The impact of globalization on businesses reflects itself in mirror images of advanced communication systems of technology, allowing companies and consumers unlimited access to global business markets. The technological environment gave new business ventures enormous amounts opportunity to enter into emerging markets, creating ease of access to consumers interested in new products. As a consumer, it is noticeable in today's business era that the long-gevity of a company relies on its success and influence in global markets and economy. With that being said, to achieve a path of success in emerging markets there are factors to consider, which may impact the future of globalization. These factors include political, economic, legal, and the technological environment.© BrainMass Inc. brainmass.com June 4, 2020, 5:31 am ad1c9bdddf
Political factors can have adverse effects on the economic stability in a country, therefore effecting international business. Both political and economic factors must be simultaneously stable to reduce any type of risks to international businesses. Specifically, the political factors that can impact global business include national governments' attempt to make decisions that aren't in the best interest of the markets, but in the best interest the governing officials. Economic factors include the bodies of governing institutions which are responsible for the economic regulations in developing countries, and contribute to the future of globalization. These governing institutions include the International Monetary Fund (IMF), The World Bank, and the World Trade Organization. The impact of legal factors on global business can cause a company to be held responsible by the host country for any unforeseen illegal actions. In addition, dealing with legal contracts and documentations in other countries may lead to misinterpretations if not communicated effectively to the host country. Finally, the impact of technological factors connects businesses worldwide through electronic meetings and trading places, and provides efficiency in worldwide distribution of goods and services.
Political Impacts on Global Business:
The national government of any international market makes decisions that define the outcomes of the sociopolitical system, according to author of Global Political Economy Jean Gilpin (Gilpin, 2001). The national government or any other powerful institution with these kinds of influences can include labor unions, giant firms, and large agribusinesses all competing for opportunities to formulate government policies that benefit their own agendas (Gilpin, 2001). This theory of public-choice position says government institutions are created by powerful politicians and power hungry groups seeking to encourage their own egocentricity (Gilpin, 2001). While large firms and government institutions might pursue policies to serve its purpose, others might instead pursue relationships with the countries to formulate knowledge resources. In a recent journal article, researchers described the resource-based view (RBV), which ideally states in a competitive business environment, and established relationships and the sharing of knowledge coincide. These resources include within an organization tangible and intangible stock resources, the internal processes of the organization and its capabilities, and the procedures or routines implemented by the organization (Griffith, Myers, & Harvey, 2006).
In international business cultures, relationships may have different values and meanings compared to business relationships in the U.S. It is important for organizational firms to recognize these differences in relationship values to avoid offense actions and severed international business relationships. Research suggests in a hypothesis that Japanese firms associate strong inter-organizational relationships with trust and commitment more ...
The Solution considers the impact of political, economic, legal, & technological factors and the future of globalization.