Globalization free essay sample

Globalization Case Study University Board Games Goes Global Bob Moos has a childs imagination coupled with killer business instincts. When the board-games company he created in 1985 sought through global expansion 2 years later, Moos faced the usual two options: export the product or manufacture it overseas for local distribution. Moos chose the latter. we decided for a number of reasons to manufacture our board game, 20 questions, in Holland for distribution throughout Europe, said Moos, President of University games Corp.. Of Burlingame, CA. International sales make up 8 percent of University Games revenue. Moos predicts that international sales will rise to 35 percent in the next 3 years because of new overseas ventures. This year, the company expanded into Australia. Unlike the European ventures, however, Moos decided that it was more economical to import its products into Australia from the US manufacturing facility. Our anticipated initial sales in Australia Just did not warrant a manufacturing operation there at this juncture, Moos said. We will write a custom essay sample on Globalization or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page If sales pick up down the line, we may then examine local manufacturing. Moons dual strategy is not unique. One of the toughest questions a many confronts when pondering an international sales strategy is: to export or not to export? While exporting is often the least risky method of selling overseas, it frequently involves significant transportation, logistics, and tax-related costs that may make it uneconomical when compared with foreign manufacturing. On the other hand, foreign manufacturing, while potentially more competitive way of entering an overseas market has its own bugaboos. Political instability, fluctuating market conditions, and the huge capital costs to set up overseas manufacturing operation re daunting challenges. Determining the best way to go often involves solving a perplexing conundrum. With exporting, a company must evaluate the various modes of transportation that would be involved in getting the goods there, and how this relates to the cycle time of putting the product in the marketplace. Some products are time sensitive others are less so. On the other had, if a company determines that an overseas manufacturing operation best meets its needs, it must examine the echo- political factors involved, such as tariff and duty drawbacks and international tax issues. Tradeoffs and traps In addition to weighing these tradeoffs, there are other related factors affecting the decision to either export or locate a plant overseas. To compete in their market, for example, some countries require that some form of local infrastructure be in place. :sometimes you run into government contracts where the only way to contribute a product in that country is to have it made locally, in China, for instance, you pretty much have to build something there in order to enter that market said Moos. Certain products also dictate the international sales strategy to be taken. A company makes drinking glasses, you will want to manufacture them in the country it wants to sell for drinking glasses generally speaking are pretty cheap to make and expensive to ship. Other factors include time, the distance to the market, and price. Certain products require short lead times and thus may best be delivered via locally maturated plant. This is where you get into issues like transp ort rotation costs tariffs and duties, labor expenses and how much it costs to build a plant, said Moos. Another factor is the skill of the labor force in the market being considered. Oh have to question whether or not the labor pool -no matter how low-cost-can be trained to do the things you need, Moos added. Best laid plans Perhaps the best way for many companies to enter a foreign market is to first export there, but with an eye towards building overseas in the future. Exporting will give you a feel for the product and its market potential, Moos said. Instead of Jumping in the lake head first, exporting allows you to get your toes wet. It may cost more, but youre able to hedge your risks. Buying an overseas plant, as opposed to starting en De novo, is a high-stakes proposition for many companies. The culture within the walls is critical with respect to the ongoing operation of the firm. Moos stated. Some companies may follow two roots in this regard: acquiring a going venture in one country but starting one from scratch is another. Mercer management, for example, built its overseas consultation business via both strategies. In Europe, we concluded that there were sound opportunities to build by acquisition, while in Asia we felt the best way to proceed was by opening our won offices De novo. Moos said. Companies seeking an international presence often must choose between [their] own dedicated sales force versus third-party agents doing the work for them. Others, such as University games, follow an international sales strategy using third-party distributors. We identify the foreign markets we want to penetrate, and then form a business venture with a local distributor that will give us a large degree of control, Moos said. In Australia, we expect to run a print of 5 000 board games. These we will manufacture in the US. If we reach a run of 25 000 games, however, we would then establish a sub-contracting venture with a local manufacturer in Australia to print the games. Smack dab between exporting and overseas manufacturing is another alternative: foreign product assembly. Sometimes this is a better option because the duties in a particular country may be low on components but high on finished goods, Moos said. In a market in which a company has a fairly good production and manufacturing costs by getting a local vendor to do the work for you. CAP International favors full-scale overseas manufacturing to either foreign product assembly or exporting. CAP uses local personnel and managers almost exclusively when operating overseas, they look for people who understand the markets and can compete very effectively within them. Local managers help you understand local government regulations, which can tricky. We also let our local managers do their own marketing, figuring they know their own markets and how to compete there better that any company does said Moos. Local relationships give local distributors and buyers peace of mind that theyre dealing with a local company, he added. Muff want to make the local buyer in France think he is dealing with French Company, Moos said. They want to feel theyre dealing with the decision-maker, not some missionary from New York in another time zone. On the ground The litany of missteps by companies overeager to enter a foreign market makes entertaining reading. General motors, for example, still winces at its decision to sell its Chevy nova in Spain without pausing to consider that nova in Spanish translates into doesnt go. Moos said. The strategy was not successful. There is a danger exporting too tar away trot a market without someone on the ground to guide you. While some elements making up an international sales strategy can be predicted tit a degree of certainty, others like currency exchange values are capricious at best. At Mix, we planned twice to enter the Italian market, in both cases, one week before we were set to launch our clothing line there; the Italian Lira was devalued 20 percent -meaning our prices would increase by 20 percent. Both times we were forced to cancel our plans. Conman said. Another unpredictable element is regulation the host government may decide to change its tariffs without notice, such changes may render your products or services too cheap or too expensive. Technology obsolescence and improvements in logistics play similar, unpredictable rules. A company may spend hundreds of thousands of dollars building a foreign facility weeks before a new automated manufacturing system renders its technology a buggy in an age of automobiles. Moreover, a new way of moving goods faster, more efficiently and less expensively may materialize, reversing the status quo and making exporting a more cost-effective meaner of reaching a marketplace. Thus ultimately, no matter which way a company chooses to enter a foreign market, it needs a pair of fleet feet. Globalization free essay sample A paper which discusses how globalization has created the gap between the have nations and the have-not nations. (more) Globalization free essay sample Globalization is the trend towards a single, integrated, and interdependent world. Some humans may not even realize globalization plays a part in our modern lives, but examples that may be classified as evidence of this trend include: the ability to buy products from dining cuisines belonging to myriad of different ethnical cultures, a joint project in which a multinational group of astronauts are sent to the moon, the visit of a Canadian circus troupe to China, the establishment of international and intercontinental trade agreements, and the ability to watch a live television broadcast from a foreign television station.These examples are made from looking at globalization as a whole, but from an economic perspective, the definition of globalization changes. â€Å"A phenomenon by which economic agents in any given part of the world are affected by events elsewhere in the world; the growing integration of the national economies of the world to the degree that we may be witnessing the emergence and operation of a single worldwide economy. We will write a custom essay sample on Globalization or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page † (Arnold 41). This definition is still very closely related to the aforementioned denotation; in fact, the meaning behind the words is the same.In other words, globalization is the growing liberalization of international trade and the movement of capital, resulting in the increase of the integration of national growing economies. Our modern world is a prime example of a civilization that is undergoing globalization. By examining the observable effects of globalization on our world, we can determine whether ambiguous and advancing neoliberalism is beneficial to our economy.Upon the assessment of globalization through the factions of or relating to economics, such as trade, the worldwide market, flowing capital, standard of living, placement of jobs, and international dependence, it would not be a stretch to say though there are unfavourable side effects, they are outweighed by the benefits and globalization is a force that should be embraced instead of feared. To prove globalization should be facilitated instead of prevented, we must examine one of the most important and fundamental aspects of the economy: trade.Since the appearance of Neanderthals, organisms of the Homo genus have been trading. Whether it is a trade of resources, services or unique skills, the presence of trade can be traced back in time. In fact, it can be said that without trade, the economy would definitely not look the same as it does currently, and perhaps not even exist, for trade signifies the evolution of humans and their ability to think, and without it, we –like most organisms– would have no need for a developed economy. Merchandise imports have increased 2 billion dollars and exports have increased by 200 million dollars between Canada and the world in a year, from July 2011 to July 2012. † (â€Å"Canadian International Merchandise Trade Database†). Globalization creates more trading partners for every individual legal entity, which facilitates the flow of capital, resulting in the empowerment of trade and thereby the economy. â€Å"In 2002, trade in goods and services as a share of world output reached 54%, up from 31% in 1980. † (Jaffe 15).The outcome of trade and globalization acting together is a worldwide market. The worldwide market is results in economic change and benefit. For customers and businesses of varying sizes, a worldwide market and more trading partners results in better access to products produced and manufactured in foreign countries. â€Å"Due to the presence of a worldwide market, there is an increase in the production sector and there are lots of options for investments for different countries. † (â€Å"Pros and Cons of Globalization†). It is evident the economic phenomenon of globalization is beneficial in terms of trade and a worldwide market because of the considerable amount of increased choice. Furthermore, globalization aids the difficult task of keeping the costs of goods and services controlled to enable everyone the ability to use means available to help their families survive. Our economy is slowly beginning to open up, becoming more accepting and galvanizing innovation from all parts of the world. While trade is one of the major benefits of globalization, there is another that is deeply intertwined with humans’ lives: standard of living. Examples of locations around the world that have dramatically improved their respective living standards since the 1950s would be the Four Tigers of East Asia – Hong Kong, Singapore, Taiwan, and South Korea. † (Sarel). These four areas of interest have managed to improve their living standards by deregulating and changing government policies that would impede globalization and open up world trade. â€Å"The Globalization Index was compared to the life expectancy for various countries.A strong correlation appears between the degree to which a country has globalized and that country’s life expectancy. † (Arnold 46). With better living standards, human life can be prolonged, seeing as more resources are given to that organism to ensure longer survival. In developing countries that have opened up their economies recently, we can detect exponential increases in income per person, meaning the citizens of that nation will be able to better provide for themselves and purchase goods and services with money that will be circulated, thereby exciting the economy further.Increasing standard of living is not limited to those in developing countries. Globalization increases the income of countries that have opened up, and when these funds are used on the infrastructure of the country including roads, healthcare, education, and social services, the standard of living in the cou ntry increases. With a productive government that acts for the needs of the people it represents, globalization can evoke better standards of living around the world. Aforementioned are only a few of the many benefits of globalization.However, as with most things in this world, every advantage comes with a disadvantage. â€Å"The new forces [globalization trends] stand in an ambiguous relationship to neoliberalism and American hegemony. † (Pieterse and Rehbein 29). Globalization can be interpreted in many ways, not all of them good. For example, large corporations can now hire people from developing countries with similar skill levels to the work force from the original country, but for a much lower price. The corporations are making more money and its philanthropic owners will donate larger sums of money towards social welfare, but the situation is not as helpful to the general public. Corporations are now outsourcing and offshoring, and people living in developed countries find themselves being replaced by workers from another part of the world for a lower price. â€Å"Corporates are building up units in other countries that [are] equally well equipped, thus transferring the quality to other countries. † (â€Å"Pros and Cons of Globalization†).Developed countries will lose their comparative advantages in terms of technology and professionalism when businesses construct advanced factories in other countries, thereby transferring the quality of produced goods and machines, making them as productive as the manufacturing and producing units back in the original country. â€Å"Overall global inequality is staggering, with 1 per cent of the world population owning 40 percent of the world’s assets. † (Pieterse and Rehbein 26). The increasing income inequality is slowly making the possibility of never leaving poverty a reality.Globalization has widened the income and poverty gap, as wealthier people in the world often claim most benefits of globalization. As a result, many of the middleclass are impoverished, and forced into debt. With debt, people are further burdened and unable to provide for their families, causing them to have to resort to desperate measures in order to survive. Globalization is not necessarily entirely beneficial to the economy, and evidence of this fact is supported by the evidence of the discussed occurrences. The presence of neoliberalism is changing the world.China and India in particular have benefitted from globalization, as they are the major political powers that have opened up economically and are on their ways to becoming world powers and even the possibility of possessing hegemony. As a developing country, China has played to its strengths, and has been on the rise as an increasingly influential nation with enormous financial reserves to facilitate development. â€Å"Globalization can be a threat to cultures that are shared only by small groups of people In this way, cultures blend together in a melting pot of global influences, especially in cities with large immigrant populations. (Hibbert 13). Like many countries reluctant to open up its economic doors, China was and is afraid globalization will result in the end of cultural diversity. Just as Canada and countries in Europe have sought to restrict the amount of foreign content in television, film, and media, the Chinese authorities have regulated the quantity of imported television programs, which convey global messages. By protecting activities that promote and educate in regards to Chinese culture, China has deemed their culture safe, and has therefore opened up economically to improve itself financially and to gain power and influence as a nation.With the success of China will come many other countries wanting to open up for the benefits of globalization. At this point, unless an unanticipated change hits the world for the worse, globalization is nearly inevitable. Around the world, nations are gradually opening up and globalization will only evolve from there. As it is inevitable change, it is more beneficial to various nations and economies if they embrace change and adapt to make the best out of this phenomenon. â€Å". .. Offshoring is a two-way street.The United States might offshore certain jobs to, say, India or China, but foreign countries offshore to the United States too. Also, while some Americans do lose jobs due to globalization, we must remember that jobs are always being lost (and found) in an economy responding to market changes. † (Arnold 49) As with offshoring, the world will develop and reconstruct itself based on our economy and the disadvantages of globalization will be diminished. Neoliberalism is not a threat to the human race; it will only serve to help develop our economy. Globalization is beneficial to our economy and should be supported. Globalization free essay sample There are many views on whether or not globalization is good or bad. In my essay I will not give a definitive answer. The reason being is there is no one correct answer. What may be good for one country may not be good for another. Globalization faces the problem that it may be a blessing for one company or country, and a nightmare for another. I believe that globalization in its essence is a force for good. I believe that it is meant to create more revenues for companies and therefore create jobs. Creating jobs so that societies can thrive is a good thing†¦right? Your immediate answer may be yes. But, think about this. When a corporation is looking at its bottom line, and they need to figure out a place to cut expenses, they will look at their costs that are the highest. In a lot of manufacturing companies it would be labor. We will write a custom essay sample on Globalization or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page In order to increase profit they will outsource these jobs to a country that can do the labor cheaper. While this is bad for the home country losing any number of jobs, for the company receiving the jobs it is good because they now have more sources of revenue for its people therefore increasing the well-being of its people. Now there is the argument that globalization is good from the standpoint that companies have the opportunity to make their products or name recognizable worldwide. I would agree with this standpoint because allows companies to grow tremendously. Of course, there are two sides to every coin, and in this situation there are also pros and cons to the idea of globalization. So in order to give a correct answer on whether globalization is a force for good you must then ask what side you are on and what you stand to gain/lose from the deal. In some cases I do believe that globalization helps societies, and of course there are other cases where I feel the other way. Globalization brings opportunities but it also brings risks, even when poverty falling overall there can be regional increases about which society needs to be concentered. Especially for the developing countries, with their potential lack of recourses for up to date legislation, it is important to remember that not everything that is legal is right. Legality is often only the ethical minimum. Therefore where national standards are inadequate, the company would need to enforce their own higher standards and not take advantage of them. Business is part of our society and ethics has place in business as in any other part of social life. In some cases globalization can increase democracy. If the country in question does not want to adopt democracy then it won’t regardless of the influence of the new companies that have entered its markets. On the other hand there are other countries that are just the opposite, who embrace the thought of democracy. Globalization does allow us in some cases to solve political problems. Of course in other cases the simple fact that globalization is occurring in this country does not â€Å"magically† solve all its problems. However, I will use one example in how globalization can improve a nations’ politics. Peru is a country that has embraced globalization and has benefited tremendously. Globalization is good for a countrys economy, politics, and most importantly for its people. Peru was once a third-world country ravaged with poverty, oppression, and a lack of education. Globalization has contributed to the reduction of poverty, increased literacy rate, and the liberation of women in Peru. The effects of globalization can be recognized in Peru and all around the world, when technological knowledge is spread, free trade is encouraged, and political or social liberation is achieved. As you can see there is no right or wrong answer on whether globalization is good or bad. When asking this question one must consider the pros and cons and what country we are talking about. However, in my humble opinion, I do believe that globalization is a force for good because it allows other countries to develop not only fiscally, but also socially and politically. Globalization free essay sample This article deals with globalization and discusses how middle-class Americans might be on the losing end of it. In the early 1990’s, when the idea of globalization started to be more frequently pronounced, many Americans supported the idea because they felt they would gain from the global expansion of their companies. Now many who work for these companies are losing their jobs to people in other countries who will do the same job for less and therefore, save the globalizing company money. Others are agreeing to settle for either a minute pay raise or a less than desirable salary. The Toronto Star Newspaper in their January 27, 2007 issue said that â€Å"since 2001 the pay of the typical worker in the United States has been stuck, with real wages growing less than half as fast as productivity. † However twenty years ago the pay of a standard top United States manager has increased around forty times the average to one-hundred times the average now. We will write a custom essay sample on Globalization or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page This shows that globalization has negatively effected the middle-class typical worker and positively effected the â€Å"top dogs† in a company. Because of this negative effect to the typical worker, some wonder that if globalization does indeed depend on voters, how much longer until barriers of trade are adapted? Globalization effects outside of the United States are, as a whole, positive. â€Å"In the past five years the world has seen faster growth than at any time since the early 1970’s, and in China each person now produces four times as much as in the early 1990’s† (Toronto Star Newspaper 1/27/07). Millions of people in developing countries have gained the opportunity to escape poverty and obtain a job that allows them to adequately supply for their families.