The Globalization

Contents

Introduction        2

International Business and Globalization        3

Technological Revolution        3

Communication/Information Technology        4

Transport/Manufacturing Technology        4

Positive Impacts        4

Negative Impacts        5

Governments and WTO as a key player        6

Conclusion        8

Appendix        9

Bibliography        11

Readings        12

Introduction

Any time you walk into a Lidl, Dunnes or Aldi you can easily find products that have been manufactured or produced in Spain, Italy or even in Africa, Asia or Latin America. Same situation happens when you want to buy clothes in Zara, shoes in Debenhams, TVs in Harvey Norman. International trade has happened since centuries ago and this is due the resources available or competitive advantages that each country has and can use. Spain can produce and export fruits or alcoholic beverage (wine) easily than Germany due the climate conditions of the country; however according (Workman, 2016) Germany’s top exports are vehicles, machines or engines and this is due the high industry they have developed. Any company that produces goods or services across national borders will be performing International Business. That’s not reduced only to International trade or foreign manufacturing but also to transportation, tourism or construction, so service industry.

In order to understand the Globalization impact to the world and provide personal insight on which areas can be improved to balance the process, is important to understand what International Business and Globalization means, the need and the reason of the International Business, the role that each players have into this game and analyse which are the cause-effect by trading internationally.

On this assignment I have analysed and detailed facts and factors about International Business and Globalization, and I have provided statistics, comparisons and trends on the globalization market and how this has impacted the society and the multinational companies. The purpose of it is to understand, explain and provide my opinion on which I think are the key factors that are driving International Business and the environments associated to them, identify positive and negative consequences and also identify which are the roles that Governments and Organizations play in order to improve this complex process. To finalise this assignment I have provided, based on all findings, my insights and approach into this complex debate.   

International Business and Globalization

International business is businesses whose activities are carried out across national borders. This definition includes not only international trade and foreign manufacturing but also the growing service industry in areas such as transportation, tourism, construction, and etcetera.  The parties involved are the Individual (employees, students or tourist), the firms, the governments and International Organizations (World Bank or World Trade Organizations). Globalization refers to the interconnectedness of national economies and growing interdependence of buyers, producers, suppliers, and governments in different countries, therefore the process by which the world becomes more interconnected at all levels; cultural, economic, financial or political. Globalization has increased the productions of goods and services, and the biggest organisations are no longer national firms but Multinational organizations operating in many different countries and continents. Any company operating outside their borders is subject to different environmental forces that impact his own expansion; those macro environmental factors include can include the Political (government activities), Economic (economic policies in the operating country), Technological (innovation or techniques used), Socio-Cultural (Skills or demographic) and International (Introduction of Euro).  

Which are the factors that have driven the Globalization? The Worldwide reduction of barriers for trade and investment has helped to speed up the globalization process. For examples the European Union which its principle was to develop a single market for all member States, which means free movement of people, goods, services and capital within this internal market. The technological revolution at different levels; Communication, Information and Transport has also impacted and facilitate the globalization of markets and the industrialization, economic development and modernization of the countries and the integration into the world financial market has contribute to drive globalization to nowadays.

Technological Revolution

The Globalization wouldn’t have made sense without the technological revolution we faced and we are still facing as it has speeded up all Globalization process and played an important role into it. I have split the technological advances in two different areas, the information/communication technology and transportation/Manufacturing technology. All of them have contributed to understand the steps forward on the globalization by reducing cost, increasing in speed and affordability of doing International trading, enables small firms to go internationally, helps to coordinate worldwide activities by all advanced in communication and information technologies and mitigates geographical distances by the developments in transportation technology.

Communication/Information Technology has advanced drastically in last decades. The internet has influenced how we communicate and connect with other people from other countries by video calls, emails or chats. Also Mobile phones allowed reaching people in matter of seconds regardless where they are in the planet. See in Appendix 2 how communication cost has dropped and how internet user has increased. Another advanced are the Satellite that provides accurate and valuable information on issues pertaining to the environment. This Instant Communication has influenced the business and social/personal live.