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Chapter
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1
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Introduction
to Going Global
Many organizations are finding that global factors are impacting
upon their operations. There are concerns by some that globalization
by breaking down trade barriers and increasing the power of
large companies may be detrimental to democracy. The sales
of the largest multinational companies exceed the GDP of even
quite well off countries.
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2
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What
is Going Global?
Going global is the process whereby organizations are able
to offer their products and services across an increasingly
wide geographic range. Globalization is the integration of
the global economy by the dismantling of trade and political
barriers and the increasing political and economic power of
multinational corporations. Organizations tend to start local
with growth moving along a regional/national/pan-national/international/global
continuum. Organizations also tend to form alliances and partnerships
abroad before moving into full international operations. Globalization
is considered by some to present a serious threat and these
concerns have been translated into violent protest.
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3
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The
Evolution of Going Global
The development of global organizations is not a new phenomenon.
The British in India, J P Morgan and the US oil companies
were pursuing global strategies long before globalization
became an issue. Countries can be very concerned when their
strategic assets are threatened by foreign ownership. The
easing of barriers to world trade has been a major goal since
1944.
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4
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Implications
of the Internet for Going Global: What Can the Internet Offer?
The Internet and e-mail have revolutionized global communications.
The Internet allows even the smallest organization to reach
a global customer base. It is harder for governments to censor
Internet material than any other form of news or communications.
The ability of linked computers to aid design and manufacturing
as shown in the case of the Boeing 777 has allowed new and
more efficient forms of cross-border cooperation. Products
for the Internet belong, in a way, to the whole world rather
than to one country.
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5
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The
Issue of Globalization
Globalization has opponents who are worried about its economic
effects and the decline of democracy. Some organizations,
termed "swallows" move from one low-cost economy to another,
depriving areas of income and job security. Consumer resistance
to child labor and exploitation is growing and has led to
boycotts. Democracy can be threatened if the concerns of special
interest groups are put above those of the general population.
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6
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The
State of the Art of Going Global
Companies that wish to expand globally need to consider the
following points: Where to expand to; How to ensure that they
will be welcomed; Whether they will expand overtly in their
own name or covertly by acquiring local companies. They need
to remember that local companies and brands may have a loyal
customer base that can be retained. The four elements to going
global are: The culture; The actual product/service; The staff
people; Competition from other global and local players. Staff
should be treated with equity across the company even if equality
is not possible. High price differentials for the same product
in different areas can lead to parallel importing. Pseudo
expansion is the use of EPZs etc. to establish a low-cost
manufacturing operation without trying to compete in the local
market.
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7
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Going
Global Success Stories
Companies from the US, Europe and Asia that have made a success
of going into the global marketplace: Amazon.com, P&O, Sony,
Timeline and key inserts to accompany each case study.
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8
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Key
Concepts and Thinkers
A glossary of the key terms and concepts of the global marketplace
and globalization plus details of the key thinkers in the
field: Giddens; Harris, Philip and Moran; Hertz; Klein; Korten;
Lewis; Porter; Trompenaars; Yip.
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9
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Resources
for Going Global
Where to find resources for the study of the global market
and globalization: Books, Journals and magazines, Websites.
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10
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Ten
Steps to Assist Going Global
The ten key steps that a company/organization going global
needs to consider are: Analyze the market and the environment
for opportunities, Decide whether expansion is to be overt
or covert, Consider who the customers will be, Consider what
the competition will be, Find out what assistance is available,
Become knowledgeable about the culture, Decide on a marketing
strategy, Train the staff, both new and existing, Tie the
operation into other company activities, Make the operation
seem indigenous.
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