Globalization - International Business

Social changes are taking place rapidly and it was not until recent that the words global, globalizing, globalization came into use more often and has made globalization increasingly omnipresent (Ritzer, 2009). The concept refers to the compression of the world and the intensification of consciousness of the world as a whole; which surpasses the physical borders rendering trade in the form of international business and free trade. Also, nations are moving away from self contained economies towards a wider prospect of interdependent and integrated system of trade (Hill, 2007).

According to Ritzer (2007), Globalization is an accelerating set of processes involving flows that encompass ever-greater numbers of the world’s spaces and that lead to increasing integration and interconnectivity among those spaces. In simple terms globalization can be said as the coming together of different worlds and getting connected over distances or it is the advancement due to human co-operation across national boundaries. Burnes (2009) highlights his views on the diversion of approaches to the practise of change management that have emerged due to globalization; now the emergent approach has taken over from the planned approach as a dominant approach to change. He also claims globalization as the single biggest challenge organizations’ face today. Therefore, it can be said that globalization is the most important change that has taken place in human history and we are living in the ‘global age’ (Bauman, 2003). All organizations in a bid to survive and succeed must develop global strategies. In incorporating today’s global realities into practise, Global organizations have to adapt to approaches in managing research and development and in areas concerned to production, marketing and finance to fulfil the consumer needs, who are quality sensitive and time-bound towards the products and services they consume. Despite the different views and definitions on globalization; Reich (1998) points out the driving forces behind globalization as:

 The growth of international competition;

 The fall of communism;

 Economic liberalization;

 The removal of trade barriers;

 The advent of new and fast paced communication technologies.

World economists have not written much about globalization, until lately in the 1900’s saw a global change and movements towards greater free trade across the globe. Thus, globalization becoming a focal point of research in the world economy and much impetus has been placed on globalization in international trade. Also, with the global trends changing gradually, it is vital to know the theories persisting and understanding why these have been successful in shaping the economic policies of so many nations. This has enabled the