Business has entered the era of the one-world market

Last Updated: 21 Jun 2021
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Business has entered the era of the one-world market. Increasingly, companies are going overseas to attain sales and profits unavailable to them in their home markets. As a result, every firm, including those with purely domestic operations, is facing increased pressure from foreign competitors .

Environmental effect on development of PW Co.

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In organizational development, environment is the sum of all forces surrounding and influencing the life and development of the firm. These forces can be classified as external or internal. Internal factors are the controllable forces or elements that the management must administer in order to adapt to changes in the uncontrollable environment variables. They include factors of production (capital, raw materials and people) and the activities of the organization (personnel, finance, production and marketing). (Bessant, J, R 2001) Moreover management has no direct control over them, though it can exerts influences such as lobbying for a change in a law, heavily promoting a new product that requires a change in a cultural attitude. The external forces are uncontrollable forces. External factors are uncontrollable forces and consists the competition, economic variables (unit labor cost and personal consumption expenditure), legal (both domestic and international laws), political elements and technological growth.

Ways in which a global managers are able to influence management decisions despite cultural and language differences:

  • Rebalancing the managerial relationships between sales departments.
  • Investing in a strong brand and consistency in their delivery on their brand promise, in their products, services and actions. Closing the least efficient local plants and converting the best into International Production Centers.
  • Innovation delivery through investing in world class strength in consumer insights, technological prowess and superior market networks.
  • Increased matrix simplification by replacing both the dual commercial and technical leadership with single management at both the corporate and national organizational levels.
  • Developing management team in talent engagement and aligning them to benchmarking of their performance.
  • Investment in profitable and fast growing business in different geographical regions hence achieving market leadership position.
  • Worked in teams and hence getting opportunity of learning from the best practices of others in the company.
  • Supported technology-sharing agreements and entered alliances in offshore manufacturing and sales.
  • Reducing its size, bringing on directors with strong operating experience, and creating subcommittees to deal with difficult issues.

Hofstede’s cultural dimensions and the way they influence management decisions

Power distance

The organization should understand its customer or country of operation, the way they perceive, accept or expect power relations which may be termed as consultative or democratic. For effective management of sales activities, the senior management should try to consult or involve the subordinates in decision making. This creates sense of belonging and spearheads the group towards goal achievements. Under this dimension you will find that in small power countries like China people relate with one another as equals in spite of formal positions held.

Masculinity vs. femininity

Masculine cultures are assumed to value competition, assertiveness, ambition and wealth accumulation together with possessions of materials as seen in Western cultures (for instance recent study shows Slovakia to be the most masculine culture)

Feminine culture has been seen to place more value on relations and quality of life. The recent study has shown that Sweden is the most feminine state. Hence the management should consider the kind of needs for a particular country before it commences its operations, for instance the quantity or quality of life in a given country should be considered.

Individualism vs. collectivism

In the individualistic cultures people are anticipated to stand up for themselves and choose their own association or group of belonging, this is commonly practiced in USA. Whereas in collectivistic cultures people belong to a given association or state and decisions are not made independently, they both have common goals. Latin America and China are good example of this culture. PM Co. senior management should put into consideration the settings in a given state before it explores the market.

Uncertainty avoidance

These basically focus to the extent in which countries try to handle its unease by reducing the prevailing risks. This is achieved when a country a good methodologies of risk reduction or retention. PM Co. management should analyze the extend of risks prevailing in the country its planning to launch its business. Research has shown that those cultures which score high risk avoidance is one in which employer tend to retain its employees longer.

Japan and Latin America have scored uppermost in risk avoidance while Pakistan the lowest.

Long vs. short term orientation

This is attached to the time horizon in most cases pertaining the future, past and present. In long term oriented countries, for instance China and Japan, value of goods or services involve persistence, prudence and in some cases ordering relations status. While for short term countries values involves normative statements, stability and steadiness, this is commonly practiced in Western countries and China.


In most cases, cultural differences describe averages or tendencies and not individual characteristics. Consequently, a society score should not be interpreted as deterministic. With the mounting competition. [6]The huge increase in imports, plus massive amounts of foreign investment meant that the firm had to face cut throat competition from everywhere in the world. This increasing internationalization of business demanded managers to have a global business perspective gained through experience, education, or both. That is why Philips tried to employ different management teams.


  1. Robbins, SP.Business without Borders. US News and World Report, July 16, 1990, pp.29-31
  2. Bessant, J, R (2001), Managing in a borderless world. Harvard Business review, pp.152-161.
  3. Weikins, Mira. R (1972), The Emergence of Multinational Enterprise, Cambridge; Harvard university press.
  4. Tugendhat, Christopher. R (1980), The Multinationals, New York; Random House.
  5. Davidson, J. R (1988), Transnational corporation in world development, New York; United Nation, pp.16-20
  6. Bessant, J, R (2001), Managing in a borderless world.
  7. Robbins, SP.Business without Borders. US News and World Report.
  8. Bessant, J, R (2001), Managing in a borderless world.
  9. Tugendhat, Christopher. R (1980), The Multinationals.
  10. Tugendhat, Christopher. R (1980), The Multinationals.
  11. Robbins, SP.Business without Borders. US News and World Report.

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Business has entered the era of the one-world market. (2018, Jun 29). Retrieved from

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