Business Studies Essay

1531 Words7 Pages
Introduction Global businesses are affected by an extensive range of external factors, such as financial, legal, political and social influences. Given the dynamic nature of such an international business environment, businesses must adapt the various strategies used to manage staff, in relation to rewards, training and development and the provision of flexible working conditions. The effective management of these key issues have played a prominent role in the recent success of businesses, such as Harvey Norman (HN) and Coca Cola (CC). Specific influences on global businesses Businesses operating in the global environment must consider various factors which will impact on their operations, and management of employees. Such factors, in particular regard to financial, political and sociocultural influences, have had a profound impact on HN and CC. - Financial: as most nations have floated their currencies, there is considerable uncertainty for businesses operating in multiple nations. The major issues which must be considered by businesses include currency fluctuations, interest rates and overseas borrowing. • currency fluctuations: this involves the movement in the exchange rate of different currencies. An exchange rate is the price of one currency (e.g. Australian dollar AUD) expressed in terms of another (e.g. USD) Currency fluctuations can significantly impact on the operations of global businesses due to significant implications in: the demand for overseas exports, the value of overseas assets, and the price of overseas supplies. For example, given the recent appreciation of the AUD, global demand for HN’s products, such as exported furniture, has decreased, as they have become more expensive for other nations to purchase. However, the cost of overseas supplies, such as HN’s laptops from Japan, have become cheaper to import, and overseas loans become cheaper

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