|Type of paper:
|Analysis International business Strategic marketing Marketing plan
Globalization and internalization are a common strategy in the technological era in many commercial industries. Therefore, the process of business expansion to international grounds requires companies to analyze the industry perspectives to allow for successful expansion critically. The Imperial East Merchant international group aims to expand into the African sub-Saharan market in rice distribution. It is in need of the business environmental dynamics analysis before entering the market. This critical analysis will process the analysis of both internal and external business elements to ensure they are in support of the expansion strategy for higher chances of success. In addition, the analysis also looks into strategic plans to implement to ensure the company’s competitive advantage. The organizational environment plays a critical role in simplifying the organization's operations and decision-making process. In both business and non-business settings, Adidas business environment is dynamic; hence, proper analysis proves to be vital in understanding the business and market dynamics for improved success. This report critically analyzes the business environment as well as critically examining a strategic plan that can be implemented by the company in marketing communications campaigns in the Sub Saharan Markets.
Internal Environment of Organization
These include forces within the physical and jurisdictional environment and play a critical role in the organization's operation. They are essential as they dictate how the organization operates by a description of its priorities and culture. Some of the factors analyzed in this part include human resources, technological resources, financial resources, physical resources, cooperate culture, and information resources (Terdoo and Feola, 2016). These are essential aspects of the organization as they play a significant role in how the organization delivers value to customers and the organization's purpose and profitability. This aspect mainly deals with explaining the organizational capabilities as well as the competitive position in the market. Moreover, based on the nature of business in this century, the deployment of resources remains a critical managerial responsibility; hence, creating a functional environment within the organization for strategic future operations. The elements of internal environmental aspects include:
Ownership and organization shareholders are critical aspects of analysis that will prove vital in the expansion program. The analysis of ownership shows the investors to the company and their rights and claims to the organization. This is an essential aspect of consideration as it influences decision making and allocation of resources in the company. Hence, since the company is a family business, there will be fewer restrictions as there exists general background information on the expansion (Mackay and Horton, 2003). The company expansion program is anticipated to face less resistance in the expansion as the family members have agreed to invest the company's resources in this expansion. Since the owners are critical aspects of the organization's internal environment, this family structure will be vital in reducing costs and optimizing profitability. The ownership also has a significant influence on the board of directors who govern the company. Therefore, since there will be harmonious ownership, there will be less effort selecting the general manager and team for this process.
This aspect concerns workforce-related elements in the company. In this case, this aspect influences task performance and the hierarchy of administration of the organization. This is a critical aspect of consideration based on the different compensation designs available for different employees as the respective ranks. In addition, the company needs to place much focus on the region’s employment laws (Thakur, Chander, and Sinha, 2017). Therefore, based on differences in employment and employee compensation and social welfare laws in Africa. The company has laid the critical infrastructure needed to work with the region's employment laws. On the brighter side, the company is set to enjoy low labor costs in the region. In this case, the company can enjoy high productivity, especially based on the aspect that the rice production and trade is a labor-intensive industry.
The organization culture is a vital aspect of consideration in the expansion strategy. The expansion program is unique and rare in its history, hence proving new challenges for the organization. In this aspect view, the company needs to develop a dynamic culture to be able to work in the region successfully. Therefore, due to the high poverty and unemployment rates, the company will need to adopt a more integrative role in society (Terdoo and Feola, 2016). The company will need to support the locals to increase production and have more land arable land for cultivation. The company will need to adopt the cooperative society dimension to increase the company reach while also boosting production. This approach will significantly improve employee behavior and improve efficiency in operation. Finally, through this approach, the company will manage to have a good reputation with the locals and the regional governments.
Resources and infrastructure
This aspect essentially deals with the organization's preparedness to handle conditions in Africa. This point of analysis will involve an analysis of the company's technological, financial, and resource capabilities. An analysis of this aspect shows a need to focus on the company's financial ability to sustain operations in several years of operation. Africa is generally underdeveloped, and the company will need to start some industries from scratch. This aspect will cost the company high technological and financial costs (Van Nguyen and Ferrero, 2006). This can lead to significant losses within the first few years of operation. On the other hand, due to low levels of support industries in Africa, there will be a need to have a vast network of internal infrastructure to operate with efficiency.
External Business Analysis
These are factors outside the organization but play a crucial role in how the respective organization operates. In these factors, the organization does not have control over them and is expected to work around them and work within the legal aspects. They are primarily environmental-related aspects as well as industry-related aspects that shape up the market environment dynamics. Companies may not have control over them but can continuously streamline operations to enjoy the proceeds of the market environment while spotting opportunities and threats. Generally, the rice production industry is still young; hence, there is a need for long term strategies for improved success levels. The external aspects include the General environment and the task or industry-related environment. The connection between the two is described in a diagram illustrated below.
General Environment of Organization
These aspects generally include aspects that affect rice growing and production players in the region. They are political, economic, technological, sociocultural, environmental, demographic, and legal factors. However, the company needs to focus on a few aspects that need more focus to avoid problems with other market players and the law.
The report utilizes the PESTEL model of analysis and identification of factors in the business environment. The PESTEL model works to explain Political, economic, social-economic, technological, and environmental aspects that influence business operations.
Political Legal Factors
In this case, the company will significantly depend on insights in this aspect for successful operation and in making crucial decisions concerning production and distribution. In this case, the company needs to focus on political stability factors for locating production, processing, and distribution centers (Thakur, Chander, and Sinha, 2017). In this case, this company will need to focus on politically stable regions to avoid regular disruptions in production.
On the environmental perspectives, the company needs to focus on the right climatic environments to set up the production areas. There are large areas of arable land with a suitable climate that can support sustainable production. On the other, hand, based on the nature of the business venture, there are few government conservations laws to abide by: in this aspect the company is needed to operate by sustainable agricultural practices while avoiding toxic chemicals in production (Seck, Tollens, Wopereis, Diagne and Bamba, 2010).
The company will need to comply with customs, values, mores, and respect the demographic characteristic of societies; hence, social-cultural aspects are generally important elements of consideration. Hence, the company will encounter diverse populations that offer the best environment for this development. In this case, the rate of urbanization will be the primary aspect as land is a significant aspect of agricultural production (Seck, Tollens, Wopereis, Diagne and Bamba, 2010). The manager will need to understand the social and cultural dimensions better to help in proper governance and coordinated production. Generally, the company will encounter suitable social and cultural policies, as many populations depend on agriculture for survival. In addition, society's structure will need the company to have healthcare as a primary service, due to the higher rate of peasant survival farming that will need to be modernized to increase production.
This is majorly concerned with methods of converting resources into workable products and services to meet the market demands. Technological factors in this industry deal with the adaptable technology that can help adapt to the environment around them. Technological factors include innovational aspects that revolutionize the production process. The company will need to engage with the market from scratch due to the technical inefficiencies that characterize the agricultural industry (Baltes, Gil-Humane, and Voytas, 2017). Strategic partners in the industry will prove to be important in increasing the technological efficiency of production. Hence, strategic planning and organization will be important formulating workable strategies with competitors. The company needs to have an adequate technological improvement plan to increase efficiency in production.
This analysis focusses on interest rates, inflation, and the unemployment rate in a nation. This is essential because they are the three aspects that influence commodity prices. In this aspect, the African market is characterized by high-interest rates and high unemployment rates; however, the market is still lucrative based on the increased population, hence the ready market for the produced products (Kassa, 2008). Despite low purchase power, employment opportunities from rice production will empower economic development. Therefore purchasing –power is anticipated to improve.
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