Introduction to Globalization
Discuss about the Concept of Globalization.
Globalization is the process of movement of goods and services and people all over the globe in a continuous and integrated pattern (Armstrong, Kotler, Harker, & Brennan, 2015). In simpler language, when some nations are hitherto closed or limited to and foreign investment and they open up their economies and go international. This develops and brings positive results of interconnectedness and integration of regions of the globe. In globalization, the nation’s liberalize their import protocols and allow foreign investments into the sectors that are the backbones of the economy. Being global will enable the nation to liberalize their visa rules and procedures which will allow a free and smooth flow of people from region to region. The term globalization has been stranded in the theory of comparative advantage which states that the economies are good in manufacturing specific goods, are better off exporting it to the nations which are comparatively less efficient in producing the same product (Beamish, 2013). This process also involves the adoption or subscription of the rules and regulations of WTO, which oversees the terms and conditions of the trade or exchanges between the two regions.
Globalization is one of the terminologies which plays an empirical role in the organization and is also considered as liable in stimulating the business structure and strategies. There are varied ranges of internal and external factor which stimulate the business environment (Cavusgil et al., 2014). The below are some of the internal and the external factors of globalization:
Technology: Technological up-gradations and advancements is one of the empirical component which is considered significant for the growth and success of any of the business entity and the same is in the case of “The Best meals” As the entity is involved in serving fast food to the consumers, the firm requires tasty recipes and dishes with a high level of quality. And maintaining good quality with taste will be done possible, if the entity is having good technology for cooking food with hygiene (Turnbull & Valla, 2013). The concepts of technological advancements and upgrades are emerged due to the globalization. These modifications have both positive and negative effects on the organizational structure and the strategies of the firm. For instance, technological up-gradation will enable the kitchen staff to cook and serve the food in time, taking orders from consumers and billing systems will be accurate and fast. This will enhance the experience of customer and which aids the entity in increasing the goodwill and brand equity. The other side of this is that there will be some negative impacts due to the changes brought in by emergence of globalization (Wild, Wild, & Han, 2014). The staff may take time to understand the changing environment and which may lead to a situation of hassle. This will directly affect the service of the firm and can result in a decline in the customer loyalty and market share.
Diversity: Diversity in the workforce is one of the major changes which will be introduced by the emergence of globalization within the entity (Czinkota & Ronkainen, 2013). There will be positive and negative impacts of diversity on business structure and strategies of The Best meals. Diversity in workforce will enable the entity to tackle and handle the customers coming from different regions. Diversity may also lead to negative outcomes for the entity. Diversity in the staff may lead to rise in the situations of conflicts and disputes among the employees as there will be differences in the ideas, thoughts and beliefs (Maylor, Blackmon, & Huemann, 2016). The business structure and the strategies will also be affected as the management will have to provide training session to the employees separately as they are from different regions and which will incur more expenses.
Internal and External Factors that Contribute to Globalization
Production: The concept of globalization of production has been referred to the sourcing of goods and services from the outer locations and or the locations on international level and this will attain the entity with a position of competitive advantage (Enderwick, 2013). In general terms, the best meals will have to make number of changes in the Menu as per the variance found in the localities and regions due to globalizations. This will become a complex task for the management. This will lead the entity to build and design new strategies and which will stimulate the business structure. There are number of positive impacts also, such as Diversification will be introduced in the products and services and which will bring a hike in the sales and customer base.
Political: Political factors include the trade and tariff policies, tax policies and the fiscal policies which are imposed by the governing authorities of the concerned region or nation in which the business firm is operating the business activities (Ferraro & Briody, 2017). In terms of business organizations, these factors are considered as one of the most stimulating divers. In case of “The best meals”, after emergence of globalization the business entity will have to follow the political conditions of the various localities in which the firm is expecting to expand the business. These stimulations can be proven favorable if the organization is adhering the same. It will bring positive results and there will be less government interference.
Social: The societies or the communities and the stakeholders are considered as the major elements of the social aspects. They are also considered as empirical players that easily stimulate the business organization (Forsgren & Johanson, 2014). The emergence of globalization will result in bringing changes in the thoughts and beliefs, buying perceptions and patterns etc. of the consumers. This will lead “The best meal” to adopt new and updated business strategies for fulfilling the requirements of the consumers. The management and the staff will have to bring number of changes in business structure and also in the training sessions provided to the employees. This will consume more time and additional expenses will be incurred.
Economic: This factor comprise of the elements such as interest rates, exchange rates, GDP and income scale of the population. These factors are every much liable in stimulating the business operations within an organization (Meiners, Ringleb, & Edwards, 2014). Due to globalization the business entity can experience fluctuations in the interest and the exchange rates. This will surely affect the business activities of the firm. In case, if the business organization is operating the business in a nation which is having low or weak GDP then the income level of the individuals will be less resulting in a low purchasing power. This will surely affect the sale of “The best meals”. The firm will have to design the menu and alter the services accordingly (Wild, Wild & Han, 2014). Whereas, if the entity is operating in an economy with strong GDP then the entity can maintain a premium ranged menu with expensive and premium services.
Technological Advancements
Legal: The most integral factors or the components of this aspect are the norms and the regulations which stimulate the business internally and externally (Turnbull & Valla, 2013). In terms of internal the norms are imposed by the management and are required to be adhered by the workforce and in case of external context the political and governing bodies mandate rules and norms and the same are required to be ethically obliged by the firm. A smooth flow of operations will be executed if the business firm is following the legal aspects levied by the authorities. But, globalization can also be considered as the reason due to which the business firm will have to make alterations and modifications in the norms and regulations as there will be variance in the governing bodies (Moran, Abramson, & Moran, 2014). Coping-up and making changes as per the situation will incur additional expenses and will force the enterprise for bringing varied range of changes in the strategies (Morschett, Klein, & Zentes, 2015). For instance the entity will have to bring changes in the pricing strategies, there are number of laws on food and hygiene and maintaining these norms will be proven more expensive (Myers, 2013).
Conclusion
In the limelight of the above executed analysis it has been inferred that “The best meals” is planning to expand business and hence wants to improve the developed business plan. The above executed analysis has been focused in explaining the ideas for bringing improvements in the existing business idea. The chosen business context is globalization which is considered as the focal point of the report. The report comprise of the internal and external impacts of globalization on the business corporation. The analysis of the internal and external business environment will enable the business firm with various aspects of market. These aspects will aid the entity in expanding the business and will reap positive and improved outcomes.
On the basis of the above executed analysis it can be concluded that “The best meals” is required to develop improved strategies and plans which will enable a smooth flow of operations. And for that the business entity is required to provide contemporary training sessions to the employees which can also include training over cultural and regional aspects etc.
For coping up with the global environment, the business entity should adopt effective market entry modes.
The business entity should conduct market research and surveys of the regions in which the business will be operated. This research should include a detailed analysis of the consumer segments and targeted market.
References
Armstrong, G., Kotler, P., Harker, M., & Brennan, R. (2015). Marketing: an introduction. New York: Pearson Education.
Beamish, P. (2013). Multinational joint ventures in developing countries (RLE International Business).Oxon: Routledge.
Cavusgil, S. T., Knight, G., Riesenberger, J. R., Rammal, H. G., & Rose, E. L. (2014). International business. Sydney: Pearson Australia.
Czinkota, M. R., & Ronkainen, I. A. (2013). International marketing. Mason OH: Cengage Learning.
Enderwick, P. (Ed.). (2013). Multinational Service Firms (RLE International Business). Oxon: Routledge.
Ferraro, G. P., & Briody, E. K. (2017). The cultural dimension of global business. London: Taylor & Francis.
Forsgren, M., & Johanson, J. (2014). Managing networks in international business. Oxon: Routledge.
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Maylor, H., Blackmon, K., & Huemann, M. (2016). Researching business and management. New York: Palgrave.
Meiners, R. E., Ringleb, A. H., & Edwards, F. L. (2014). The legal environment of business. Ny Boston MA: Cengage Learning.
Moran, R. T., Abramson, N. R., & Moran, S. V. (2014). Managing cultural differences. Oxon: Routledge.
Morschett, D., Schramm-Klein, H., & Zentes, J. (2015). Strategic international management. London: Springer.
Myers, M. D. (2013). Qualitative research in business and management. London: Sage.
Turnbull, P. W., & Valla, J. P. (Eds.). (2013). Strategies for international industrial marketing. Oxon: Routledge.
Wild, J. J., Wild, K. L., & Han, J. C. (2014). International business. London: Pearson Education Limited.
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