The globalization of business has resulted in creation of a perfect business environment in which each business owner is in a position to implement a given business strategy throughout the world. Globalization has made the business environment a one big union. It has facilitated movement of goods and service to all parts of the world efficiently (Hortum & Lloyd 2009). It has also facilitated movement of capital and other factors of production from areas where they are idle to areas where they are needed most. In fact, globalization has created much efficiency in communication among the business stakeholders, making them exchange ideas that are vital for development. Globalization has resulted in various forms of financial services that are used as the standard of trade (Del, Carayannis & Della 2012).
The aim of current report is to give a professional consultancy service to windmill app on the contract that they have just won and on their intention to send a new manager to control the new branch of service delivery. Current report will also give a professional training and counselling that is aimed at equipping the selected female Muslim manager with the necessary skill and competence that she needs for her new assignment. Moreover, the report will give a clear cross-cutting training solution to the manager so that she could be prepared for the challenges in her new job and the possible solutions that she may employ to overcome such challenges. In addition, current professional report will evaluate and look at the nature of globalization in relation to Indonesia and Netherlands, give comparison and analyse the Hofstede’s work with critical evaluation of its weaknesses. The challenges facing current business opportunities in the globe will also be analysed and the available solution be provided in the report.
Brief Overview of Macro-Level Facts about Socio-Political Facts
The macro level provides many facts about the socio political aspects that determine the business management points of the global businesses. The cross-cultural concept is also considered in the context giving the idea a great strength in determining the future of business ventures. It helps countries, regardless their geographical borders, overcome the dimensions and categories that they have put themselves in (Pauleen 2007). Some of the macro level facts are discussed below.
There are several factors that determine the nature of globalization in the current business management world. Such factors are very critical and integral parts of the globalization process and play a major role in determining the business management process success or failure. The factors include the socio-political aspects of the international organizations. Political stability is a very important aspect that must be given priority when dealing with any issues concerning business management. In order to have a successful business, the political goodwill must prevail. It is very necessary for maintaining peace, attracting investors and ensuring that there is a good business environment that can allow easy movement of goods and services (Johann 2008).
The environmental aspects that determine the success of the business management process include both the internal and external environment of the business. The way the business relates to its employees and the way it carries out its production process is called the internal environment. It affects the efficiency and productivity of the employees and the business at large. The way a business relates to the customers, its competitors and the government is called the external environment. It affects how successful the business management process will be through influencing the competition, sale and public image of the business (Tanachart & Islam 2010).
The economic aspect will determine the economies of scale through which the business operates. The larger the business is the more advantageous it is, as well. It makes a business enjoy economies of scale as it can operate at low cost, receive a wide market share, increase its production base and use the latest technologies in production. It is difficult to manage small size businesses compared to the large business organization, since they do not enjoy economies of scale.
Value Comparison of Indonesia and the Netherlands. Hofstede Work Graph
According to Hofstede’s work, there are six dimensions in which the socio-cultural aspects determine how a business institution is managed. The six aspects differ between Netherlands and Indonesia. Indonesia has high results in the aspect of power distance with a score of 78 percent compared to that of Netherlands which stands at 38 percent. It means that they prefer people to be very close and narrow the distance between them at their work places. In the individualism category, Netherlands scores high with 80 percent compared to Indonesia at 14 percent. It strengthens the argument that the Indonesians prefer people to stay apart from each other to develop independently (Hofstede & Michael 2008). In the masculinity aspect, Indonesia has 46 percent compared to Netherlands at 14 percent.
The Indonesians believe that certain stereotypic aspects of management determine what kind of job one should hold. The two countries are, however, close to each other when they deal with the uncertainty aspects. Netherlands scores 53 percent, while Indonesia is at 48 percent. It means that they both are interested in running away from ambiguous issues. The pragmatism aspect is also at par with Netherlands recording 67 percent and Indonesia recording 62 percent (Hofstede & Michael, 2008). However, a great difference is seen in the indulgence aspect, where Netherlands is leading with 68 percent against that recorded by Indonesia at 38 percent.
Criticism to Hofstede’s Work
According Hofstede’s work, power distance is used in describing how one desires to achieve a certain hierarchy in the society. It is distributed within an institution and governed by the organization equally. The closer people are, the more they struggle to equalize the power among them. Avoidance of uncertainty helps the society avoid any uncertainty or things that are ambiguous (Hofstede & Michael 2008). It helps people be stable and stress-free.
Individualism encourages the members of the society to focus on their own welfare and that of their immediate family members. Around 82% of the population has a GNP at an average per capita in the world. Moreover, masculinity index proves that male members of the society have a better stint for high profile positions than women. The stereotype study also shows that male members are more preferred to high profile jobs than female counterparts (Hofstede & Michael 2008). Such facts are discriminative and unrealistic, since the female manager who has been selected for the managerial position in the foreign country has proven its high efficiency.
Furthermore, the issue of individualism cannot be applied since teamwork and consultation forums are needed for the success of the business management. In addition, Hofstede’s work is wrong in suggesting that the society should be certain at all times. It will not allow coordination and flow of command from the senior managers to the junior staff. The issue of distance being a factor to power and authority cannot be allowed, since the organization has structures that handle power and authority within the organization (Hurn & Tomalin, 2013). Furthermore, distance will not affect the manner in which the business is managed.
Challenges Facing Business Management
There are several challenges facing business management. Such challenges will depend on the size of the business entity and the magnitude of impact will depend on the kind of products it deals with. It is important to note that irrespective of the site of an organization, it has to face several challenges. The challenge will also determine the level at which the business is at depending on how it struggles to avoid the challenges (Natale, Fenton & Libertella 1997).
Globalization is a major challenge for multinational business entities. They are entities that operate in more than one country in the world. It has been a major concern that globalization has created much hurdle for the multinational companies, while at the same time working against the small business entities that operate domestically. Globalization has made business adapt to the business models and operation of every country in which they operate. It has made the management of such business entities very difficult and challenging, since training and facilitation of work transfer processes have to be developed for every country of operation.
For any business entity to operate efficiently, the management has to be involved in making decisions concerning very critical issues that affect the operations of the business entity. It mean that at one point, the management will be in a situation whereby it has to decide on only one opinion among the many it may have at its disposal. In small business entities, decision making is not as complex as the large multinational business entities. Large business entities take much time for making decisions due to the huge number of management staff that they have.
Negotiation and Communications
Communications and negotiations are very important parts of any business entity operations. The chain of command in a business entity should be smooth so that information is passed very efficiently to facilitate action. In large organization, there is much bureaucracy and a complex chain of commands. Every action must pass through several offices before it is implemented. It causes the delay in implementation of various decision of the business entity, thereby negatively influencing the management process of the business. The multinational companies may face worse situations, since they have to go through a very long and time-consuming process of negotiation and communication before they implement any decision that the management had offered (Primecz, Romani & Sackmann 2011). As a result, it affects the management of every business in a negative manner.
Leadership and Cultural Intelligence
Cultural intelligence and leadership are also major challenges in the management process of any business entity. A leader is thw one who has right to influences different production processes and, therefore, such influence is very important for the success of a business. The level of intelligence that can make a business success and avoid negative cultural hindrances is also important. Negative leadership skills will lead a business entity to failure. It means that the management process will not be effective. Embracing negative and outdated cultural practices that prevent the business entity from normal operations will also hinder the production and success of the business (Hampden-Turner & Trompenaars 2000). It will further affect the management process of the business.
Current professional report has detailed the purpose that it was intended to achieve. It has also looked at the environment and the current nature of business globalization. The cultural intelligence that is required by every business manager for the success of a business has also been outlined. It is now clear that globalization has changed the way the business is managed and it has called for proper training and knowledge dissemination to the staff who intend to undertake their managerial work outside the domestic market. The sensitive global environment through which a business operates is very critical for the success of the management. The manager needs to equip themselves with the information on the socio-political aspects of globalization, nature of economies and the cultural aspects of the business in the global arena. They also need to undergo intensive training to ensure that they are well-prepared to undertake good decision making to ensure that the proper communication an implementation of ideas is achieved.