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How globalization affects management
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“Today, we do not live in a civilization, we live in a ‘globalisation’ – with a globalisation of resources, a globalisation of business activity and a globalisation of humanity” (Schermerhorn et al., 2014, p. 151). This large scale societal evolution of the global economy of late has resulted in the need for managers to possess a transnational outlook, be competent in working with other cultures, be more informed of international developments (Schermerhorn et al., 2014, p. 90), as well as be able to successfully manage the expansion of their firm into international territories by respecting the culture of the host country, and through the use of expatriates. These are employees who live and work in foreign countries on short-term or long-term assignments and, as a result, gain valuable international and corporate experience (Chew & Debowski, 2008, p. 4). Globalisation signifies the “interdependence of resource flows, product markets and business competition” (Schermerhorn et al., 2014, p. 89) on a global scale. The expansion of international corporations into uncharted competitive territories has brought managers of these MNCs to face a vast number of greater challenges than before, such as problems that arise from managing expatriates and repatriates, management across cultures, managing cultural diversity, the transference of knowledge across cultures, and the need for alterations to the existing management practices. This essay will further examine the aforementioned challenges that managers are required to surmount to succeed in today’s global economy.
The global success of a company is often attributed to its expatriates (Schermerhorn et al., 2014, p. 111), yet the policies in place are ineffective in providing support and d...
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...2008). Developing an Effective Repatriation Strategy for MNC: A Model and Tools for International Human Resource Management. Journal of Comparative International Management, 11(2), 3-21.
Combs, G.M., Nadkarni, S., & Combs, M.W. (2002). Implementing affirmative action plans in multinational corporations. Organizational Dynamics, 34(4), 346-360.
McPhail, R., Fisher, R., Harvey, M., & Moeller, M. (2012). Staffing the Global Organization: “Cultural nomads”. Human Resource Development Quarterly, 23(2), 259-276. de Pablos, P. (2004). Knowledge flow transfers in multinational corporations: knowledge properties and implications for management. Journal of Knowledge Management, 8(6), 105-116
Schermerhorn, R., Davidson, P., Poole, D., Woods, P., Simon, A. & McBarron, E. (2014). Management (5th Asia Pacific Edition). Australia: John Wiley & Sons Australia, Ltd
To have a successful business overseas the owners had to sacrifice a lot: working seven days a week, missing holidays and other personal sacrifices. They even went to the extent of taking no salary, instead putting all the profit back into the growth of the company (Frodey & Naidu, 2008).
According to Hill (2007) the ethnocentric staffing policy is now on the wane in most international businesses because an ethnocentric staffing policy limits advancement opportunities for host country nationals, and an ethnocentric policy can lead to cultural myopia. The polycentric or local approach centers on recruitment of host country nationals (HCNs; i.e. individuals within the country) to manage the subsidiary. However, Hill (2007) recognized two advantages to the polycentric approach: (1) the firm is less likely to suffer from cultural myopia, ...
Introduction In the world we are living in today globalization has enhanced the development of many global companies that functions next to geographical boarders. A lot of business are increasing through alliances and joint ventures to partner together to create more revenue and solutions to the problems. This problem has caused an increasing number of employees wanting to gain international experience outside of their home-based countries. Trent Spencer is an African American male that is 34 years old.
The article, International worker’s satisfactions with the repatriation process, states that half of the repatriates returning home from abroad will consider leaving the company when greeted with a poor repatriation process. Of those who consider leaving, 10%-25% would leave within the first year and almost 30% would leave within two years (Sanchez & Vidal 2008). The study found that companies who provide training after repatriation and set clear expectations for the repatriation process are more likely to retain employees.
Globalisation allows individuals, groups, corporations, and countries to reach around the world farther, faster, more deeply, and more cheaply than ever before. Most large local companies regard globalisation as opportunity, thereby exploring overseas markets for maximum market share and optimum business strategies. However, managers would face a series of challenges caused by leadership models, cultural backgrounds, political and economic risks, HR management, etc. To study multinational management skills is very useful for my future career. In this essay, I will set goals for this subject, identify the skills I have honed and need to improve, and explain my strategies for achieving goals.
International businesses are also finding new ways of increasing diversity abroad. Instead of using expatriate employees as management, they are starting to hire locals. Companies that operate abroad are realizing that using expatriate employees is not a permanent solution. They are often expensive, and are not capable of translating their skills into the new environment. In a company that operates globally, it is important that the company knows how to relate to the local markets, and a great way to do this is by hiring local talent. Hiring locally is cheaper, there is not a language barrier, and they are accustomed to the business environment in the area(5). They can also help the business by providing a new perspective into international markets, and offer ways that the company can improve their diversity abroa...
A major challenge of doing business internationally is to adapt effectively to different culture. Such adaptation requires an understanding of cultural diversity, perceptions, stereotypes, and values (Hodgett &Luthans, 2005). Doing business overseas has its challenges as well as it rewards.
High turnover rate of expatriate: expatriate managers are frustrated with the performance and practices of local employees. And they do not have enough international experience and cross-cultural communication and sensitivity training.
In the past few decades, the world has experienced heightened globalisation. During this period, organisations have prioritised setting up leaders capable of dealing with the ever-increasing involvedness of running their global operations. Overseeing global talent along with career paths is consequently a decisive challenge in lots of multinational organisations. Individuals as well as organisations perceive International assignments as a constructive way of developing global occupational competencies (Brewster & Suutari, 2005).
Svensson, G., 2001. 'Globalization' of Business Activities: A 'Global Strategy' Approach, Management Decision, 39(1), pp.6-18.
...e located and the human resource management to effectively manage the global workforce diversity. Furthermore, management practices across nations should be more focused in terms of enhancing expatriates’ experience with cross-cultural training. It is also highlighted that executives of international firms must efficiently devise the best strategies and plans to increase the business positive performance and for controlling resources of their foreign subsidiaries. As a consequence, global managers play a very important role in the development and success of multinational corporations in the current competitive international market since there are numerous issues that they have to deal with in the operating process. If the enterprises could overcome the management challenges, they would gain great opportunities in the global economy and achieve favorable outcomes.
Sonderberg, A-M & N Holden. (2002), Rethinking cross cultural management in a globalizing business world' International Journal of Cross Culture Management 2(1): 103-121
As all the countries are on the way to globalize with each other, business is not the exception. Globalization in business definitely brings a lot of great opportunities for many countries. However, in order to make the best of the globalization in business, management is the golden key to that success.
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.
To be successful in today’s global market, managers and leaders need to understand more than just technical skills. Managers and leaders should also understand globalization and organizational behavior. Globalization is the tendency of businesses, technologies, or philosophies to spread throughout the world, or the process of making this happen. The global economy is sometimes referred to as a globality, characterized as a totally interconnected marketplace, unhampered by time zones or national boundaries (Search CIO). Organizational behavior is a field of study that studies individuals groups, and structure. Organizational behavior applies the knowledge gained about individuals, groups, and the effect of structure on behavior in order to make organizations work more effectively (Robbins,2014).Gaining an understanding of globalization and its effect on organizational behavior is crucial to interacting effectively in the modern global economy. Globalization affects an organization’s behavior in several ways like stimulating hyper competitive pricing for a product or service, perpetuating continuous operations and communicating around the clock and globe, capitalism is replacing governmental control and organizations are no longer constrained by borders, and corporations are becoming more heterogeneous and adapting to people who are from different nationalities and cultures. To be successful in a global economy, professionals should have a thorough knowledge of sociology, psychology, communication, and management.