Marketing Assignment help online Essay writing Review Analysis:: Company strategy of IBM in South Africa – SWOT & PEST
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Write an essay for Business Expansion of IBM in South Africa??
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1.1 About the company (International Business Machine)
To complete the topic “Business expansion in south Africa” this paper consists and provides descriptive information of service provider company IBM (International Business Machine). IBM is a leading technology company that operates the business and provides their services worldwide. The company believes in innovation that defines the success path. IBM has largest operation which is around 170 countries. In terms of services IBM provides numerous services to their clients (enterprises, institutions and people) that consist invent and integrated hardware, software and many other consulting services in the area of Information technology and outsourcing. IBM Australia provides its technology and services to numerous organization from last 80 years. The commitment of IBM is stronger than the natural resources in the market place in Australia. IBM is also investing on local communities and working with schools and universities to ensure and to build the better and smart future in Australia. Thus this also create high value by investing in research and development other expertise and global creativity in the Australian economy. (Ibm.com 2012, 01)
This paper provides in depth understanding about the business expansion strategy of the IBM that established in Australia in South Africa. Whole discussion of topics covers into different sections in the paper. The rationale of the paper is:
– To describe the IBM Australia
– To focuses on the key element that affect the expansion of IBM in South Africa.
1.2 Proposed Expansion
As discussed in the above section IBM is operating their business in Information technology and outsourcing industry. To expand business in the South Africa the IBM Australia has to set up its whole operation in South Africa means source and production of the entire products and services should be in South Africa. (Ibm.com 2012, 01)
1.3 Needs that help in the proposal of expansion strategy of IBM in South Africa:-
IBM (International Business Machine) is the leading company that providing numbers of services to their clients in the area of information system and outsourcing. This paper discusses and focuses on the key topic “IBM Australia business expansion in south Africa” and provides descriptive information about the factors and strategies that IBM need to adopt for expansion. This paragraph focuses on required factors that IBM needs to expansion in South Africa. For expansion in South Africa IBM has to set up its unit in South Africa that consist well structured information system infrastructure, highly skilled and technical manpower to provides its services effectively and efficiently. (Ibm.com 2012, 01)
1.4 Addresses issues and structure of the paper
This paper present a discussion that addresses issues which provides information and clear visibilities about the expansion plan of IBM Australia in South Africa. To understand the issues and factors that affect expansion plan below sections contain information of PEST and SWOT analysis. On the basis of PEST and SWOT analysis and discussion the paper provides recommendation and conclusion at the end.
Discussion of the report
Political Environment
2 To expand the business internationally and globally, there are certain factors that need to be addressed through the help of various sources such as:-
2.1 Political Environment: It do not matter that the economic prospects of the country is doing business in the greater manner or not but the political environment helps to know about the significant impact in the country’s economy. This also is helpful to know and to understand about the political climate of the country. The changes will result towards the business and also the implications of the government create high influence in the market. As an emerging economy, the country has not remained unaffected by the turmoil in other emerging economies worldwide. This is especially in country like Asia and Russia. This positively reflects the strength of the economy and also helps in the political stability of the country. The country is peaceful with respect to democracy and it is known well for the major establishments and other achievements. The country is known for high level of confidence and it also has the key potential to invest with great level of confidence. Thus it is essential to focus on external as well internal factors for political stability in the country. Political stability has increased as the constitutional democracy. (Reportbuyer.com 2012, 74)
2.2 There is high level of involvement of the foreign investors in South Africa and this helps in international community. The government has also shown talented leadership to the greatest potential and also this gains the business community. The greater the level of involvement, the greater is the country’s political climate. (Exporthelp.co.za 2012, 01)
2.3 The discussion effect the organization with respect to the performance in the country. Expansion in South Africa will help in own development. This also will create high capacity in the development. Thus it will also create lot of opportunities and also it will help in huge expansion. (Jacobs 2012, 98)
3. Legal environment:
The legal system in this country is comprised of three important dimensions such as:-
3.1 Regulatory framework: The domestic laws of the country, the laws of the foreign markets and also the international law
This helps the buyers to focus on different aspects in the business in South Africa. These laws also are governed in the market in many respects. This governs the country with marketing aspects and also it relates to high safety, security as well as performance. The rules and regulations create the international process. (Bothma 2012, 01)
3.2 Business laws: South Africa carries laws for competitive policy and it also is creating the world class infrastructure and also it helps in better growth and better network. (Southafrica.info 2012, 16)
3.3 Labour laws: The employment laws in South Africa helps in ordinary working hours, it provides overtime to the employees, the employees extends the ordinary working hours and also there is huge night working hours in the country. There is an availability of public holidays and also every people get leaves on Sundays. (Placedynamics.co.za 2012, 10)
3.4 Taxation laws: The taxation laws in South Africa deals with the tax deduction with respect to the employee contributions. This also improves the changes with the benefits and other policies. (Expat.com 2012, 01)
3.5 This discussion effect the organization with great motivation and also this also helps in greater approach to the critical thinking and other skills as well as approaches. This also helps to develop the critical thinking skills and development.
4.0 Economic Environment
4.1 Interest rates: The interest rate in the South Africa helps to know about the country’s rate of interest. The average interest rate is 5.5 % in South Africa. (Tradingeconomics.com 2012, 38)
4.2 Inflation rates: The country’s rate of inflation is based on the consumer pricing index and this also helps to measure the purchase and other departments. (Globalrates.com 2012, 01)
4.3 Currency exchange rate ($): The currency exchange rates of South Africa deals with the daily rates of availability. {0.1214 US $ = 8.24 ZA Rands}. (SAVenues.com 2012, 01). Currency exchange change rate in terms of USD of South Africa is 0.000882.
4.4 Free-market/command /mixed economies: South Africa adjusts to free market and they are in a comfortable position for the market place. (Nkosi 2004, 14)
4.5 Economic trends/forecasts: In South Africa, there is a huge combination of economic knowledge and other ranges of available data.
4.6 Tax policies – The tax policies in South Africa is based on the resident and income-based. The normal rate of tax in South Africa is about 28%.
4.7 This discussion effects the organisation with the help of major important factors to know about the rate of inflation and other important techniques.
5.1 Socio cultural environment
5.1.1 Hofstede cultural dimensions: This is well defined in the country with the human mind with the relative culture.
5.1.2 Individualism vs. collectivism: This refers to the degree of individuals and it refers to the individual side as well as it focuses on the group for the same. The high side of dimension is known as individualism and collectivism on the other side deals with loyalty.
5.1.3 Uncertainty avoidance: This leads to the risk avoidance. This expresses the members of the society where they feel uncomfortable with uncertain situations.
5.1.4 Time orientation: The attitude of South African culture with respect to culture is very timely. The time is not linear and it is considered as a philosophy that contributes to great practices and high relief.
5.1.5 Quality vs. quantity of life: The quality matters the most in this culture.
5.2 The above discussion will help the organization to sustain for the long term because this creates the major source of advantages and also will help to know about the social and culture views as well as ideas.
6. Technological environment:
6.1 Technological infrastructure: This will require the products and machinery with respect to the competitive advantages.
6.2 There is a high communication in the country with respect to internet and technologies in the country.
6.3 Logistics network: There is a global based network and global procurement in the country that helps in better reach and better connectivity.
6.4 The above discussion is important because it helps in high technology and information with respect to the global brand known effectively as IBM.
SWOT analysis, Recommendations and conclusion
7. SWOT Analysis
7.1 Strengths: South Africa is well known for the industrialized country. It has the strong governmental policy in its framework.
7.2 Weakness: It has low skilled employees and there are shortages of manpower. Thus it also deals with high cost of labour. It also creates low amount of productivity.
7.3 Opportunities: There is great opportunity to increase the skills and technology capable labour.
7.4 Threats: The major threats are the unemployment as well as the poverty in the economy.
8. Recommendations and conclusion
To recommend and to conclude the above discussions, the company can increase its expansion with respect to improving its capacity, by increasing the high level of skills and also by the help of creating low cost labour.
The paper focused on effective discussion about the country South Africa for expansion and other networks.
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