The Global Context

Lecture 1

Unit Introduction and The International Business

Environment

ESSENTIAL READING

The International Business Environment (2009)

Hamilton, L & Webster, P.

ISBN:978-0-19-921399-3

Sage Publications£31-99

Unit Assessment• 70% Examination

– 1.5 hrs– Closed Book– Answer 2 questions from 3– Essay type

• 30% Presentation– Student Led Seminar– Full details in Unit Document– Organised during first seminar

UNIT OBJECTIVES

• Discuss the reasons for organizations choosing to expand outside their borders.

• Examine how various aspects of the International Business Environment impinge upon organizational life.

• Use appropriate theory to appreciate how culture affects organizational activity.

• Discuss the ways in which a country’s political and legal systems affect organizational life.

UNIT OBJECTIVES

• Consider the ways in which technology impinges upon the choices made by organizations as they operate internationally.

• Understand how the global economy impinges upon operations of organizations operating across borders.

UNIT OBJECTIVES

• Appreciate the role of Corporate Social Responsibility in the 21st century international business

• Consider global trends and future challenges faced by international business.

UNIT OBJECTIVES

UNIT OBJECTIVES

• Appreciate the role of International Business in causing, preventing and rectifying environmental and ecological problems

INTRODUCTION• “The starting point for understanding the

world today is not the size of its GDP or the destructive power of its weapons systems, but the fact that it is so much more joined together than before. It may look like it is made up of separate and sovereign individuals, firms, nations or cities, but the deeper reality is one of multiple connections.” (Mulgan, 1998, p3)

GLOBALIZATION - Defined• 5 Broad Definitions (Scholte, 2000)

• Globalization as Internationalization• Globalization as Liberalization• Globalization as Universalization• Globalization as Westernization or

Modernization• Globalization as Deterritorialization

Globalization as Internationalization

• Simply another adjective to describe cross-border relations between countries.

• Describes the growth in international exchange and interdependence

Globalization as Liberalization

• A process of removing government imposed restrictions on movements between countries in order to create an ‘open’, ‘borderless’ world economy

Globalization as Universalization

• The process of spreading various products and/or services to people across all corners of the world

Globalization as Westernization or Modernization

• Understood as a dynamic, whereby the social structures of modernity (capitalism, rationalism, industrialism, bureaucratism etc) are spread the world over, normally destroying pre-existent cultures and local self-determination in the process.

• Sometimes called ‘Americanization’!

Globalization as Deterriorialization

• The intensification of worldwide social relations which link distant localities in such a way that local happenings are shaped by events occurring many miles away and vice versa

Globalization Defined?

Held et al (1999,p16) define globalisation as:

‘the widening, deepening and speeding up of worldwide interconnectedness in all aspects of contemporary social life, from the cultural to the criminal, the financial to the spiritual.“

Thus, they see globalisation as pervading all areas of

society.

Domestic?

International?

Export?

Global?

Multi-national?

Multi-domestic?

So What’s in a Term?

Born Global?

Think back over everything you have done today.

Make a quick list of what you did.

Note how people, goods and services from other countries affected your actions.

What does this tell you ?

The Importance of International Business ?

International Business is important to us all, whether we are simply ‘consumers’ of its output or workers within it.

The Importance of International Business ?

A Model of International Business

Issues Impinging on International Business

Trade & International Competitiveness

Cultural Change

Technological Transformation

Political Flux

Population Dynamics

Resource Demands

Changing Work Roles

The Role of the Nation State

Global Integration

References

Held, D., McGrew, A., Goldblatt, D. & Parraton, J. (1999) Global Transformations – politics, economies and culture

Cambridge, Polity Press

Mulgan, G. (1998) Connexity: Responsibility, freedom, business and power in the new century (revised edition)

London, Viking

Scholte, J.A. (2000) Globalization. A Critical Introduction

London, Palgrave