Critical Approach to Challenges for Organizations

Subject: Management
Pages: 8
Words: 2301
Reading time:
9 min
Study level: Master

Introduction

Developing a strong and affluent business requires implementing multiple management strategies aiming to sustain the productivity of the endeavor. As the global and local market environment constantly changes, shifting financial, social, and environmental conditions, any enterprise faces various challenges. In the contemporary world, corporations are compelled to withstand the environmental, pandemic, and international trade-related pressure, directly affecting labor and organizational processes. When left unattended, these complications remarkably increase in scale, prompting multiple hazards and reducing the potential success of the company. This work examines the three most pertinent challenges for modern businesses, namely sustainability, COVID-19 handling, and international trade maintenance, from a theoretical and empirical perspective, suggesting recommendations for complications resolution.

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Enhancing Ecological Impact: Sustainability Approach in the Current Environment

Demonstrating a responsible and environmentally friendly approach to business management is a crucial task for contemporary organizations. As the primary contributors to the rising level of air, water, and soil pollution, companies are required to implement efficient strategies that manage the production’s ecological output, decreasing its environmental impact (Hill, 2020). Although this objective requires considerable effort and input from both local and international enterprises, the absence of attention towards this area can be detrimental to the future of our planet. Given the availability of resources and the significance of corporations’ influence on financial and social aspects of sustainability, it is vital for the organizations’ leaders to utilize novel approaches which diminish the companies’ negative ecological effects.

A prominent method that addresses the issue of the environmental state of Earth is the sustainable development initiative, which determines the most pertinent goals in this field of improvement. Incorporating these objectives into the enterprises’ enhancement plans is suggested to reduce the consequences of climate change, protect basic human rights, and promote prosperity for various populations (United Nations Department for economic and social affairs, 2020). Overall, this strategy focuses on these three dimensions, attempting to alter the organization’s and countries’ approach to people and the planet. To achieve these targets, the United Nations have devised 17 goals for both governments and businesses (Hill, 2020). These aims perfectly capture the current difficulties connected to upholding a proper level of Environmental Protection, highlighting the necessary objectives to accomplish by 2030.

Nevertheless, there are several complications within the sustainable development goals project, which should be addressed in order to establish an efficient sustainability strategy. The requirements presented in the initiative were referred to as highly idealistic, as they aim at an incredible level of cooperation and resourcefulness, not available to every participating country or corporation. For instance, the goal of affordable and clean energy, while accomplishable for large-scale and developed organizations, might be more difficult to achieve for smaller businesses (United Nations Department for economic and social affairs, 2020). Additional investments and governmental support are necessary factors in securing a successful transfer to renewable energy sources.

Given the abundance of complications, some nations and businesses have chosen to follow their own agendas, omitting sustainable development goals. However, a majority of production companies have invested in the promotion of environmental protection, aiming to alleviate the negative effects of climate change. A prominent example is the NextEra energy firm, which contributed significantly to the generation of clean power, namely solar wind and other kinds of renewable energy. In recent years, despite the complications connected to the manufacturing of green power, this corporation became the largest energy distributor in America, yielding significant profit and considerable results in the battle against the impact on nature. Another case is the Stella McCartney brand, which is focused entirely on the fabrication of ecologically friendly clothing, implementing additional strategies to reduce the environmental cost of mass production. Therefore, although it might be strenuous to utilize green marketing approaches when devising company development plans, it is evident that this endeavor is possible in various fields of business and can provide the enterprise with considerable benefits.

The Organizational Consequences of COVID-19: Rising against the Pandemic

The outbreak of the Coronavirus has proven to drastically affect not only the social aspects of life but also international business policies. Responding to the pandemic in an efficient and cost-appropriate manner is a complicated challenge for numerous industries worldwide, the leaders of which are forced to create additional approaches to resolve the novel difficulties. Such consequences as loss of profit, diminished production rates and decreased communication have adversely impacted the affluence of various corporations, ranging from production firms to service providers (Van Assche and Lundan, 2020). Given the described problems, the enterprises began the search for applicable strategies that alleviate the financial and physical restrictions caused by the virus, allowing the structural processes to commence in a new environment.

One of the pertinent approaches to the issue described lies in response to limited travel. As the governments of various countries switched their policies to protectionism, the expenses related to the cross-border transfer of goods were elevated remarkably (Van Assche and Lundan, 2020). Subsequently, the transition of tacit knowledge, a highly complicated procedure of transferring information through face-to-face exchanges, became impossible, prompting the creation of long-distance measures which aid this interaction. Many companies that previously relied on the transfer of tacit knowledge directly have switched to digital communication, simplifying the process of interpersonal interaction (World Economic Forum, 2021). The development of digitalization has soared due to the global demand for non-physical conversation and knowledge exchange, becoming one of the most suitable approaches for tackling pandemic restrictions.

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Although numerous enterprises have adopted the strategy of digitalization, transferring their traditionally face-to-face processes to the online environment, there are some disadvantages to consider when reviewing this tactic. The expanse of the digital gap, a well-recognized phenomenon concerning underfinanced communities and their inability to purchase the needed resources, has risen significantly since the implication of Internet-based corporate processes (World Economic Forum, 2021). In the long term, the worldwide shift to digital communication greatly undermines the opportunities for occupation candidates, restricting corporations from strictly following non-physical methods of hiring, managing, and leading personnel. While some potential employees are unable to secure positions within the organizations, the enterprises have to battle the ramifications of diminished workforce availability.

The change of European supermarkets Albert Heijn sets a perfect example of an advanced digital hiring technique, promoting distanced employee search during the pandemic. To transform the process of recruitment and achieve greater efficiency in candidate selection, the company decided to implement Harver, a digital tool that aims to simplify the hiring procedure, ensuring that COVID-19 requirements are met (Harver, n.d.). Instead of direct interviews, the human resources (HR) personnel use the specialized online platform that decreases some of the HR responsibilities and enforces the fulfillment of social distancing. Another instance is Vodafone, a large-scale mobile operator that promoted the introduction of an OpenVPN network, a novel mobile product aiming to enhance the network capacity (Anonymous, 2020). By establishing a 5G connection that does not require expensive technical gear, the enterprise improved the experience for numerous users, ensuring their security and faster connection. This example demonstrates that novel solutions to the digital gap dilemma are being developed and tested to advance the growth of digitalization.

Creating International Business Partnerships in the Modern Era

The reduction of international trade, a detrimental consequence of the COVID-19 pandemic, drastically changed the traditional approach to establishing business connections and cross-border transfer of goods. As multiple countries decided to close their borders to improve the health conditions of the nation’s citizens, the challenge of maintaining the prosperity of international relationships emerged. Numerous production companies and services providers encountered a significant decrease in partnership stability and interaction with other firms, which diminishes the profits secured and undermines the future success of the corporations (United Nations Department For Economic And Social Affairs, 2020). Developing a strong and productive connection with international businesses is essential for any enterprise in order to uphold its location on the global market and enter the global trading networks (Hill, 2020). Nonetheless, the contemporary trade tensions have significantly diminished global trade growth, creating disruptions in international relationships.

From the theoretical perspective of the international trade theory, foreign export is highly beneficial to both the country and its enterprises, providing additional resources and supporting the growth of national firms. Even small-scale corporations have been shown to profit from international trading strategies, diversifying the materials used and securing the financial affluence of the endeavor (Hill, 2020). Therefore, as it is essential to maintain an appropriate level of international business relationships, some companies implement strategies to maintain international corporation and ensure the creation of positive interaction with foreign organizations’ leaders. For instance, it is possible to utilize an internationalization approach in combination with heuristics, which transforms the internal culture of the corporation, stating that the company’s values lie in developing a successful network or foreign operations (Guercini and Milanesi, 2020). By adopting heuristics within internationalization, more effective strategies and information-driven tactics for international business management can be implemented, alleviating the negative impact of uncertainty on foreign relationships.

Given that interaction uncertainty is a significant problem for international corporations, the aforementioned method is especially useful for companies battling this complication. However, although this procedure appears to be less time-consuming than devising sophisticated information models, the subject of heuristics is exceptionally diverse, making it difficult to pinpoint specific strategies and potential outcomes (Guercini and Milanesi, 2020). Only a small amount of scientific studies focus on particular schemes and their significance for an organization’s management processes. Therefore, to efficiently implement this concept in practice, it is essential to investigate it in detail, carefully exploring the common groups of research, heuristic types, and the outcomes of their utilization.

Considering internationalization, this notion is well recognized in academic studies, but it can also be challenging to establish in a specific environment, as it requires a thorough exploration of the potential risks and gains. According to Hill (2020), the choice between two major pathways to internationalization is grounded in the situational circumstances of the enterprise. While it might be easy for a newly established corporation to adopt its internal culture, it is a more burdensome endeavor for a significantly older organization. Therefore, deciding between internationalization, heuristics, or the combination of both requires remarkable attention and academic knowledge.

An inspiring example is presented in the case of Cemex, an international building materials company that followed a distinct internationalization strategy in its development. When attempting to expand the area of operations, this organization established its influence in regions close to its original country, avoiding the issues of international dependence and the need to adjust corporate policies (Ghemawat and Matthews, 2017). By thoughtfully choosing new areas of improvement that resembled the mentality of the workers and ensured their understanding of the corporation’s values, Cemex was able to create a worldwide operations network successfully. In a contemporary setting, this enterprise effectively trades with numerous international partners, adhering to their perspectives and constructing a close bond relationship through mutual understanding.

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Recommendations for Contemporary Organizations’ Leaders

Given the outlined challenges that current enterprises are presented with, several suggestions can be developed to enhance the resolution processes. The first proposition covers the environmental aspect of international management, recommending the use of an operational agility approach. This strategy has proven to be highly useful when devising a method of incorporating sustainability into the company goals, both adhering to the development needs of the corporation and decreasing its environmental impact (Bouguerra et al., 2021). Incorporating the elements of transformational leadership is another pertinent method, as employees might be inspired to suggest their ideas regarding the resolution of this issue. Therefore, it is imperative for contemporary businesses to achieve a proper level of operational agility in environmental responsibility, including swift and flexible methods of Ecological management.

As for COVID-19 and its influence on interpersonal communication and cross-border trade, it might be beneficial to devote an appropriate amount of company resources to compensate for the negative effects of digitalization. Given the current environment of the pandemic, it is essential to address the digital gap and the growing demand for online-based occupations. As in the example with Vodafone, aiding the disadvantaged individuals in lack digital resources or Internet coverage may present the corporations with an additional workforce, a highly valuable asset in the contemporary labor shortage. The principles of operational agility might also be advantageous in this regard, as they allow the organization to react to the unstable development of the virus quickly. Thus, following a proactive strategy and elevating the quality of the working conditions in Internet-deprived areas could tremendously assist the enterprise in confronting the consequences of the COVID-19 outbreak.

Another recommendation concerns the creation of international partnerships, which are especially valuable for the contemporary state of the global economy. To enhance the development of both the corporation and its foreign contributors, the leaders should encourage international cooperation and interaction, strengthening business relationships and promoting the exchange of relevant knowledge (World Economic Forum, 2021). Given the importance of cross-country communication, it is also crucial to implement critical thinking strategies to accomplish the necessary goals (Kogetsidis, 2012). The inclusion of the transformational leadership style can significantly advance this endeavor, prompting an organizational change in an efficient, rather than forcible, manner.

Conclusion

To conclude, the three most pertinent challenges for contemporary organizations, namely environmental impact, COVID-19 consequences, and international partnership management, were discussed in detail in this paper. It is evidenced that numerous corporations are confronted with the necessity to diminish their negative influence on ecology, improve the interaction patterns according to the pandemic guidelines, and secure long-term involvement in global trade. The methods of sustainable development goals, digitalization, and internationalization appeared to be highly effective in resolving such matters, providing the company leaders with additional management instruments. Nevertheless, these strategies also possess several considerable disadvantages, necessitating the implementation of supplementary approaches. The inclusion of operational agility, promotion of digitalization, and maintenance of affiliative leadership style were suggested as possible accommodations for future growth.

Reference List

Anonymous. (2020). ‘Open sesame.’ The Economist, 437(9219), p. 16.

Bouguerra, A., Gölgeci, I., Gligor, D.M. and Tatoglu, E. (2021). ‘How do agile organizations contribute to environmental collaboration? Evidence from MNEs in Turkey’. Journal of International Management, 27(1). Web.

Ghemawat, P. and Matthews, J. L. (2017). Case Flash Forward: Globalization of CEMEX. Harvard Business School.

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Guercini, S. and Milanesi, M. (2020). ‘Heuristics in international business: A systematic literature review and directions for future research.’ Journal of International Management, 26(4). Web.

Hill, C. (2020). International business: Competing in the global marketplace. New York: McGraw-Hill Education.

Harver. (n.d.) How Albert Heijn empowered store managers to hire 40% faster. Harver. Web.

Kogetsidis, H. (2012). Critical systems thinking: A creative approach to organizational change. Journal of Transnational Management, 17(3), 189–204. Web.

United Nations Department for Economic and Social Affairs. World economic situation and prospects 2020. United Nations. Web.

Van Assche, A. and Lundan, S. (2020). ‘From the editor: COVID-19 and international business policy’. Journal of International Business Policy, 3(2020), 273–279. Web.

World Economic Forum. Global Risks Report 2021. Web.