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GLOBALISATION

SUBMITTED BY
MANISHA
MEHAK
LOVEPREET
CONTENTS
 MEANING
 DEFINITION
 IMPORTANCE
 DRIVERS
MEANING
 GLOBALISATION is the system of
interaction among the countries of the
world in order to develop the global
economy.
 It refers to the integration of economics
and societies all over the world.
G lo b a lisa tio n

eco n o m ic so cia l cu lt u ra l t ech n o lo g ica l


Definition
“A process in which geographic distance
becomes a factor of diminishing
importance in the establishment and
maintenance of cross border economic,
political and socio-cultural relations”
(Lubbers, R)
Quotes from business and
Government
 "Globalisation is irreversible and
irresistible."
Tony Blair (1999)

 "Globalisation is not a policy choice, it is a


fact."
Bill Clinton (1999)
IMPORTANCE
 Economic Growth
 Free International trades
 Reduces cultural barriers
 Permitting the investors to invest.
 Communication networks
 Possibility of war reduces.
 Smooth and speedy transportation.
 Environmental protection.
 Mutual interdependence among nation-
states.
 Flexibility of corporations
Facebook
 Reduces global boundaries
 Speak to people around the world
 Globalisation of social communication

Facts about Facebook usage


 More than 250 million active users
 More than 120 million users log on to Facebook at
least once each day
 The fastest growing demographic is those 35
years old and older
 About 70% of Facebook users are outside the
United States
What drives globalisation?
 Increase of information.
 Better communications
 Ease of travel
 Increase of knowledge sharing: Internet.
 Opening of the markets: Free trade agreements,
World trade organisation.
 Reduction of tariffs on imports
 Attraction of foreign investment
Globalization Drivers
 Market Drivers
 Competitive Drivers
 Cost Drivers
 Government Drivers

Low High
Multi-domestic Global
Market Drivers
Common customer needs : products and
technology is transferred with its cultural
baggage to other countries with similar needs.
e.g Coca Cola , McDonald, K.F.C
Global channels: Global channels have
emerged with free trade as free trade enabled
companies to distribute goods and provide
services internationally.
e.g Wal-Mart have developed global channels to
distribute products.
 Marketing Transfers and Global Branding: IBM, Toyota,
Kodak have become household names throughout the
world

 Lead Countries: Countries have developed a name for


some products
e.g. Japan for consumer electronics,
Switzerland for watches,
USA for computer software, etc.
Competitive Drivers
Competitive Drivers
Competing with imports and other global rivals
have placed increasing pressures on both
domestic and international companies to be
competitive in national and international
markets.
Cost Drivers
 Economies of scale: expensive to set up
production but they can rope in huge profits
by targeting multiple markets.

 SteepExperience Curves: knowledge and


technology intensive sectors: aircraft

 Low Cost Production: low cost labor (textiles)

 FavorableLogistics: transportation costs


important as we decide where to produce:
lumber, non-specialty chemicals
 New Product Development Costs: are rising
due to short life of their products that require
higher return on their investment (airlines,
telecommunications, chips,
pharmaceuticals )
Government Drivers
 Government Drivers
United Nations, and its agencies like
IMF,
World Bank
WTO: free trade,privatization . \
E.g.
Greece has debt/GDP is 12.7% (whereas EU
rules require something closer to 3%)
KEY POINTS
 Globalization drivers can be based on market, cost,
competitor, or government factors.
 Companies prepare for globalization by assessing
corporate competencies, supply chains, leadership
capabilities, and corporate cultures.
 Globalizing corporate cultures involves defining and
critically examining organizational relationships,
communication patterns, and employee behaviors.
THANKS

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