Globalization: Drivers, Impacts, and Management Roles

Why the Upsurge in Globalization?

1. Increased Customer Demands and Access

• Demand for more value for money
• Preference for global brands over local brands
• Access to global distributors

2. Increased Technological Innovation

Improved ICT facilitates access to markets, partners, and global networks.

3. Increased Power of Emerging Markets

4. Increased Globalization of Financial Markets

5. Shared R&D and Global Sourcing

• Companies spread their research across multiple countries.
• Outsourcing is more of a rule than an exception.

6. Evolving Government Trade Policies

Governments try to attract foreign investments.

Consequences of Globalization

Pros

• Free Trade Objective: No borders, fewer tariffs, lower prices, cost reduction, open markets.
• More Employment: New jobs, internationalization of products.
• Development of less developed countries or regions.
• Communication Improvements: Open lines of communication, a greater global perspective, increased accessibility to products and places.
• Improvement in labor conditions.

Cons

• The rich become richer, the poor become poorer.
• The majority of new jobs are created in underdeveloped countries.
• Political systems where the bigger and the richer have the power.
• Security problems because of the global image and communications development.
• Lack of identity – we all become the same.

10 Management Roles (Mintzberg)

1. Interpersonal Roles

Building and leading effective groups and organizations.

• Figurehead: Symbolic value varies across countries.
• Leader:
  • Individualistic cultures prefer "take charge" leaders.
  • Collectivistic cultures have different preferences.
• Liaison: Some countries prefer informal contacts; others prefer official representatives.

2. Informational Roles

Collecting, organizing, and disseminating useful information in a timely fashion.

• Monitor: Culture often influences the extent of monitoring.