Scarica Globalization: Impacts, Advantages, Disadvantages and Glocalization in Business e più Appunti in PDF di Tedesco solo su Docsity! Globalization Globalization is the process by which the world is becoming interconnected and it has increased the production of goods and services. Globalisation is the result of several factors: o Travel o International trade o Cultural exchanges … Positive impacts of globalisation: o Movement of capital, goods and services is facilitated o People can share ideas, cultures and different lifestyles o The price of products is lower o Range of products is available to consumers o People are more aware of global issues Negative impacts of globalisation: o Anarchism o Competition in trade o Child labour o Animal rights o Debts o Anti-capitalism Anti-globalization The opposition to the increase in the global power and influence of businesses, especially multinational corporations. Globalisation is a controversial issue and has divided opinion: o Supporters of the process argue that it allows poorer countries to develop economically and that it raises standards of living there. They think that it will lead to greater economic, social and cultural equality. o Opponents, however, believe that globalisation is increasing the gap between the world's richest and poorest countries. They claim that it operates in the interests of the world's most powerful nations, which continue to dominate world trade, at the expense of developing countries. Glocalization Glocalization is the combination of the words' globalisation' and 'localisation’. It first appeared in the late 1980s in articles by Japanese economists in the Harvard Business Review and it is used to accommodate the consumers in a local market. This means that the product or service may be tailored to conform to local laws, customs or customers preferences. Products or services that are effectively ‘glocalised’ are going to be of much greater interest to the end user. Google is an example of a company that practises glocalisation. It markets/sells a portal which is viewed worldwide and offers different versions of its website and its services for different users. The international fast food chain McDonald's is another example which illustrates the concept of glocalization: they change their menus to appeal to local palates and 'customs. For example, in India, a country in which the cow is sacred, the menu features McVeggies instead of hamburgers. In Singapore, customers can order a Chicken SingaPorridge; in Hong Kong, some Seaweed Shake Shake Fries. Outsourcing and Offshoring Outsourcing and offshoring are two related terms which are often used when talking about economic globalisation. Most of the time an organization cannot handle all aspects of a business process internally. Outsourcing is a practice where a certain company 'hires' another company in the same country to do a part of its work. The most commonly outsourced streams of business include IT outsourcing, legal outsourcing, web design and maintenance, recruitment, logistics, manufacturing and technical / customer support. Offshoring (or, more accurately, offshore outsourcing) is the name for a practice where a certain company moves the production or a particular business function to another country. Currently the major players in offshoring are India followed by Philippines and China. Some of the advantages of offshoring are lower labour and equipment costs and the use of less office space as well as the concentration of production in the most efficient location. Despite the advantages and cost benefits that offshoring offers, it involves risks which need to be considered. For example, the political climate in foreign countries is a big source of uncertainty as these can be unstable at times. There are the differences in work practices, culture, language and communication styles, and hidden costs such as legal costs and fluctuating exchange rates which can affect the profits. There are also problematic and controversial issues related to offshoring: standards may ho different and there may be exploitation of the local environment and of workers. Nowadays, offshoring isn't as popular as it used to be. Many businesses are shifting production back home, mainly for economic reasons. For example, manufacturing is beccating more automated, so labour makes up a decreasing proportion of costs and labor costs have soared in formerly poor countries. These days the main reason why companies want to expand their presence overseas is to be close to consumers in fast-growing new markets, not to exploit low wages as part of an offshoring strategy. ADVANTAGES FOR COMPANIES • Companies have greater flexibility to operate across borders because there are less controls, taxes or documents to fill in, this allows them to grow beyond domestic borders. • Global companies gain access to new materials and
