Abstract The Caribbean area is faced with new trends in the world today that would lead to development

and cause change. Change is not static but rather is dynamic in nature and is definitely inevitable. Today the Caribbean is facing globalization and regionalization. Globalization and regionalization can be viewed as an expansion of a viable market. One must be able to advantage of the world becoming a global village. One must not throw up arms in despair but must face the challenge of globalization and regionalization. How organizations adapt to this new trend can lead to their rise or fall. This paper endeavors to highlight some trends of globalization and regionalization their impact on the Caribbean businesses. This paper will also show that these trends do not have to be necessarily negative but can work out to the benefit of the Caribbean. Keywords: globalization: regionalization: change

Introduction

overing a wide range of distinct political, economic, and cultural trends, the term globalization has quickly become one of the most fashionable buzzwords of contemporary political and academic debate. In popular

discourse, globalization often functions as little more than a synonym for one or more of the following phenomena: the pursuit of classical liberal (or free market) policies in the world economy (economic liberalization)

the growing dominance of western (or even American) forms of political, economic, and cultural life (westernization or Americanization)

the proliferation of new information technologies (the Internet Revolution) the notion that humanity stands at the threshold of realizing one single unified community in which major sources of social conflict have vanished (global integration)

Fortunately, recent social theory has formulated a more precise concept of globalization than those typically offered by pundits. Although sharp differences continue to separate participants in the ongoing debate, most contemporary social theorists endorse the view that globalization refers to fundamental changes in the spatial and temporal contours of social existence, according to which the significance of space or territory undergoes shifts in the face of a no less dramatic acceleration in the temporal structure of crucial forms of human activity.

Geographical distance is typically measured in time. As the time necessary to connect distinct geographical locations is reduced, distance or space undergoes compression or annihilation. The human experience of space is intimately connected to the temporal structure of those activities by means of which we experience space. Changes in the temporality of human activity inevitably generate altered experiences of space or territory. Theorists of globalization disagree about the precise sources of recent shifts in the spatial and temporal contours of human life. Nonetheless, they generally agree that alterations in humanity's experiences of space and time are working to undermine the importance of local and even national boundaries in many arenas of human endeavor. Since globalization

contains far-reaching implications for virtually every facet of human life, it necessarily suggests the need to rethink key questions of normative political theory.1

There are six basic global trends that are impacting upon Caribbean businesses. These trends are listed below: Nature of the Workforce Technology Economic Shocks Social Trends World Politics Global Competition

The Seven S Framework It's all very well devising a strategy, but you have to be able to implement it if it's to do any good. The Seven S Framework first appeared in "The Art Of Japanese Management" by Richard Pascale and Anthony Athos in 1981. They had been looking at how Japanese industry had been so successful, at around the same time that Tom Peters and Robert Waterman were exploring what made a company excellent. The Seven S model was born at a meeting of the four authors in 1978. It went on to appear in "In Search of Excellence" by Peters and Waterman, and was taken up as a basic tool by the global management consultancy McKinsey: it's sometimes known as the McKinsey 7S model.
1

For added details see Stanford Encyclopedia of Philosophy <http://plato.stanford.edu/entries/globalization/>

Managers, they said, need to take account of all seven of the factors to be sure of successful implementation of a strategy - large or small. They're all interdependent, so if you fail to pay proper attention to one of them, it can bring the others crashing down around you. Oh, and the relative importance of each factor will vary over time, and you can't always tell how that's changing. Like a lot of these models, there's a good dose of common sense in here, but the 7S Framework is useful way of checking that you've covered all the bases.2

The impact of globalization and regionalization on Caribbean businesses will be analyzed within the Mckinsey 7-S framework. The model starts on the premise that an organization is not just structure. The basic concept underlying the seven Ss is that the organization efforts in each area must be coordinated- aimed at the same objectives and moved in the same direction- to produce synergy. The seven S framework embodies major concepts of implementation: Hard Ss Strategy Structure Systems

Soft Ss
2

Style Staff Skills

For added details see Famous Models: 7S Framework. <http://www.chimaeraconsulting.com/7s_model.htm>

Shared values

Figure 1. 7-S Framework

Critique of 7-S Model A major critique of McKinsey's 7S framework is to be found in Richard D'Aveni's book, Hypercompetition. The gist of his critique is that the competitive environment is often moving so fast that the stability assumptions built into McKinsey's approach are dysfunctional, and that organizations need more speed, agility and capacity for coping with uncertainty to prosper.

D'Aveni's "New 7S Framework" identifies Stakeholder Satisfaction, Strategic Soothsaying (good sense of where the world is going), Speed, capability to Surprise rivals, ability to Shift the Rules of competition, capable Signaling, and Simultaneous and Sequential Strategic Thrusts that create momentum and follow-on as the newer, more contemporary approaches that allow a competitor to contend with today's more competitive environments - or to render the environment more competitive, so as to catch the opposition flat-footed. D'Aveni's fundamental model is that strategic competition is war, and like it may include strategic alliances, but it's mostly all against all.

1. Stakeholder satisfaction is the main focus of any organizational activity. The stakeholders include investors, employees, the larger society and most importantly, the consumer. If a new advantage is to be created it has to revolve around the consumer, be developed by the employee and funded by the investor. Employees must be empowered to generate new processes that can create value for the consumers. 2. Strategic Soothsaying is the process of seeking out consumer and competitor information to help in decision-making. Understanding the innate needs of consumers is necessary to constantly delight consumers. Monitoring competitor activity is necessary to maintain your advantage. 3. Surprise is the essence of any military attack. The same applies to the competitive business environment. The element of surprise can dull your competitors ability to react.

4. Speed of the attack is key to triumph. The swiftness with which a strategy is executed can decide its success. 5. Signaling in the markets can help mould or pre-empt competitor moves. 6. Shifting rules can catch your competitor unawares. Companies try and compete within the traditional framework, which means they are predictable. You can therefore shift the focus from the traditional view to your advantage. 7. Simultaneous or sequential strategic moves are necessary to achieve the objective. A combination of tactics like speed, surprise and shifting of rules can dent competition much more effectively than when used in isolation.3

Strategy Strategy can be defined as a coherent set of actions aimed at gaining a sustainable advantage over competition, improving position or allocating resources. Since objectives are derived from the organizations strategy, it is only logical that strategy and structure should be closely linked. More specifically, structure should follow strategy. If management makes a significant change in its organizations strategy, the structure will need to be modified to accommodate and support this change. Most current strategy frameworks focus on three strategy dimensions-innovation, cost minimization, and imitation-and the structural design that works best with each (Robbins 430)

For added details see The New 7S Framework. The ManageMentor. <http://www.themanagementor.com/enlightenmentorareas/sm/Cms/the new.htm>

To what degree does an organization introduce new products and services? An innovation strategy does not mean a strategy merely for cosmetic changes from previous offerings but rather one for meaningful and unique innovations. This strategy is not pursued by all organizations because they are not all seeking to be innovative.

An organization pursuing a cost-minimization strategy tightly controls costs, refrains from incurring unnecessary innovation or marketing expenses, and cuts prices in selling basic products.

Organizations following an imitation strategy try to capitalize on the strengths of both of the previous strategies. They seek to minimize risk and maximize opportunity for profit. Their strategy is to move into new products or new markets only after innovators have proved viability. They take the successful ides of innovators and copy them.

Organizations that function in more than one business formulate strategy in much the same way as a single-business organization (Higgins 242). They review: Mission Vision Goals

These organizations examine the internal and external environment, do SWOT analysis; determine core competencies, capabilities, and resource bases; develop planning premises; establish strategic objectives, propose strategic alternatives; and, finally, evaluate the alternatives and make a decision.

An organizations strategy outlines its goals and the means for attaining its goals. The strategy that an organization is pursuing, at any given time, will influence the power of various work groups, which, in turn, will determine the resources that the organizations top management is willing to allocate to them for performing task.

Many people view the world with fear and dread rather than excitement and anticipation. The world is changing too fast for them. The future appears to be so unknowable and unpredictable. We are alienated from the present and ambivalent to the future. We are afraid we are falling behind. We are worried about our society. We lack framework for interpreting what is happening (James 15).

These sentiments expressed by Jennifer James in her book Thinking In The Future Tense appear to be all too true for Caribbean businesses. Organizations are so afraid of the future that most of them are unsure as to how to prepare for it. In expressing his views in the Nation newspaper of November 29, 2002, James Husbands the managing director of Solar Dynamics Limited, declared, globalization should not be viewed as the death knell for local manufacturing.4 Although Mr. Husbands was speaking specifically to the manufacturing sector, this can be said for all organizations in the Caribbean.

There are a few basic points that all organizations should know about change:

Change Happens Anticipate Change

For added details see Alleyne, David. Globalization No Death Knell. Nation Newspaper 29 November 2002.

Monitor Change Adapt to Change Quickly Change Enjoy Change Be Ready to Change Quickly and Enjoy It Again (Johnson 74)

Caribbean businesses must change or modify their strategies. Michael Porter argues that businesses must respond to five competitive forces. Michael Porter provided a framework that models an industry as being influenced by five forces. The strategic business manager seeking to develop an edge over rival firms can use this model to better understand the industry context in which the firm operates.5 These forces are listed as follows: 1. The threat of new entrants 2. The bargaining power of suppliers 3. Threats from substitute products or services 4. The bargaining power of buyers 5. Rivalry amongst existing firms

Diagram of Porter's 5 Forces

5

For added details see Strategic Management: Porters Five Forces. <http://www.quickmba.com/strategy/porter.shtml>

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SUPPLIER POWER
Supplier concentration Importance of volume to supplier Differentiation of inputs Impact of inputs on cost or differentiation Switching costs of firms in the industry Presence of substitute inputs Threat of forward integration Cost relative to total purchases in industry

BARRIERS TO ENTRY
Absolute cost advantages Proprietary learning curve Access to inputs Government policy Economies of scale Capital requirements Brand identity Switching costs Access to distribution Expected retaliation Proprietary products

THREAT OF SUBSTITUTES
-Switching costs -Buyer inclination to substitute -Price-performance trade-off of substitutes

BUYER POWER
Bargaining leverage Buyer volume Buyer information Brand identity Price sensitivity Threat of backward integration Product differentiation Buyer concentration vs. industry Substitutes available Buyers' incentives

DEGREE OF RIVALRY -Exit barriers -Industry concentration -Fixed costs/Value added -Industry growth -Intermittent overcapacity -Product differences -Switching costs -Brand identity -Diversity of rivals -Corporate stakes

Figure 2. Porters Five Competitive Forces

Michael Porter recommends three generic strategies to out-perform competitors or maintain a market position against competitors. These strategies are also quite helpful in the Caribbean context.

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A. Overall Cost Leadership. Produce the same/better quality at less cost than anyone else. Enjoy greater profits or, in a price war, stay in the market, profitably, with reduced prices. B. Differentiation. This implies a better/different product/service (or perceived as different) from others. With differentiated quality as the target do we ignore costs? C. Market Niche/Segmentation- focusing on 1. a section or group of the buying public 2. a segment of a product line 3. an area of a geographic market The premise is that a narrow target can be serviced more effectively than rivals who compete broadly. Low cost and differentiation will still be required for the niche.6

Porters theories were based on the economic situation in the eighties. This period was characterized by strong competition, cyclical developments and relatively stable market structures. Porters models focus on the analysis of the actual situation (customers, suppliers, competitors etc) and on predictable developments (new entrants, substitutes etc). Competitive advantages develop from strengthening the own position within this FiveForces-Framework. Hence, these models cannot explain or analyze todays dynamic changes that have the power to transform whole industries.7

For added details see Porter- Competitive Forces and Generic Strategies. New Product Development Body of Knowledge DRM Associates. <http://membere.aol.com/drmassoc/bok.html> 7 For added details see Beyond Porter- A Critique of the Critique of Porter. The Manager.org. <http://www.themanager.org/strategy /BeyondPorter.htm>

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Porters model though viable in its area would need to be adapted for this new dispensation. His model does not take into account the advance of technology and its benefits to the success of businesses. The importance of the technological age cannot be overemphasized when considering the advancement of organizations especially in the light of globalization and regionalization. Todays markets are highly influenced by technological progress, especially in information technology. Therefore, it is not advisable if not to say impossible to develop a strategy solely on the basis of Porters models.

Michael Porters obituary for the New Economy, Strategy and the Internet, published in the March 2001 Harvard Business Review, is typical of the thinking that the Internet is unnecessary. In it, Professor Porter exhorts business leaders to return to fundamentals and abandon thoughts of new business models or e-business strategies that he says encourage managers to view their Internet operations in isolation from the rest of the business.8

One should not, however, render Porters models useless as valuable lessons can be learnt from them. Porter as an economist would have probably been viewing strategy from that viewpoint. A strategy or strategies should not be based on one model in particular but maybe by a fusion of models where necessary. Every strategy should be based on a careful analysis of all internal and external factors and on their potential future development.

Improvements in distribution logistics and communications have allowed nearly all businesses to buy, sell and cooperate on a global level. Customers, meanwhile, have the
8

See Tapscott, Don. Rethinking Strategy in a Networked World.

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chance to shop around and compare prices globally. In the result, even locally orientated mid-sized companies find themselves in a global market, even if they do not export or import themselves.

One can add here, that global and networked markets impose new requirements on organizations' strategies. It is not enough any more to position oneself as a price-leader or quality-leader (like Porter suggests in his Generic Strategies model). Rather competitive advantages emerge now from the ability to develop lasting relationships to more mobile costumers and to manage far-reaching networks of partners for mutual advantage.9

Globalization and regionalization are major changes to the environment for Caribbean organizations. These are external factors that cannot be ignored. To create a global strategy, managers must first understand the nature of global industries and the dynamics of global competition. A well-designed global strategy can help a firm to gain a competitive advantage. This advantage can arise from the following sources:

Efficiency
o

Economies of scale from access to more customers and markets Exploit another country's resources - labor, raw materials Extend the product life-cycle- older products can be sold in lesser developed countries

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Operational flexibility - shift production as costs, exchange rates, etc. change over time

Strategic
o

First mover advantage and only provider of a product to a market Cross subsidization between countries Transfer price

Risk
o

Diversify macroeconomic risks (business cycles not perfectly correlated among countries)

Diversify operational risks (labor problems, earthquakes, wars)

Learning
o

Broaden learning opportunities due to diversity of operating environments

Reputation
o

Crossover customers between markets - reputation and brand identification10

10

See Global Strategic Management. <http://www.quickmba.com/strategy/porter.shtml>

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There are a set of strategic objectives that are proposed in order for an organization to be able to compete in the global world. These objectives were proposed by Bartlett and Ghoshal, in their book, Managing Across Borders: The Transnational Solution.

Forces for Global Integration: Need for Efficiency. For a number of reasons and in an ever-expanding number of industries, companies are being forced to manage their businesses in a more globally integrated manner in order to capture the benefits of efficiency (Bartlett and Ghoshal 7).

Force for Local Differentiation: Need for Responsiveness. Theodore Levitt argued that Economics was not the only force driving companies to integrate their operations. He iterated that consumer tastes and preferences, which once differed widely from one national market to the next, began homogenizing.11 Contrary to the belief of Levitt, Bartlett and Ghoshal argue that the classic barrier to globalization has always been rooted in the differences in national market structures and consumer preferences. Clearly, as Levitt argues, international travel and communications have reduced those differences, yet worldwide tastes, habits, and preferences are far from homogeneous (Bartlett and Ghoshal 10).

Forces for Worldwide Innovation: The Need for Learning. This is the third strategic demand for competing in worldwide businesses- the need to develop and diffuse worldwide innovations internationally. As major global competitors achieve parity in the scale of their operations and their international market positions, the ability to link and leverage knowledge is increasingly the factor that differentiates the winners from the losers and survivors (Bartlett and Ghoshal 14).

11

See Bartlett and Ghoshal. Managing Across Border: The Transnational Solution p.7

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Especially for growth-orientated small and medium-sized enterprises (SMEs), export will be an important strategic option to achieve continued business growth. Export does not only facilitate sales growth, it offers a range of other advantages:

Expansion of customer base Reduction of dependence on few major customers

Opportunity to even out regional business cycle-related demand fluctuations Additional growth opportunities for niche products, for which the local market is limited.

Establishment of a network of contacts and partners, gain of experiences these can be used to improve offers to traditional local customers.

Many typical characteristics of SMEs are determined by factors like size of organization or independent ownership (family of small group of people). These characteristics may lead to disadvantages and advantages in the process of globalization.12 The organization must engage in strategic planning that clearly defines objectives and assesses both the internal and external situation to formulate strategy, implement the strategy, evaluate the progress, and make adjustments as necessary to stay on track.

12

See Small and Medium-Sized Enterprises and Globalization. <http://www.themanager.org/Strategy/global.htm>

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Structure An organizational structure defines how job tasks are formally divided, grouped, and coordinated (Robbins 413). As organizations grow, their strategies become more ambitious and elaborated. Structure must therefore be expanded with growth to maintain efficiency. Matching organization structure to strategy is an extremely aspect of implementation. Without the proper structure- jobs, departmentalization of jobs, and distribution of authority- an organization cannot carry out its strategies successfully.

Various factors affect the choice of a structure. An organizations structure and strategies should match the companys growth stage. Structures are not static but conversely are dynamic. One of the major strategic structural choices being made concerns how much authority to delegate. Through planning, managers will be able to establish and maintain an organizational structure with clear-cut lines of authority and working relationships among its members.

When an organizations structure is being designed, there are six key elements to consider. 1. Specialization 2. Departmentalization 3. Chain of command 4. Span of control 5. Centralization and Decentralization 6. Formalization

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The Bureaucracy. Standardization! Thats the key concept that underlies all bureaucracies (Robbins 423). Bureaucracy is a form of organization characterized by division of labor, hierarchy of authority, members selected on the basis of their qualifications, and strict rules and procedures (Higgins 51). The bureaucracy is characterized by highly routine operating tasks achieved through specialization, very formalized rules and regulations, tasks that are grouped into functional departments, centralized authority, narrow spans of control, and decision making that follows chain of command (Robbins 423).

Matrix Structure. The strength of functional departmentalization lies in putting like specialists together, which minimizes the number necessary, while it allows pooling and sharing of specialized resources across products. Its major disadvantage is the difficulty of coordinating the tasks of diverse functional specialists so that their activities are completed on time and within budget.

The most obvious structural characteristic of the matrix is that it breaks the unity-ofcommand concept (Robbins 424). The employees have two bosses-their functional department managers and their product managers. The matrix carries a dual chain of command.

The strength of the matrix lies in its ability to facilitate coordination when the organization has a multiplicity of complex and interdependent activities. As an organization gets larger, its information processing capacity can become overloaded. The matrix also facilitates the efficient allocation of specialists. When individuals with highly specialized skills are

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lodged together, their talents are monopolized and underutilized. The matrix achieves the economies of scale by providing the organization with both the best resources and an effective way of ensuring their efficient deployment.

Team Structure. When management uses teams as its central coordination device, you have a team structure (Robbins 425). The primary characteristics of the team structure are that it breaks down departmental barriers and decentralizes decision making to the level of the work team. Team structures also require employees to be generalists as well as specialists (Robbins 425).

Mechanistic vs. Organic Structures. Tom Burns and G. M. Stalker first called the tension to two types of organizational design responsive to external environments: mechanistic and organic. The mechanistic model focuses on hierarchical relationships and tends to be rigid in the worse sense of bureaucratic. Organic organizations are characterized by openness, responsiveness, and lack of hierarchy (Higgins 358).

This model is flat, uses cross-hierarchical and cross-functional teams, has low formulization, possesses a comprehensive network (utilizing lateral and upward communication as well as downward), and it involves high participation in decisionmaking (Robbins 429). The organizational structure is dependent upon its strategy, size technology, and environment.

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For Caribbean businesses to succeed it cannot be business as usual. Change has become the order of the day for the world at large. In some cases there are calls for radical changes in order for these businesses to survive in the light of globalization and regionalization. Reorganization is absolutely necessary for Caribbean businesses. Organizations have entered an era of unprecedented challenges and uncertainty. As a result, leaders must increasingly look to structural alternatives because the traditional reliable functional design models do not appear to be as effective in the ever-changing environment of today.13

There must be a move away from the present mechanistic structures that plague most of the Caribbean organizations. Organizations need to be organic in nature with the ability to adapt to the changing environment. These organizations would be flatter and hence will be able to respond quickly to global changes. The decision making process will be greatly enhanced if there is also a move away from centralized to decentralized organizations. No longer can most decisions be made at the top and then filtered to different levels of the organization but decisions must be made where the action is, and the people directly involved. All the red tape that is involved in the decision-making process must be removed if Caribbean organizations will survive.

Structure is most likely the greatest influence on how the organization performs. In this case, function follows form. The organizational structure determines how information flows, how decisions are made, what priorities are established, etc. Most support organizations are structured to represent products or technology families. This was due to the need to develop expertise areas by proximity. The resources that we once spread out in
13

For added details see <http://www.hjharrington.com/html/organizational_structure.html>

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field resources, then were converged in call centers, are once again becoming disbursed through globalization, virtual relationships, and telecommuting to name a few. And, as we see these resources become more disbursed, we attempt to stretch our hierarchical structures across the globe. We are worried about span of control, efficiency and job satisfaction.14

We are considering new structures because we have growing pressures to perform and to deal with the breadth and complexity of our operating environments. We are most commonly steering toward the building of networked teams so that we can develop and manage varied levels of expertise and cultural perspectives. In the past, when we have created teams, we often did not redefine our operational models to support team processes. We had the formal, institutionalized processes that were hierarchical and then we had the informal teams that were managed on the side mostly for performing projects and temporary assignment. Our challenge is to construct structures that leverage the control that is inherently perceived in hierarchical organizations and also add a dimension that supports synergy and integration in a production environment.15

The trend towards globalization creates a larger market, which can be taken advantage of by businesses in the Caribbean. The expanded market must be seen as such and therefore, organizations must also recognize that the competition is now significantly increased. Organizations are no longer safe in their own backyards whose headquarters are located halfway around the world. The era for protectionism for domestic markets is coming to a

14 15

For added details see Organizational Structure. <http://www.outsights.com/frame/org/struct.htm> For added details see Organizational Structure. <http://www.outsights.com/frame/org/struct.htm>

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climax and this is a matter that cannot be taken lightly by for businesses. Organizations, therefore, need to be flexible and adopt structures that are appropriate in each competitive market. Globalization also forces organizations to be more flexible as new ways of doing business are developed and introduced around the world.16

Systems Operational planning systems, integrated planning and control systems; organizational leadership, motivation, and communication systems, and managing human resources from a system perspective are all critical to successful implementation (Higgins 254).

It is not enough simply to have strategic objectives and strategic plans; there must be operational and sometimes intermediate planning programs to provide leadership and develop a certain style of managing throughout the company.

There must be compensation systems and other reward systems to encourage proper implementation. There must be communication systems such as meetings, attitude surveys, policies, rules, procedures, and bulletin boards, so that people know what to do and how, when, where and why to do it.

To ensure proper utilization of human resources, the human resources department must actively engage in personnel planning, recruitment and attracting, selecting, training and development, orienting, providing compensation etc. Finally, management must develop systems to ensure the successful implementation of strategy.
16

For added details see <http://www.hjharrington.com/html/organizational_structure.html>

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In the context of Caribbean businesses, the correct systems must be in place in order for organizations top reap success. The small size of Caribbean countries is indeed a factor but it does not have to be daunting one.

Globalization certainly poses new questions as to the relation between size and development. On the one hand, globalization is making all countries smaller relative to the relevant (world) market. By reducing the transaction costs associated with distance, new technologies have reinforced this process. The relative importance of large national markets has thus declined, and even larger economies are increasingly dependent on external conditions. This is also true in terms of macroeconomic variables, as capital mobility has reduced the effective autonomy that macroeconomic authorities enjoy even in large economies.

Size, however, has not become an irrelevant factor in the current phase of globalization. In this regard, it can be argued that small economies have both advantages and disadvantages, in particular disadvantages relating to economies of scale, less diversification and macroeconomic policy autonomy, but also- at least potential- sociological and political advantages in achieving greater social cohesion.17

The Caribbean holds limited resources and hence a move to invite multinational firms to their shores should be encouraged. The foreign direct investment (FDI) for the

17

See Ocampo, Jose Antonio. Small Economies in the Face of Globalization.

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participating region should be determined and the benefits to the host country, carefully analyzed.

Foreign investors presumably recognize the potential for host country firms to realize spillover benefits. They also presumably recognize that they can expend resources to mitigate spillovers if it is a profit-maximizing strategy to do so. For example, if conveying trade secrets to local affiliate managers creates unacceptable risks that those managers will take their knowledge to rival firms (or to other foreign affiliates) in exchange for better pay or improved working conditions, the multinational firm (MNC) might consider paying efficiency wages to the managers entrusted with trade secrets. On the other hand, the MNC might decide to use expatriate managers from the home country in the foreign affiliate rather than local managers, since the former are less likely than the latter to defect to rival domestic companies.18

MNCs usually bring with themselves improved technology. Caribbean organizations must take advantage of this and ensure that there is technological transfer. The reason for a multinational being invited into a country should not be for the sole purpose of monetary gain but there should be gains in technology and skills by the host. All mechanisms should at work to ensure that there is learning by the host for the advancement of it self in order to better face globalization.

18

See Blomstrom, Magnus et al. The Determinants of Host Country Spillovers From Foreign Direct Investment: Review and Synthesis of the Literature. SSE/EFI Working Paper in Economics and Finance No. 239 October 1999

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Individual and Team Performance and Reward Systems. In the Caribbean most organizations pay wages at a fixed rate per hour. This method of payment can be somewhat inefficient for some businesses. Businesses would need to move away form this and look at setting realistic, attainable objectives and then pay accordingly. To compete globally, businesses must be more efficient in every area. In some cases this may lead to a reduction in the staff compliment but this is the reality of the global world.

Certainly businesses cannot survive in their present condition. If a worker were paid according to how much he/she produces, this would certainly increase productivity for the organization. It should be noted that a system such as this must be closely monitored. In an effort to produce more a worker increase productivity at the expense of quality. In production work must be of a standard that is world class.

Organizations generally hire people for their skills, then typically put them in jobs and pay them based on their job title and rank. However, organizations can hire people based on their competencies and then pay them for those same competencies (Robbins 201).

Skill-based pay is an alternative to job-based pay. Rather than having an individuals job title define his or her pay category, skill-based pay sets pay levels on the basis of how many skills employees have or how many jobs they can do (Robbins 202). This is an option for Caribbean businesses because the reality is that for them to compete globally some organizations will have to downsize. These organizations will then require more general practitioners and fewer specialists.

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While skill-based pay encourages employees to acquire a broader range of skills, there are also other benefits. It facilitates communication across the organization because people gain a better understanding of others jobs. It lessens dysfunctional protection of territory behavior. Skill-based pay additionally helps meet the needs of ambitious employees who confront minimal advance opportunities. Finally, skill-based pay appears to lead to performance improvements (Robbins 202). One should be aware that employees would have to continue to improve and upgrade their skills so that these skills would never appear to become obsolete.

Staff Never before has an organizations strategic success depended so heavily on its human resources, and never before has managing human resources been so difficult. From the standpoint of global competitiveness, the changing nature of the work force poses a very great manage challenge to firms (Higgins 421). Employees must be carefully selected and recruited. For an organization to be successful, it needs employees with the right attitude, motivation, skills, and education.

Human resource planning, often referred to as personnel planning, is the process of determining the staffing requirements necessary to carry out an organizations strategy. It is part of the organizing and systems components of strategy implementation (Higgins 426).

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For any organization to function effectively and efficiently, the human resources recruiting must be carefully planned. The organization must know the quality of talent it is seeking and must have the means to attract such talent. Without the correct human resources, an organization is doomed.

Its strategy, structure and systems determine the staff required by an organization. The companys goal is to get the best fit for the job. Anything less than the best can lead to failure of achieving the overall goals of the organization.

The most important resource is the human resource. The world is moving in a new direction and at a fast pace. The old mentality of staff and old ways of doing things cannot work in the new structures that must be adopted by Caribbean organizations. The digital age is upon us and for survival any staff member must be computer literate.

Organizations must be able to take advantage of increased technology. We are being forced to use computers or lose access to libraries (the card files are gone), messages (voice mail), correspondence (electronic mail), gas pumps (automatic pay at the pump), and banks (automatic cash machines) (James 18). A look at the larger nations should tell Caribbean organizations the direction there are heading. Organizations cannot buried their heads in the sand and appear to be oblivious to their surroundings. What is happening the world is on the threshold of happening in the Caribbean. Businesses must have the staff competent enough move the organization forward.

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Strong investment in human capital is a key ingredient of a strategy aimed at high-valueadded service sectors. Indeed, more broadly speaking, high levels of human capital may be crucial to compensate for added disadvantages, including those associated with size or limited endowments of natural resources, and have been key to the success of the smaller developed economies in Europe. Fiscal considerations have certainly not stopped small economies, especially countries in the Caribbean and some Latin American countries, from developing a very active public policy of investment in human capital. In fact, small size promotes a closer association between the State and its citizens and should favor less bureaucratic forms of allocating public funds.19

There is always a need for recruiting, developing, motivating, promoting, and retaining the best employees, especially during periods of rapid growth and in times of downsizing. An organization's ability to attract, hire and retain the best employees depends on whether its work environment is favorable to and supportive of diverse groups of people. By building a climate in which all groups feel comfortable, companies are in a position to enhance their recruitment possibilities and their ability to attract and retain talented people. The way people are treated and how they perceive opportunities, affect not only their loyalty to the company, but also their day-to-day performance. Since companies are all competing for talented employees, being seen as an employer of choice is central to gaining competitive advantage in today's business environment.20

19 20

For added details see Ocampo, Jose Antonio. Small Economies in the Face of Globalization For added details see Ghany, Patricia. Managing Diversity in Caribbean Organizations.

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Style Organizational culture refers to a system of shared values held by members that distinguishes the organization from other organizations. This system of shared meaning is, on closer examination, a set of key characteristics that the organization values. Research suggests that there are seven primary characteristics that, in aggregate, capture the essence of an organizations culture.

Innovation and risk taking. The degree to which employees are encouraged to be innovative and take risks. Attention and detail. The degree to which employees are expected to exhibit precision, analysis, and attention to detail. Outcome orientation. The degree to which management focuses on results or outcomes rather than on the techniques and processes used to achieve these outcomes. People orientation. The degree to which management decisions takes into consideration the effects of outcomes on people within the organization. Team orientation. The degree to which work activities are organized around teams rather than individuals. Aggressiveness. The degree to which people are aggressive and competitive rather than easygoing. Stability. The degree to which organizational activities emphasize maintaining the status quo in contrast to growth.

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Appraising an organization on these seven characteristics, then, gives a composite picture of the organizations culture (Robbins 510). Organizational culture is concerned with how employees perceive the characteristics of an organizations culture, not with whether or not they like them. Organization culture represents a common perception held by its members. We should expect, therefore, that individuals with different backgrounds or at different levels in the organization will tend to describe the organizations culture in similar terms (Robbins 511).

Culture performs a number of functions within an organization. First, it has a boundarydefining role; that is, it creates distinctions between one organization and others. Second, it conveys a sense of identity for organization members. Third, culture facilitates the generation of commitment to something larger that ones individual self-interest. Fourth, it enhances social system stability. Finally, culture serves as a sense-making and control mechanism that guides and shapes the attitudes and behavior of employees (Robbins 515).

As we progress into the 21st century, managers everywhere will be in transition, experimenting with better ways of managing human and material resources during this period of profound change. In order to meet the challenges of the global marketplace, Caribbean enterprises must restructure and renew themselves so as to remain viable players in the global economy. Many of the forces fueling change in the Caribbean region are economic.21

21

See Ghany, Patricia. Managing Diversity in Caribbean Organizations.

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In this post- industrial information age, companies are faced with the emergence of a new work culture. In this new culture, the norm is intellectual contribution from every worker, regardless of race, color, creed, lifestyle or origin. This emerging new management mindset views the human resource as the organization's main asset. Human interaction in the workplace means managing diverse personalities and ideas. Diversity in organizations includes differences in age, gender, ethnicity, color, religious affiliation, thinking style, physical appearance and abilities, educational background, and even sexual orientation.22

For any corporation to be healthy and productive, it needs to be strong in four core areas: (a) financial capital in terms of investments and profits, (b) technological in terms of cutting-edge software and hardware, (c) human capital in terms of knowledge, expertise, and creativity and (d) social-spiritual capital in terms of ethics, relationships, meaning and purpose.23

The effective manager must identify the organizations existing culture and its impact on effectiveness and efficiency. He or she must then determine whether that culture is appropriate and, if not, change it (Higgins 472). The manager must have the ability to manage multiple cultures within the organization. To operate regionally and especially globally, Caribbean managers will need the ability and skill to manage multiple cultures. These cultures may exist because of various factors. The organization may be made up of people of different races, ethnicities, nationalities, gender, and ages. This condition is known as cultural diversity (Higgins 473).
22 23

See Ghany, Patricia. Managing Diversity in Caribbean Organizations. Paul T. P. Wong. Lessons from the Enron Debacle: Corporate Culture Matters! Trinity Western university

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Caribbean businesses, when operating globally and regionally do not only have to deal with cultural diversity in respect to their employees but also with the varying cultures of the countries in which they would operate. This is one of the many challenges facing Caribbean businesses and can only be overcome with some market research as well as have some training in how to manage the cultures of other. Managing cultural diversity is a complex and difficult task, both from the perspective of the organization and from that of the individual manager. Training and development programs aimed at increasing awareness of cultural diversity and promoting positive attitudes toward cultural differences are critical to successfully managing cultural diversity. Such programs should begin with top management and involve all levels of the organizational hierarchy. It is important to instill a positive attitude toward diversity (Higgins 474).

Shared Values Shared values is at the core of the McKinsey Seven Ss framework. It influences and influenced by strategy, structure, systems, staff, style, and skills (Higgins 461). These values provide direction, meaning, and energy for members of the organization

Shared values speak to the significant meanings or central beliefs that an organization imposes in its members. These overarching values act as tie breakers. Shared values have a great meaning within the organization. They are the codes and standards that employees live by.

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Every member of an organization is expected to know its shared values. Anyone who detracts from these values is considered as an outsider. They could be written or unwritten. Shared values often dictate the organizations orientation toward quality, financial objectives, employees, society etc.

Skills Skills refer to the distinctive capabilities of the organization that authentically differentiate it from competition. In order to remain competitive and to be successful an organization must have competencies that will inspire growth.

Going global requires a certain degree of international experience and knowledge within the organization. Without that, the business would too much depend on third peoples advice. This is often expensive (external consultants) and not always as reliable as own experience.

Own know-how improves confidence into the chosen strategy. Ideally, the owners(s) or the next generation should have an international training. The future heads of the firm must have international exposure and acquire experience in overseas markets and cultures. If the organization does not have this internal knowledge, it is advisable to hire an appropriately qualified person to take on a management position. This leads to a valuable side-effect: the leader from outside the organization will bring a new way of thinking and acting into the business, which is helpful to implement the necessary changes in culture, ways of doing things, processes, and structures. To make a small and medium-sized

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enterprise or any business a global business requires an openness to change among the owners and the management team. Without that, the powerful dominance of the ownermanager will make the efforts of all committed external experts fail.24

24

See Small and Medium-Sized Enterprises and Globalization. <http://www.themanager.org/Strategy/global.htm>

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