Recognise the process of globalisation | My Assignment Tutor

1Session 2: Global Marketing Contrasted with InternationalMarketingICTM Module Delivery Team By the end of the session, the student will be able to: Define Globalisation Recognise the process of globalisation Explain the drivers of globalisation Describe the barriers to globalisation Identify and evaluate the benefits and cost of globalisation 2. Going over the Assignment Brief, including the assessmentcriteria of the Unit 3. Going over the Scheme of Work so that students see howthey could allocate their time wisely. 4. Going over the Unit Specification so that students have anoverview of the syllabus (also available on ICON VLE).ICTM Module Delivery Team2 ICON College of Technology and ManagementGlobal Economies and International Markets Week 2 Activities PlannerWk1StepsDescriptionExample Activity TypesTool that will support this activity1Introduction(Informinglearners oftheobjective)Introduction of the concept of globalisation and how it hasimpacted lives today. Objetives: Recognisethe process of globalisationExplain the drivers of globalisationDescribe the barriers to globalisationIdentify and evaluate the benefits and cost of globalisationRead Levitt’s article onGlobalisation and on theICON VLE and summarise hisarguments in the Forumcreated for your groupICON VLE: Theodore Levitt (1983), TheGlobalisation of Markets. Published byHarvard Business Review. Also available at: deliverymethodSession 1: Globalisation (global marketing contrasted withinternational marketing; Key drivers of globalisatio; Key influenceson the global marketing effort): Instructor-led with Q&A forstudents engagementPresentation, video on“Globalization at thecrossroads”Kaltura – My Media url to video.Lecture material on ICON VLE3ActivityGroup work on conducting a PESTEL analysis of a country of theirchoice, and for an organisation of their choiceGroup reports of PESTELanalyses of their chosencountriesBreakout Rooms in Kaltura4ReflectionandFeedbackIndividuals summarise the importance of environmental factors,which is part of their individual portfolioFeedback; Reflective journal –students keep a record of theresults of the analyses for theportfolio developmentICON VLE and Kaltura5Consolidation andIntegrationStudents share their summaries of the importance ofenvironmental factors. These summaries are uploaded onto theICON VLEStudents are divided intogroups in breakout room toshare their summaries of theimportance of environmentalfactors on an organisation oftheir choiceKaltura and ICON VLE ICTM Module Delivery Team  Globalisation is a widely and somewhat loosely usedterm, intended to describe the recent and rapid processof intercontinental economic, social, and politicalintegration. This worldwide integration allows people tocommunicate, travel, and invest internationally, andhelps companies market their produces widely, acquirecapital and human and material resources moreefficiently, share advanced technology, and enjoyeconomics of scale.(Wells, Shuey & Kiely, 2001)ICTM Module Delivery Team3 “The integration of the political, economic andcultural activities of geographically and/ornationally separated peoples,” (Final Report ofthe Defense Science Board Task Force onGlobalisation and Security, 1995:5) “The increase of globalism with “is the state ofthe world involving networks or interdependenceat multicontinental distances…through flows andinfluences of capital and goods, information andideas, and people and forces, as well asenvironmentally and biologically relevantsubstances”. (Spring, 2000:105)ICTM Module Delivery Team Rapid movement towards internationaleconomic integration; consensus on politicalvalues, processes and principles; and therevolution in information and communicationtechnologies. (Carnegie Endowment forInternational Peace, Global Policy Programs,p.1) The defining international system based on”the inexorable integration of markets,nation-states and technologies” (Friedman,2000:7-9)ICTM Module Delivery Team4 Chinese Economic Growth +10% each since 2003 The impact of Globalisation through its impact oninternational trade and investment, and it isfundamentally changing the map of the worldeconomy. The increased demand of raw material to meet therapid expansion of Chinese industry fromdeveloping economies of Latin America. Between 2000 and 2012, bilateral trade in goodsbetween China and Latin America increased fromaround $12 billion to £250 billion. (read morefacts from the case study)ICTM Module Delivery Team Globalisation involves the creation of linkagesor interconnections between nations. It is usually understood as a process in whichbarriers (physical, political, economic,cultural) separating different regions of theworld are reduced or removed. Thus, it stimulates the exchange in goods,services, money, and people. Removal of these barriers is calledliberalization. (Hamilton & Webster, 2015)ICTM Module Delivery Team5 Globalisation promotes mutual reliance betweencountries. Globalisation can have many advantages forbusiness such as new markets, a wider choice ofsuppliers for goods and services, lower prices,cheaper locations for investment, and less costlylabour. It can also carry dangers because dependenceon foreign suppliers and markets leavesbusinesses vulnerable to events in foreigneconomies and markets outside their control. (Hamilton & Webster, 2012) ICTM Module Delivery Team Globalisation is a process of internationalintegration that has arisen from the interchangeof views, products, ideas and other aspects ofculture (Albrow and King, 1990). Morrison(2011) defines globalisation as a process bywhich products, people, organisations, moneyand information are able to move quicklyaround the world. By G RileyICTM Module Delivery Team6 Morrison (2011) and Wetherly and Otter (2014)identify globalisation as one of the key changedrivers in modern organisations. Despite somerecent indications that some countries maybecome more protectionist in their approach toeconomic management, the international natureof economics and management will continue tobe important (Watson and Head, 2016).ICTM Module Delivery Team There are three main economic and financialindicators of globalization: International trade in goods and services The movement of people across nationalborders The transfer of money capital from onecountry to anotherICTM Module Delivery Team7 It means that countries become moreinterconnected through the exchange of goodsand services; that is, through imports and export. Between 1950 and 2006, world trade grew 27 foldin volume terms, three times faster than worldoutput growth (WTO 2007) Merchandise trade grew very quickly, particularlyin manufacturers, which increased tenfoldbetween 1950 and 1975.ICTM Module Delivery Team Describe the growth path of exports over theperiod covered by the figure. Try to come upwith some explanations for your findings Exports of which type of service grew mostrapidly after 2009 in both developing anddeveloped economies? Give some reasons,paying particular attention to developingcountries 20 Minutes TaskICTM Module Delivery Team8 The first Foreign Direct Investment (FII, orportfolio investment), occurs where money isused to purchase financial assets in anothercountry (Hamilton & Webster, 2013) UK financial institutions such as HSBC andBarclays often purchase bonds or companyshares quoted on foreign stock exchangessuch as New York or Tokyo. Purchasers buy them for the financial returnthey generateICTM Module Delivery Team You can also use this link to discover a numberof economic indicators of the strength of theeconomy of any country: FDI videoICTM Module Delivery Team9 Hamilton & Webster (2012:10) Tata Group, a giant in Indian multinationalconglomerate, operates in over 175 markets. Employs some 67,000 people, and producesaround 700,000 vehicles per year in countries asfar afield as India, South Korea, South Africa,Thailand, Bangladesh, Singapore, UK, Spain,Morocco, and Brazil. There is a need to update the model line, and acustomer perception that Tata’s cars were onlygood for use as taxis.ICTM Module Delivery Team Questions to address: What were the main causes of Tata’s poorperformance? How did Tata’s poor performance impact on itssales and profits Access the book at: Module Delivery Team10 The International Monetary Fund (2000)identifies four key elements of globalisation: Trade and transactions: Capital and investment: Migration of people Dissemination of knowledgeICTM Module Delivery Team Palmer (2003) identifies three broad elements ofglobalisation. The spatial dimension (international scope)Palmer (2003) uses the spatial dimension as a termwith which to describe the process of expansion ona world-wide scale. This is a key feature ofglobalisation: it reflects a development by whichlarge business has extended the scope of theiractivities. Many large businesses now operate on amultinational basis.ICTM Module Delivery Team11Economic ‘globalisation’ is not a new phenomenon. Peoplehave been trading across borders since the beginning ofhistory. Perhaps the first multi-national corporation wasthe East India Corporation, which was established in 1600.So international trade is not a new concept.Broadly speaking, the process of Internationalisation refersto the growth of international trade, international relations,country/regional alliances, etc. Internationalisation in thecontext of business refers to the expansion of commercialorganisations outside the borders of their own countries.Globalisation, on the other hand, is a much tighterintegration.ICTM Module Delivery TeamThe newly-emerging economic powers such asChina, India, Brazil, Russia etc. are also developingstrong links with the less-developed economies aswell as those of the developed nations. Areas suchas electronics, telecommunications and domesticconsumer durables such as kitchen appliances andmotor vehicles are all examples of sectors that thelarge conglomerates from these countries includingTata (India), Haier (China), EBX (Brazil), Sistema(Russia) have entered.ICTM Module Delivery Team12Ottaway (2001), Morrison (2011), Wetherly and Otter(2014) point to two key drivers of globalisation.Corporatism: Corporatism is an ideology that givesprivilege to the rights of corporations over those ofindividuals. The interests of corporate groups aregiven primacy in the organisation of a society(Wiarda, 1996). Ottaway (2001) suggests thatcorporatism has been identified as an underlyingfactor that has driven globalisation, particularly asregards trade and the movement of capital.ICTM Module Delivery Team ConsumerismGlobalisation is often seen as a consequence of thedrive for personal acquisition and consumption. Thedrive for – and encouragement of – the acquisitionof goods and services is sometimes referred to asconsumerism. From an economic perspective, thisapproach is based on the principle that free choiceby consumers should be the basis for theorganisation of production in an economy.Critics of consumerism point to the effects ofconsumption on, for example, the environment(Majfud, 2009). (Remember Sustainability)ICTM Module Delivery Team13 Identify the factors that underpin globalisation.Discuss the economic barriers that existed prior toglobalisation and how they have been removed tofacilitate a global economic system.ICTM Module Delivery Team Stubbs and Cocklin (2008) identify the followingfeatures of sustainable organisations: A definition of purpose that reflects economic,environmental and social aspects The use of a reporting system that goes beyond‘traditional’ accounting metrics of performance A stakeholder, rather than a shareholder, approach An emphasis on environmental stewardship Leadership that promotes and emphasisescultural and structural change in this context A systems perspective as well as a firm-level perspectiveICTM Module Delivery Team14 The issues linked with globalisationICTM Module Delivery Team Globalisation raises a multitude of issues forbusinesses. It creates opportunities for businessesto expand their revenues, drive down their costs,and boost their profits. While the global economycreates opportunities such as these for newentrepreneurs and established businesses aroundthe world, it also gives rise to challenges andthreats that yesterday’s business managers did nothave to deal with (Palmer, 2003). Module Delivery Team15 Find the following links to read for furtherinformation on Globalisation: Theodore Levitt (1983), The Globalisation ofMarkets. Published by Harvard Business Review.Also available at: L. Hamilton, P, Webster, (2015). The InternationalBusiness Environment. Third Edition. OxfordUniversity Press. Also available at: Module Delivery TeamICTM Module Delivery Team


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