JESSA D.

QUINZON GLOBALIZATION: The Changing Demographics of the Global Economy

.There is little doubt that to be viable during the next century all organizations, whether domestic or international, will need to become more global in their outlook, if not in their operations -Stephen Rhinesmith A Managers Guide to Globalization Globalization may be defined as the integration of production and consumption in all markets across the world, which in turn also is connected to the concept of global economy. The demographics of the global economy have under gone rapid changes in the past 30 years. There are four trends that describe the demographics in the global economy. Globalization has played a dramatic role in the global economy. 1) The first trend was the U.S. dominance in world economy. 2) Follow up by the U.S. dominance in world foreign investment. 3) Next is the Dominance of large, multinational U.S firms on the international business scene; and 4) Lastly the centrally planned economies of the communist world were not within reach of the western world. Basically, around 30 years ago, the U.S. was dominating the world economy, as they were the super power in that era. Gross Domestic Product (GDP) measures the world economic activity. According to the measurement in the GDP in the 1963, 40.3% of world economics were dominated by the U.S. Thats almost half of everything that the world has. In year 2006, the U.S. and along with other countries like France, Germany and the United Kingdom that first industrialized were faced with a significant drop of GDP. The U.S. dropped from 40.3 percent to 19.7 percent, however still remained the largest in the world. This was due to the faster economic growth of several other economies in Asia.

The Changing Demographics of the Global Economy. AntiEssays.15.Nov.2012 from the World Wide Web: http://www.antiessays.com/freeessays/html.

Managing in the global marketplace 1) As their organizations increasingly engage in cross-border trade and investment, it means managers need to recognize that the task of managing an international business differs from that of managing a purely domestic business in many ways. Countries differ in their cultures, political systems, economic systems, legal systems, and levels of economic development. 2) These differences require that business people vary their practices country by country, recognizing what changes are required to operate effectively. It is necessary to strike a balance between adaptation and maintaining global consistency, however. Coca-Cola would not be as successful, nor would Coke be Coke, if it tasted like ginseng in one country, lemon in another, and rhubarb in a third. Clearly some adaptations need to be made to correspond with local regulations and distribution systems, but some things need also remain consistent in order to benefit from economies of scale in advertising and production. 3) As a result of making local adaptations, the complexity of international business is clearly greater than that of a purely domestic firm. Firms need to decide which countries to enter, what mode of entry to use, and which countries to avoid. Rules and regulations also differ, as do currencies and languages. 4) Managing an international business is different from managing a purely domestic business for at least four reasons: a) countries differ, b) the range of problems and manager faces is greater and more complex, c) an international business must find ways to work within the limits imposed by governmental intervention and the global trading system, and 4) international transactions require converting funds and being susceptible to exchange rate changes.