Driving Change Through Diversity and Globalization - Research Paper Example

0 IT AND GLOBALIZATION 3 1 Introduction 3 7 References 15 0 IT AND GLOBALIZATION 1 Introduction Globalization refers to the process of international linkages and integration brought about by the interchange of word products, views, ideas and even cultures. Globalization is a continual process and aims at linking people, neighborhoods, regions and cities across the globe together resulting into much closer relationships and ties. Globalization has made people all over the world to have their lives intertwined with each. This is through the clothes they put on, the music they get to listen, the information they get access to and in the different ideas they profess. This concept has made the ever prevalent barriers created by the national and international boundaries become of a relatively smaller relevance and made the world appear like a global village (Beenhakker, 2001). It is driven mostly by the financial flows and trade, information technology, mass media and entertainment. Human factors including cultural exchanges, international tourism and migration have also contributed to globalization to a significant extent. This process with the integration with both communication and information technology has made people co-exist very closely together and has changed people’s lives in regard to how they think and in the other aspects of their lives. As a concept, globalization was thought to have begun after World War II, and has been speeded over the years. It has had many impacts, both positively and negatively, on lives of people, the environment, national governments, cultures and economic development in countries all over the world. The four basic concepts that have been identified to constitute globalization include: a) Trade and transaction b) Capital and investment movements c) Migration and the movement of people d) Dissemination of knowledge Other challenges that have been identified and linked to globalization include that of climate change, over-fishing in the ocean waters and cross-boundary air and water pollution. Considering the role of information technology in globalization issues, it can be considered as a driving force within the current global economy. The internet and the computer-based technologies have made a vital impact in the area of communication and information technologies. Easy access to such technologies has also increased internet usages and made internet information to spread more. The World Wide Web, www, in particular being a collection of varied documents accessible over the internet, is responsible for easy and reliable access of information by people across the globe (Beenhakker, 2001). The internet too has enabled both people and countries to contact each other constantly, creating an instant connection between them. The communication advancement has been made possible through the use of such items as video calls, emails and chat programs. In addition to the internet and the cyberspace, there  has also been the existence of the global media networks that have served to bring news and value information on the current issues and state of affairs to people globally. People from different countries can obtain information about their countries and others even without the need to be physically in them. Ideas and trends can flow freely among countries, offering clients both in the developed and the developing nations the background of their decision-making processes. The avenues involved through which people can make use of spreading of information include televisions, print media and the media companies which in most cases have their branches in various countries. Mobile phones, text messaging and voice mails have also enable more and more people stay interconnected to each other. Marketers and managers alike can actively use this platform to market their products globally and reach their global clients (Rantanen, 2005). Another particular advancement that has revitalized and given globalization a newer face is the use of the space satellites. Outgrowing their initial use by governments in their research activities, satellites have proven vital in the communication of global issues and threats. This is through the application of the global positioning systems which has been used in the provision of accurate information on positions and locations both on the land, in the sea and on air. These global positioning receivers normally use the information received from these satellites. The satellites have also been used to provide such information as of weather and other phenomena that are usually of global significance (Castles, 2000). The different aspects of globalization can be considered and in relation to information and communication technology: 1.2 Trade and transaction: When it comes to global trading, no individual country is considered to be self-sufficient. Each country gets involved at different trade levels, by some selling what it produces and acquiring what it does not have. Traders have also taken the full advantage of the IT capabilities to undertake businesses. Globalized commerce and IT have been known to facilitate huge amount of change in the trading and commercial sector. This topic involves the analysis and the benefits of the international trade that has been experienced through globalization. In addition, the topic highlights the benefits that small and medium-sized enterprises have experience through their interaction and integration with the bigger companies as a result of globalization. Large multinational companies are reviewing their relationships with the clients and customers, and unprecedented opportunities have opened up for small enterprise businesses and medium sized companies. The volume and scale and efficiency of the international trade have increased with time with the dropping of the several trade barriers that have been in existence and the integration of the capabilities of IT (Barfield, 2003). Trading per se as a globalization process has been largely facilitated by such processes as would include: 1.2.1 Integration; this includes the coming together of different countries to create economic blocks and the decrease in the amount of tariffs at the global scale. Integration was largely made possible by information technology that enabled the huge part of this integration. Regulatory regimes have been harmonized through this process, and this has promoted trading and businesses being carried out across the borders of different countries. The creation of international bodies such as the European Union and the South East Asia Free Trade Agreement has also facilitated this process of economic integration. The capacity of transaction and magnitude of trade has also consequently been on the rise with the development of information technology, transport networks, and the readjustment of trade flows that has followed integration. 1.2.2 Standardization; this is concerned with the setting up of an uniform frame of reference over physical and information flows. Standardization has enabled traders to benefit from the effects of globalization, by enabling them to trade in reliable and compatible goods and services especially for those traders who have abided by the rules of the standardization. This facilitates the reduction in production cost, distribution cost and that cost incurred for the maintenance of these goods and the services. Measurement units become the first standards to be applied, and the development of Information technology has also led to the common operating and telecommunication systems (Rantanen, 2005). 1.2.3 Production systems; It is usually of huge significance for trading partners and countries to produce and maintain units of geographically diversified products to facilitate the smooth exchange of commodities, goods and services. IT in particular has been exploited and has played a major role by facilitating these transactions and the management of the complex business operations and systems. Direct foreign investments have been hugely linked to globalization of production as multinational companies invest in foreign countries in a bid to lower the production costs and venture into newer markets. A leading example of such a process is China with the increasing availability of goods and services which can be traded on a global scale. Transport efficiency; the developments in information and communication technologies have been in concurrence with the improvements in the infrastructural sector especially regarding the capacity and throughput. Transport efficiency has increased to a large extent the transferability of commodities across borders and has also dictated the location of viable, sound and profitable economic activities (Barfield, 2003). 1.2.4 Transactional efficiency; the role of the financial sector too cannot be understated in the facilitation of the international trade as these take many process and time to be actualized. It has helped the integration of the global trade. Due to the rigorous trade processes and procedures that are bound to delay, bank and financial guarantees are often required to ensure a successful transaction. These goods being also transferred need to be insured against such eventualities as theft, damages or delay, services that are provided by large multinational insurance companies. The global financial system should also allow the currency conversion of the different countries be guided by the market forces in existence in the global market scene. The use of information technology has successfully helped in the formulation of such monetary policies that has influenced the international trade immensely. International trade has enabled consumers to obtain goods and services at relatively reduced prices especially through the abolishment of import tariffs. This has also provided an incentive especially for the local producing farms to stay competitive. Exportation, on the other hand, has been a major factor in the economic growths of countries especially for the developing ones. It has led to the creation of job opportunities as the local industries, through globalization has been able to sell across their traditional borders. It has also enhanced national competitiveness by making the working force focus on those vocations that in which they or their country possess a competitive advantage (Rantanen, 2005). Another factor under this topic would relate to the symbiotic nature and relationship of organizations that has existed as a result of the integration of IT and global trading. Smaller sized companies have been able to compete actively with the larger companies through the viable use of the internet. The internet had enabled these small sized companies to compete with the owners of larger companies who had before had an upper hand through their expensive electronic data interchange (EDI) systems. The internet due to easy availability has a lower administrative cost and results into much saving for those businesses that use it in conducting businesses. Internet availability is also guaranteed on a 24-hour basis, and thus business can always be conducted at the convenience of both parties in a transaction. 1.3 Capital and Investment movements. The flow of capital has increased to a booming extent over the recent years and has been a key aspect of the global monetary system. They provide potential benefits to countries, though their size and volatile nature can also cause policy challenges. The money needs to be in a position to provide consistent and clear advice regarding capital flows and policies that relate to them. The main issues and points usually noted in capital flow movements and under a wide range of discussion involve such points as: a) Capital movements having significant benefits for countries, especially for the developing countries, including the enhancement of efficiency, promotion of competitiveness in the financial sector, and the facilitation of greater productive investment and consumption smoothing, b) In circumstances where its inflow surges and/or disruptive outflows are rapid, policy challenges can be created. The required policy responses would include a range of measures, involving both countries that receive the capital flows and those from which the flows come from. For those countries that have to manage and contain the macroeconomic and the risks on their financial stability brought in by the inflow surges or disruptive outflows; established roles is required to be played by the macroeconomic policies, including fiscal, monetary, fiscal, and the management of the exchange rate. This should be complimented by a vibrant financial supervision and regulation and stronger financial Institutions. In certain cases, capital flow management measures are often very useful. c) The people involved in policy making in all countries, including those that generate huge amounts of capital flows, must always take into consideration how these policies could affect the global economic and financial stability. Cross-border coordination of policies often helps in the mitigation of the riskiness of capital and investment flows. d) Consequently, capital and investment flows also carry with them risks, which are often magnified by the gaps in the different countries’ institutional and financial infrastructure These points, being key points to capital flows and investment movements should be given utmost considerations in all spheres of both foreign and domestic investments. These types of investments have increased over the years and through the effects of globalization, have taken a center stage in the world economics. Advancement in information technologies, telecommunications and transportation has just made it easier to carry out business over great distances. Considering these advancements to date, satellites and other telecommunications infrastructure have a known ability to handle one million calls simultaneously. This is in reference to Europe and the United States continents. The fact that people can reach each other faster and with ease has hastened globalization and further increased direct foreign investments. The incorporation of such factors as the use of fax machines and email and the decrease in the cost of air travel have also led to a significant growth of the foreign direct investments and varied capital inflows. The owner of a business would think twice about the idea of running an affiliate in a foreign country if the communication between the mother company and that particular affiliate were not easy and cheap. Changes in capabilities tend to drive changes in practices, and these new methods to communicate have undoubtedly helped in driving much of the subsequent desire and the need to promote economic integration between countries. Such infrastructure lures investors. If the infrastructure of the country is better, especially the communication and transport infrastructure, more capital and investment inflows are attracted (Szlajfer & Chmielewska-Szlajfer, 2012). The developments in 21st century have brought even greater changes in the Information technology sector. These developments included the innovation of the Bluetooth technology, creation of better satellite reception, access and utility and increased flexibility in telecommuting and teleconferencing. These modern and innovative ways of communication injects much trust and goodwill especially for those would be investors in a particular country or with different governments. 1.4 Migration and the movement of people International trade and the migration and movements of people are also without a doubt crucial for the spread of the fundamental innovations that characterizes advances of human productivity around the globe. These advances range from the indigenous use of the wheel through to the modern personal computer. Societies that alienate themselves off from trading and commerce with the rest of the world often tend to stagnate (Anderson, 2008). To gain from the human resource and the ever continuous technological advancement especially from the developed nations by the developing nations, the movement of labor becomes a core component. For this to occur then, the channels of communication have to stay open and accessible. Massive movements of labor have featured in all of the three waves of globalization. The free movement of labor as a factor of production has had powerful effects on wages in both the developing and developed countries alike. Before, the varying speeds of growth within and across countries which promoted inequality in wages and wealth, in turn created the economic pressure to migrate. Migration as a factor, complementing the increase in trade and capital flows, helped in decreasing or even reversing the growing wage inequality. The introduction of low-wage labor exerted a reduced wages demands in immigrant regions, while on the other side, raising wages in the emigrant areas. Moreover, wealth gets redistributed to the extent where emigrants send remittances back to their countries (Aghion, & Williamson, 1998). From the foregoing, movement of people to foreign countries thence helps in the reduction of inequality and redistribution of resources. Statistically, by 1995, there was an average of 2.3% of the population that lived as emigrants in foreign lands, a higher percentage consisting of those in the developed nations. Migration issues are also facilitated by the access and the availability of information on the various opportunities that the emigrants might want to explore in the foreign countries. Such information has been made available on the various government websites and agencies and was available over the internet and the cyberspace (Anderson, 2008). The use of information technology has thus enhanced awareness and created the need for people to move from one region to another in pursuit of their unsatisfied desires. 1.5 Dissemination of information Globalization has supported to a significant extent the spread of information within and across borders of countries and regions. Much information is available over the internet where people can easily access it and find whatever they need to know. Other global media networks, televisions and print media, with their companies spread all over the world, also provide information and news of the current events to everyone all over the world. For instance and as an example, it is at the moment easy to learn about the current political stalemates and intrigues in the United States even when one is in Africa or East Asia. One can get the current fashion trends in the United States by obtaining an American Fashion magazine in any other country. The application of the information technology has made the world appear like a global village where vital information is easily found all over the cyberspace and internet sources (Rantanen, 2005). A real life case study of this research topic would be evidenced in the usage of materials produced in the domestic countries and used in the other different countries of the world. Through the use of information technology via the internet, one can obtain a television set in Africa bought from the e-bay. Through the internet, one can see the products on sale from the comfort of the house. Once an order is placed for the items and the transactions completed, the item can be shipped to the client in their mother country. This is a practical application of the use of IT, integrated with globalization. 1.6 Benefits of globalization; These benefits of globalization include: Increased wealth; developing countries have been able to gain a lot and become wealthier based on their growing per capita GDP as a result of globalization. Over the years, the developing nations have been able to gain substantially from the developed nations through the spread of newer technologies, direct foreign investments, and creation of exportation markets for their products and services. This has helped in raising the standards of living of this populace. Better Quality of life; even with some opposition to the impacts and emergence of globalization, it is regarded as a significant factor in the betterment of individuals’ life by the following means: i) Increased opportunities for international travel and tourism ii) Increased consumption of worldwide entertainment music and sports iii) More opportunities to work abroad iv) Increased access to external financing v) The increased and rapid spread of consumer goods Makes foreign goods easily available; globalization has led to the increased availability of diversified technology, services, and products. Through the bringing of knowledge together and exchange of more goods and services, the country’s economies expand and benefit from technological and medical advancements. This existence in a variety, especially of basic goods, allows one in Kenya to eat American Pizza and drink Frenched wine while sitting on a Japanese chair. Through global exchange, efficiency in production can be realized hence maximization of production resources (Aghion, & Williamson, 1998). 1.7 References Aghion, P., & Williamson, J. G. (1998). Growth, inequality, and globalization: Theory, history, and policy. Cambridge, UK: Cambridge University Press. Anderson, J. A. (2008). Driving change through diversity and globalization: Transformative leadership in the academy. Sterling, Va: Stylus Pub. Barfield, C. E. (2003). Internet, economic growth and globalization: Perspectives on the New Economy in Europe, Japan and the USA. Berlin [u.a.: Springer. Beenhakker, H. L. (2001). The global economy and international financing. Westport, Conn: Quorum Books. Ben-Rafael, E. (2002). Identity, culture and globalization. Leiden [u.a.: Brill. Castles, S. (2000). Ethnicity and globalization: From migrant worker to transnational citizen. London [u.a.: SAGE. Rantanen, T. (2005). The media and globalization. London: SAGE. Szlajfer, H., & Chmielewska-Szlajfer, M. (2012). Economic nationalism and globalization: Lessons from Latin America and Central Europe. Leiden: Brill. Read More