We all know that globalization leads to the development of multinational corporations which corporations or enterprises manage the production and delivery of their products in more than one country. It is an important factor of globalization that it makes more competition in the local market. This can lead to the higher quality products that the consumers in the local market can benefit. And it also creates more job opportunities for local employees. Even though it can brings some disadvantages to the changes in the local consumers and their living environment.
Together with the appearance of more and more multinational corporations, it will bring some difficulties as the cultural differences for the managers as well as their employees.
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Works Cited
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Today, many companies enter the global market, and some companies have become extremely successful in the global marketplace and others still struggling. In Theodore Levitt’s article “The Globalization of Markets”, he states that a well managed corporation focuses on selling standardized products with high quality and low priced instead of focuses on selling on customized products with high cost. Levitt defines the differences between multinational corporation and global corporation, and adopts many specific examples to proves his view. He defines the multinational corporation who operates in many countries and adjust its product based on the taste of specific region. This will result in a high cost to produce the product because company have to input more resource into each individual product. However, global corporation sells similar product worldwide at relative low cost. According to Levitt, the cultural differences are becoming more and more “homogenized”; therefore, becoming a global corporation will lead to the successful of the company in the global market.
The latest official figures indicate that there are now more than 37,000 transnational companies controlling almost a quarter of a million subsidiaries. Ninety per cent or 34,000 are based in industrialised countries. Just over half of their subsidiaries are operating in the Developing World. 56% of the parent corporations have their base in the European Union but only 24% of their subsidiaries operate within European boundaries. The number of multinationals is growing daily and increasingly have a base in the newly industrialised countries.
Fair trade is defined as the practice of directly benefiting producers in the developing world by buying straight from them at a guaranteed price. As a first world country, the United States is enamored with the concept of helping those in need, and fair-trade products are an essential component to that idea.
Globalization is an important contemporary phenomenon and it is difficult to avoid the trend. Its development as well as make people recognize each other's lives in an interdependent global village. Therefore, globalization encourages people to care about many global equity issues such as peace, justice, environmental protection. Like many phenomena, there are both sides of pros and cons in globalization. Globalization can create new opportunities for the expansion of international trade, and enhance global commodity circulation and improve cultural exchange (Krier, 2001). It is beneficial to the development of integration with the global economy. Emphasizing efficiency in terms of globalization
In recent decades, the process of globalization has accelerated and the world economy has become increasingly interdependent. The rise in the number of businesses that extensively operate in more than one foreign country, which is known as multinational corporations, plays an important role in the ongoing procedure of globalization. The United Nations has reported that multinational corporations hold one-third of world’s productive assets and control 70 percent of world trade (Schermerhorn et al., 2014). As there is a considerable growth in international businesses, worldwide economy is becoming more highly competitive. The global economy not only offers great opportunities for multinational enterprises but also on the other hand, creates many difficulties for them. Therefore, success in the large-scale economy requires a number of elements. One of the major determinants is dependent on global managers. In the operation of organizations, managers may encounter different international management challenges that restrict their business development. These challenges often include issues associated with the host countries, the global workforce diversity management, management across cultures, difficulties in competitive global business environment as well as in the process of global planning and controlling. This essay is going to discuss the above international management challenges in a broad sense and giving illustration in aspects of each challenge.
Nowadays, business is set in a global environment. Companies not only regard their locations or primary market bases, but also consider the rest of the world. In this context, more and more companies start to run multinational business in various parts of the world. In this essay, companies which run multinational business are to be characterized as multinational companies'. By following the globalization campaign, multinational companies' supply chains can be enriched, high costs work force can be transformed and potential markets can be expanded. Consequentially, competitive advantages of companies can be strengthened in a global market. Otherwise, some problems are met in the changed environments in foreign countries at the same time. The changed environments can be divided into four main aspects, namely, cultural environment, legal environment, economic environment and political system problems. All the changed environments make problems to multinational companies. In particular, problems which are caused by changed culture environment are the most serious aspect of running a multinational business. This essay will discuss these problems and give some suggestions to solve them.
Globalization remains a pivotal topic in many schools of thought, and continues being a topic of controversy even in local economies today. Perhaps the reason for this is integration and competitiveness the world over. Conceivably, even more than integration, is the competitiveness of organizations, has possibly facilitating the fascination and misconception about of globalization. Nevertheless, globalization has brought about a number of effects influencing the design and geographical location of the organization. However, globalization has effectively placed the world in a bubble, or maybe one could equate the changes to being placed in an envelope.
The progression and evolution of international business has played an integral role in the overall development and progress of the world economy, culture, and politics. The multinational corporation was an essential part of this process and has roots as far back as the 15th and 16th centuries in Western Europe, specifically in the nations of England and Holland, during a period known as mercantilism. This was a time of unprecedented global exploration, colonization, and other imperialist ventures. Organizations such as the British East India Trading Company, promoted both global trade and the acquisition of natural resources, primarily for their home countries in areas including Africa, East Asia, and the Americas. Global trade was the primary factor in the growth of the world economy during this time. However the modern MNC, as it is known today, did not appear until the 19th century. These new entities provided a new level of inter-firm connectedness, a wider division of labor, and a higher level of product integration across countries in which MNCs are growing. Studies have shown that modern MNCs are characterized by a high degree of complexity, and have not followed a linear pattern in their development. In addition, it is crucial to understand the geographical context in which these MNCs were founded. This paper will analyze the development of the multinational corporation (MNC) from the 1870s to the modern day and examine it what ways, and to what degree it has changed over time.
It is widely accepted that there are a lot of benefits globalization brought to our life. Firstly, advanced transportation system makes different places of the world closer. Considerable amount of exciting tourists can visit remote villages in the corner of the earth. Secondly, new telecommunication, such as internet and TV, makes people’s common life colorful. Fans in China who are interested in Manchester United can also share their joy with their counterparts in United Kingdom, when the team won a game. Moreover, we can buy the popular products of high quality made in other countries, such as automobiles of Volkswagen and furniture of IKEA. Finally, globalization can lead to cooperation in trade between different countries. Even though globalization can bring so many conveniences to us, we still worry about its severe negative aspects.
With the proliferation of the internet international Business transactions are more common today than ever. Globalization is now a key factor when creating a business strategy for most companies whether they are small family own businesses or huge corporations. Globalization however does not just involve selling a product in other countries. There are legal and cultural concerns that must be addressed. The legal aspects are fairly simple because in most places the laws are spelled out. It's the local customs, and regional way of doing things that can be tricky. Research on globalization has shown that it is not an omnipotent, unidirectional force leveling everything in its path. Because a global culture does not exist, any search for it would be futile. It is more fruitful to instead focus on particular aspects of life that are indeed affected by the globalizing process. (1). In this new economy, as it has been in the past, it will be the people not the machines who will determine a company's success. Having an effective Human Resource Management team that effectively analyze your company's current and future personnel needs is key in any business organization.
Fair Trade is considered as an alternative trading system, which aims to protect the economically disadvantaged producers, especially in developing countries. It provides transparency and respect in international trade (Gingrich and King, 2012). Besides, Fair Trade also contributes to sustainable development by offering better trading conditions for marginalised producers and workers and securing their rights (Mohan, 2010).
Globalization is associated with bringing together world economies and cultures. Globalization is a controvertible conception. This allows powerful corporation change local enterprises and in the future make the gaps big between, rich people and poor people. The benefits of an international market to integrated where labour, ideas, capital and goods can be free and to promote the economic development all of the levels in the society. Globalization is a process to interact and integrate among companies, people and the governments of other nations. Globalization is process which international organization, corporations, individuals and communities has become more interconnected with politics, cultures and the earths environment. “It is characterized
The process of globalization allows the global market to include products and services from all the companies around the world, including all the investments that is across national borders. Indeed, many American companies have taken their merchandise, manufacturing and services to invest in other countries. However, this has produced a negative effect in the global economy. The American companies
I. Introduction: Globalization and the Growth of Multinational Corporation With the emergence of economic globalization, corporations are boundless, without home territories. The most widely accepted principle of multinational corporations, sometimes called multinational enterprises or translational corporations, is to maximize shareholder wealth. MNCs enact corporate strategies to improve cash flows, market share, and ultimately enhance shareholder profit. Shareholders today expect double-digit returns, yet the global economy barely accomplishes an annual average rate of growth of only 2-3 percent, especially since the unfinished financial crisis in 2009. Mired in domestic saturated markets, MNCs have gone beyond local investment to investing in a foreign country.
Globalization’s history is extremely diversified and began during the beginning of civilization. Now we live in a world that is constantly evolving, demanding people to use resources in locations that are very difficult to obtain certain resources. This could make it completely impossible to operate in these specific parts of the world. However, globalization allows people across the world to acquire much needed resources. Globalization creates the opportunity for businesses to take advantage and exploit the ability to take part of their business to a different country. Nevertheless, globalization is part of today’s society and will be involved in virtually all situations.