• Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

How Has Globalization Affected Corporate Strategy in the 21st Century?

Extracts from this document...

Introduction

How Has Globalization Affected Corporate Strategy in the 21st Century International Business Strategy Siobhan Connell In the last 21 years the notion of a multinational company has changed significantly. This is best demonstrated by the 1973 United Nations definition, which clearly stated an enterprise is multinational if it "controls assets, factories, mines, sales offices, and the like in two or more countries" (Bartlett, Ghoshal 2000 p.3). As we know a multinational corporation is much more then just that it controls foreign assets, it must also have a substantial direct investment in foreign countries, as well as engaging in some form of management of these foreign assets. The evolution of corporations over this time has been somewhat difficult and by no means is the process of change finalized. As with most things this evolution and learning process could be seen as being life long. The environment in which we operate clearly evolves each year and to stay ahead businesses are now required to stay ahead of developments to compete. Some of the slower players, such as Phillips (Bartlett 1999) merely lost market share through this evolution, others in the past and perhaps in the future will lose their businesses. To understand the importance of multinational corporations in relation to the world economy we see that they account for over 40 percent of the worlds manufacturing output, and almost a quarter of world trade (Bartlett, Ghoshal 2000 p.3). ...read more.

Middle

Bartlett and Ghoshal have gone beyond this to advocate the development of the transnational corporation. This takes the concept of global corporations one step further. Corporations to prosper in a globally competitive environment, should concentrate wherever possible on responding to cost pressures, leveraging of knowledge and information, whilst ensuring local responsiveness to consumer needs (1989 p.13). Cost reduction are imperative to ensure the ongoing viability of corporations. The sharing of costs globally for items such as R & D and mass production both provide examples of significant cost reductions, while enhancing learning and knowledge. By increasing the availability of information across the group you are more likely to also encounter a higher quality product as the innovation and knowledge is shared for the corporations greater good. Often companies forget that knowledge does not just reside in just the home country. Important information such as the local consumer market are often best to be determined by local managers so as to respond to local needs. In relation to local responsiveness Theodore Levitt (1983) provides a somewhat extreme view of the global market. His philosophy is that technological, social and economic developments over the last two decades have combined to create a unified world marketplace in which companies must capture global-scale economies to remain competitive. ...read more.

Conclusion

To win, a company must now achieve all three goals at the same time" (1989 p 25). REFERENCE LISTING Bartlett, Christopher A. 1983 "Case 6-1 Proctor and Gamble Europe: Vizir Launch", taken from Bartlett, Christopher A. & Ghoshal, Sumantra 2000 Text, Cases, and Readings in Cross-Border Management, 3rd Edn, McGraw-Hill International Editions, Singapore, pp 632 - 647. Bartlett, Christopher A. & Ghoshal, Sumantra 1989 Managing Across Borders: The Transnational Solution, Harvard Business School Press, Boston Massachusetts. Barlett, Christopher A. 1999 "Case 2 -4 Phillips and Matsushita 1998: Growth of 2 Companies", taken from Bartlett, Christopher A. & Ghoshal, Sumantra 2000 Text, Cases, and Readings in Cross-Border Management, 3rd Edn, McGraw-Hill International Editions, Singapore, pp 164 -180 Bartlett, Christopher A. & Ghoshal, Sumantra 2000 Text, Cases, and Readings in Cross-Border Management, 3rd Edn, McGraw-Hill International Editions, Singapore. Gomes-Casseres, Benjamin & McQuade, Krista 1991 "Case 4-1 Xerox and Fuji Xerox", taken from Bartlett, Christopher A. & Ghoshal, Sumantra 2000 Text, Cases, and Readings in Cross-Border Management, 3rd Edn, McGraw-Hill International Editions, Singapore, pp 418 - 443 Hill, Charles W. L & Jones, Gareth R. 2004 Strategic Management Theory: An Integrated Approach, 6th Edn, Houghton Mifflin Company, Boston, Massachusetts. Levitt, T. 1983 "The Globalization of Markets" Harvard Business Review, May - June, pp. 92 - 102. Srinivasa, Rangan V. 1985 "Case 3-1 Caterpillar Tractor Co.", taken from Bartlett, Christopher A. & Ghoshal, Sumantra 2000 Text, Cases, and Readings in Cross-Border Management, 3rd Edn, McGraw-Hill International Editions, Singapore, pp 259 - 279. ...read more.

The above preview is unformatted text

This student written piece of work is one of many that can be found in our AS and A Level UK, European & Global Economics section.

Found what you're looking for?

  • Start learning 29% faster today
  • 150,000+ documents available
  • Just £6.99 a month

Not the one? Search for your essay title...
  • Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

See related essaysSee related essays

Related AS and A Level UK, European & Global Economics essays

  1. Marked by a teacher

    Is Increased globalization a good thing?

    5 star(s)

    The high technology in the world of 1000 A.D. included the printing press, paper and the magnetic compass, all of which were used extensively in China and unknown elsewhere. Globalisation spread them across the world, including Europe. This shows that it can work both ways. A similar movement occurred in the Eastern influence on Western mathematics.

  2. Marked by a teacher

    International Business Strategy - Case Study on Unilever

    4 star(s)

    The third level is transnational. Companies at this level have some sort of integrated business units in other countries. They tend to make greater effort to address local needs and appreciate cultural difference. Truly global is the fourth level of globalization.

  1. Where does the World Trade Organisation fit in the overall scheme of international public ...

    The hyperinflation of the GATT/WTO, i.e. the accession of so many developing and transitional countries during and especially after the Uruguay Round, has added new sets of interests and preferences to the Organisation's ongoing business.

  2. "Legal control of multinational corporations: problems and prospects".

    Obviously there is significant divergence in the expectations of the role of MNCs, and it remains highly unlikely that the opinions of MNCs, states and human rights activists will converge in the near future24. The third major dilemma is how should regulations be enforced, that is, how should those MNCs that fail to respond to regulatory initiatives be dealt with?

  1. Discuss Globalization.

    So even if globalization has failed much of the developing world in modern times, it surely must be the way forward. Another valid complaint is that globalization does make it more difficult to prevent against transnationally orchestrated crimes such as drug trafficking and terrorism.

  2. Discuss Globalization.

    of economies of scale, lower its average costs of production and find a comparative advantage, at which point the trade restrictions will be removed. Although this can be a very useful way of starting up new industries it can lead to a lack of competitiveness and the industry becoming dependent on protection from foreign competitors.

  1. Comprehensive Anatomy of China

    This has allowed for these agencies to function with more independence versus the days of the government-controlled planned economy. As a result of the restructuring, local governments have far more control over the way they adapt national policies to their respective environments.

  2. Many examples of Companies working globally are: Nike, Adidas and other companies which may ...

    ideas and information to travel and spread around the world, very fast and very easily. Freedom of worldwide companies is another reason for globalisation. Trade levels between different parts of the world, which can be through LEDC's and MEDC's are increasing rapidly.

  • Over 160,000 pieces
    of student written work
  • Annotated by
    experienced teachers
  • Ideas and feedback to
    improve your own work