MGMT20144 - Globalization: Impact on Internal & External Business

This presentation explores the impact of globalization on businesses, examining both internal and external factors. It discusses how globalization has led to increased competition, technological advancements, and the internationalization of national economies. The presentation identifies key external factors such as political situations, economic conditions, social environments, technological growth, legal issues, and environmental aspects, and links them to internal factors like owners, employees, business culture, customers, competitors, strategic partners, and government regulations. It highlights the importance of factors like product cost, target market, technological adaptation, and quick response in a globalized market. Furthermore, the presentation emphasizes the role of information technology, foreign investment, and knowledge sharing in shaping the internal and external environments of businesses, ultimately influencing their strategies and market diversification. The presentation concludes by addressing how companies are responding to globalization by exploring new markets, adapting branding strategies, and recognizing the importance of employee capabilities in a culturally diverse environment.

GLOBALIZATION AND
BUSINESS
INTERNAL AND EXTERNAL FACTORS

INTRODUCTION
• Globalization has become an essential aspect of business during the last
few decades.
• It has affected the economy of the countries, society, business life and
international environment in various ways and changed them in various
ways (Keller, 2017).
• The changes brought about by globalisation are mostly associated with
the enhanced about of competition as well as the changes in the
information and technologies.
• These have either affected the business in positive or the negative ways.
• Therefore, the all categories of business remain ready to respond against
thus effects and survive.

GLOBALIZATION FOR BUSINESS
• With the growth of national
economics, the business of different
countries have started to
internationalization process.
• The business of one country is
entering the market of another
country and either exporting their
goods or manufacturing in that
market itself.
• This is the reason why the business
are more depending more on the
external and internal environment of
the organizations.
• The external environment of
the business include
• Political situation of the country
• Economy
• Social situation
• Technological growth
• Legal issues
• Environmental aspects.

GLOBALIZATION FOR BUSINESS
• These external issues get directly involved with the internal
factors which include-
• owners, employees, business culture and board of directors in
the oraganization itself
• Customers
• Competitors
• Strategic partners
• Governmnet and their regulations

GLOBALIZATION FOR BUSINESS
• The external environment of the business as gets
manipulated by the legal issues or political changes,
similarly, the internal part of the organizations have
witnessed increased in the diversity for outsourcing (Hsu,
Fournier & Srinivasan, 2016).
• These are the reasons why the companies are entering
the markets where they get more economic support,
diverse and cheap labour force and a huge demanding
market.

FACTORS OF GLOBALISATION
• Due to globalization, the competition among the international
companies have enhanced greatly.
• This competition largely involve the factors like-
• Product and service cost
• Target market
• Technological adaptation
• Quick response
• Fast production by the companies

FACTORS OF GLOBALISATION
• Another notable change after globalisation that effected the
internal and external environment of the business is the
exchange of technology.
• This informational technology has changed the entire process
of doing business and helping entrepreneurial and international
oriented firms for exploiting new business opportunities
(Lechner & Gudmundsson, 2014).
• The more advanced technologies the companies are utilising,
the ,ore they are getting chances to operate in the global
business.

FACTORS OF GLOBALISATION
• The main aims of the companies after globalisation has
become to find out the market where they can produce goods
with less cost and increase their market share (Heding,
Knudtzen & Bjerre, 2015).
• The external environment has been supported by this factor
as the companies are being able to identify the customer
expectations and catering them with more effectives.

FACTORS OF GLOBALISATION
• Due to globalization, the aspects of foreign investment has
gained its pace.
• It is not only the flow of economy from one developed to
another developed country.
• These knowledge or information, they are sharing with their
employees which is manipulating the internal environment
of the company, supporting the organisational culture.

FACTORS OF GLOBALISATION
• Long with technological development, the external
factors of business are getting support from the
process of information transfer
• By the means of knowledge sharing, the business firms
are developing huge and intense knowledge bases.
• Through information sharing, the organisations are
making good relationship with their stakeholders and
gaining more competitive advantage.

RESPONSES TO IMPACT OF
GLOBALIZATION
• The companies both larger or small are taking advantage of
globalization either directly or indirectly.
• Due to globalization, the companies are exploring new
markets around the globe and catering the demands though
their huge range of products or services.
• The importance of the global polices and political treaties now
have become more effective as the economic exchange of the
countries are catering around the multinational businesses.

RESPONSES TO IMPACT OF
GLOBALIZATION
• Due to globalisation, the companies are manipulated to take part in the
larger socio-political events and vote according to their own interests.
• The business organisations are maintaining awareness of being
prudent to decide for the side to serve their own interests.
• Every business is either international or ahs gained potentiality of
being international.
• More companies are getting involved in the import or export- oriented
business

RESPONSES TO IMPACT OF
GLOBALIZATION
• The companies in this business contexts are depending more
upon the information technology that can allow them to
expand more.
• In this context, the crafted or experienced employees or
entrepreneurs are getting more exposure than the others.
• Market diversification has continued and increased as this is
the factor for the business for market success and survival.

RESPONSES TO IMPACT OF
GLOBALIZATION
• Globalisation has enhanced the interconnection among the business and people
therefore, the customers are more aware now that is mandating the firms to
enhance their product and service quality.
• The companies are indulging in market analysis
• This process is identifying the barriers to entry
• local economic or political uncertainties
• availability of resources
• Response and reactions of the local customers and suppliers to the global
companies.

RESPONSES TO IMPACT OF
GLOBALIZATION
• Due to globalization, the companies are developing the
branding strategies which can align their logo as well as their
external presence in the global market.
• By offering high quality of products and services, the
international companies are developing their market value as
well as global fame.
• It the company brand which is the first thing that the
consumers see when they interact with that particular
company.

RESPONSES TO IMPACT OF
GLOBALIZATION
• Based on the factors of globalization, the international
organizations have started to consider the importance of the
employee capabilities.
• As the differences of national culture directly relate to the
organisational culture, the companies are getting more
culturally diverse.
• Therefore, the organisations have started to identify the
strength and weaknesses of their human force for enhancing
competitive advantage.

REFERENCES:
• Heding, T., Knudtzen, C.F., & Bjerre, M. (2015). Brand management: Research,
theory and practice. Routledge.
• Hsu, L., Fournier, S., & Srinivasan, S. (2016). Brand architecture strategy and firm
value: how leveraging, separating, and distancing the corporate brand affects risk
and returns. Journal of the Academy of Marketing Science, 44(2), pp.261-280.
• Keller, K.L. (2017). Managing the growth tradeoff: Challenges and opportunities in
luxury branding. In Advances in Luxury Brand Management (pp. 179-198).
Palgrave Macmillan, Cham.
• Lechner, C., & Gudmundsson, S.V. (2014). Entrepreneurial orientation, firm
strategy and small firm performance. International Small Business Journal, 32(1),
pp.36-60.