Strategic International Business Management-Samples for Students

Question: Write an essay of 3,000 words that critically discusses the following statement: Upward communication and senior leader behaviour the possibilities and challenges of developing an inclusive, open culture within a multinational enterprise. Answer: Over the years, ways of doing business have changed and so are the methods that leaders adopt for managing their operations (Ball, et. al, 2012). With the changing global business needs and environment, it has become essential for the leaders to adopt methodologies that are more flexible. The competition in the market is increasing at a much faster rate and hence leaders need to adopt strategies that give them strategic edge over the others firms. Communication within the company plays a very crucial role in managing operations (Wheelen and Hunger, 2011). It helps to maintain the smoothness in the working process as well as making sure that every information reaches to the beneficiaries. Effective communication system helps in construction of positive environment within the organisations. Most of the leaders in the firms have accepted open culture which helps them in bringing new ideas for solving issues that arise in daily operations of the firm. Style of leadership plays an essenti al role in managing any changes in the operational procedures. Later part of this essay highlights the ways in which MNEs are changing and the leadership challenges that is present in front of them. It also illustrates about the style of leadership that needs to be followed as well as the factors that is hindering development of open culture. Ways of doing business is changing at much faster rate. It is due to the fact that there is large change in the environment from the past. Environment in the business have become more sensitive and have become variable in nature (Scullion and Collings, 2011). This has brought challenges for the firms as they have to make continuous change in its operational style so as to make sure that there is less chance of business failures. Multinational enterprises are operational in many parts of the world and hence they are more sensitive towards change in the global environment. Internal and external factors are making huge impact on the operational procedures of the company (Alkhafaji, 2011). The changing global scenario needs to be evaluated in a better way by understanding each and every aspect of the variables that is making impact on the business of the firms. With the globalisation multinational enterprises have emerged in many parts of the world which has benefitted many people. There are several ways in which multinational organisations are changing. In the past companies were more dependent on the human capital for their operations but the amount of people that are working within a firm have reduced. Automatic and smart machines have replaced people and have enhanced the efficiency of the firm (Crawford, 2012). It has reduced the number of errors occurring while performing any task. MNEs were only concerned about their growth and profits that they can make through their business. But now they also have to think about the sustainability of the society and their business. Sustainability has become a major concern for such firms and they have to take care of the issues related to the sustainability (Lee and Carter, 2011). In previous times, multinational firms have been concerned about making their business more profitable irrespective of the impact it is posing to the environment. But now companies have been forced by the governments to operate their business in such a manner that it puts lesser burden on the environment and the resources available with the company. It is also essential that companies take care of the CSR activities along with their business. Companies need to take care of all the ethics while managing their operations and need to make policies that benefit their stakeholders (David, 2011). Companies need to invest a whole lot of their money in the welfare of the society. There have been a lot of changes noticed in the organisational structure of the companies over the years. They have developed their organisational structure in a way that senior level employees can interact with their juniors. More parallel structures have been promoted in the companies. Companies are giving most of their jobs on contracts. This helps company in cutting their cost that they would have invest on the welfare of their employees (Bolden, 2011). Most of their jobs are given to the smaller or local companies who have their own employees and are very much capable to finish the task. It is one of the cost cutting measures that companies have adopted over the years. There are many leadership challenges that are faced by the MNEs. These challenges have to be removed in order to ensure the long term growth of the company. There is a huge amount of competition that is present in the market and it has become a challenge for the leadership to maintain its growth rate. For surviving in the competition leaders needs to make strategies that are unique and differentiates their firm from that of others (Hitt, Ireland and Hoskisson, 2012). This has also brought challenges for the leaders as they have to manage their business in such a manner that they can achieve higher profits. For doing this they usually adopt cost cutting measures. In the changing global workforce the demands of the employees have also changed. Companies also have to fulfil their demands so as to make sure that the employees remain loyal to the firm (Spillane, 2012). Managing healthy employee relations is essential for the firms production as it directly affects performance of the employees. A satisfied employee always adds value to the product and services of the company which is necessary for maintaining the standards of the products. In present business there are large amount of situations and issues that company faces and it is essential for the leaders to make sure that they have an effective decision making system. This can only be possible if they involve large number of employees in their decision making process (Birkinshaw, Brannen and Tung, 2011). Any discrepancies in the decision making can lead to failure in the market which is not good for the image of the company. As it can be seen that there are many challenges that is faced by the leaders at higher levels of hierarchy. The way in which operations is managed within the company always depends on the style of leadership being followed within an organisation (Cavusgil, et. al., 2014). In the past it can be seen that most of the leaders were following autocratic style of leadership. It was beneficial at that time but in the current business environment it is essential that a manager listens to its employees and become more democratic in nature. In order to reduce the difficulties in business, leaders need to apply effective strategies that will able to solve the problem. Developing a culture within an organisation is necessary. This helps to bind the whole workforce in a single thread. Open culture is something that is the demand of the workplace. Open culture has become the key for modern day business. In the multinational firms there are many employees working. They all come from different cultural backgrounds and hence a common culture must be applied within an organisation. This brings uniformity in the working procedures as well as it helps in maintaining the positive environment at the workplace. In the past top leadership finds developing a culture within an organisation to be waste of valuable time. Even till today most of the leadership in an organisation understand it to be the work of the HR department (Reiche, et. al., 2016). According to Edgar Schein there is indirect and direct mechanism within a firm and organisational culture is directly affected by direct mechanism. Open culture is also understood to be as the responsibility of colle ctive responsibility and collective creativity. In such type of culture every employee works as a team to achieve common goals with having mutual respect for each others idea. It is necessary in the modern day business to retain old employees, attract new talents and inspire them all to work for the organisation. Embedding an open culture within an organisation can provide it with the same. It acts a protective shield at the time when firm faces challenges or is going through tough times. It is the role of the leader to pay attention to the culture in which employee live or work (Doz, 2011). Developing a culture within an organisation is important because a competitors can copy anything product, services or prices but to imitate a culture takes a whole lot of time, energy and commitment. It always depends on the leaders way of leading their organisation that how organisation can adopt open culture. This can be understood with the example of Volkswagen where their top leadership failed to incorporate a culture that made them once the peoples car. Many of the leaders are adopting a democratic as it is a facilitator of the open culture. This is the reason why most of the firms are removing decision making hierarchy which was strangling creativity and talent (Czinkota, Ronkainen and Moffett, 2011). By adopting openness companies makes all their procedures in front of the employees. This is also important for the morale of the employees as they understand themselves as an essential part of the company. Since the global environment for business is changing at much faster rate. The changes are frequent and hence companies also need to adjust their strategies accordingly so as to eliminate probability of any loss due to these changes. In order to manage these changes and adjusting according to the environment leaders needs to adopt transformational leadership style (Padmanaban, 2016). This is a leadership in which leadership adopt their style of leading as per the arisen situation. Scheins organisational culture model also provides points of reference to create changes in culture. According to Edgar Schein, it is good to have discussion with as many workers as possible. It helps to discover underlying aspects of organisational culture. In his views leadership is understood to be as the ability to step outside the culture that made the leader and to adopt more revolutionary changes processes that are more adaptive (Meissner, 2012). Open culture in an organisation is like the positive attitude to an individual. Open culture is an abstraction but its attitudinal and behavioural consequences are very concrete indeed. Impact of leadership style on open culture can also be understood by the fact that if there is no flexibility in the leadership style then it is threatening for its survival (Rentfrow, 2018). According to him leaders need to provide a framework for the open culture to be adopted inside the company so that there is no chaos in the functioning of organisation. It is not difficult to understand that why culture is important within an organisation. But there are many factors present inside the organisation that hinders the development of open culture inside the firm. These factors need to be evaluated in a proper manner so as to make sure that the hindrance can be eliminated. Leader plays an essential role in development of open culture. They have the role to develop, nourish and promote such kind of culture within an organisation. Success of implementation of organisational culture depends on the style of leadership being followed by them (Hagen, et. al., 2012). Open culture is always impacted by the shadow of the leader. Multinational organisations are bigger in size and hence it is always difficult to embed open culture within the organisation. People in MNE are coming from different ethnic and cultural backgrounds and hence bringing them under the same cultural values is a difficult task. It is also difficult for managers to implement a culture within such a large firm and manage it carefully. The way in which an open culture is fostered inside the organisation depends on the skills that leaders pose (Rothaermel, 2015). One of the most essential skills that are required in this regard is motivational skill. This skill helps leaders in motivating their employees about benefits of adopting open culture within the organisation. His personal behaviour and communication skills help in promoting such culture. If these two skills are not utilised by the managers in a better way then there is sure chance of failure. Organisational practices, policies and structure is another aspect that hinders the promotion of organisational culture. There must be flexibility in the organisational policies so as to adopt these changes. Apart from this if hierarchal organisational structure is present within the firm then there is less chance of success for such open culture. For the development of open culture within the organisation, it is essential that an effective communication background is present within the firm. Better the communication channels and mechanism inside the firm better is the chances of development of open culture within the organisation. They are the most important part of any organisation (Galliers and Leidner, 2014). Without their support it is impossible to adopt any culture. Usually employees always support open culture but if they react negatively after adopting open culture then it can hinder the growth of such culture. It depends on the market or industry of the organisation that whether adopting open culture will be beneficial. Its the nature of the work that decides how much influence a manager must have in the working of the lower level of work. If the operations within the industry or demand of the market does not support open culture then it may hinder the development of open culture. On the other hand factors related to the external environment always affect the culture inside the organisation. If these factors have negative impact on the working culture of an organisation then there is always a chance that development of open culture will be hindered. Attitude of the firm refers to the type of outlook an organisation possess i.e. whether they are risk taking organisation or innovative. If the organisation has a risk taking or innovation friendly attitude then it is probably a higher chance that company may succeed in the development of open culture within an organisation. It also depends on the sector in which a firm is working that how much successful it will be in developing open culture within an organisation. If the organisation is in service sector there is always a chance that more challenges will come to the company in adopting open culture. In manufacturing sector it is rather simpler process. As adopting open culture also invites for more distributed form of leadership. There is chance that in the future more distributed form of leadership will emerge. Distributed leadership is a conceptual and analytical method to understand the complex nature of an organisation. Apart from this distributed leadership foregrounds the way in which actors engage in an operation that is distributed or stretched across the organisation. Distributed leadership throws light on shared purpose, recognition and responsibility of leadership irrespective of position or role they have within the firm. If in future such type of leadership is promoted within the organisation then sharing of knowledge is promoted. This kind of leadership promotes trust among each other which is beneficial for bringing positivity at the workplace (Cadogan, 2012). It also promotes creation of a culture that is learning friendly. This culture stops the practice of making decisions behind the doors and facilitates employees with the power of making decisions. This kind of leadership always supports sharing and dissemination of information which cannot be possible without having effective communication mechanism. This kind of leadership always helps in creating widespread strategic changes. This also helps in bringing new leaders into the workforce as many people get the chance to participate in the important operations of the firm. Distributed forms of leadership always promotes organisational learning which is necessary for the growth of firm as well as developing individual capabilities. This helps firms to solve problems that arise in their daily operations. If in future more distributed form of leadership were to emerge then companies have to be ready with their culture that is able to sustain this change. More distributed for of leadership will bring more people under the main stream of the organisation. It will also enable people in sharing what they have learned through their experience. In such forms of leadership develops then there can be chances that there are many leaders emerging within an organisation and hence companies needs to balance between the powers. It is essential for the growth of the company while ensuring that there is no tussle for the power. There are many people that are coming to the firm from different cultural backgrounds and hence in multinational firm managing distributed form of leadership can be a complex thing (Lasserre, 2017). Behaviour of senior managers at this will become more essential at this time. If distributed form of leadership arises then there is always a chance that there can be miscommunication which has a negative effect on the operations of the firm (Gimenez-Espin, Jimnez-Jimnez and Martnez-Costa, 2013). In order to reduce this problem a more formalised medium of communication channels is required within the organisation. On the concluding note it can be said that there are larger numbers of changes that are going on inside the firm. There are many people working in an organisation and they come from different cultural backgrounds. In MNEs a whole lot of internal and external factors are responsible for making these changes. Along with these changes there are many new leadership challenges have also emerged. In recent years in most of the organisations open culture has been promoted. Open culture always helps in the growth of the company as well as assist in building leadership skills in the individuals. There are many factors along with the style of leadership that effects the growth of the open culture within an organisation. In future more distributed for of leadership is expected to emerge. It is beneficial for the development of the company as well as promoting organisational learning. Effective communication channel and the behaviour of leadership play an essential role in managing these changes . References Alkhafaji, A.F., (2011) Strategic management: formulation, implementation, and control in a dynamic environment.Development and Learning in Organizations: An International Journal,25(2). Ball, D., Geringer, M., Minor, M. and McNett, J., (2012)International business. McGraw-Hill Higher Education. 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