Globalization

Globalization is playing a major role in the environment of many firms today. The volume of
international trade has grown significantly and continues to grow at a very rapid pace. There are
four basic reasons for this growth: (1) communication and transportation have advanced
dramatically over the past several decades; (2) businesses have expanded internationally to
increase their markets; (3) firms are moving into international markets to control costs, especially
to reduce labor costs; and (4) many organizations have become international in response to
competition. There are numerous cross-cultural differences and similarities that affect behavior
within organizations. A second major environmental shift in recent years has been the increased
attention devoted to the concept of diversity. Workforce diversity refers to the important
similarities and differences among the employees of organizations. Unfortunately, many people
tend to stereotype others in organizations. Stereotypes can lead to the even more dangerous
process of prejudice toward others. Managers should be cognizant of both primary and secondary
dimensions of diversity, as well as the wide array of benefits to be derived from having a diverse
workforce.