General Description of Poland
Poland is country in Eastern Europe with a growing economy. The Euro zone economic crisis of 2009 did not negate the economic performance of the country due to its strict monetary policies that restrain monetary supply. The country also curtails its debt budgets significantly compared to other European countries which rely significantly on debts following the sovereign debt crisis that started in Greece in 2009. Poland became a democratic country in 1989, moving away from its previous communist form of leadership. Since, the country has opened its doors to international business, recording an exports’ account of up to 40% of its GDP. Its entry into the European Union also accelerated the country’s foreign earnings as business between the country and other European countries of Europe such as Germany increased. However, its regulations still hurt business firms that engage in international business.
Central Issue of the Case
The key issue concerning this case is the high level of regulation that businesses still experience. For effective international business to materialize there should be a free market where forces of demand and supply are allowed to determine prices. Poland is one of the worst performing countries in terms of ease of doing business. State-owned enterprises still operate in the market even after 20 years of moving from a socialist to a democratic system. Although the government is committed to enhancing a free market through legislations such the Entrepreneurship Law passed in 2009, the country still faces a lot of challenges in making its business environment less restrictive for businesses.
Goals of the Country
The goals of the country are specifically aimed at making the environment suitable for business operations. The country is committed to improving the ease of doing business among various international and domestic businesses. There is need to provide a simple taxation system, reduce tax rates, and eliminate bureaucratic systems. Specifically, Poland focuses on reducing controls on health, labour and tax systems in order to make business operations easy for domestic and foreign firms. Privatisation of state-owned enterprises is also an important goal of the government as it advances in its process of creating a market-based economy and enhance efficiencies and increase productivity and growth in the economy.
Constraints of the Problem
There are various constraints that may affect the process of deregulation in Poland and prevent the country from achieving its goals. First, institutional factors such as poor governance and corruption may become a hindrance to the economic transition process. For example, leaders who benefit from the heavy taxation and stringent regulations can become a hindrance to the implementation of the Entrepreneurship Law for their own interests. Corruption in state-owned corporations may also become a hindrance to the privatization process because the people who benefited from the previous regime may not be happy with the changes (Ali, 2009). Lack of human capital may also cause a problem to the implementation of changes. For example, simplification of the tax system requires human capital to change the entire taxation structures and systems in the country. Furthermore, it is costly to implement these changes and implement the proposed solutions to the problem.
Relevant Alternatives
There are various alternative measures or steps to reduce the burden of government regulations and improve the efficiencies of a market-based economy. The following alternatives are suggested:
- Collaboration and partnership across all government departments – this is an important strategic management tool that enables all stakeholders to come together and discuss issues and find ways to solve the problems they face (Rugman & Hodgetts, 2003). All [arties including government officials, heads of state-owned corporations and the private sector operators should be involved.
- Opening up the market for free trade – another option is to eliminate all trade barriers by overhauling all laws and systems that discourage business entry (Ali, 2009). This reduces inefficiencies and encourages entry of firms that can bring in new ways and technologies.
- Technological development – the country can also improve its existing systems including state-owned corporations without privatization using technology (Ali, 2009). This approach also encourages improved accountability and fast delivery of services to businesses.
- Creating a balanced market system where all sectors are given equal opportunities for growth. This system encourages improved human capital and balanced government spending; hence taking tax revenues to the sectors they deserve, and reducing taxation inefficiencies
The Best Alternative
The best alternative is to develop collaborations and partnerships across all departments in the government and the private sector. This encourages input from different stakeholders so that the interests of all parties are taken into consideration (Ali, 2009). For example, international businesses can explain their challenges regarding the difficulties of conducting business in the country and suggest appropriate measures to overcome them (Rugman & Hodgetts, 2003). Such inputs from different parties will make the implementation of the entrepreneurship laws easier and the process of doing business in the country will also become easier.
Implementation Plan
| Activity | Date Started | Date Ended | People responsible |
| Planning | 15/08/2015 | 20/08/2015 | President and cabinet |
| Holding Meetings to Discuss | 21/08/2015 | 22/10/2015 | Committee from all sectors |
| Reviewing the recommendations | 23/10/2015 | 24/11/2015 | President and Cabinet |
| Putting recommendations into action | 25/11/2015 | 24/12/2015 | Committee |
| Evaluation and Closure | 2/1/2016 | 3/2/2016 | President and Cabinet |
The government should be tasked with the sole responsibility of implementing the collaboration and partnership strategic tool. First, it will plan for the meetings by selecting the required members of the committee from all sectors, including government corporations, private sector and international businesses and partners. Meetings will then be held regularly until agreements are made on how to address the problem. The recommendations are then put into action by the selected committee. The implementations are then evaluated by the executive office to determine whether the actions are meeting the desired goals.
References List
Ali, A.J. (2009). Managers and diplomacy. International Journal of Commerce & Management, 19(4), 256-259.
Rugman, A. M., & Hodgetts, R. M. (2003). International business. Harlow, England: Prentice Hall/Financial Times.
