Essay
Introduction
Globalization is an umbrella term for complex senses of economies, social and technological culture and political change that increase the independence integration and interaction between people and business in disparate locations.it can be also known as the shrinking of the time and space.
As globalization affects country and people all over the world economic and culture factors play a very large role.
The world has become a globalize village so everyone is connected, there is no more barriers International business is a clear result of globalization, foreign markets are increasingly becoming bigger and bigger. Importing and exporting has become one of the successful features of business. INTERNATIONAL BUSINESS
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• In ‘international business’ is very important to understand and solve problems in a global way without prejudicing any sector of the business.
• It is very different from domestic business as domestic business has local problems that are less complex to solve.
• It is becoming increasingly popular and bigger.
• At international level, the globalization of the world economy and differences between two countries present both opportunities and challenge to international business.
• Raising awareness of the interrelatedness of one country’s political policies and economic practices on another.
• Therefore, understanding the global business environment, that is the interconnectedness of cultural, political, legal, economic and ethical systems.
• There is also a need to take account of the globalized business environment when making international strategic decisions and managing international operations.
• Exploring the basics concepts of underlying international finance, management marketing and trade relations.
KEY
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• There is a cultural and economic exchange between countries that trade together.
• Foreign direct investment is a measure of foreign ownership of productive assets such as factories, mines, land and other natural resources.
• It normally improves the balance of payments and trade deficit of a country.
• Such trade however not only occurs between industrialized nations but also between developing and emerging economies.
• Those businesses that are not competitive in the global village are pushed out of business or forced to fold as globalization favors firms that are strategic and can maintain their competitive advantage and exploit their strengths and opportunities.
• There has been an opening of worldwide production markets and broader access to a range of a foreign products for both consumers and companies
EFFECTS OF GLOBALIZATION
• There has been an increase of information flows between geographically remote locations.
• Globalization leads to increased competition and this competition can be related to products, service, cost and price. Technological advances have quickened lag and response times throughout all economic
Globalization has broken down many of the trade barriers and has allowed companies to expand internationally over last few decades. Emerging markets such as Brazil,
With businesses fast emerging and competition strict as ever, most businesses seek ways to expand internationally in order to ensure their position in the competitive market. Although globalization-the shift toward a more interdependent and integrated global economy- creates more opportunities for international business, some business attempt to expand blindly in a different country without considering issues such as culture clash, other businesses tackle the competition through strategic changes in order to accustom to the new culture.
Globalization can not only affect a company opening an office in another country but it can affect a small local business as well. As the internet brings the world closer together it becomes far more likely that a business that opened with no intention of selling internationally will have customers form different parts of the world asking for their product. For instance a steel company located in Pennsylvania may suddenly find orders coming in from South American factories. How the steel plant chooses to handle this new international customer could mean ...
When it comes to doing business internationally the decision making is more complex. There are many interactions between each country that need to be addressed. In order for a business to be successful in the international market they need to examine and analyze all the facets of their company. They need
A major challenge of doing business internationally is to adapt effectively to different culture. Such adaptation requires an understanding of cultural diversity, perceptions, stereotypes, and values (Hodgett &Luthans, 2005). Doing business overseas has its challenges as well as it rewards.
To keep up with the fast moving phase of the global business era, it is a necessity for organizations to understand the larger forces that is shaping the macroenvironment of the foreign market. Companies usually decide to expand their market to grow their revenue in an untapped market, however, before doing so, the obstacles that are not typically encountered in the domestic market should be taken into account.
Globalization remains a pivotal topic in many schools of thought, and continues being a topic of controversy even in local economies today. Perhaps the reason for this is integration and competitiveness the world over. Conceivably, even more than integration, is the competitiveness of organizations, has possibly facilitating the fascination and misconception about of globalization. Nevertheless, globalization has brought about a number of effects influencing the design and geographical location of the organization. However, globalization has effectively placed the world in a bubble, or maybe one could equate the changes to being placed in an envelope.
THE POLITICAL ENVIRONMENT: The critical concern Political environment has a very important impact on every business operation no matter what its size, its area of operation. Whether the company is domestic, national, international, large or small political factors of the country it is located in will have an impact on it. And the most crucial & unavoidable realities of international business are that both host and home governments are integral partners. Reflected in its policies and attitudes toward business are a governments idea of how best to promote the national interest, considering its own resources and political philosophy. A government control's and restricts a company's activities by encouraging and offering support or by discouraging and banning or restricting its activities depending on the government. Here steps in international law. International law recognizes the right of nations to grant or withhold permission to do business within its political boundaries and control its citizens when it comes to conducting business. Thus, political environment of countries is a critical concern for the international marketer and he should examine the salient features of political features of global markets they plan to enter. THE SOVEREIGNITY OF NATIONS From the international laws point of view a sovereign state is independent and free from external control; enjoys full legal equality; governs its own territory; selects its own political, social, economic systems; and has the power to enter into agreements with other nations. It is extension of national laws beyond a country's borders that much of the conflict in international business arises. Nations can and do abridge s...
A globalizing business sector advertises viability through rivalry and the division of the work it permits individuals and economies to keep tabs on what they specialize in. It also allows people to go globally. Globalization has stretched the assets, items, administrations and markets accessible to individuals. The increasing set of reliable connections around individuals from distinctive parts of a world that happens to be separated into countries.
Globalization’s history is extremely diversified and began during the beginning of civilization. Now we live in a world that is constantly evolving, demanding people to use resources in locations that are very difficult to obtain certain resources. This could make it completely impossible to operate in these specific parts of the world. However, globalization allows people across the world to acquire much needed resources. Globalization creates the opportunity for businesses to take advantage and exploit the ability to take part of their business to a different country. Nevertheless, globalization is part of today’s society and will be involved in virtually all situations.
Globalization affects this world and the people of this world in many ways. It is the idea of making the entire world like a single country.
Daniels, J. D., Radebaugh, L. H., and Sullivan, D. P., (2011). International Business: Environments and Operations. Prentice Hall, Upper Saddle River, New Jersey.
The process of globalization allows the global market to include products and services from all the companies around the world, including all the investments that are across national borders. Indeed, many American companies have taken their merchandise, manufacturing and services to invest in other countries. However, this has produced a negative effect on the global economy. American companies who invest in other countries produce an economic deficiency for the country, similarly companies that invest in other countries produce a loss in the global economy that affects the citizens of the whole world.
Globalization will continue to escalate, transferring technologies, bringing cultures and societies close, and creating a community of peace loving, intelligent citizen. Cooperation and competitiveness are ways to accomplish excellence (Miller, K., 2012). It unites different cultures and demographics together through technology (M O’Shaunessy, 2008).
Stonehouse, G., Campbell, D., Hamill, J. & Purdie, T. (2004). Global and Transnational Business (2nd ed.). Chichester: John Wiley & Sons.