Question

Define Globalization and explain its various characteristics. As business managers, determine whether you are ‘pro-globalization’ or ‘counter globalization’ and justify your stance in the context of your business operation.

Provide References

Answer 1

Answer: Globalisation: It means the growing economic interdependence of countries worldwide through cross-border transactions in goods and services, international, capital flows, and also through the more rapid and widespread diffusion of technology. In short, we can say globalization means the unification or integration of the domestic economy with the rest of the world through trade, capital, and technology flows.

Characteristics of globalization:

• Reduction of trade barriers( tariff and non-tariff barriers) to permit free flow of goods across national barriers.
• Free flow of capital among nation-states, i.e. no restriction on foreign investments,
• Free flow of technology,
• Free movement of skilled and semi skilled workers, employees among different countries of the world.
• High level of migration can be seen like many blue-collar workers of India go to gulf nations for work

In business operation, where pro-globalization is required:

• During business operation outsourcing can be done it means, hiring business services on contract from the outside world. Especially with the growth of information technology, outsourcing has acquired an international dimension.
• The main services which are outsourced from developing to developed countries are voice-based business processes, banking services, record keeping, book transcription, clinical advice, teaching, etc.
• we can take an example of companies like Genpact, HCL BPO, Wipro BPO are offering outsourcing services in India.
• companies of developed countries find it more profitable to hire services from developing countries as the costs for these services in developing countries are much less than in the developed countries.
• India has a large pool of skilled and young manpower and its an important destination of outsourcing see here globalisation is profitable.
• Competitive markets reduce monopoly profits and incentivise businesses to seek cost-reducing research.
• More customers mean more profitability.
• It will increase international Productivity, provides lower prices to the consumer.
• It will create an open market for the business activities from production to supplier.
• It will give access to a new culture which helps business to prosper in international markets.

Counter Globalisation:

• It can spread economic colonialism as it can spread more foreign goods in the domestic market for eg, Indian industries are damaged by the Chinese influence over Indian markets. that creates economic slavery and bad for business operations.
• A big example which counters globalisation is that COVID-19 as it has impacted the business operation worldwide so with globalisation disease also transmit which led to damage business operation etc.
• Vulnerable to external economic shocks.