Globalization- Essence
Discuss about the Global Business and Social Technology.
Globalization can be understood as the process of continued integration and interaction amongst people, companies and government bodies of the participating nations in a process which is driven by global trade and huge investment and facilitated by the use of Information technology. In technicalities it can be seen as an economic process of integration which has significant implication of the social and cultural aspects with conflicts and diplomacy being a bigger role in Globalization (Costello & Costello, 2015).
Hyper globalist are of the opinion that free economy and open markets ensure that a large number of people participate in the development of the economy, on the other hand other experts believe that globalization is actually Globaloney which has no effect on the state’s role. Before the advent of globalization states encompassed highest power with full sovereignty and played its role in governing people and putting stronger regulation on the corporations. However in the present day, the role of the state has changed politically, economically, socially and technologically. The change in the state role can be attributed to the higher dependence on others (Reader, 2017). Corporate organization these days have taken over the state and are the major contributors behind altering their power. These large corporate organizations in the present day form a strong lobby of the like-minded individuals and have the influencing power on the government bodies.
According to my learning and perspective gain from the topic I think is is high time that State government wins their power back and apply strong legislation to ensure the sovereignty of the state along with the development of the entire state and not just few people. Although, contrary to what is generally claimed, National governments still holds the power to set policies and the rules of globalized economy which have to be followed by the business organizations. The government however have a tremendous scope of improvement in understanding the business practices and identifying the gaps on how the businesses can overrule the government, States will become powerful. It is at times the ineffective machinery of the states which help the businesses to grow beyond leaps and bounds and work beyond borders (Zhang, Fung & Changong, 2017).
The real issue according to me is the bigger picture here is to identify which are the countries which set the rules, which country do they favour in free trade agreements and other policy relaxation in the global arena. There are certain countries which do not have the necessary power to exercise their dominance and thus gets easily dominated by international institutions (DenHond & DeBakker, 2016).
Impact of Globalization
The two most significant drivers of globalization over the last two decades have been the emergence and development of computer technology and Internet. These two are the biggest influencers and drivers of globalization. It is the leverage provided by Technological innovation and advancements which have made the organizations to take advantage of more open markets and spread out its wings all over world. It is due to the opening of the national economies that merger between businesses from different countries and investment in equities is shaping up (Losonc, 2016).
Based on my research and learning it has been observed that developed countries are foraying into the emerging countries for the growth and expansion opportunities, similarly the companies from emerging economies are going abroad to leverage the technical advancement of the developed economies. Asian countries are the biggest beneficiaries of Globalization and the states have less power over this because foreign current and employment opportunities are created in return. States are also focussed on profitability in terms of taxes and increased revenues by exercising less control over the large corporate organization. The state machines is being more and more profit driven in the present business day, and more than anything they are inclined towards the concept of Co-Creation. Every large multi- national corporation in the present day lays emphasis on co-creation with the state and enters with the promise of optimum utilization of resources along with the development of State; this ensures a win-win state both for the state government and the business organization. Globalization can thus be seen to have a positive effect on the development of the states by optimum utilization of the available resources to the fullest and also generating abundant revenue for the state(Cohen & Jaidi, 2014).
Technology has played one of the most important roles in globalization which has impacted the lives of people significantly. People around the world are experiencing the growing effects of technology on their lives and are happy with the changes brought along with it. Evolution of Internet which has transformed into one of the most profitable business for the government is e-commerce. My learning states that E-commerce companies with the usage of technology have made it extremely easier for people to order goods beyond the borders. State governments have benefitted strongly due to this revolutionary technology as it means added tax and revenue and also helped them to provide employment to their population. State government have to quickly adapt to the changing landscape of technology to better understand the organisation (Steger, 2017). Creation of Cyber cells and analytics labs can help the state governments tremendously. Once the business organization are aware that the governments are becoming smarter and are using Technology to track the business and identify the existing lacunae between the government and the business organization, they will start behaving like a good corporate citizen and divert their interest towards the welfare of the state. Automation in State government with the usage of Technology is the only way to keep a close tab on the business activities which are leveraging technological innovation at its forte, thus exerting their power on the business organization (Asongu, 2014)
The Bigger Picture
It is not just one way transaction; it is the ability to co-create in the state which is of huge importance to the state government. Thus, they are giving majority of power in the hands of business organization. This has although created a lopsided effect on the government in terms of imposing strong government penalties on these huge MNC, they are exercising less control on these organization in the light of strong developmental effects for the state. There is plethora of organization which still does their best in complying with all the governmental regulation and legal compliances to ensure the long term business sustainability of the organization, however there are certain organization which leverages the limiting power of the state and taking undue advantage of it (Walsh, 2016).
I am of the opinion that to prevent the misuse of state government’s lenience, creation and intervention of International government organization comes into play. This international body should evaluate and assess the role the business organization is playing in the state, and the boundaries in which it is operating. The government body should be extremely rigid in imposing penalties and focus on ensuring the development of the sovereign state within the boundaries of legal compliance. It is then, these big corporate houses will wake up to reality in the presence of an external monitoring body and solely focus on development and conducting exercise of co-creation in the state(Bloom, Draca & VanReenen, 2016).
To conclude I would say that Technological advancement is a boon both to the country and the business organization, but only to the extent that it is within the purview of the government organization. This can only be ensured by levying strong penalties on the defaulting companies, or the companies which are flouting rules created by the state and the central government to increase their revenue. This, exploitation of the state has to be stopped before it reaches the tipping point and destroys it sovereignty. The only way to ensure that is to create a formidable body which works beyond the control of any country and is mercilessly working towards a better functioning state within the boundaries of legal and state compliances.
References
Asongu, S., 2014. Globalization (fighting), corruption and development: How are these phenomena linearly and nonlinearly related in wealth effects?. Journal of Economic Studies, 41(3), pp.346-369.
Bloom, N., Draca, M. and Van Reenen, J., 2016. Trade induced technical change? The impact of Chinese imports on innovation, IT and productivity. The Review of Economic Studies, 83(1), pp.87-117.
Cohen, S. and Jaidi, L., 2014. Morocco: Globalization and its consequences. Routledge.
Costello, T.G. and Costello, A.O., 2015. Globalization and the United States: Empirical Evidence Interpreted Using Propaganda Literature. Journal of Business and Behavioral Sciences, 27(2), p.28.
Den Hond, F. and de Bakker, F.G., 2016. Boomerang politics: How transnational stakeholders impact multinational corporations in the context of globalization. In A Stakeholder Approach to Corporate Social Responsibility (pp. 321-338). Routledge.
Losonc, A., 2016. Global inequality: A new approach for the age of globalization. Panoeconomicus, 63(4), p.493.
Reader, J., 2017. Reconstructing practical theology: The impact of globalization. Routledge.
Steger, M.B., 2017. Globalization: A very short introduction(Vol. 86). Oxford University Press.
Walsh, K.A., 2016. China R&D: a high-tech field of dreams. In SEEKING CHANGES: The Economic Development in Contemporary China (pp. 191-212).
Zhang, K.H., Fung, H.G. and Changhong, P., 2017. China and the challenge of economic globalization: The impact of WTO membership. Routledge.A
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