GLOBALIZATION

BY

KUMAR AVIINASH AIMT

GLOBALIZATION
Definition: An economic phenomenon? A social phenomenon? A cultural phenomenon? The movement towards the expansion of economic and social ties between countries through the spread of corporate institutions and the capitalist philosophy that leads to the shrinking of the world in economic terms.

GLOBALIZATION
Globalization in its current phase has been described as an unprecedented compression of time and space reflected in the tremendous intensification of social, political, economic, and cultural interconnections and interdependencies on a global scale. Stegler

GLOBALIZATION

involve Globalisation could involve all these things!

GLOBALIZATION
Bosworth and Gordon: A survey of some key processes of globalization
Technological advances Expansion of international commerce (exports and imports) Rising importance of private capital flows (stock markets and multinational corporations) Increasing travel and migration (international tourism and domestic diversity) Increased communication and interaction between peoples (through all sorts of media)

Advantages
Increased free trade between nations Increased liquidity of capital allowing investors in developed nations to invest in developing nations Corporations have greater flexibility to operate across borders Global mass media ties the world together Increased flow of communications allows vital information to be shared between individuals and corporations around the world Greater ease and speed of transportation for goods and people Reduction of cultural barriers increases the global village effect Spread of democratic ideals to developed nations Greater interdependence of nation-states Reduction of likelihood of war between developed nations Increases in environmental protection in developed nations

Disadvantages
Increased flow of skilled and non-skilled jobs from developed to developing nations as corporations seek out the cheapest labor Threat that control of world media by a handful of corporations will limit cultural expression. Spread of a materialistic lifestyle and attitude that sees consumption as the path to prosperity Increase in the chances of civil war within developing countries and open war between developing countries as they vie for resources Decreases in environmental integrity as polluting corporations take advantage of weak regulatory rules in developing countries

GLOBALIZATION
Over the past decade globalization has been driven by technological advances..But globalization has also been driven by policies and ideas
Bosworth & Gordon

A multinational corporation (MNC) or enterprise (MNE),[1] is a corporation or an enterprise that manages production or delivers services in more than one country. It can also be referred to as an international corporation. The International Labour Organization (ILO) has defined[citation needed] an MNC as a corporation that has its management headquarters in one country, known as the home country, and operates in several other countries, known as host countries.

MULTINATIONAL CORPORATION

MNC
The Dutch East India Company was the first multinational corporation in the world

and the first company to issue stock.

Multinational corporations are very big, with budgets that exceed some nations' GDPs. Multinational corporations can have a powerful influence in local economies, and even the world economy, and play an important role in international relations and globalization.

Types Of MNC
There are 4 types of MNCsEthnocentric Polycentric Regiocentric Geocentric

ETHNOCENTRIC
Ethnocentric organizations manage overseas operations directly primarily to protect the companys competitiveness in the home market. Communication and information is top down and all strategic decisions are steered from corporate headquarters. Subsidiaries sell products design and manufactured by parent companies with little or no local control. (Odell, 2006) Ethnocentrism allows such organizations to streamline manufacturing processes while protecting their intellectual capital. This method is also used with organization sin how they release information throughout social computing platforms. Intellectual capital can constrain organizations ability to reach out and touch people through social computing.

POLYCENTRIC
A polycentric organizations take more responsibility to adapting designs while customizing products to meet local needs. Unlike the ethnocentric management model a polycentric organization manages their subsidiaries as independent units with minimal influence from headquarters.

REGIOCENTRIC
Regiocentric mnc relies on local managers from a particular geographic region to handle operations in and around that area.

GEOCENTRIC
Geocentric organizations define global markets and technology is transferred rapidly to sell more or less the same product worldwide maximizing economies of scale both in production and R&D. Organizations that are thriving right now in social media are using this tactic allowing community managers, social marketing strategist and their employees to operate more independently allowing greater transparency and relevancy of information to be transmitted through social channels.