Globalization as the Internationalization Strategy - Research Paper Example

?Effect of Globalization Section Introduction Globalization is defined as a process, which is based on the formulation of internationalization strategies, which helps in the expansion of business on a global scale. Globalization is largely facilitated by inter and intra cultural global communication due to technological advancement. The business organization usually expands on a larger scale by technological advancement, political, socio economic and environmental developments. The major objective of globalization is to offer competitive positions to the organization with low operating costs and gain greater number of products. Globalization requires varied expansion strategies like diversification, bifurcation, mergers, acquisition etc to gain competitive advantage over its competitors. The study will highlight the various factors that affect globalization and its effect on global economy. Factors like how globalization serves purposeful at organizational, reorganizational and integration of financial markets. The integration occurs at varied levels especially at industrial and financial markets. The author of the study will also highlight the various important components of globalization that binds the companies together for a unified purpose. The techniques of research methodology and the findings and analysis of the research methodology would be also included in the study. Finally, the study will conclude with recommendation that can improve the current situation that affects globalization. Background & Rationale for choosing the topic Globalization not only affects and benefits the national economy but also has positive effects on the regional development of the economy. Apart from economic integration free trade conditions (Wagner, 2002). Globalization compels the business organization to adapt to changing market dynamics based on ideological trends that help in the balance of the professional and personal goals of the employees of the organization. Various other factors like unemployment, parallel economic growth, cutting of costs, etc will be considered an important aspect of globalization are some of the major factors which have been considered while choosing the topic. Modernization and growing economy is also a significant contributor to development of the organization. The principal cause of the effects of globalization is that it helps in the modernization and growth of the economy, which is instrumental for understanding its impact on the business activities. This is one of the basic and rationale for choosing the topic for the author of the study, which helps in understanding the effects and outcome of the globalization. Apart from the above mentioned components factors like deregulation also helps in liberalization of the capital account and also integration of wide range of financial services. Section 2 Literature Review Effects of Globalization Globalization has been regarded as a crucial component from the economic, monetary, socio economic aspects and implications of globalization (Rosnan, Ismail and Daud, 2010). In economics, globalization has played an important role for the development of the economy and has changed the scenario of the world economy. Different types of industries have benefitted importantly from globalization especially the creative industries, which have earned an estimated amount of $60 billion annually over the past few years. The increasing globalization has also impacted the creative, film, car manufacturing and pharmaceutical industries to a large extent for expanding on a larger scale. The globalization of the film industry has made it significant contributor to the world economy. Apart from strategy aspects monetary and exchange policy also helps in emphasis of the maintenance of the economic contention like trade off, credibility, increase in uncertainty etc. This also helps in increased competition among the organizational members. Globalization helps in shaping the social policy and the policy making procedure for the welfare of the organization. Capitalism has been seen as a first integrated social economy which points out the social and economic developments and the development focuses on the increasing internationalization of the financial markets, revolutionizing of the communication markets etc. It has been observed that the emerging markets are overstrained and have high requirements for hard pegging and also show fear of floating or intermediate regimes. The exchange rate flexibility increases to determine the basis of monetary policy and also choose a nominal anchor. There is paramount importance of globalization policies, which have a direct impact on the financial stability associated properly with the non credible pegs. Inflation targeting also leads to structural changes within the organization, which have an effect on the natural transition and the business relationships and also the credibility of the central banks. It also has a direct relationship with the political consensus, as it helps in regulating the relationships among the government of varied nations. Globalization also affects the expansion activity and is largely driven by three major forces like technology, globalization of products, financial market and deregulation activities. Section 3 3.1 Research questions The research questions are formulated keeping in mind the objectives of the study which are as follows: 1) What are the impacts of the globalization on the world and national economy? 2) What is the impact of the globalization on the business activities? 3) What is the negative impact of the globalization process? 3.2Hypothesis The projected justification of the phenomenon stated in the research study is called its hypothesis. Hypothesis may be either scientific or working in nature. Scientific hypothesis is based on scientific theories and observations, while working hypothesis is developed for further research (Walther, 2004). In this study the hypothesis is formulated for further research on the effects of globalization. The hypothesis is formulated keeping in mind the objectives and questions of the study. They are stated as follows: 1) H0= There is no impact of the effects of globalization on the world and national economy. H1= There is an impact of the effects of globalization on the world and national economy. 2) H0= Globalization has an impact on business activities of an organization. H1= Globalization has an impact on business activities of an organization. 3) H0= There are harmful impacts of the globalization process on business activities. H1= The harmful impact varies organization to organization. 3.3 Research Methodology Types of Research A research or an investigation study depends upon the research conducted by the researcher. In a research study the data collected would be identified and analyzed to derive solutions. In this particular section, research methodology would be utilized and data would be analyzed. There are three types of research, which are qualitative methodology, quantitative methodology and hybrid methodology. Qualitative methodology deals with the non numerical aspects of the research study (Silverman, 2011). Qualitative data is very descriptive in nature and has the ability to solve complex problems very easily. It helps in evaluating factors like cultures, beliefs, opinions (Patton and Cochran, 2002). Quantitative methodology helps in assessing the numerical and statistical aspects of the study (Flick, 2011). The derived solutions are generally specific and very concise. Hybrid methodology is a combination of qualitative and quantitative methodology (Green Book, 2013). Certain research study requires the usage of quantitative and qualitative methodology. This is because the research study requires the evaluation of data through qualitative and quantitative analysis. Choice of methodology The main objective of the research study would be to conduct an analysis to understand the impact of globalization on business activities. The study would also analyze the financial damage caused to the creative and movie industry. A qualitative analysis would be appropriate in this context as factors like opinion of consumers on effect of globalization and the objective behind doing so would be analyzed only through a qualitative analysis. Section 4 4.1 Analysis & Findings The advent of environmental, political and economical challenges leads to the development of several strategies. The development of several strategies are compelled by the forces of globalization and also lead to smooth cross cultural communication, facilitation of free trade policies and also regulated activities (Stryker, 2000) It was observed that the globalization had harmful and positive impacts on the world and national economy. One of the major effects of globalization policies would be to design policies for inflation targeting which can meet the targets and expectation of the economy. The impact on FDI on the economic growth has a positive impact to an increase in the FDI which results out of higher growth interests and increase in foreign exchange. It has been observed that globalization brings about the reorganization at a national, international and sublevels for the smooth integration of activities. It also helps in facilitating trade and exchange facilities. The impact of the FDI has positive impacts on the positive growth of the economy and also on the increase in trade and FDI. However, it has been observed that globalization has harmful effects which include the unsystematic flow in the exchange market due to erratic reasons which can disrupt the flows in the domestic financial system. Economic analyst view that the costs associated with the globalization will outweigh the benefits associated with it in the short run. It has been observed that the developing and underdeveloped countries may not have the equal benefits like the developed countries and may lack expertise and staff to receive high quality beneficial effect for the maximization of output. Domestic industries in certain developing and developed countries may be highly endangered due to absolute or comparative advantage of various other countries in certain specific industries. Another potential and harmful effect would be the over utilization of natural resources to meet the higher demands of the organization. Conclusion & Recommendations One of the major potential benefits of globalization would be to provide profitable opportunities for the reduction of the macroeconomic volatility consumption and output through diversification, bifurcation, mergers and acquisition etc. The overall impact and the evidence of globalization on macroeconomic volatility indicate that the direct impact of globalization is ambiguous in the theoretical models. The financial integration of activities helps in the base diversification and also leads to a sudden increase in specialization of mass production. However, the specialization of mass production will be based on the concept of absolute and comparative advantage which can lead to higher volatility in most of the industries within a world and national economy. Thus, it is observed that globalization is largely associated with financial, socio economic, and social consensus to large extent for the increase in the output of the economy. Reference List Flick, U., 2011. Introducing research methodology: A beginner's guide to doing a research project. California: SAGE. Green Book, 2013. Demystifying Hybrid Research [online] Available at: < http://www.greenbook.org/marketing-research.cfm/demystifying-hybrid-research > [Accessed 27 April 2013]. Patton, M.Q. and Cochran, M., 2002. A Guide to Using Qualitative Research Methodology [pdf] Available at :< http://fieldresearch.msf.org/msf/bitstream/10144/84230/1/Qualitative%20research%20methodology.pdf> [Accessed 29 April 2013 Rosnan, H., Ismail, M.N. and Daud, N.M., 2010. The globalization of film business and its effect on the Malaysian film industry. Business Strategy Series, 11(5), pp.327-329. Silverman, D., 2011. Interpreting qualitative data. California: SAGE. Stryker, R., 2000. Globalization and the welfare state. Department of Sociology and College of Law, 18(5), pp.01-45. Wagner, H., 2002. Globalization and financial instability. 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