Globalization describes an ongoing process by which regional economies, societies, and cultures have become integrated through a globe-spanning network of communication and trade. :) The term is sometimes used to refer specifically to economic globalization: the integration of national economies into the international economy through trade,foreign direct investment, capital flows,migration and the spread of technology However, globalization is usually recognised as being driven by a combination of economic, technological, sociocultural, political, and biological factors. The term can also refer to the transnational circulation of ideas, languages, or popular culture.
An early description of globalization was penned by the American entrepreneur-turned-minister Charles Taze Russell who coined the term 'corporate giants' in 1897. Although it was not until the 1960s that the term began to be widely used by economists and other social scientists. The term has since then achieved widespread use in the mainstream press by the later half of the 1980s. Since its inception, the concept of globalization has inspired numerous competing definitions and interpretations. Globalization affects every aspect of our lives.
Why is it so important in the world of business?
To put this matter as simple as possible, globalization is todays norm to do business.
Evolution of a concept>>>>>>>
* various business houses started experimenting abroad
* soon many businesses tasted blood by tapping the global financial resources
* realizing the opportunity almost every business aspires to be in the global market
* leading to cut throat competition
So to understand modern business methodologies and move any organization forward, globalization not only important but absolutely vital!!
Globalization has revolutionized products and services industries alike. Growing economies like India and China are playing a major role in this. For example , various outsourcing services provided in India for countries like USA, UK and Australia. Different products which were exclusively manufactured abroad are being produced in India and making it available to the local market at a competitive price.
Hence, clearly there are several advantages in this era, like more resources available, faster technological development leading to more business opportunities. We are moving forward in this era at break neck speed. Its leading
breaking down of cultural barriers, like World Movies channel on tv shows movies in different languages across the world. Which not only tells us theres a market for it, but also that we are accepting different cultures quite openly. All this is because of globalization. Globalization now is like an avalanche effect, more globalized we become faster is the rate of globalization.
Globalization has various aspects which affect the world in several different ways such as:
Industrial - emergence of worldwide production markets and broader access to a range of foreign products for consumers and companies. Particularly movement of material and goods between and within national boundaries. International trade in manufactured goods increased more than 100 times (from $95 billion to $12 trillion) in the 50 years since 1955. China’s trade with Africa rose sevenfold during 2000-07 alone.
Financial - emergence of worldwide financial markets and better access to external financing for borrowers. By the early part of the 21st century more than $1.5 trillion in national currencies were traded daily to support the expanded levels of trade and investment. As these worldwide structures grew more quickly than any transnational regulatory regime, the instability of the global financial infrastructure dramatically increased, as evidenced by the Financial crisis of 2007–2010.
Economic - realization of a global common market, based on the freedom of exchange of goods and capital.[44] The interconnectedness of these markets, however meant that an economic collapse in any one given country could not be contained.
But globalization is not all that lush green pasture, to make it fruitful, the business honchos, global leaders need to understand lot of things. Different culture, the effect of it on market, the globalized economy and how it can be put to the advantage of any business.
But we should be careful… heres why???? Heres the flip side of it.
Theres always a risk, if any of the big economies of the world is hit, it will adversely affect the other economies around the world as well.
In the 1990sround the world, incomes were rising; capital markets were processing endless flows of money and investment; technological gains meant that ever more information was available ever more cheaply. And politics in the age of abundance, Mr Lindsey claimed, was all about values. In America this was the period of the “culture wars” over abortion and gun ownership; internationally, there was a huge expansion in concern over human rights.
The 2010s, it is sometimes said, will be an age of scarcity. The warning signs of change are said to be the food-price spike of 2007-08, the bid by China and others to grab access to oil, iron ore and farmland and the global recession. The main problems of scarcity are water and food shortages, demographic change and state failure.
In the domestic debates of some rich democracies, things are shifting already. In Europe the talk is of how to distribute the pain of cutting public debts. In America the return of mad-as-hell populism looks like a turn away from the politics of abundance.
The sort of problems governments increasingly face, they say, will be much less predictable than those associated with old great-power rivalries. Pressure from demography, climate change and shifts in economic power builds up quietly for a long time—and then triggers abrupt shifts.
The authors say that what is needed is not merely institutional tinkering but a different frame of mind. Governments, they say, should think more in terms of reducing risk and increasing resilience to shocks than about boosting sovereign power. This is because they think power may not be the best way for states to defend themselves against a new kind of threat: the sort that comes not from other states but networks of states and non-state actors, or from the unintended consequences of global flows of finance, technology and so on.
Effect of globalization on language:
English has come up to be the official language of the world. Thus, gone are those days when one had to pack all foreign language dictionaries on a trip abroad. English is spoken in most countries. Mainly because every government realized that to survive in this era one has to communicate in the language everyone understands.
It sounds all nice and good…..but heres a flip side:
So what seems to be happening is that formal politeness, at least in spoken and written exchanges, is on the decline, thanks to globalisation (meaning the rise of flat, nuance-less English as a means of international communication), to social changes and to technology. Replacing it is a kind of neutral friendliness, where human encounters take place devoid of the signifiers of emotional and status differences that past generations found so essential.
That may lubricate business meetings. But it makes life outside the workplace less interesting. If you use first names everywhere at work, how do you signify to a colleague that you want to be a real friend? If you sign all e-mails “love and vibes”, how do you show intimacy? Much of the world has an answer to that, at least in their own languages and cultures.
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