Adaptation of Companies to Globalization

Adaptation of Companies to Globalization

Introduction

The word globalization leaves us implicit “a whole” or that “it covers everything”.

The meaning of this concept does not exist in the dictionary, however, we all know what is meant by this: a generalized world in which things are the same or mean the same, a world without geographical, sociocultural, economic, and even political borders. These are the most important aspects of globalization.

Globalization also comes, when the discoveries of man and technological innovations change our way of seeing the world, creating a global impact, where the central objective is to turn the entire planet into a great market. As expressed by Doctor Leonel Fernández:

“What is sought, for the first time in the history of humanity, is to be able to produce any product anywhere in the world, and that can be consumed by anyone anywhere else on the globe. ”.

 

THE GLOBALIZATION

I. CONCEPT

We understand by Globalization the political, economic, social, cultural, and ecological process that is currently taking place worldwide, thanks to which there is an ever greater economic interrelationship between different countries – no matter how far away they are, always under the control of large corporations. multinational companies. More and more spheres of life are regulated by the “free market”, neoliberal ideology is applied in almost all countries with greater intensity and mega-corporations gain more and more power at the expense of states and peoples.

II. HISTORY OF GLOBALIZATION

Although the concept of globalization is very recent, the term has existed throughout history. Globalization began to gain momentum after the Industrial Revolution some 200 years ago (18th century) in England, which was the most developed country in the world at that time. Illustrious thinkers developed international trade theories, which have survived all this time because they are correct and consistent. These theories are based on what is called the principle of comparative advantage. According to them, each country must dedicate itself to producing those products in which it is better prepared than the others.

If a country has a highly educated and highly educated population, surely it should be dedicated to the production of high-tech products, such as electronics. If you have a large underwater platform you should develop fishing and if you have a climate with certain special conditions, you could plant grapes to make wine.

In this way, if each country dedicates itself to producing where it has the most comparative advantage, it can export its surplus production and, with the income of foreign currency, import all the other goods it needs for consumption.

Thus, in the end, all consumers in the world benefit because each one is dedicated to producing where it is most efficient and, therefore, at the lowest costs.

III. ADVANTAGES OF GLOBALIZATION:

One or more of four categories of benefits can be achieved with globalization, namely:

A. Cost Reduction:

Globalization can reduce world costs in different ways:

  • Economies of scale: they can be carried out by combining production or other activities for two or more countries.
  • Lower factor costs: can be achieved by moving manufacturing or other activities to low-cost countries.
  • Concentrated production: means reducing the number of products that are manufactured, from many local models to a few global ones.
  • Flexibility: it can be exploited by moving production from one site to another in a short time, to take advantage of the lowest cost at a given time.
  • Increased Bargaining Power: With a strategy that allows production to be shifted between multiple manufacturing sites in different countries, a company’s bargaining power with suppliers, workers, and governments is greatly increased.
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B. Improved Quality of Products and Programs:

Concentrating on a smaller number of products and programs, rather than the many products and programs that are typical of a multi-site strategy, can improve the quality of both products and programs.

C. More Customers Preference:

Global availability, service, and recognition increase customer preference through reinforcement.

D. Greater Competitive Effectiveness:

A global strategy offers more points of attack and counterattacks against competitors.

IV. DISADVANTAGES OF GLOBALIZATION

Globalization can cause significant administrative costs due to increased coordination and reporting needs and even increased staffing. Globalization can also reduce the effectiveness of administration in each country if excessive centralization impairs local motivation and lowers morale. In addition, each of the global strategy drivers has its particular drawbacks.

Product standardization can result in a product that doesn’t leave fully satisfied customers anywhere.

Uniform marketing can reduce the adoption of local consumer behavior and the marketing environment.

Integrating competitive measures may mean sacrificing revenue, profits, or competitive position in some countries.

V. REGULATIONS TO CREATE A GLOBAL ORGANIZATION

To create a global organization, administrators must keep the following rules in mind:

A global strategy cannot be successful if there are barriers and resistance in the organization.

Different aspects of the organization – be it structure, administrative procedures, people, or culture – will be more difficult to globalize depending on the history and circumstances of the company. It may be preferable to work on the aspects that are easiest to change first, to prepare the way for the most difficult changes.

Like the elements of the overall strategy, different aspects of the organization may have different levels of globalization.

But globalization will not fully work until all aspects of the organization complement each other to support the desired global strategy.

Changing the organization, especially towards globalization, can be a matter of a very long time. Senior management must instill a sense of urgency to drive the desired changes.

SAW. MANAGING A GLOBALIZED COMPANY

As far as planning is concerned, multinational companies and their subsidiaries are already adept at developing corporate and national strategic plans. Despite this, most of them have not yet developed global strategic plans that integrate the strategies of the same business in different countries, not to mention integrating strategies between multiple world businesses.

Ideally, there would be a global strategic planning process involving senior management from key countries and regions. That process would fit with the corporate and national strategic planning cycles.

However, having global strategies and programs implies having global budgets to be able to execute them. Adding national budgets into a global total is the first step in global resource allocation.

Apart from knowing the global figures, companies need to take into consideration different points, such as being able to transfer resources from one country to another to subsidize countries that need them. Another important point is to determine the costs of these activities in a globally neutral way. Lastly, they should also consider making global budgets available only for global programs.

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VII. EFFECT OF GLOBALIZATION ON PERSONNEL MANAGEMENT

Within the processes of global administration, the way of evaluating and rewarding the personnel of a company is quite important. Making this process supportive of the overall strategy will fill any gaps that exist. Rewards should be set in a way that reinforces the company’s overall objectives, since executives may feel biased and influence their decision-making.

A global strategy can only be executed by company executives. Preparing managers and others in the company to think and behave globally requires many of the policies that have been successfully employed by multinationals, but it is also necessary to go beyond that. In particular, the “United Nations” model of multinational management has influenced the fact of letting the nationals of a country occupy all the positions of a company in that country; But if this policy is taken to the extreme, the benefit of executives having experience in other countries is reduced.

The ideal human resources policy for a global strategy offers a specialization of nationals in other countries. Executives from globally strategic countries are the ones to be preferred for global careers. It is more important to globally disseminate their experience in those key countries than that of executives from marginal countries. Thus, while it would be easier to move a Haitian citizen around the world, it might be more convenient for the global strategy if a Japanese citizen went.

Highly capable foreign executives need to gain experience not only in their own country but also at their company’s headquarters and/or in other countries. This practice produces several benefits: it provides individuals with an irreplaceable opportunity for training, thereby expanding the pool of capable employees available for executive positions; visibly showing that senior management is in a process of internationalization.

A global company equally needs to have the ability to counter local objections against foreigners.

Particular considerations

Johanna Marmolejos :

We are involved in a constant whirlwind of information and transformations in all senses: cultural, economic, social, and political, where the domain of finance is above production and transnational or global corporations have influential power over the States. Companies merge to raise capital so they can compete with each other. The relocation of industries is motivated by factors that make it easier for them to reduce their costs, such as labor, in developed countries there is a gap that does not exist in developed ones,

It only remains to say that this new trend forces us to obtain better preparation in every way to be at the forefront of the new changes.

Martha Espinal

Globalization, for me, is an attempt to create a world that is not divided, but generalized, in which most things are equal, a world without geographical, socio-cultural, economic, and political borders.

Among the advantages of globalization is: Free access to markets, the increase or rise of competition, and promotion efficiency, since if we do not worry about being better and perfecting ourselves every day, we are going to be left behind.

For small and underdeveloped countries like ours, we may be left at a disadvantage, since we are not able to compete. To achieve this we must invest large sums of money and wait for the results.

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Catherine Tactuck

The issue of globalization is very fashionable in recent years. In my way of seeing things, if it is possible to “integrate” the economies of the countries, the technological processes and communications – among many other things – and everything that promotes progress in companies and nations, we will achieve the highest objective. desired by all: lower costs and obtain greater benefits.

If this could be achieved and those results are focused positively, it will redound in favor of society. The trick is for everyone to agree and some who do not want to give in can take off the bandages and see that what in the short term seems unbeneficial can affect them positively in the long term and they will have to give in.

Globalization is not something of the future, IT IS ALREADY HERE. We can verify that there are already Dominican companies that are expanding and impacting the economy of other countries, such as the Dominican National Brewery, Bon Agroindustrial, and Tricom. These companies have known how to adapt to international service and quality regulations and already export their products abroad and provide their services. Other companies, such as Codetel, have had to merge and seek foreign capital to continue competing. Within the mergers we see that in the financial area, many of our large banks have come together to obtain greater benefits, an example of this is the merger of Banco del Progreso and Banco Metropolitano.

 

CONCLUSION

It is definitive that we must be more prepared for the changes that we will continue to witness day after day. In countries like ours, where we have very few competitive advantages, we must make an even greater effort to prepare ourselves, and be more mentally qualified, since globalization is a clear trend in developed countries, the relocation of their industries in undeveloped ones, thus reducing their labor costs, which are usually low. We must prepare more, learn to relate as human beings regardless of the language (in these times it is necessary to know more than two languages), or borders (it is essential to learn to use the internet and cutting-edge technology), be more competitive (the better product, at a lower price and the one that sells best).

Taking into account all the steps of the administrative process, not only planning is important, but also organization, integration, direction, and control, acting as excellent leaders, and realizing our mistakes to improve and/or avoid them. We must try to be like the Swiss, who are highly organized, punctual, and perfectionists people. Globalization is inevitable and it is a goal that each individual must aim to achieve.

 

BIBLIOGRAPHY

  • Reflections on Globalization: Challenges and Experiences. Directorate of Information, Analysis, and Strategic Programming. Office of Economic Communication., Presidency of the Republic. Corripio Editor.
  • Globalization, Socio-Legal Consequences in the Dominican Republic. Carmen rosa. Edition Property of the Author.
  • What is Globalization? Fallacies of Globalism, Responses to Globalization. Ulrich Beck. Paidos Publishing House, Barcelona.
  • Personnel Administration and Human Resources. William B. Werther Jr. and Keith Davis. Macgraw-Hill Publisher, Fourth Edition.
  • Globalization, Strategies for Gaining an International Competitive Advantage. George S. Yip. Norma Editor.

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