Question:
Discuss about the Organizational Structure and Management Levels.
Resource is one of the major essentials in the business and for the international business of the company Mabe resource works as the vital component for the offshore expansion in of the same. The resource based consideration is based on the view of the resources that are currently available in the firm. The resources of the business are the potential of the company marked as the capabilities which are financial, physical, human and intellectual (Hunt and Davis 2012). The resource based consideration referred to the strategies and the planning of the company interns of the international business. The resource based view (RBV) model enables the company to have the potential market opportunities in the new host market in the terms of the strategic resources of the organization (Lin and Wu 2014). The strategic resources of the firm further refer to the VRIN which is valuable, rare, inimitable and no substitutable. These resources signify the success of the organization in the new international market in terms of the competitive advantage. The VRIN framework entails that the resources must be valuable in orders to have the power for creating or leveraging the opportunities for the firm’s business (Talaja 2012). The next category in the framework refers to the rarity of the resources for providing the uniqueness of the same in the international market. The first two features of the resources denote the inimitable feature of the resource, which further indicates achievement of the competitive advantages. The achievement of the competitive advantage ensures the non-substitution of the resources. Therefore, the model based on the resources of the organization will enable the firm to analyze resources in order to ensure the success.
In the other hand the institution based consideration is also important for driving the organization towards the success in the international market. The market of India is highly competitive and the existence and sustainability of Mabe in this new market is difficult. The institutional framework is considered in this respect for driving the success of the company. The institution based view of strategy defines the role of the industry in which the company belongs. The view based in the institutional framework refers the industry specific environment for the organization in the new international market (Van Essen et al. 2012). The intrinsic potential as well as the performance of the industry in the new market environment is stressed by this particular framework in order to ensure the success of the company in the international context of the business. The institution based view also refers to the economical condition of the market as well as the organization for initiating the business in the new industrial market (Peng 2014). For the chosen company Mabe, the institution based view is important to be considered for understanding the market condition of India as well as the potential and performance of both the organization and the industry in the same. This framework will enable the company to analyze the market and business opportunities for the international expansion and success and achieve the competitive advantages.
For the expansion of Mabe in the international context of the business, the organization has chosen India. For the business expansion of the company, the firm must identify the specific attributes in the potential market of India. The attributes are based on the market opportunities and the sustainability factor of the company. To ensure the sustainability of the organization in the potential new marker the company must understand the market environment and effective strategies for the same (Bell, Filatotchev and Rasheed 2012). The attributes here in the potential Indian market refers to the various dimensions of the country. Undoubtedly, the entire market of the India is provides both the ground and the competitive advantages o the company, yet there are some specific attributes of the company that must be considered by the company for ensuring the success of the company.
As per the Action Learning team of the company, the company must understand the need and the necessity for the joint venture for the future success in India (Beamish 2013). In the other hand, the company also understands the economical condition of the country as per the geographical division within the same (Guadalupe, Li and Wulf 2013). The unequal distribution of the electricity in India refers to the need of considering the geographical preferences for the company as the company products are the electrical kitchen appliances (Deshmukh, Natarajan and Pahwa 2012). The next attributes of the potential market of India refers to the demand of the consumers and the preferences and choice of the same. The Action Learning team presents the result that the demand and the need of the consumers indicate the successful business of company in refrigerators, washing machines and stoves. The next dimension refers to the financial capacity of the Indian consumers for purchasing the electric appliances. It cannot be avoided that India is still a developing country and hence there are regions that are economically not capable of purchasing the products offered by the company. Therefore, the financial capacity of the consumers determines the success of the company in the specific part of the country. The business environment of India marks another dimension of the potential market for the company. The business environment of the country is highly competitive; therefore the company must analyze and find opportunity in the competitive market environment in India.
From the above discussion on the factors driving the sustainability of the company some specific attributes must be considered by the company. The specific attributes for the potential market of India are financially capable customers, geographically and economically developed regions, demand and need of the customers and the business environment of the country. In addition, the cultural dimension of the country also needs to be considered (Deresky 2017). This is because, India being a country enriched with diverse cultures, there are people who different beliefs, practice and preferences and use different languages (Ferraro and Briody 2017). Therefore, the company has to hire local people in order to understand specific preferences, demands and needs of the consumers based on their cultures. These few attributes need to be considered by the company to sustain in the potential market.
The management structure of any company entails the style and ways of organizing the management hierarchy and the organizational operations. The management structure of the company to certain extent similar to the organizational structure which is the foundation for operating the business of the company (Guadalupe, Li and Wulf 2013). There are different organizational structures that are dependent of the operations of the business of the company. Multinational companies like Mabe must follow specific organizational management structure for operating its business in the different nations. It is certain the Mabe has to face different challenges in the new host market of India. Therefore, the company has to maintain functional and organization units in order to resolve the challenges and fulfill the different functions in terms of the business operations.
One of the appropriate structures of the management for the foreign expansion of the organization will be the matrix management structure. The functional structure of the organization will enable Mabe to separate the unit for the different functions of the company I the international context of business. In this order the company will be able to maintain a clear and organized structure within the organization as well as operating the business. Another advantage of this management as well as the organizational structure is that this structure is flexible in operating business in the local area of the foreign country by collaborating and linking the business operation with the local practices. However, this structure is used by the small multinational companies operating within two to three foreign countries, but for Mabe this would be helpful in terms of operating business in the culturally diverse country.
The governance structure of the company defines the set of rules, processes and practices that controls and directs the company for operating its business. The governance structure is the corporate governance of the company that balances the interests of the key stakeholders of the company. For the multinational companies like Mabe who is expanding its business in the international market must follow and maintain proper corporate governance for the successful and effective business operations in the new foreign market. The determination of the governance structure is the responsibility of the management and the board of the company (Singh and Gaur 2013). In other words, the governance structure ensures the business operation within the organization for the successful expansion of the company as well as the sustainability of the company in the foreign market. The governance structure includes the role of the committees, bylaw of the organization, policies and procedures, incorporation and the charitable status. In short, the governance structure of the company signifies the internal operation of the organization which is responsible for the successful business expansion in the new foreign market.
Ethical consideration is another major and vital aspect of the international business expansion. The ethical consideration is to be taken into account because the legal and ethical issues of the foreign countries can be different from that of the home country of the business (Burchill et al. 2013). It is often possible for the company to differ their ethical and legal frameworks from that of the other countries. Therefore, some of the ethical considerations are recommended here in this section for Mabe that the company must follow while expanding the business in the foreign country in order to achieve the target and success.
The first ethical consideration for the company is regarding the employment. The company must understand the trend and the legal procedures of the employment in India (Ardichvili et al. 2012). It may possible to encounter issues in the employment regarding the leaves, overtime, wages and others. Therefore, the company must have knowledge about the ethical and legal issues and rules in the operating countries in order to avoid any conflicts as well as approach the issues with proper solutions.
The second ethical consideration is based on the culture as India is most diverse cultured country. The cultural dimension of India is capable of creating conflicts in the workplace which the company is unaware of. The cultural management within the workplace thus needs to be taken care with ethical consideration in order to avoid any cultural conflicts.
The next ethical consideration is based on the human rights of the country. The human rights of the foreign country can be different from home country of the organization. In other hand, the business operation of the company can disrespect the human rights of the foreign countries. In addition, it is also possible that the business operation of the company is discriminating the human rights (Ardichvili et al. 2012). In regard to this, the polycentric approaches of the staffing can be used (Nagendra and Ostrom 2012). Therefore, the ethical consideration based on the human rights of the stakeholders of the organization in the foreign country must be taken into account by the Mabe.
Pollution is another element that comes under the ethical consideration in the international context of the business. While expanding in the new countries for the business, the firm must follow strategies that are capable of preventing pollution. It may be possible that the company can face legal issue for creating pollution in the country in which the company has expanded its business. Therefore, to avoid any legal hazards in the foreign country for the business operations the company must consider the ethical framework while expanding its business in the international context (Ferrell and Fraedrich 2015).
The last ethical consideration refers to the corruption. The corruption can be possible to happen in the workplace regarding payments, unethical practices or behaviors, employee rights and others. The ethical consideration of the company therefore must include the corruption control to maintain a healthy workplace culture (Bucic, Harris and Arli 2012). However, there are many other aspects that can be considered to avoid any ethical issues or conflicts, but these are the major and most important ethical consideration outlined for Mabe.
For the sustainable business opportunities as well as the business operations of the company, the two alternative recommended structures for the company are functional structure and the divisional structure. These two structures are equally important and effective for the successful and effective business operation of the company in India. However, the divisional structure is highly recommended for the company for operating its business after ten years.
The organization structured as the divisional one is based on the objectives of the organization (Kavale 2012). The divisional structure of the company refers to the operations of the business as per the product of the business. The product is itself the self contained division that is capable of making strategies according to their product features and design and the geographical division of the area in which the business company is operating. As stated above in the report the geographical division of the country India is one of the major factor that is responsible for driving the business towards the success of the of the organization (Spate and Learmonth 2017). The divisional structure therefore is most appropriate for the organization for after ten years of successful business in the foreign country market. There are several advantages proposed by the divisional organizational structure such as the accountability, competition, culture, local decision, multiple offerings and the speed. Therefore the divisional organizational structure will be the effective and appropriate one for the future business operations as well as long-term sustainability and success of the company.
The divisional organizational structure is capable of maintaining strong business relationship with the stakeholders as well as the industry. The acquisition of the divisional structure of by Mabe will enable the organization to develop relationship with the local stakeholders which will ensure the success of the company in the local market. In addition, the acquisition of this structure within the company is capable of maintaining rich workplace culture within the organization, which will be beneficial (Steiger, Hammou and Galib 2014). The cultural integration and management in the organization will ensure the effective of the business operation in the local market. in the other hand this structure of the organization makes the organization maintain a healthy relationship with the industry in terms of the accountability and competition. The divisional structure is such a structure that approaches the organization for being responsible and accountable for their business operations and the any kind of the issues emerging for the same (Guadalupe, Li and Wulf 2013). The divisional structure forms competitive relationship with the other existing companies in the market which strengthen the relationship between the organization and the industry. Moreover, this structure also proposes values towards the local decisions and offers multiple products from a wide range in terms of the geographical divisions. Therefore, the divisional structure of the company will be most effective and appropriate in order to achieve the long term benefit for the organization.
Reference:
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