Globalization refers to the interconnectedness of the world’s economies, populations, and cultures due to widespread international trade (Smith, 2018). It has become a necessary part of the modern world. However, as much as globalization improves people’s lives, it creates new challenges for companies when they expand across borders (Smith, 2018). This essay will discuss how most companies face globalization concerns and how a corporate structure and culture can be a strength and a weakness. Lastly, the essay will discuss how these strengths and weaknesses affect competitiveness in the global market.
Ways a corporation’s structure can be a strength
A corporation’s structure can also be a strength if it facilitates the company’s growth in a sustainable manner (Groysberg et al., 2018). A simple organizational framework may be all that is required for a startup. However, as a company expands into new global markets and its operations grow more complex, it may be necessary to reorganize and strengthen its internal structures. A corporation’s structure can be a strength if the structures are matrix (hybrid) (Groysberg et al., 2018). This organizational setup can vastly enhance communication and lead to much fewer conflicts. This is because it discourages managers from exercising dictatorial control over their employees and encourages them to work together. With this structure, the company can also use its resources better, allowing for greater leeway in how those resources are allocated (Groysberg et al., 2018).
Another corporation’s structure that can be a strength is geography-based. Using this framework, it is guaranteed that each customer’s unique needs will be handled to the best possible quality while also giving customers the attention they deserve. Also, with a geography-based structure, unproductive product lines may be scrapped (Groysberg et al., 2018). Furthermore, a corporate structure may be a source of strength if the structure of its business teams is customer-centric, promotes employee self-management, and expands workers’ knowledge and skill sets.
Ways a corporation’s structure can be a weakness
Companies might suffer if their organizational structure is weak for their size and the objectives they hope to achieve. A corporation’s structure can be a weakness when its management is lopsided. Most of the world’s largest companies have many managers, each of whom is in charge of a certain aspect of making the company’s products or providing the company’s services (Smith, 2018). One cause of uneven management lines is when one supervisor is in charge of a disproportionately large number of subordinates. In this case, the drawback of the corporation’s structure is that a manager may be unable to properly lead his or her division (Drucker, 2017). Another way a corporate structure can be a weakness is when it has increased bureaucracy. Most businesses are classified into two broad types: the tall and the flat. Flat structures have fewer managers at each level, while tall ones typically have more. When more people are in positions of authority, it might take much longer to make important choices. Moreover, micromanagement may occur due to a lack of leadership and fewer workers (Drucker, 2017).
Another way a corporate structure can be a weakness is if its organization has slowed communications. In formal organizational structures, lines of communication are often strictly monitored and managed. For instance, if a company is structured into regions, it may take more time to transmit data to other firms. Technology has helped reduce this delay, but it is still necessary for some situations (Groysberg et al., 2018). Shipping goods from one place to another is another trouble spot. As a result of having specific locations for shipping and receiving, most businesses have an innately formal system. The last way a corporate structure may be a weakness is when it is not flexible enough. When a corporation has strict business procedures, it finds it challenging to meet the ever-evolving needs of its clients. For instance, if consumers demand shifts, a company with a strict and formal structure may be unable to swiftly adjust the kind of products it sells to meet the new needs of its clients (Drucker, 2017). The two main worries about this situation are the potential for lower profits and higher operating expenditures.
Ways a corporation’s culture can be a strength
A corporation’s culture can be a strength if it is clearly stated and fosters a sense of community among its employees. This is if it fosters dedication among workers, strengthens the firm as a whole, and provides a framework for employees to make meaning of their daily work lives (Drucker, 2017). Moreover, a corporation’s culture is also a strength if it upholds core values. Since a company’s core values serve as its moral compass, the principles must be carefully considered. After all, these are the standards that employees use to determine how they should act within the company, helping to foster the desired culture. Core values should be cultural traits that are seen but actively enacted and quantifiable in all facets of a company’s day-to-day operations (Drucker, 2017). In addition, the organization’s values will benefit if they are flexible and allow for growth and change as the business and its culture evolve.
The second way is if the staff works together. The guiding principles will likely have a significant and far-reaching impact on how people work together. How people interact with one another and collaborate is the most obvious manifestation of the culture. The third way a corporate structure can be a strength is if there is a sense of community (Drucker, 2017). This necessitates dismantling the obstacles that prohibit people from working together and sharing ideas efficiently. Bringing people together may be done in various ways depending on the problem: Creating opportunities for traditionally different teams to connect and learn more about one another or, even better, work together to solve a common problem (Drucker, 2017).
Ways a corporation’s culture can be a weakness
If employees do not fully comprehend the company’s corporate culture, it might have a negative impact on the business as a whole. Poor communication is one way a corporate culture can be a weakness. When there is no team chemistry in an organization, things can quickly deteriorate into a toxic environment. Therefore, it should not be surprising if the improper business culture includes poor internal communication (Drucker, 2017). One may tell there is an issue when people complain that it is too difficult for them to communicate with each other or when interactions are unpleasant.
Micromanagement in a corporate’s culture can also be a weakness. Employees’ stress levels rise, and productivity plummets when they believe their superiors are spying on them. Micromanagement is never a good idea and should be avoided at all costs. To be more precise, it causes unnecessary stress for employees, which slows down their productivity and has a detrimental effect on both the quality and quantity of their output. An excessive amount of gossip is another way a company’s culture might be a weakness. In every environment, whether corporate or not, gossip can ruin the atmosphere at the office. It may promote abusive management practices like bullying and firing workers without justification (Drucker, 2017). The target of the rumor can feel hurt and have their confidence eroded.
The last potential failing of corporate’s cultures is a permissive stance towards inappropriate conduct. When bad habits are introduced, they often come from the top management tier. It is only natural for workers to disregard established norms in their field if management disregards them. With time, this will weaken the entire company.
How the strengths and weaknesses affect competitiveness in the global market
A strong structure’s ability to rapidly create new forms is a competitive advantage. This directs the business to provide value to the market and enables it to tackle the right problems for its various markets, products, and distribution methods (Rana et al., 2021). Further, the ability to renew and modify strategy emphasis through organizational design keeps management teams engaged, energetic, and consistently ahead of the competition across the global market. On the other hand, a weak corporation structure leads to low profitability hence a competitive disadvantage. As a result of a lack of clarity on the management team’s roles, the various departments lack the direction they need to generate revenue. Therefore, maintaining the competitive advantage would be no benefit, and the service or product would revert to its normal form.
Strong company culture may act as a magnet, luring the most qualified candidates and giving them an edge in the fierce battle for top talent. In addition, a strong culture values its employees, supports their development, and inspires them to do new things. Therefore, making the finest and most experienced personnel feel valued and appreciated causes a company’s innovation to be maintained and its competitive intensity in the global market to be raised. In contrast, a weak corporate culture leads to a selfish environment which causes the best employees to depart. With the most talented employees gone, a corporation can no longer provide innovative solutions to problems or new ideas for products and services. This will, in turn, reduce the company’s ability to compete in the global market.
The structure and culture of a corporation affect its performance in the global market. Whether one considers operations or productivity, a strong corporation’s structure, and culture lead to high profitability. On the other hand, a weak corporation’s structure and culture lead to the erosion of the company’s worth. This essay has discussed ways a corporation’s structure and culture can be strengths and weaknesses. It has then concluded by describing how the strengths and weaknesses affect competitiveness in the global market.
Drucker, P. (2017). Concept of the Corporation. Routledge. https://copify.ir/wp-content/uploads/2018/01/2018-6.pdf
Groysberg, B., Lee, J., Price, J., & Cheng, J. (2018). The leader’s guide to corporate culture. Harvard business review, 96(1), 44-52. https://egn.com/dk/wp-content/uploads/sites/3/2020/01/HBR-The-Leaders-guide-to-Corporate-Culture.pdf
Rana, S., Prashar, S., Barai, M. K., & Hamid, A. B. A. (2021). Determinants of international marketing strategy for emerging market multinationals. International Journal of Emerging Markets, 16(2), 154–178. https://fardapaper.ir/mohavaha/uploads/2021/10/Fardapaper-Determinants-of-international-marketing-strategy-for-emerging-market-multinationals.pdf
Smith, K. E. I. (2018). What is globalization? In Sociology of Globalization (pp. 3–10). Routledge. https://www8.gsb.columbia.edu/faculty/jstiglitz/sites/jstiglitz/files/The%20Overselling%20of%20Globalization_0.pdf