Information Technology Involvement in Globalization Process - Literature review Example

Information Technology (IT) Involvement in Globalization Process University’s Name Submitted by Name: Tutor: Date: Abstract The primary objective of this literature review is to discuss the involvement of IT in the globalization process. However, it also defines IT and globalization and it looks at the effects of globalization on the society. Globalization has both positive and negative effects on individuals, organizations and nations. The main driving force behind globalization is information technology, as it facilitates smooth flow communication and information between different countries. IT has eliminated the communication barriers, especially the geographical barriers that made it hard for people to share information with people in different parts of the world. The development of IT such as the internet, the web, personal computers and mobiles phones have made the world a global village. Table of Contents Definition of Information Technology (IT) 4 Definition of Globalization 5 Development of Personal Computers (PC) 9 The Invention of the World Wide Web (the internet) 10 Open Sourcing 11 Digital, Mobile, and Virtual Movement 11 Conclusion 12 Reference List 12 Literature Review IT Involvement in Globalization Process Introduction Globalization has significantly changed the way the world operates. The barriers that once prevented the interaction and communication of people in different parts of the globes have been destroyed due to increased globalization. Globalization is now felt in all aspects of life, including economic, social, political, and socio-cultural aspects. Information technology (IT) is the most visible aspect of globalization while at the same time it is the driving force behind increased rate of globalization. Globalization is felt in every part of the world due to emergence of IT, which has managed to integrate all kinds of humanity across the world. Therefore, the primary objective of this literature review is to demonstrate of IT has affected globalization process. The Literature review starts by defining the key terms, globalization and IT, and the impact of globalization in the society. Finally, it looks at the role of information technology in globalization by focusing on specific types of information technology such as the internet, personal computers (PC), fiber optic cables, and open sourcing. The literature review ends with a conclusion the discussion. Definition of Information Technology (IT) IT is the short term that is used to describe information and communication technologies and the services that are offered. However, in many cases, the “technology” aspect of the term is overemphasized compared to “service” aspect (Stefko and Sojka, 2015). Interestingly, many people have no interest in technology aspect, as they only focus on benefits and services that they receive from it. In a broader definition, IT include the production, distribution, and consumption information that are generated in all media, including radio, the internet, and satellite. However, in many cases, it is defined as the creation, maintenance, and use of computer systems, software, and networks for processing and distribution of data. Definition of Globalization Globalization is the quantitative and qualitative expansion of activities and ideas across borders. However, different scholars define globalization in different ways. According to Hrynyshyn, (2002), there are some people who only focus on the qualitative aspect of globalization while others defines it in terms of multilateral state-to-state flow of commodities and services. On the other hand, other scholars use the globalization as a synonym for internalization. However, globalization is commonly defined as the process of interaction and integration among individuals, organizations, and governments from different countries across the globe (Hrynyshyn, 2002). Globalization is majorly driven by international trade and investment, which are facilitated by information technology. Effects of Globalization in the Society Currently, people across the globe are more connected than before due to globalization and advanced technology. According to Haile, Srour and Vivarelli (2013), the world’s population is connected socially due the development of media and telecommunication; culturally through free movement of people across the globe; economically through international trade; and politically due to international relations and global rules and regulations. The interconnection has of people across border has led to their interdependence. Consequently, globalization affects people, organizations and countries worldwide due to interconnections and interdependence. There are many positive consequences of globalization that is felt by many people across the globe. People are now able to access knowledge, products, and services from different parts of the world, which was not possible before globalization (Stefko and Sojka, 2015). Globalization has led to a lot of economic opportunities as well as social development of people in different countries. However, it has also led to a number of negative effects, especially in the developing countries. Ul Haq (2010) argued that globalization has enhanced poverty in the society, growth in the gap between the poor and the rich, and exploitation of weak individuals and countries. Furthermore, globalization has enhanced the violation of human rights, forced immigration, conflicts, insecurity, and individualism (Lee and Vivarelli, 2006). Therefore, globalization has both advantages and disadvantages. Many scholars agree with the fact that globalization has affected the global landscapes. Increase in knowledge is one of the benefits of globalization. Globalization has enhanced the flow of information and communication across the borders and people can now access knowledge from the comfort of their homes. Consumer can now enjoy cheaper and high quality products due to reduced cost of production, as businesses can now utilize cheap labor and raw materials from different parts of the world. However, despite the cheap products, there has been increased exploitation of workforce, especially in terms of low wages. Jaumotte, Lall and Papageorgiou, (2013) argue that globalization has also led to greater discrepancy between the rich and the poor, as the former take advantage of globalization to use world resources to make more wealth at the expense of the latter. Consequently, globalization has led to unending cycle of poverty in the world (Jaumotte, Lall, and Papageorgiou, 2013. There are some international investors who take advantage of globalization, especially in terms of cheap labor to destroy local industries. Many local industries in developing countries are not able to compete with well-established international companies. Globalization has also affected business environment. A research by Burstein and Vogel (2010) found that one of the major advantages that globalization has brought to businesses is the ability to acquire skills and knowledge across different countries in the world. Businesses can now communicate and convey information globally, which has enabled them to get the best expertise and skilled workers from different parts of the globe (Burstein and Vogel, 2010). As a result, globalization has led to more collaboration and innovation in the business sectors due to enhanced communication and sharing of information and knowledge. According to Adiwijaya and Djati (2010), Globalization has made it possible for businesses to outsource that has led to increased efficiencies in business operations. Outsourcing is particularly common in multinational corporations that operate in many different countries. Outsourcing give business an opportunity to carry out faster innovations and it increases efficiency international businesses (Adiwijaya and Djati, 2010). However, outsourcing is also disadvantageous because it causes job loss, which can lead to increased unemployment. Globalization cause quicker information transaction and increased selection of mobility, leading effective and efficient running of businesses. Globalization gives small and local companies an opportunity to be part of the global playing field. The recent research that was carried out by IBM found that enhanced digital infrastructures and changing world economic policies have made small businesses to venture into the international market (Brooks, Weatherston and Wilkinson, 2010). The breakdown of global barriers has enabled small businesses to access international distribution channels that were traditionally the preserve of large and well-established companies. However, Kilic (2015) argued that stiff competition in the international market has hindered the performance of small companies in the international market, as established companies enjoy economies of scale. Therefore, a significant number of small businesses find it hard to survive in the international market. In summary, globalization has both negative and positive consequences in the society and it affects individual, organizations, and countries. Both the negative and positive effects of are attributed to enhanced technological development, especially in terms of the flow communication and information. Therefore, the above discussion shows that information technology is the major driving force of globalization because it enables smooth flow of communication and information across borders. Role of IT in Globalization Process Lawlor (2007) stated that globalization started in the late 20th century due to advances in technology, particularly information technology. It was the IT that that led to the development of global integration of different international markets that form globalization. According to Borghoff (2011), improvement of computer hardware, software, and telecommunication systems in early 1990s enabled people from different parts of the world to access information and other economic potentials. Development and improvement of internet-based tools in the last decade, especially in the social networking websites have revolutionized the way people utilize and share information (Borghoff, 2011). IT also facilitates the innovative use of available global resources across countries and cultures without respecting geographical boundaries. With its ability to facilitate effective and efficient flow of information across borders, IT plays an important role in the globalization process. There are specific advances in IT that have played important role in the globalization that are going to be discussed in this literature review. Development of Personal Computers (PC) The development of window-based PC eliminated barriers that restricted the flow of information in different parts of the world (Dedrick and Kraemer, 2008). PC allowed people to write their digital contents and then share it with different people in different parts of the globe. The development of window-based PC was followed by the invention of dial-up modem that people could link with their phone lines to send email to different people. In 1990s, people started integrating PC, fax, and dial-up modem, which was used to create a global information revolution. Therefore, development and advancement of PC was the first step towards globalization. PC gave people both reach and scale because they were able to develop and distribute information to many people around the world. Globalization only started when people were able to generate and share information across borders with a lot of ease. Globalization was only possible as a result of the development of information technology. The Invention of the World Wide Web (the internet) The invention of the World Wide Web in 1991 is believed to be the major driving force behind the rapid globalization. The internet came before the web and it enable people to connect to different parts of the globe. However, according to Hrynyshyn (2002), with the arrival of World Wide Web in 19991, people were able to post their digital information for the whole world to view and use. The web became an important factor in globalization because it enabled individuals to develop a link between the computer and the internet. It was the invention of the web that made the internet more relevant and useful because it increased the number of internet users from 600,000 to 40 million in a period of five years (Hrynyshyn, 2002). The web enabled individual and companies to share information worldwide, which accelerated globalization process. Many countries have invested a lot in the development of the internet to enable easy flow of information, which can be used to tackle the global problems. According to Borcuch et al. (2014), the internet has enabled business to thrive despite geographical barriers, as entrepreneurs and investors are now using e-business to reach people globally. Businesses can now connect to the world without constructing physical because they can meet consumers in the internet. The internet has created online shopping and transactions, which has made the world to be a global village (Borcuch et al., 2014). Small businesses can now reach international consumers through online marketing. The internet has also become an important tool in organizing democratic movements that are aimed at improving global governance. Many people are now using social networks such as Facebook and Twitter to champion for the rights of the disadvantaged and the marginalized in different parts of the world. Open Sourcing Open sourcing is a community-driven movement that enables businesses and individuals to avail their source codes in various online platforms (Hrynyshyn, 2002). Hrynyshyn (2002) argued that open sourcing is facilitating globalization because it can be downloaded with anyone around the world without any cost. It enables companies to acquire knowledge and expertise of various personnel who are located in different parts of the globe. Open sourcing is one of the driving forces behind globalization because it gives everyone an opportunity to share his or her idea regarding a certain software package irrespective of their geographical locations. Digital, Mobile, and Virtual Movement According to Lau (2000), the modern world is characterized by high use of mobile phones, digital cameras and laptops that have significantly affected the progress of globalization. Individuals and organizations are now able to collaborate and frequently communicate with one another through the use of laptop and personal laptops (Lau, 2000). The invention of instant messaging that allows individuals to engage in instantaneous conversations has made the global village while global boundaries have become meaningless. Companies are also using instant messaging services to communicate with their employees and customers in different parts of the world. Businesses are using instant messaging to frequently update their clients on the new products and the services that they offer. Other new information technologies like Voice-Over Internet Protocol (VoIP) allow people to make phone call through the internet (Lau, 2000). VoIP allow people in business trip to use the internet to verbally communicate with their clients or partners who are located in different countries in the globe. IT makes it possible for people to interact irrespective of their geographical locations. Conclusion Information technology has led to rapid globalization, as people are now able to share information and communicate with people located in different parts of the globe. People are organizations are now able to engage in virtual communication irrespective of their geographical location sue to advancement in information technology. The invention of the internet and the web are the main IT developments that have significantly led to rapid spread of globalizations, even in remote areas in developing countries. However, globalization come with both advantages and disadvantages to various segments of the society. Reference List Adiwijaya, M. and Djati, S.P., 2010. Analysis of Globalization Trends and Its Impact on The Reflexive Society and on The Development of Retail Industry. Surabaya: Petra University. Borcuch, A., Piłat-Borcuch, M. and Świerczyńska-Kaczor, U., 2014. The Influence of the Internet on globalization process. Journal of Economics and Business Research, 18(1), pp.118-129. Borghoff, T., 2011. The Role of ICT in the Globalization of Firms. Journal of Modern Accounting and Auditing, 7(10), p.1128. Brooks, I., Weatherston, J. and Wilkinson, G., 2010. Globalisation, challenges and changes. The international business environment, pp.306-336. Burstein, A. and Vogel, J., 2010. Globalization, technology, and the skill premium: A quantitative analysis (No. w16459). National Bureau of Economic Research. Dedrick, J. and Kraemer, K.L., 2008, April. Globalization of innovation: the personal computing industry. In 2008 Industry Studies Conference Paper. Haile, G.A., Srour, I. and Vivarelli, M., 2013. The Impact of Globalization and Technology Transfer on Manufacturing Employment and Skills in Ethiopia. Hrynyshyn, D., 2002. Technology and globalization. Studies in Political Economy, 67(1), pp.83- 106. Jaumotte, F., Lall, S. and Papageorgiou, C., 2013. Rising income inequality: technology, or trade and financial globalization?. IMF Economic Review, 61(2), pp.271-309. Kilic, C., 2015. Effects of Globalization on Economic Growth: Panel Data Analysis for Developing Countries. Economic Insights–Trends and Challenges, 4, pp.1-11. Lau, L.J., 2000, June. Economic globalization and the information technology revolution. In Economic Globalization: China and Asia,” a conference of the National Committee of the Chinese People’s Political Consultative Conferences, Beijing, June (Vol. 15). Lawlor, B., 2007. The age of globalization: Impact of information technology on global business strategies. Honors Projects in Computer Information Systems, p.1. Lee, E. and Vivarelli, M., 2006. The social impact of globalization in the developing countries. International Labour Review, 145(3), pp.167-184. Stefko, R. and Sojka, L., 2015. Analysis of The Impact Of Globalization On Selected Indicators Of Firm's Activities. European Scientific Journal. Ul Haq, I., 2010. Information and Communication Technologies, Globalization and Terrorism. Read More