International Business - Coursework Example

Globalization has been made possible mainly due to the advancements in technology. Technology has made possible the reach of organizations to various markets and thus effectively providing them necessary tools and techniques to innovate and bring in products and services. However this does not seem to be all successful as still there are differences between doing businesses in various countries which effectively not allow globalization to fully integrate into the whole fabrics of the societies of the world. Introduction The face of international competition has changed with the emergence of globalization. Historically, Organizations limited themselves to their geographical locations thus effectively limiting the scope of their businesses however as the technological changed emerged, the world started to become more connected with each other with enormously easy access to the information and resources. Thus the process of globalization kick started where the businesses became more integrated with each other despite being thousands of miles away from each other. Technology has been considered as one of the most important and critical factors behind this integration of resources and organizations. The advancement in communication technologies specially the emergence of internet and has provided the organizations necessary channel to communicate effectively and securely with each other. This in return has provided a necessary flexibility to the organizations to better organize their resources and their movement across the continents. It is also believed that this integration has resulted into benefits as well as harms as within due course of process, many cultural as well as social changes occurred which virtually put the indigenous cultures and civilizations at great stake. It is because of this that many considers globalization as a more refined form of colonialism where the global super powers, without physically occupying the country, are ruling them through their giant transnational organizations. Whatever the conspiracy theories be, there are very clear advantages as well disadvantages of the globalization. This work will explore the role of technology has contributed to the globalization of markets and production besides discussing the difference between doing business in Asian countries and other more modern Western countries. Technology, Globalization and Markets At its most elementary level, globalization is the name given to various economic, technical, social and political forces that collectively shape the contemporary life. The elements of globalization include international capital flows, global integration of business activities, flows of image, ideas, information and values through media and communication, Spread of consumerism and individualism throughout the world and political actions across borders and directed at supernatural forums. The concept of globalization is generally considered as a Meta-concept involving interrelated processes, structures, forces and agents Globalization in the current framework outlines a broader understanding of the issues related with the globalization. It includes not only a globalized face of capitalism but it also started to inculcate various cultures and values into its umbrella also. (Dash, 1998). First scathing criticism of globalization came in the shape that many considered it as just a re-labeling of capitalism at much larger scale (Dash, 1998) and both were interposition with respect to each other. It was considered as a phenomenon which is “strengthening the dominance of world capitalist economic system, supplanting the primacy of the nation-state with transitional corporations and organizations and eroding local cultures and traditions through a global culture” (Kellner, 2002). Further analysis of the issue suggested that the globalization is the “systematic extension of corporate capitalism across border” (Dash, 1998). In its ideological framework, Globalization is considered as a phenomenon which is reshaping the whole social fabric of the society as its historical analysis suggest that it is also resulting into re-formation of social classes within the society. The so called that the increased integration and emerging uniformity in the production are creating a social structure of accumulation at the global level. However the most striking thing about this change in the social structure of accumulation is the fact that it is being done by the elite of the society virtually alienating the masses with low social and economic standing in the society. Having explored the issue, it is now clear that the globalization is clearly termed as capitalism at broader scale. It is believed that the process of globalization and technology go hand in hand thus globalization unleashes innovation which in return result into a force strong enough to unleash productivity and derive sales. The technological changes especially those of in the communication technologies have enabled the organizations to integrate their resources to capture the economies of scales. The outsourcing phenomenon has mainly become possible due to the integration of markets and resources which allowed organizations to achieve globalized production. The emergence of bricks and clicks companies in turn have also opened a new vista for conducting business without the constraints of the borders. The emergence of new technologies has also allowed the globalization of production processes also. Early definition of outsourcing referred the situations when the firms expanded their purchases of manufactured physical input. (Bhagwati, Pangariya & Srinivisan, 2004), however the recent shifts in the concept it has now became a new phenomenon where it now include arms’ length purchases of service abroad(Bhagwati, Pangariya & Srinivisan,2004). However there is a still a controversy over the definition of outsourcing as the economists specially debate over the precise definition of outsourcing. Since outsourcing is mostly now involved the outsourcing of services therefore World Trade Organisation in its general agreement defined four different modes under which services can be outsourced. (Bhagwati, Pangariya & Srinivisan, 2004). Whatever the modes of outsourcing can be, the process has allowed the organisations to integrate their resources and take advantage of the globalized pool of skills and experiences to achieve efficiencies and effectiveness mainly due to the use of technology. Globalization without technology The integration of technologies resulted into the globalization of the markets and production however without the advances in technology; this may not have been possible to the extent which it is now. The industrial revolution especially the inventions of airplanes, trains, ships and other road vehicles provided organizations access to the different markets but the extent was limited. The rudimentary advances in these technologies continued however at very low pace. It was because of this purpose that it is extensively argued that the globalization of markets and productions would not have been possible especially without the technology. The post industrial era which witnesses a shift from being production oriented to more of service oriented demanded a different approach and unique support from the technology because services always demand spontenousness. Organizations without the ability to respond to the changes in quickest possible way would have clearly lost their traditional competitive advantage to their competitors having better and more integrated approach to show a response to the changes. It is also a fact that most developed countries in the world have almost exhausted their indigenous resources through extensive exploitation of resources therefore to sustain the already established organizations in the longer term, it was imperative that the new resources and avenues must be explored to fulfill the domestic demand. It was also because of this purpose that the organizations started to integrate their resources at the international level not only get an access to the untapped resources at cheaper level but make sure that these resources are distributed evenly across the countries to meet their demands and necessities. It was because of this reason that the through technologies, the markets and production processes were integrated in less developed countries also and Asian countries were among the top priority areas where the next generation of globalization took effect. Doing Business in Asian Countries Asia is one of the largest markets in the world with large un-tapped potential in terms of markets and production resources. However most of these countries are still under-developed or in the process of development. The dynamics of doing business in the region are markedly different from the dynamics prevalent into the other countries specially Western Countries. Thus doing business in the region is markedly different. If we analyze the dynamics of doing business in the region, we may be able to divide these analyses into two parts. First by making comparison with European Union Block and secondly with that of the American region. Firstly, Asian block do not have a formal and strong trading coalition between them therefore hindering their progress. It is also because of this fact that there is a lack of uniformed laws and regulations which can allow organizations to open operations in the country. Facing different rules and regulations, international organizations working in the Asian countries find themselves restricted to the country in which they work. Thus they hardly are able to form synergies with their companies working in other countries but in the same region. Secondly, Asian countries especially China and India to some extent largely remained under the influence of socialist economic policies thus explicitly discouraging the ownership rights and encouraging the role of the central ownership of the resources. It is because of this that the so called free market economies tend not to work effectively in Asian countries as there are lot of government intervention and beurocratic hurdles in getting the necessary approvals from the government officials to formally open the business in the country. It sometimes even involves bribing of the government officials to get the necessary approvals which may in future prove negative for the long term sustainability of the business in the region. With comparison to EU, the major difference is the lack of uniformed regulatory structure for doing business with the international level. Though there are some regional pacts involving various regional countries but these pacts do not offer specific incentives to Western Countries to do business. Besides there are differences in the management practices between the Asian and Western Countries. Just taking the example of Japanese organizations where there were very marked differences between the management practices between the organizations of West and Asia. Besides culture seems to be the most important and vivid difference between doing business in Asia and Western Countries. Culture seems to be sapping in almost all areas of social as well as economic life in Asia (Haley et.al, 2008). The so called little modification of the cultural values in Asia with the passage of time has effectively diluted the impacts of globalization as for as social and cultural norms are considered and since these norms and values are so strong that they also become a part of doing business in the Asian countries. Besides the most of the Asian countries lack the necessary information technology infrastructures which can provide organizations a ready access to all the market places in the world. Western countries fortunately have the necessary infrastructures especially of information technology thus offer more flexibility and effectiveness in the operations of the organizations to carry out their business practices in better way. The lacks of effective information technology infrastructure coupled with lack of physical infrastructure are twin impediments which are serious hampering the opening up of the Asian markets to the rest of the world. Religion seems to be another very strong reason behind creating a difference into the practices, products and services adopted by the international countries to do business in Asian countries. For example, McDonalds do not sell beef products in India due to religious values of the Indian Hindus whereas the Wine is strictly prohibited in Islam therefore all the Wine producing companies in the world despite having all the necessary quality products and services can not access these markets because of the religious norms of some of the countries in Asian Block. On the whole there are very marked difference between doing business in the Asian countries and that of the other Western countries because of the various complexities of the business dynamics working in the region. Conclusion Globalization is an emerging trend as for as the less developed countries are concerned. The increased integration of the economic resources has allowed technology to take precedent and allow organizations to be more integrated and explore areas which were traditionally concerned as impossible. The emergence of communication technologies especially the internet helped created a network of resources which can be easily shared and explored. This in turn equipped company to outsource some of the processes which could have been performed better by those having specialized skill sets and experiences so that the costs can be saved and efficiencies can be achieved to broaden the net to get competitive advantages. However it seems that globalization over the period of time has not achieved the results for which it was perceived. As there are still very marked differences between doing business in the Asian countries and other Western countries. References: 1) Helbling, Thomas, Batini, Nicoletta, Carderli, Roberto. 2005. ‘ Globalization and External Imbalances’, World Economic Outlook, pp.109+ 2) Jagdish Bhagwati, Arvind Panagariya & T.N. Srinivasan (2004), The Muddle over Outsourcing, Journal of Economic Perspectives,18(4), pp93-114 3) Porter, Keith,2007,’What is Globalization’ retrieved December 3, 2007 from http://usforeignpolicy.about.com/od/trade/a/whatisgz.htm 4) Dash, Robert C, 1998,’Globalization: for whom and for what’, Latin American Perspective, 5) Kellner, Douglas, 2002,’Theorizing Globalization’, Sociological Theory 6) Held, D., and McGrew, A., 2002. Globalization/Anti Globalization. Chapter 8. pp 98-116. © Cambridge: Polity Press. 7) Haley, George T, Usha, Tan, Chin Tong, 2008,’The Chinese Tao of Business’ accessed March 11,2008 from http://www.business-in-asia.com/books/chinese_business.html 8) Yeates, Nicola, 2001, ‘ Globalization and Social Policy’ Google Book Search, retrieved March 7, 2008, from http://books.google.com/books?hl=en&lr=&id=9qsJytINGxgC&oi=fnd&pg=PP11&dq=+Nicola+Yeates+Globalization+and+Social+Policy+2001+&ots=DpzoIEQ8tb&sig=wPMbW-ELyBMkghOG11TTOp0KJlM Read More