Globalization and International Business

This assignment analyzes the effects of globalization on international business. It examines how globalization has facilitated Australian businesses to expand into foreign markets, attract new customers, and generate increased revenue. The discussion also covers the benefits of globalization for both participating countries, including economic growth and improved trade relations. Examples of multinational corporations like McDonalds and Coca-Cola are used to illustrate the positive impacts of globalization on international business management.

Running head: INTERNATIONAL BUSINESS
International business
Name of student
Name of University
Author note

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Table of Contents
Introduction......................................................................................................................................3
Concept of globalization..................................................................................................................3
Importance of international business...............................................................................................4
Impact of globalization on international business...........................................................................5
International business and globalization future...............................................................................7
Conclusion.......................................................................................................................................8
References........................................................................................................................................9

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Introduction
The report is prepared to focus on the major concepts of globalization and international
business considering various business organizations present in Australia. The topic will illustrate
the globalization concept in details and evaluate the ways by which international business can be
managed. The focus though will be on how the globalization can create an impact on the
international business and furthermore allow the companies to sustain in the competitive
business environment in the future (Hitt, Ireland & Hoskisson, 2012).
Concept of globalization
The concept of globalization is actually the changes done for managing business globally
and moving beyond boundaries, i.e., from the self contained nations to a more competitive
business environment. The changes managed by a business help in operating in the home country
as well as in the foreign countries by penetrating the foreign market segments and allowing to
fulfill the needs and requirements of more people worldwide. There are two types of impacts
created by globalization including the market globalization and production globalization. The
market globalization allowed for overcoming the barriers and managed selling of products and
services outside the home country (Baylis, Owens & Smith, 2017). The lower tariffs would keep
the prices of products and services lowered, which could also overcome the restrictions of cross
border trade activities and maintain good cultural aspects too. Cultural differences could be a
major barrier, so it must be overcome as well to enter the foreign markets and respect the
cultures for developing useful marketing strategies. This would deliver proper marketing
messages to target the most important foreign market segments and ensure that the products and
services were delivered properly to the customer (Wild, Wild & Han, 2014).

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Many business organizations in Australia have managed trade relations with other
countries through reduction of costs incurred during the transportation and communication
activities. The communication process is facilitated as well as the barriers to flow of goods and
services have been reduced largely to manage international business. Globalization considers the
changes in economic, social, cultural, political, technological factors to manage businesses
across borders and this enhanced the profit level of the companies by driving the sales through
acquisition of more customers (Kumar, Mudambi & Gray, 2013).
Importance of international business
The international business management is a slightly different concept than that of
globalization, were trade related barriers resulting due to cultural differences are overcome.
International business is managed by popular companies in Australia like Woolworths, Coles,
etc. by involving exporting the products and services to other countries, managing the licensing
procedures and even working as joint ventures. Few organisatons within the food and retail
sector like McDonalds has also opened new branches for managing the production and
distribution of products and services in the international markets and ensured proper managerial
services provided t the companies present in the host country. The international business brings
immense benefits for the business organizations like large scale operations are conducted along
with integration of economies with many countries all over the world (Piekkari, Welch & Welch,
2014). The cultures of different places are understood and adapted too, which creates enough
scopes and opportunities for the organisation to sustain in the competitive business environment.
One of the major benefits is the large scale operations managed during the international
business, which allows for enhancing the marketing and production capabilities too. The goods

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and services are produced in large numbers, while the surplus is exported to the outside countries
for gaining more customers and increased sales revenue in business. The international business
management integrates the global economies and the financial and human resources of one
country are used for another country. The international business management has also benefited
the participating countries through rapid advancement in technological aspects and
industrialization (Trudgen & Freeman, 2014). It has not only improved the sales revenue but also
has resulted in the growth in economy of the country as well. The science and technology have
been facilitated with the international business management and this has enhanced the production
level and ensured successful global business.
International business creates certain issues as well including restrictions during the
inward and outward flow of cash, technological components and products. The Government and
regulatory bodies also prevent international business management by creating trade blocks,
putting restrictions on foreign exchange rates, which can degrade the business performance
globally. Due to the sensitive nature of the international business, it is important to conduct
market researches and identify the changes that are needed to be done and adapted to (Deresky,
2017).
Impact of globalization on international business
The globalization has created huge impact on the management of international business
for the Australian companies. The international business involves various business activities that
have been managed across the international borders to draw in more customers and enhance the
profit level of the organisation. Globalization has often created problems not only for the
business but also kept the staffs of the organizations unsatisfied by paying lower wages and

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putting more migrants in the poor countries. The lower rate of interest and inflation rate also
could be a major problem despite the growth and success in business from the global business
perspective (Ueda, 2012).
By enabling globalization, investments are done on a rapid scale to enter the foreign
markets, which can improve the growth in economy of the country as well. The globalization
also impacts the business organizations by improving the capabilities and exposing the
companies to the global forces related to the supply and demands in the international markets.
Not only the business is impacted, but also the various stakeholders involved in business are also
affected. The business organizations, if do not adapt to the global factors, will face difficulty in
managing international business and even struggle to survive in the global competitive business
environment with ease and effectiveness. Coping up with the changes in global circumstances
could help in transforming the global opportunities into useful strategies to controlling the
environmental threats and ensure successful business functioning (Wild, Wild & Han, 2014).
There are multiple positive effects created on the international business that have resulted
from globalization. The production of products and services has improved in various markets all
over the world and allowed the companies to gain accessibility to the foreign products and
services delivered to the customers (Savrul, Incekara & Sener, 2014). With the globalization
creating positive impact on the international business, financial markets from all over the world
have emerged, which has created enough scopes for managing external financing and could keep
the shareholders who made investments for managing the international business satisfied as well.
The global markets have been studied with ease and the freedom for exchanging capital and
goods is measured as well. Political globalization is enabled by managing good relationships
between the nations where the business is expanded to guarantee successful international

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business (Kose, Otrok & Prasad, 2012). The cultures of different places where the business is
done have been understood, which has allowed the customers in that place to enjoy the new
foreign products that have been exported to the respective countries. With the international
cooperation arising due to the international business management facilitated by globalization, the
environmental challenges could be handled properly like changes in climatic conditions and
prevention of cross boundary air and water pollution too. Industrialization would be possible
along with better transportation facilities, which could even reduce the travelling time and
transportation costs (Gabrielsson & Gabrielsson, 2013).
International business and globalization future
Foreign direct investments made could bring enormous benefits for the host country with
advancement in technologies, providing more employment opportunities to people and
enhancing the income level of the workers too. FDI also transferred technology from the
developed country to the countries that are developing in the recent period. Training would also
be provided to the local workers for making them obtain the skills, knowledge and expertise to
perform within the global business environment and perform to their potential. This would
improve the management skills as well as improve the performance of the companies that are
expected to expand business globally, furthermore contribute to the growth in economy of the
host country too (Liang, Ren & Sun, 2015). It would be easy to become accustomed with the
culture of a different nation, which could enable good communication style and furthermore
improve the production and delivery of products and services in the foreign markets in the future.
The international business has transformed the entire way by which business is conducted and it
has created a positive impact on the globalization too (Hitt, Ireland & Hoskisson, 2012).

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Conclusion
The report focused on the different aspects of globalization and its impact on the
international business. The globalization helped many companies in Australia to start
international business with ease and even allowed to enter foreign markets to attract more
customers and generate better sales revenue. This could allow the companies to gain competitive
advantage in business as well as manage good trade relations between the two nations,
furthermore would contribute to the growth in economy of the host country. The impact of
globalization had been huge because it brought people and businesses together and even
contributed to the growth in economy of the countries where the businesses were managed
globally. The merchandise and service related industries were hugely benefitted based on the
international business transactions that helped the company to stay ahead in the competition
within the foreign market conditions. The international brands like McDonalds, Coca Cola and
other companies were highly benefited with the globalization’s impact on the management of
international business too.

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References
Baylis, J., Owens, P., & Smith, S. (Eds.). (2017). The globalization of world politics: an
introduction to international relations. Oxford University Press.
Deresky, H. (2017). International management: Managing across borders and cultures. Pearson
Education India.
Gabrielsson, P., & Gabrielsson, M. (2013). A dynamic model of growth phases and survival in
international business-to-business new ventures: The moderating effect of decision-
making logic. Industrial Marketing Management, 42(8), 1357-1373.
Hitt, M. A., Ireland, R. D., & Hoskisson, R. E. (2012). Strategic management cases:
competitiveness and globalization. Cengage Learning.
Kose, M. A., Otrok, C., & Prasad, E. (2012). Global business cycles: convergence or
decoupling?. International Economic Review, 53(2), 511-538.
Kumar, V., Mudambi, R., & Gray, S. (2013). Internationalization, innovation and institutions:
the 3 I's underpinning the competitiveness of emerging market firms. Journal of
International Management, 19(3), 203-206.
Liang, H., Ren, B., & Sun, S. L. (2015). An anatomy of state control in the globalization of state-
owned enterprises. Journal of International Business Studies, 46(2), 223-240.
Piekkari, R., Welch, D., & Welch, L. S. (2014). Language in international business: The
multilingual reality of global business expansion. Edward Elgar Publishing.
Savrul, M., Incekara, A., & Sener, S. (2014). The potential of e-commerce for SMEs in a
globalizing business environment. Procedia-Social and Behavioral Sciences, 150, 35-45.

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Trudgen, R., & Freeman, S. (2014). Measuring the performance of born-global firms throughout
their development process: The roles of initial market selection and internationalisation
speed. Management International Review, 54(4), 551-579.
Ueda, K. (2012). Banking globalization and international business cycles: Cross-border chained
credit contracts and financial accelerators. Journal of international Economics, 86(1), 1-
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Wild, J. J., Wild, K. L., & Han, J. C. (2014). International business. Pearson Education Limited.