Globalization and Internationalization †MyAssignmenthelp.com

Question: Discuss about the Globalization and Internationalization. Answer: Introduction Globalization of market is concerned about meeting the preferences of the buyers in the markets all over the world. This helps the organizations in reducing the marketing costs involved along with creating new market opportunities. Technology is the most influential force that pushes the world towards converging commonality. It is used by the consumers to gather information and making purchases from different parts of the world and used by the companies to obtain raw materials and products from different places and to sell the finished products abroad (Pearson, 2017). This report focuses on the fact that the success and failure of the firms is enabled or constrained by the institutions (formal and informal) which can often be referred to as the rules of the game. Also, this report focuses on the ways which will enable the managers to solve the problems faced by them. Globalization and Internationalization Globalization is a process with the help of which the cross border economic, socio-culture and political relations are established and maintained and the geographic distance becomes the matter of least importance. The term internationalization appears to be identical with globalization but there is difference between the two. Internationalization relates to increasing importance of international relations, trade, treaties and alliances, etc. Technology has contributed to a lot of extent in todays era to support the process of globalization by providing ease by the way of e-commerce, promoting cultural globalization through television and telephone and facilitating 24/7 trading by supporting the financial sector. Globalization has resulted into the integration of internationalization of markets and businesses and has altogether changed the manner in which the modern organization perform their business activities. The goods, services and technology are shared across the boundaries which not only benefit the organizations but also the countries by enabling them to establish international relations with different countries. Global Business Environment Global business environment is the environment in different autonomous nations outside the home environment of the organization which influences the decision making process of such organization in relation to the use of resources (Hamilton Webster, 2015). Institutional based view Firms achieves success or faces the failure as the result of opportunities and threats present in the business environment. It is often referred to as the rules of the game which means that the success and failure are enabled or constrained by the institutions i.e. formal and informal. Formal Institution Formal institution can be defined as the institution represented by laws, regulations and rules enforced by the home and host country (Garrido, Gomez, Maicas, et. al., 2014. In simple words, formal institution consists of the entire political system governing the nation which can be either democracy or totalitarianism also known as dictatorship. Various practices are covered under the applicable laws such as common law, civil law, theocratic law, etc. which govern their functioning under the legal system. Informal Institution Informal institution can be defined the institution represented by ethics, cultures and norms (Peng, Wang Jiang, 2008). It involves the way of doing things and the choice between what is right and what is wrong among the alternatives available. It also involves the values and beliefs that guide the behavior of individual and firms. Resources based view The success of a firm is also dependent upon its own strengths and capabilities to deal with the external environment. A resource-based view basically focuses on the internal resources and capabilities of the firm. It is an approach used to achieve competitive advantage by developing their internal factors to deal with the external environment. It has a strong relationship with the performance of the firm in terms of achieving the competitive advantage. Skills The existing resources are used in a new way to exploit the external opportunities by acquiring new skills for each different opportunity (Jurevicius, 2013). Moreover, skills also involve the talent, knowledge and experience possessed by employees, managers and other members of the organization which cannot be replicated by other organizations in the global business environment (Enriquez-De-La-O, 2015). Management skills possessed by the top management which is responsible for controlling the entire organization acts as a key to success if done with full expertise. Capabilities The resources possessed by an organization consists the part of its distinctive capabilities which provides the ability and strength to compete with other organizations in the marketplace (Management Study Guide, 2017). The internal resources and capabilities provides the ability to meet the preferences of the customers with latest technology, flourishing ideas to maintain competitive advantage over others and to deal with the unstable environment by adopting secure bases for formulating strategy.(MBA Tutorials, 2017). Capabilities also involves the ability to adapt and change the internal and external resources of the organization in accordance with the changing global business environment. Challenges faced by Managers Entering the global market involves a high amount of risk which must be identified and assessed on time by the managers in order to prepare themselves against the impact of high-risk and unfortunate events. Ethnocentrism is one of the important challenge faced by the managers during the course of communication to different cultures which could even lead to heavy financial losses in the long run (Parker Buzz, 2017). Another challenge involves the inflexibility and inability to adopt the practices of different culture in order to meet the preferences and expectations of the consumers of foreign countries. The managers are challenged with the various constraints led down by the formal and informal institutions and therefore are required to arrive at a proper decision based on such formal and informal institutions and then come out with a strategy in order to deal with the situation (Globerman, 2017). It requires proper research to be made by them with the view to gather knowledge and intelligence regarding the trade and investment barriers in the cross border country such that the nature of government intervention can be identified. Therefore, when a situation arises where the behavior of the form is governed by both formal and informal institutions and the formal constraints appear to be unclear then the managers must take help of the informal constraints in order to reduce the uncertainties and provide a level of constancy in operations. Also, the managers and the chief executives must take proper steps to undertake continuous monitoring of the business environment relating to culture, taste, preferences and technological variations such that appropriate changes can be made in the products on time and adverse conditions can be prevented. Conclusion Rapid globalization of markets along with technological revolution has changed the entire scenario of the market. Technology has helped the organization to eliminate the inefficiencies out of their international operations by making the use of innovative production and distribution techniques in order to boost the competitiveness in the global business environment. The challenges faced by the managers must addressed with the in-depth business environment analysis such that variations required to be made can be easily interpreted in advance and does not cause any discrepancies in the future. It may adopt risk management and scenario planning to deal with the various risks which may arise in the course of business. References Enriquez-De-La-O, J. F. 2015. Resource-Based View and Dynamic Capabilities Resource-Based View and Dynamic Capabilities. Retrieved November 25, 2017 from https://unipub.lib.uni-corvinus.hu/2171/1/VT_2015n11p50.pdf Garrido, E., Gomez, J., Maicas, J. P. and Orcos, R. 2014. BRQ Business Research Quarterly. Retrieved November 25, 2017 from https://www.sciencedirect.com/science/article/pii/S2340943614000024 Globerman, S. 2017. Assessing The Global Business Environment Retrieved November 25, 2017 from https://cbe.wwu.edu/files/assessingglobalbussenviro.pdf Hamilton, L. and Webster, P. 2015. The International Business Environment. Oxford University Press. Jurevicius, O. 2013. Resource Based View. Retrieved November 25, 2017 from https://www.strategicmanagementinsight.com/topics/resource-based-view.html Management Study Guide. 2017. Resource Based View - The VRIN Characteristics. Retrieved November 25, 2017 from https://www.managementstudyguide.com/resource-based-view.htm MBA Tutorials. 2017. Rbv Resource Based View Retrieved November 25, 2017 from https://www.mba-tutorials.com/strategy/1174-rbv-resource-based-view.html Parker Buzz. 2017. challenges faced by managers during cross cultural communication. Retrieved November 25, 2017 from https://www.parkarbuzz.com/challenges-faced-managers-cross-cultural-communication/ Pearson. 2017. Globalization. Retrieved November 25, 2017 from https://catalogue.pearsoned.co.uk/assets/hip/gb/hip_gb_pearsonhighered/samplechapter/0273752634.pdf Peng, M. W., Wang, D. Y. and Jiang, Y. 2008. An institution-based view of internationalbusiness strategy: a focus on emerging economies. Journal of International Business Studies. pp. 1-17.