The Impact of Globalization on Business and Leadership

1. Introduction:

In order to understand the impact of globalization on business, it is first important to understand what globalization is and how it has come about. Globalization is the process of expanding world trade, contacts among societies, and the sharing of ideas around the world. This process has been unleashed by a series of dramatic technological changes – from Johannes Gutenberg’s movable type printing press in the 15th century (which made the mass production of books possible) to the Internet and the cellular telephone in the late 20th century – and by economic, social, and political changes. With more countries coming on board, the forces of technology and global integration were pushing against traditional forces that had sustained distinct lifestyles and distinct economic systems around the world. Aided by jet travel, satellite TV, calls to the home country on your cell phone, and the overwhelming flow of images through the electronic media, globalization has adopted mind-blowing speed.

2. The Process of Globalization:

The process of globalization has contributed to the development of multinational corporations conducting the majority of their operations outside their headquarters. In addition, multinational corporations have been able to tap into new markets and create new products tailored to local preferences (Ritzer 2001). For example, Coca Cola produces over 3,500 different products depending on local preferences such as Fanta in Germany or Thums Up in India (Ritzer 2001). Finally, multinational corporations have taken advantage of advances in communication and transportation technologies to coordinate their activities on a global scale (Ritzer 2001). The following paragraphs will further explore how multinational corporations have affected globalization processes.

2. 1 On-boarding:

Multinational corporations have played a significant role in promoting globalization through their international expansionary activities. On-boarding refers to the process by which individuals are inducted into an organization and given the social and psychological resources they need to feel like valued members who contribute to organizational goals (O’Reilly & Chatman 1996). One way in which multinational corporations have facilitated globalization processes is by providing opportunities for employees from all over the world to be on-boarded into their organizations. For example, Google has set up engineering offices in countries such as China, India, and Russia in order to tap into local talent pools (Google 2016). This has not only increased the company’s access to a wider range of skills but has also helped Google to build an international reputation as a people-friendly employer (Google 2016). Furthermore, by on-boarding employees from different cultures into its ranks, Google has been able to gain insights into how people from different cultures think and work (Google 2016). This knowledge has been invaluable for developing products that appeal to global audiences (Google 2016).

2. 2 Company performance:

Research suggests that there is a positive relationship between multinationality and company performance (Friedman & Johnson 1998). One reason for this may be that multinational companies are better able to transfer best practices across borders (Friedman & Johnson 1998). For example, General Electric has been successful in implementing Six Sigma quality control procedures at its factories around the world (Friedman & Johnson 1998). This has resulted in significant improvements in product quality and customer satisfaction levels (Friedman & Johnson 1998). Another reason why multinational companies may outperform their purely domestic rivals is that they are often more innovative (Friedman & Johnson 1998). This is because multinational companies are exposed to a greater variety of ideas and cultures, which can stimulate creativity and the development of new products and services (Friedman & Johnson 1998).

2. 3 Employee engagement:

Multinational companies often enjoy higher levels of employee engagement than purely domestic companies (Friedman & Johnson 1998). This is because employees in multinational companies are more likely to feel that their work is meaningful and that they are making a valuable contribution to the company’s success (Friedman & Johnson 1998). In addition, multinational companies often offer employees the opportunity to work in different countries, which can be an extremely motivating experience (Friedman & Johnson 1998). For example, IBM has a policy of posting employees to different countries every few years (Friedman & Johnson 1998). This enables IBM employees to develop a global network of contacts and to gain new skills and knowledge (Friedman & Johnson 1998).

3. Bill Trahant’s Six Attributes of Successful Global Leadership:

In order to be successful in the global marketplace, leaders need to possess a number of attributes. In his book The Wisdom of Teams, author and management consultant Jon R. Katzenbach outlines six attributes of successful global leadership:
1) The ability to lead diverse teams: Leaders need to be comfortable working with people from different cultures and with different value systems. They also need to be able to build trust and rapport with people from different backgrounds.
2) The ability to operate in multiple cultures: Leaders need to be able to understand and navigate the complexities of multiple cultures. They also need to be able to adapt their leadership style to suit the cultural context in which they are operating.
3) The ability to deal with ambiguity: Leaders need to be able to deal with ambiguity and uncertainty. They need to be able to make decisions in the face of incomplete information and they need to be comfortable with change.
4) The ability to think globally: Leaders need to think beyond their own cultural context and they need to be mindful of the global implications of their actions. They also need to be able to take a long-term view when making decisions.
5) The ability to build global relationships: Leaders need to be able to build relationships with people from different cultures. They also need to be able navigate the complexities of cross-cultural communication.
6) The ability to lead in a virtual environment: Leaders need to be comfortable leading in a virtual environment where they may never meet their team members face-to-face. They also need to have the skills and knowledge required to manage remote teams effectively.

4. Technology: Innovative Strategies for Leadership

Technology has had a profound impact on the way we live and work. It has also had a significant impact on the way we lead. In order to be successful in the global marketplace, leaders need to be comfortable using technology to communicate and collaborate with people from all over the world. They also need to be able to use technology to connect with people who may be located in different time zones or in different parts of the world. Furthermore, leaders need to be comfortable using technology to access and share information. Leaders also need to be aware of the latest innovations in technology and how these innovations can be used to improve company performance.

5. Conclusion:

Globalization has had a profound impact on the way we live and work. It has also had a significant impact on the way we lead. In order to be successful in the global marketplace, leaders need to posses a number of attributes, including the ability to lead diverse teams, the ability to operate in multiple cultures, the ability to deal with ambiguity, the ability to think globally, the ability to build global relationships, and the ability to lead in a virtual environment. Leaders also need to be comfortable using technology to communicate and collaborate with people from all over the world.

FAQ

Globalization is the process of expanding world trade, contacts among societies, and the sharing of ideas around the world. It has impacted businesses by making them more international in scope and operation.

The main drivers of globalization are technological advances, economic integration, and political changes.

Globalization has affected business strategy and operations by making firms more aware of global opportunities and threats, and requiring them to be more flexible and responsive to change.

The challenges faced by businesses as a result of globalization include managing cross-border risks, adapting to cultural differences, and dealing with volatile markets.

Businesses can effectively manage the risks associated with globalization by understanding the global environment, developing flexible strategies, and building strong relationships with partners in other countries.

Opportunities for businesses to capitalize on global trends include expanding into new markets, developing innovative products and services, and tapping into new sources of labor and capital