Decentralization is the process of dispersing people or resources from a central point or authority. Decentralization comes with the delegation of power to less senior management who manage small units of the business. Many reasons exist for decentralization including quicker decisions, expertize in local units management and utilization of the economies of scale that are found in one location and not the other. The work environment in the various business segments or branches has to run smoothly for the overall success of the business. According to (Travis, 2007), labor is the one most important component of the production process since it determines the rest of the processes in the business. From raw material collection, manufacture of products, distribution and the feedback of the consumers of the product involve labor. Decentralized global businesses have to create a good working environment for both the human and non-human capitals they employ in their operations.
Decentralization has long been at the heart of huge multinationals like Coca-Cola and Walmart whereby each unit of the companies in different countries has a separate management and is allowed to make independent decisions so long as the decisions help in the expansion of business. All business success is dependent on planning. The global businesses spend much time planning on the operations of the segments. The central administration and management consisting of the heads of departments in the companies and other senior management like the chief executive roll out the plans and plan on how they can be effectively implemented by the branches. According to (Gupta, 2006), the senior managers of every business are fully responsible for the success or failure f a business because they are the ones that plan for the overall operations of the business. They are the ones that determine the operations of their branches. A good plan yields good results and creates a conducive working environment.
Motivation of workers is another important strategy of maintaining good business environment. Constant commendation by supervisors may serve as a god incentive to workers to give their best. Workers should also be made aware of the global objective of the business so they can see beyond their local unit. According to Punnett (2008), a motivated workforce reduces loss since the resources are taken care of. He gives an example of a glass company where the workers can decide to intentionally break glass during processing due to low motivation. Proper and competitive remuneration of the workers is another factor that increases motivation. When workers are paid well for their efforts, they feel part of the business and have of belonging. They therefore towards the goal of the business which contributes to the overall result of this global business with diversified operations. The safety of the workers must also be an important consideration of any business. Business dealing with dangerous products like chemicals must ensure that the workers are provided with safety gear during work. The fire safety precautions and other safety measures work together to ensure good working environment.
No business can operate in a country without compliance to the law and the policies set by the government of that country. The tax policies and other policies that businesses should follow are all an essential part of peaceful operations of a global business in a given nation. Thomas (2011) says that all businesses must observe the policies of countries f operation for the good of themselves. He further states that any deviation may attract huge fines that may bring about losses and even eviction of the business from that country. According to Punnett (2008), the fact that business booms in a certain country and not in the other, the cause is largely the policies set for foreign investments in the nation. Therefore, for any business thinking of decentralization, the implication of the government policies in the target country of operation is critically important.
Government policies hugely determine s the working environment of any business since it is the responsibility of the government to assure the business of peace and political stability. Some policies that some countries have employed in limiting the operation of business may include the ban of plastic bags in Bangladesh which banned the use in 2002. San Francisco city in the US followed suit in 2007 while Los Angeles implemented the same policy in 2013. The use of Butylated hydroxyanisole (BHA) and Butylated hydroxytoluene (BHT) which are preservatives are carcinogenic and their use is banned in over 160 countries in the world. Any global business planning to set up operation in such countries and states must consider such things to create peaceful relations with the governments of the concerned states (Thomas, 2011).
Technology employed in the operation of any global business is also an important consideration in any business. Countries with huge unemployed labor force needs a labor- intensive technology so that the business can take advantage of the low labor costs they will incur while a country with a low unemployment rates require a capital-intensive technology. According to Travis (2007), the technology used must also be friendly to the environment, otherwise the neighborhood will demonstrate and the closure of such a business is imminent. Any governments main duty is to protect its citizens and the complaint of people to their government will see the setting up of sanctions for a business. With government sanctions, the workforce is disrupted and this affects the business working environment.
The management of the local business unit also contributes to the conduciveness of the work environment. One of the main reasons of decentralization is the utilization of the local expertize of management. The local managers and supervisors have better understanding of the working conditions. It is this knowledge and familiarity according to Barlett & Ghoshal (2009) that gives the global business a competitive advantage in the countries where they set up their branches. Local managers are more aware of the needs of the workforce in that country and as such are best placed to make decisions that affect work environment in such a nation. They continue to say that the local management decides the promotion of their workers and this helps the global business protect its name if the appointments and promotion are wrong since the blame will fall on the local management which did the appointments.
In conclusion, global businesses are responsible for the workforce that has devoted itself to the success of the businesses. Providing a good working environment is not only a want but a necessity for any global business. The businesses should take every step possible to provide such an environment.
Barlett, C.A, & Ghoshal, S (2009).What is A Global Manager? International Business Managers. Dubuque. Dushkin Publishers.
Gupta, A.K, (2006). Global Strategy and the Organization. New Jersey. John Wiley & Sons Publishers.
Punnett, B.J, (2008). International Perspectives on Organizational Behavior and Human Resource Management. Armonk New York. MESharpe Inc.
Thomas O. K, (2011). International Political Economy. New York. McGraw-Hill
Travis, T. (2007).Doing Business Anywhere: The Essential Guide to Going Global .New Jersey. John Wiley & Sons Publishers.
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