Objective

The objective is to critically examine the impact of globalisation on the business

environment and how globalisation affected by political, economical, social-cultural and
technological environment.

Contents

Introduction

Impact of Globalisation

Effect of Globalisation

WTO

Case Studies

References
Introduction

Globalisation is a decisive configuration of social, economic, political and cultural

changes which frequently transforms key instructions in this modern world. Globalisation of

world makes closer between different parts of the world. Globalisation of industry makes

closer between the different parts of the members in the industry. Globalisation is a global

process, which refers to the shift toward a more integrated and independent world economy.

The globalisation has been around for past 500 years, on the other hand globalisation is

defined as interconnection and interdependence between states and between societies.

According to Thomson Larsson, The Real Story of Globalization (2001), stated that

globalisation:

“Is the process of world shrinkage, of distances getting shorter,

things moving closer. It pertains to the increasing ease with

which somebody on one side of the world can interact, to mutual benefit,

with somebody on the other side of the world.”

Thomas Lauren Friedman (an American journalist) examines the impact of the 'flattening' of

the globe", and argues that globalized trade, outsourcing, supply-chaining, and political

forces have changed the world permanently, for both better and worse. He also argues that

the pace of globalization is quickening and will continue to have a growing impact on

business organization and practice.

Impact of Globalisation

Globalisation is very important topic in discuss about the context of developed and

developing countries. Globalization has had extensive impact on the world of business. In a

business environment marked by globalisation, the world seems to shrink, and other

businesses halfway around the world can exert as great an impact on a business as one right

down the street. Internet access and e-commerce have brought small-scale coops in Third

World nations into the same arena as thriving businesses in the industrialized world, and

visions of low-income workers hand weaving rugs on primitive looms that compete with rug

dealers in major cities are not totally far-fetched.

Globalisation has affected workforce demographics, as well. Today's workforces are

characterized by greater diversity in terms of age, gender, ethnic and racial background, and a

variety of other demographic factors. In fact, management of diversity has become one of the

primary issues of 21st-century business.

Trends such as outsourcing and offshoring are a direct offshoot of globalisation and have

created a work environment in which cultural diversity can be problematic. But today most

developing countries want to profit from globalisation in the form of increased foreign trade,

foreign direct investment, foreign aid and industrial borrowing. On the other hand,

globalisation also raises problem in these countries. The problem is related to the consequent

fast structural changes in the economies. Then we can analyse globalisation on different

ways, with focus on the economic impact on developing countries. Globalisation has a

relatively new idea that the world has been embracing. The positive effects of globalisation

are numerous and extremely beneficial for everyone in all countries. It has been the most

successful prosperity and antipoverty movement in modern history.

(REF: http://www.etla.fi/files/918_FES_02_3_developing_countries.pdf)
Effects of Globalisation

Globalisation has various aspects which affects the world in different ways:

Political Political stability and risk, Government’s policy

Economical Gross Domestic Product (GDP), Employment

Social-Cultural Level of Education, Demographics, Consumers life

style changes

Technological Environment Innovative product and service, Improvement of

Customer Relationship Management (CRM)

POLITICAL

Globalisation is mainly used for the creation of a world government which regulates

the relationships among governments and guarantees the rights arising from social and

economic globalization. Politically, the United States has enjoyed a position of power among

the world powers, because of its strong and wealthy economy. With the influence of

globalisation and with the help of The United States’ own economy, the People's Republic of

China has experienced some tremendous growth within the past few years. If China continues

to grow at this rate then within next few years, there will be major reallocation of power

among the world leaders. China will come stronger in their economy with enough wealth,

industry, and technology to rival the United States for the position of leading world power.
30% - http://redblueint.com/Content/Knowledge_Center/Knowledge_of_Industry.html

52% - http://www.absoluteastronomy.com/topics/Globalization