expectations. Several internal and external barriers to innovation can hamper the business output of an organisation. It is important for the organisations to identify, evaluate and rectify those issues in order to enhance innovative strategy development process that can help an organisation to gain potential competitive environment within specific operating industry. It is true that the management of several organisations need to evaluate their innovative potential and into several barriers to innovation to develop effective proactive business operation strategies. This report will identify the innovative strategies implemented by firms and barriers to innovation. Finally, the report will recommend several strategies to overcome those barriers. Literature Review and Critical Analysis This part of the report will critically analyse the literature reviews of two tasks. Task One Several leading domestic and multinational organisations have adopted and implemented innovative strategies in business operation process in order to gain potential competitive advantages. Tesco Plc. is one of the leading retailers around the globe. The organisation is popular among the global consumers due to its offering of high quality and differentiated products at economic price level. The management of the organisation has adopted and implemented both cost leadership and differentiation business level strategy to meet the needs and expectations of consumers. Adoption of cost leadership strategy has helped the organisation to reduce its overall business operation cost. Moreover, the organisation has succeeded to offer products at competitive price comparing to the customers. On the other hand, development and implementation of differentiation strategy has helped the management of Tesco Plc. to offer high quality and differentiated products according to the needs of target customers (Ryle, 2013, p.22). Tesco Plc. is the first retailer in this world that has adopted and implemented online business operation strategy. This adoption of online business operation strategy enhanced the organisation’s cost leadership and differentiation business level strategy. It is true that global retail industry is becoming highly competitive as the management of several organisations within the retail industry understood the contemporary needs of global consumers. Huge level of workplace stress, busy daily schedule and competition in job market have reduced the tendency of traditional consumption activities of consumers in developed and emerging countries. Several retail organisations tried to adopt unique strategies in order to attract the potential target customers, such as competitive pricing, seasonal gifts and discounts etc. Management of Tesco understood the ongoing issue with the present traditional consumption activities. They tried to implement unique and innovative strategy in business operation process in order to motivate the consumers to continue with their consumption activities (Krishnan, 2013, p.84) Information communication technology has played an important role in the success of Tesco Plc. the management of Tesco Plc. has successfully installed several applications of advanced information communication technology in order to enhance effective online business operation process. Customers can go through product and service portfolio through these applications and make orders according to their needs. This online product choosing and order procession activity brought a significant revolution in the history of global retail industry (Heinemann, 2010, p.203). Advanced PDA service helped the logistics and distribution team of Tesco Plc. to keep track the stocks in inventory in quick time period. In addition to this, this application helped the organisation to reduce overall supply chain lead time. Advanced navigation process also helped the logistics executives to deliver ordered products to the proper address of customers in quick time period. Effective ICT security application has ensured secured online transaction for the consumers. Tesco is the first ever retailer that has adopted and implemented online business operation process. This process helped the organisation to minimise the traditional shopping efforts and costs of the customers. Following figure will help to identify the market position and sales growth rate of Tesco after implementation of online strategy in business operation process. (Source: Emerald insight, 2006, p.1) The above mentioned online business operation process helped the organisation to take off the burden of consumption activities’ efforts of the customers. Moreover, it has helped to reduce overall business operation cost. Effective implementation of online business operation process has helped the organisation to gain potential competitive advantages. E-commerce business process also can be considered as one of the important, effective and innovative business strategies introduced by several organisations (Kenneth, 2011, p.3). E-bay and Amazon can be considered as the two leading organisations within this global e-commerce industry that have adopted this business process quite effectively (Kotler and Armstrong, 2013, p.543). This online e-commerce business process has helped the management of these organisations to sources materials and products at economic price. Moreover, effective distribution team of the organisations make sure that the consumers get the products within the mentioned deadline. However, the management of these organisations have developed a skilled and effective technology department to maintain the high quality of the operation of these technological software applications (Fensel, 2006, p.158). Effective monitoring and quality control have helped the organisations to overcome the possible technological breakdown that may lead to hamper of brand image. Wal-Mart is one of the largest and leading multinational retail chains. This organisation also has tried to adopt and implement several innovative business operation strategies in business operation process in order to ensure positive sales growth rate. The organisation has successfully adopted cost leadership strategy in business operation process in order to offer products and services at economic price level to the target customers. Looking into the competitive business environment and market demand for differentiation products and services, the management of Wal-Mart decided to bring innovation in business operation process to maintain its competitive position in global retail industry. The organisation has installed advanced technological software applications in order to introduce online transaction facility for the customers. Moreover, the management of the organisation has installed advanced CRM software to enhance effective public relation with customers and employees. But, lack of employee morale and motivation affected the business operation activities of the organisation (Deresky, 2006, p.494). In addition to this, risks associated with online transactions affected the sales growth rate of the Wal-Mart. Following figure will address this issue. (Source: WIMS, 2014, p.1) Service marketing can be considered as an important strategic marketing option that needs to be considered by the leading organisations in this present era of globalisation and technological advancement in order to mitigate the risk of intense market competition. Customer service management process can be considered as an important service marketing aspect that needs to be monitored by employee of the organisations. Employees can be considered as real business growth drivers of an organisation. It is the responsibility of organisations to enhance high motivation and self-confidence level of employees by taking care of their professional and personal needs. It will morally boost the employees to perform effectively to enhance effective customer relationship management. Inadequate wage distribution and too much centralisation affected the motivation as well as performance level of employees. In addition to this, lack of training and development programme for employees hampered the potentiality of employees. Limited knowledge about technological applications of employees affected the customer service aspect of Wal-Mart (Bhattacharya, 2011, p.260). Task Two It is clear from above discussion and assessment that each and every organisation needs to develop and implement innovative ideas and strategies in business operation process in order to maintain their competitive market position and sales growth rate. Several forms of barriers can affect the development and implementation of innovative business operation strategies and activities. Firm infrastructure, low employee morale, inadequate customer service and challenging external business environment can be considered as the major barriers to innovation. Each of the barriers will be discussed one by one. Poor firm infrastructure can be considered as one of the critical barriers to innovation for an organisation (MacGregor, 2007, p.117). It is true that technological advancement, globalisation and revolution in advanced information technology history have influenced several organisations to develop and implement online business operation activity. It is true that the management of an organisation should have effective technological management department to overcome the barriers. But, inadequate management process and lack of skill of R&D team can hamper the effectiveness of online business operation process. It has been discussed earlier that Tesco Plc. has adopted and implemented effective online business operation strategy in business operation process. Implementation of advanced information technology software application in online transaction process has eased the consumption activity of the customers as the customers have not wait for too long in a queue. However, recently the management of Tesco Plc. has experienced an issue in the online transaction process. The company website suddenly broke down and lost its link for a longer time period. It created harassment for the consumers waiting for reply. It affected the brand image of the organisation (Davis, 2006, p.52). In adequate support staff and poor firm infrastructure was the major reason behind this breakdown. However, the organisation has recovered from that issue and appointed professional technological executives in the organisation to overcome the possibilities of these types of breakdowns. However, it is clear from the issue that the organisation has suffered from serious infrastructure breakdown that has affected its business operation process. The issues in Wal-Mart also suggest that the organisation lacks in customer service management process. Employees can be considered as the real growth drivers of an organisation. Lack of employee motivation and low employee morale affected the performance level of the employees. It is true that the management of Wal-Mart tried to adopt and implement online business strategies in business operation process to maintain their competitive edge over their competitors. But, lack of effective training for employees and low employee morale did not influence the employees to increase their performance level. It is highly important for the management of the organisation to review its organisational structure and leadership style in order to boost the motivation level of employees (Linsky, 2009, p.55). Effective training and development process for employees will help the self-confidence level of employees to handle the technical applications quite effectively. Moreover, the management of Wal-Mart should try to bring transparency in the performance appraisal and reward distribution process in order to motivate both performing and under-preformed employees to improve their performance level. Customer service can be considered as an important business operation element that needs to be considered by the employees as well as the management of an organisation. It is true that, several organisations are trying to implement advanced CRM software in order to maintain good relationship with customers in post-consumption time. But, inadequate follow-up and lack of support can affect the business environment of an organisation. Ford Motor Company can be considered as one of the leading automobile manufacturing and distributing organisations in this world. Recently, the organisation has faced customer service related issues. In several cases, the customers of the vehicles made complaint that the executives are not supportive enough to give solutions or answers to their asked questions or quarries. However, it is true that inadequate PR management and lack of training regarding customer service management process has affected the business performance of the organisation. The management of the organisation has tried to install advanced CRM software application to enhance effective customer service and public relation management process. But, inadequacy of support team and executives has become serious barriers to this innovation (Senft, 2012, p.218). It is highly important for the management of the organisation to look into this matter and strengthen employee training and development process in order to enhanced customer service management process. Challenging external environment also can be considered as an important barrier to the innovation. Several leading multinational organisations are adopting and implementing business expansion strategy in order to increase their global market share. It is highly important for the entrepreneurs to adopt this strategy as the competitive business environment in this world is posing real threat to them. But, it is also important for the organisations to conduct effective market research before going into a new emerging market and starting business operation process. The example of McDonalds and Coca Cola Company can be considered in this part of the report. The management of the organisation has adopted aggressive business expansion strategy to increase its global market share. However, the management of the organisation has entered in several emerging countries and started business practices. Lack of political support and inadequate cultural orientation has affected its business process initially. However, after that the management of the organisation tried to implement technological process to present and offer food products to the customers. They have implemented this technology to reduce manpower as well as business operation cost. It has affected the business performance of both the organisations as the government of several countries opposed this strategy according to the employment and labour policy (Bose and Lyons, 2010, p.155). It is important for the management of the organisation to include external stakeholders in the decision making process in order to overcome these sorts for external barriers to technical innovation in business process. These are the barriers that need to be addressed by the management of the organisation in order to maintain their competitive place in global market place. Conclusion and Recommendations It is clear from above literature review and assessment that innovation and unique strategy development in business operation process utilising advanced technological resources is essential for the global organisations. Global business environment has become highly competitive. Moreover, the demand of customers is changing frequently. Therefore, it is highly important for the organisations to focus on effective implementation of differentiation business level strategy in business operation process capitalizing on potential opportunities that have been developed due to technological advancement. However, it is true that several leading organisations tried to develop and implement innovative online strategy in business process quite aggressively. But, several issues, such as infrastructure issues, employment issues, customer service issues and external environmental issues affected the business process of the organisation. Several leading organisations, such as Tesco Plc, Wal-Mart, Ford Motor Company and McDonalds have suffered from these barriers to innovation. Following recommendation plans will help the organisations to overcome these issues. First of all, it is highly important for the organisations to sources advanced and high quality technological resources in order to maintain the efficiency of business operation process. It is clear that system breakdown due to poor quality resources have affected the brand image of Tesco, Ford Motor Company and Wal-Mart. Therefore, it is highly important for the organisation to ensure high quality control. Secondly, it is highly important for the organisations to ensure appropriate training and development programmes for the employees in order to increase the skills and level self-confidence of employees regarding the handing of newly implemented software applications. Moreover, the management of the organisations should try to implement effective leadership styles to motivate the employees to perform effectively. Thirdly, it is important for the management of the organisations to determine the availability of technological resources in emerging markets before expanding business operation process in those market places. Proper market research and cultural orientation will help the organisations to reduce the possibility of the barriers to technological innovation. Last but not the least; it is important to install advanced CRM software to maintain effective follow-up with the customers even after the completion of consumption activities. It will help the organisations to increase brand loyalty in the mind of the target customers. References Bhattacharya, B. C., 2011. Leveraging corporate responsibility. London: Cambridge University Press. Bose, P., and Lyons, 2010. Cultural critique and the global corporation. New York: Indiana University Press. Davis, M., 2006. More than a name. London: AVA Publishing. Deresky, H., 2006. International management. New jersey: Pearson. Emerald insight., 2006. Internet transaction and physical logistics: Conflict or complementary. [Online]. Available at: http://www.emeraldinsight.com/journals.htm?articleid=852144. [Accessed on August 15, 2014]. Fensel, D., 2006. Enabling semantic web services. New York: Springer. Heinemann, G., 2010. New online retailing. New York: Springer. Kenneth, L., 2011. E-Commerce. New Jersey: Pearson. Kotler, P., and Armstrong, G., 2013. Principles of marketing. New jersey: Pearson. Krishnan, R., 2013. 8 steps to innovation. London: Harper-Collins. Linsky, M., 2009. The practice of adoptive leadership. New York: Harvard Business Press. MacGreor, C. R., 2007. Small business clustering technologies. London: IGI. Ryle, S., 2013. The making of Tesco: A story of British shopping. London: Random House. Senft, S., 2012. Information technology control and audit. New York: CRC Press. WIMS., 2014. Walmart among lowest-ranked sites in new personal security report. [Online]. Available at: http://whosmindingthestore.org/tag/ecommerce/. [Accessed on August 15, 2014]. Read More