Globalization: PDF

What Is Globalization? Globalization is the trend toward greater economic, cultural, political, and technological interdependence among national institutions and economies. Evolution of Globalization Recent Events Measuring Globalization Globalization of Markets: Conv...

What Is Globalization? Globalization is the trend toward greater economic, cultural, political, and technological interdependence among national institutions and economies. Evolution of Globalization Recent Events Measuring Globalization Globalization of Markets: Convergence in buyer preferences in markets around the world Reduces Marketing Costs Creates New Market Opportunities Levels Uneven Income Streams Local Buyers’ Needs Global Sustainability Globalization of Production: Dispersal of production activities to locations that help a company to minimize costs and/or maximize quality. Resources for production of goods and services. Access Lower-Cost Workers Access Technical Expertise Access Production Inputs Drivers of Globalization Falling Barriers to Trade and Investment World Trade Organization Regional Trade Agreements Other International Organizations – UN, IMF, World Bank Global E-commerce The Internet Intranets and Extranets Digital Transformation Communication and Transportation Communication Transportation Technologies Globalization Debate Globalization Harms Jobs and Wages. Improves Jobs and Wages. Summary of the Jobs and Wages Debate: Efficient use of resources. Debate about Income Inequality Inequality within Nations Inequality between Nations Globalization and Culture. Globalization and National Sovereignty Menace to Democracy? or Guardian of Democracy? Globalization and the Environment Chapter 2: Ethics, Social Responsibility, Sustainability Ethics Theories Utilitarianism, Rights Theory, Justice Theory, Cultural Relativism Business Ethics Resolving Ethical Dilemmas Codes of Ethics Sources of Unethical Behavior Corporate Social Responsibility Efficiency and Profits as Social Responsibility  Business Responsibilities to Society Stakeholder Theory. Internal and external stakeholders. Sustainability Carbon Footprints and Climate Change A Circular Economy (vs a Linear Economy) Greenwashing Environmental, Social, and Governance Funds Additional Key Global Issues Bribery and Corruption. Foreign Corrupt Practices Act. Working Conditions and Human Rights Diversity, Equity, and Inclusion Chapter 3: Cross-Cultural Business What Is Culture? Culture is the set of values, beliefs, rules, and institutions held by a specific group of people. Cross Cultural Literacy Avoiding Ethnocentricity, Developing Cross-Cultural Literacy Cross-cultural literacy brings a company closer to customer needs and improves competitiveness. National Culture, Subcultures, Physical Environment, Material Culture Values, Attitudes, and Behavior Values. Values are ideas, beliefs and customs to which people are emotionally attached. Attitudes. Attitudes are positive or negative evaluations, feelings, and tendencies that individuals harbor toward objects or concepts. Aesthetics. Aesthetics is what a culture considers to be in “good taste” in the arts, the imagery evoked by certain expressions, and the symbolism of colors. Behaviors: Manners, Customs Social Structure and Education Social Group Associations: Types of Groups, Family (nuclear vs extended) Collectivism and Individualism: extent to which a culture emphasizes the individual versus the group. Social Status: Social stratification is the process of ranking people into social layers, or classes. Social Mobility. Social mobility is the ease with which individuals can move up or down a culture’s “social ladder.” Caste System, Class System. Education: Education passes on traditions, customs, and values. Religion – Human values often originate in religious beliefs. Different religions take different views of work, savings, and material goods. Beliefs can influence competitiveness, economic development, and business strategies. Christianity, Islam, Hinduism, Buddhism, Judaism, Confucianism Personal Communication Spoken, Written Language Implications for Managers – Different cultures communicate differently Body Language Culture in the Global Workplace Perception of Time, View of Work Cultural Change: When Companies Change Cultures, and When Cultures Change Companies. Kluckhohn-Strodtbeck Framework Hofstede Framework - psychologist Geert Hofstede developed six dimensions for examining cultures. Chapter 4: Political, Economic, Legal Systems. Political Systems  Totalitarianism - individuals govern regardless of the people’s support, tightly control people’s lives, and do not tolerate opposing viewpoints. Theocratic Totalitarianism - under the control of totalitarian religious leaders Secular Totalitarianism - control through military and bureaucratic power. Doing Business in Totalitarian Countries - It can be risky because the law is vague or nonexistent, and people in powerful government positions can interpret laws at will. Democracy Representative Democracy. Representative democracies strive to provide freedom of expression, periodic elections, full civil and property rights, minority rights, and nonpolitical bureaucracies. Doing Business in Democracies - Democracies tend to maintain stable business environments through laws protecting individual property rights. Participative democracy, property rights, and free markets tend to encourage economic growth. Economic Systems - An economic system is the structure and processes that a country uses to allocate its resources and conduct its commercial activities. Centrally Planned Economy - Land, capital, factories, and other economic resources are owned by the government, which plans nearly all economic activity. Decline of Central Planning - Failure to create economic value. Failure to provide incentives. Failure to achieve rapid growth. Failure to satisfy consumer needs. Mixed Economy Origins and progress of the Mixed Economy Market Economy An economic system in which most land, factories, and other economic resources are privately owned, either by individuals or businesses. Price mechanism determines Supply & Demand. Supply: Quantity of a good or service that producers are willing and able to provide at a specific selling price. Demand: Quantity of a good or service that buyers are willing and able to purchase at a specific selling price of a Market Economy  Government’s Role in a Market Economy: anti-trust, preserve property rights, macroeconomic policy. Economic Freedom - economic freedom tends to coincide with higher living standards. Legal Systems Common Law – tradition, precedent. Detailed contracts. Civil Law - detailed set of written rules and statutes. Contracts can be less detailed. Theocratic Law – religious law. Global Legal Issues Intellectual Property Industrial Property – patents, trademarks. Copyrights Product Safety and Liability Antitrust Regulations – encourage competition, try to correct economic inefficiency. Taxation – Different legal systems tax businesses differently. Taxation policy affects business development. Chapter 5: Economic Development Economic Development Classifying Countries Advanced (Developed) Countries Emerging Markets Developing Countries National Production Uncounted Transactions  Question of Growth Problem of Averages Pitfalls of Comparison Purchasing Power Parity Human Development Political Risk Conflict and Violence Property Seizure Government Policies Managing Political Risk Adaptation Information Gathering Political Influence International Relations The United Nations Economic Transition Transition Obstacles Managerial Expertise Shortage of Capital Cultural Differences China’s Economic Transition: State capitalism. Chinese Patience and Guanxi China’s Challenges Russia’s Economic Transition Russia’s Challenges