New Balance Athletic Shoe, Indonesia, and Globalization Essay

New Balance Athletic Shoe, Indonesia, and Globalization Essay

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With the constant quest for greater profitability, American companies are reaching further and further around the globe for opportunity. Factories are being built in third world countries, and sales efforts continue to increase in the world’s fastest growing economies like China and Brazil. Consumer products corporations, especially, are seeking out the cheapest and most efficient method of production, and many are beginning to look to Indonesia for answers. According to the Indonesian Footwear Association, “sports footwear produced in Indonesia is expected to soar roughly 25 percent to $1.6 billion since 2007,” (Abelson 1). One of the American companies leading the global initiative, New Balance Athletic Shoe Inc., alone expects to increase its number of shoes manufactured in Indonesia to almost 6 million pairs over the next couple years (Abelson 1). This vast migration of manufacturing facilities is lead not only by the hunger for corporate profits, but also by the new international system of globalization. This system destroys international barriers and allows for enhanced communication, efficiency and cultural understanding. When developing production operations in Indonesia, New Balance must be aware of both the cultural and geographical differences of the country, as explained by authors Thomas Friedman and David Landes, as well as the potential benefits and costs of globalization, explained by authors Amartya Sen and Paul Collier.
Prior to building its new factory in Tangerang, New Balance Athletic Shoe Inc. must be aware of all developmental barriers, including the cultural differences in religion and view of authority, and the geographical differences that influence employee pace of work and cause threat of potent...


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...rld, they often lose those ancient traditions passed down from generation to generation and we begin to experience Americanization through “western dominance and imperialism,” (Sen A2). In addition, Collier explains that “countries at the bottom coexist with the twenty-first century, but their reality is the fourteenth century,” (Coullier 3). As New Balance begins to build its new plant and hire the factory workforce, they must keep in mind that Indonesia is not as advanced as the US. Therefore, certain technologies and ideas be culture shock to the people.
Even though globalization has both benefits and costs, if New Balance can overcome the cultural and geographical differences and help preserve their employees’ culture and traditions, both the Indonesian people and the company will benefit.



Works Cited

Landes, David "The Wealth and Poverty of Nations"

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