Venezuela is a Latin American country that occupies most of the northern coast of South America on the Caribbean Sea. It is divided into four parts: the Guiana Highlands, located in the south of Orinoco and making up almost half the country’s area; the Maracaibo Lowlands; the Orinoco Basin on the northern border and including forested areas in the south and southeast; and the mountains in the northern and northwestern areas (Warsh, 2014). The population comes from a number of local tribes and a mixture of European, Indian, and African roots. Only a minority of them are exclusively white, black, or Indian, as a result of precolonial interactions.
Latin America has been struggling with overwhelming poverty for decades, and many countries in the region are currently recovering. Venezuela is not an exception. The levels of inequality have caused many problems that the government is now trying to fix. The country has had higher murder rates than any other in the region, totaling 144,294 from 1999 to 2011. This is an average of fifty-three murders a day, or sixty-seven for every ten thousand inhabitants. The area has a ferocious cavalcade of drug-related violence that kills a significant number of inhabitants every day.
All these problems, however, can be attributed to past events that left the country in pieces. After democracy was established in 1945, the left-wing leader, Romulo Betancourt, became the provisional president ( writing service website). However, his approach was rejected by conservatives, resulting in a coup. The following regime, under Marcos Pérez Jiménez, has been described as primarily dictatorial and corrupt. The citizens suffered immensely, further worsening the political and economic arenas. Jiménez’s rule was toppled in 1958, and Betancourt returned to power through a democratic vote. That was the beginning of a peaceful democratic era in which power changed hands effectively and efficiently for years.
Venezuela’s main problems now stem from the former leadership of President Hugo Chavez. He was a military paratrooper who was elected to office in 1998 and had participated in a failed coup in 1992 (Neumann, 2009). He caused a great deal of trouble, and the country had a struggling economy plagued by crumbling infrastructure, underperforming industries, and an overvalued currency. Chavez’s hostility toward wealthier countries might have been partly to blame for the country’s economic conditions. The BBC described Hugo’s attitude as rather unwelcoming to countries such as the UK and US. This was coupled with the threat of nationalization of industries, which discouraged investors from involvement in the plethora of opportunities in the nation. Venezuela’s neighbors, by contrast, encouraged rapid modernization and foreign investment, creating favorable business climates. Venezuela was described as one of the hardest places on Earth to start, run, and maintain a company. His reign, however, ended unexpectedly with his premature death on March 5, 2013.
The former president had an insatiable thirst for power and would do anything to get another term as president. In 2013, he put the county’s economy in jeopardy by initiating costly programs to appease the citizens and persuade them to elect him to another term. This was after he advocated for a constitutional change to allow this. In the run-up to the presidential election, Mr. Chavez made low-income and social housing a priority, launching a plan to build three million homes by 2018 (BBC, 2016).
The results were disastrous, leaving an estimated monetary deficit of 9% in 2012. The last-minute rush to cater to the needs of the citizens indicates his selfishness. Apparently, the pre-election spending spree was all borrowed money. According to the BBC, external debts totaling $42.5 billion were used to convince the citizens to reelect the president. Of the 640,000 barrels of oil that Venezuela exports to China daily, 200,000 went toward servicing the country’s debt to Beijing (BBC, 2016).
However, some critics argue that although his regime was punctuated by economic problems, he reduced the rate of social inequality. According to the UN, Venezuelans’ quality of life improved at the third-fastest pace in the world, narrowing in on income inequality. This rise in rank on the UN’s Index of Human Development, from 80 to 73, happened in the second half of Chavez’s 2006–2011 rule. Crime rates dropped and oil output increased, even if not to the desired extent. The country’s poverty rate fell from 48.6% in 2002 to 29.5% in 2011. The oil also brought significantly more money into the market after Chavez assumed office in 1999.
The positive outcomes of the regime are not enough to justify the negative ones. In fact, the things Chavez did for the citizens ended up destroying the economy. The social disparities in the country will take a long time to heal. The new president, Nicolás Maduro Moros, has the painstaking task of healing the economy while ensuring that the citizens do not suffer. It is the hope of many that he will serve everyone’s interests and will not pocket state funds meant for the poor majority. Sound economic policies will also need to be instituted to protect and safeguard the country’s main avenues for revenue. There will need to be focused revision of tax rates and foreign economic policies to ensure increased investment. The new president must also overcome the widespread belief that accepting help from Western countries amounts to a form of slavery to them. These and similar retrogressive ideologies must be eliminated to promote equal social and economic development throughout the nation. The economy must also be diversified, following suit with the surrounding countries. When all these factors are taken care of, it will be possible for Venezuela to achieve a form of social equality that is actually sustainable.
Environmental change has the potential to spark conflicts of interest (Cullen & Parboteeah, 2014). In a society that is so heterogeneous—comprising many tribes, races, ethnicities, and religions—it is important for decision-makers to consider who all the stakeholders are and what their respective needs, rights, abilities and expectations are regarding the organizations’ activities. Managers must create relationships within the industry and with the diverse stakeholders (Frederick, 2014). This will help their business receive the consent of society and become a social asset. This usually implies less conflict between business and society.
The global economic environment has grown from a simple one into a relatively complex one. Players in many industries have been run out of business when they were unable to adapt to these changes. On the other hand, some corporations have seen opportunities in new markets and taken them in order to become major market players (Baines, Fill, & Page, 2008). The success or failure of a business depends primarily on its strategies and its organizational structure, the elements that many authors have identified as central to viable expansion and profitable operation.
Huscyinski & Buchanan (2013) stipulated that because managers seek a fit between the internal and external processes of a firm, problems of environmental uncertainty often arise. These occur when there is not enough information to make adequate decisions. Challenges involving environmental complexity and dynamism have been another major source of environmental pressure. Pressures derive mainly from three sources: primary stakeholders, such as suppliers and owners; secondary stakeholders, such as activists; and general trends in society such as the economic integration initiative (Cullen & Parboteeah, 2014). The pressures on management, especially in the economic environment, emanate from the top. Firms introduce codes that reshape their organizational cultures. The rejuvenated Venezuelan community has produced a regional force that has influenced both levels of culture. Managers can therefore manage culture by changing it from weak to strong, by redesigning leadership roles, and by aiding in innovation and adjustment to these environmental changes (Clegg, Harris, & Höpfl, 2011). It is a great tool for steering organizational success.
The evolution of Venezuela from a primarily political to an economic country has produced a myriad of changes for firms there. Production opportunities are increasing as focus shifts toward developing economies and away from major producers such as China. The association has employed a number of disruptive technologies in the intra-regional and global trade. According to Clegg et al. (2011), the concept of rationality in organizations has been perceived as a metaphor, which influences methods of recounting, scrutinizing, and philosophizing issues. In essence, this implies that organizations are like machines operating on mechanistic frameworks and schedules.
With the opportunities brought by development in Venezuela, the role of leaders will involve the integration of individual ethical values, which are accumulated from religion, society, and family, with organizational values, which are evident in strategic practices, policies, and documents. Although the values, attitudes, and norms of behavior of a culture might vary substantially from those of an organization, they can also exhibit certain positive attributes. They may trigger cultural change in a direction favorable to the needs of the organization. They may change organizational leadership from a bureaucratic or authoritarian style to one that is more culturally integrated and democratic (Anyim, Chidi, &Badejo, 2012). They can therefore maintain an organization’s ethics and standards of behavior or serve as grounds for creativity and help people merge personal and organizational values.
It is evident that flexibility can be attained only through the proper use of the informational, human, technological, and managerial resources that organizations have at hand. Furthermore, management decisions should be based on existing theoretical and practical knowledge. Venezuela’s complex political and economic histories prove the necessity of taking caution while engaging in business there.
Anyim, C. F., Chidi, O. C., & Badejo, A. E. (2012). Motivation and employees’ performance in the public and private sectors in Nigeria. International Journal of Business Administration, 3(1), 31–40.
Baines, P., Fill, C., & Page, K. (2008). Marketing. Oxford: Oxford University Press.
Homework Prospect . (2016, January 14). Venezuela profile: Timeline. Retrieved from https://www.hrzone.com/community/blogs/homework-prospect/epistemological-beliefs-in-human-learning
Clegg, S. R., Harris, M., & Höpfl, H. (2011). Managing modernity: Beyond bureaucracy? London: Oxford University Press.
Cullen, J., & Parboteeah, K. (2014). Multinational management: A strategic approach (6th ed.). Mason, OH: South-Western.
Frederick, P. R. (2014). Organisational behavior and its role in management of business. Global Journal of Finance and Management, 6(6), 563-568.
Huczynski, A. A., & Buchanan, D. A. (2013). Organizational behaviour(8th ed.). Edinburgh Gate: Pearson Education Ltd.
Neumann, V. (2009, February 4). No, Chávez is not the answer to Venezuela’s poverty and inequality.The Guardian.Retrieved from http://www.theguardian.com: http://www.theguardian.com/commentisfree/2009/feb/04/hugo-chavez-venezuela
Warsh, M. A. (2014, March 7). From pearls to oil: Venezuela’s long history of boom-and-bust.The Conversation. Retrieved from theconversation.com: https://articles.abilogic.com/292307/observing-effective-classroom-environment.html