D.Y.H. Williams, Vice President of Internal Development
31 East River Street, Suite 604
Chicago, IL 60602
Dear Ms. Williams,
As requested to in regards to the presentation of a globalization proposal, I am pleased to present to you my research on the effects of globalization on Wal-Mart. I believe that globalization has become a plausible aspect that has re-shaped the business frontier of most businesses. Most specifically, Wal-Mart has enjoyed a remarkable business environment enhanced by globalization. Through globalization, Wal-Mart has sustained effective growth and ventures into various markets. However, it is imperative to note that majority of research undertaken has relied mainly on the positive aspects of globalization. It is worthwhile to note that globalization has had significant negative effects on Wal-Mart and other businesses. Increased losses as a result of piracy and growth of black market are some of the negative effects of globalization.
Hence, I believe that it is imperative for the organization to evaluate the various effects of globalization in a more holistic manner. Through an emphatic evaluation of globalization, proper operative policy incorporation will be evidenced. Effective polices construed towards sustaining profitability within the global scope is bound to catapult the organization to greater heights.
I hope that my proposal will be profound for evaluation and incorporation of the varied aspects evaluated. For further queries please contact me. Regards for your time.
Globalization
Abstract 3
Summary 4
Introduction 4
Background information 5
Problem statement 9
Purpose statement 11
Scope 11
Recommendations 11
Conclusion 12
Proposed plan 13
References 14
Abstract
Globalization has become a phenomenon of great acknowledgement. The prospect of globalization has been fueled by beneficial advancements in the telecommunication, transport, and other sectors of operation. The development in the aforesaid avenues has generated increased flexibility in operations. Furthermore, through globalization, extensive market growth of organizations has prevailed evident from the various international ventures that businesses have undertaken. However, it is noteworthy that businesses have solely relied on the positivistic literature materials available on the impact of globalizations. Most organizations have taken great risks in venturing into the various markets as a result of globalization. Most organizations have not undertaken individualized research into globalization and specific effects that are bound to fuel or pose a challenge in their international ventures. Thus, it is imperative to evaluate Wal-Mart and the various challenges and benefits that are bound to ensue through globalization.
Summary
Businesses have benefited greatly through globalization. Growth has been manifested within the business frontier through the various benefits accrued from globalization. However, it is imperative to note that organizations have relied majorly on positivistic theories on globalization. As such, proper evaluation of the various challenges bound to be faced such as piracy and black market have not been evaluated. Hence, as a research proposal construed towards evaluation of globalization and its effects on Tesco, proper examination of specific effects are bound to be evaluated.
Introduction
Globalization has become a dominative term within the business and social scene. As an aspect of imperative analysis, globalization has revolutionized the various aspects of social economic life. Entailing a rapid positive growth in technology and infrastructure growth, globalization has been increasing at a first rate. Denoting a plausible change in telecommunication and transport infrastructure, a globalized economy has become evident. Globalized economy or society as per the various pundits entail a more effective environment for Wal-Mart to operate coupled with communicate effectively among different global partners. Within a globalization mandate, cross border communication has become easier than before. In the past decade, communication among individuals from different countries or continents has become easy, fast and effective. Furthermore, access to information has become quite easier and faster due to the revolution within the telecommunication sector. The growth of the internet and so forth has become a dominative figure towards the globalization prospect. On the other hand, the shift in transport sector towards faster, efficient and plausible infrastructure has become a causative aspect to the growth of globalization. Hence, through the growth of transport and telecommunication sector, globalization has become evident within the different continents. The world has become a global village in which various efficiencies in operation have been evidenced. Thus, this proposal is construed towards the evaluation of globalization and its various effects on Wal-Mart’s business frontier.
Background information
Research undertaken into globalization and its effects has mainly been construed towards its effects on the business environment. As such, Dawes (2012) asserts that the prevalent information has been construed towards the evaluation of the integral and plausible impact that globalization has on the global business sector. Furthermore, the global factors that affect businesses such as Wal-Mart in various regions in the globe can be classified mostly as external factors of business. These include; sociocultural factors, political factors, legal factors, economic factors and technology. The sociocultural determinants comprise of factors such as tastes, preferences and demographic patterns of the consumer population. Demographic factors such as the ageing population and scarce labor force in the developed economies has adversely affected business operations (Parking, 2002). Wal-Mart has had to change their operating procedures and adopt outsourcing of non-core activities. Manufacturing firms in the developed economies have had to shift their operations to countries that are labored abundant. The prospect of globalization has led to the increase in the labor mobility coupled with production mobility. Through the growth of globalization, businesses have managed to shift production effectively in order to suit their operational targets. Profitability coupled with revenue growth has formed an interconnecting aspect towards operational success among businesses. Hence, among the various effects that globalization has had on the Wal-Mart’s operative environment include;
Increased competition
The rapidly evolving business environment in the international sector in which Wal-Mart operates has led the organization to adopt a global competitive outlook. Firms within the retail chain sector have had to compete not only on the local, regional or national front but also globally. The emergence of communication technology, liberalization of markets and formation of unions has been key drivers of the globalization agenda.
Production efficiency among businesses
The rapidly evolving technology in most industries has also had a lot of impact on the business environment. Changes always occur within technology availing new methods of production, improving efficiency and creating competitive advantage. Businesses need to regularly assess their technological environment to ensure that they are at par with the latest technologies.
International trade offers new opportunities for growth and expansion to the various businesses. Admittedly, multinational organizations operate in an international environment where competition is ever on the rise and proper ventures into other markets are crucial for sustainability and perpetual operations. Hence, in accordance to Dinkhoff (2009), the significances of international trade on multinational businesses are, capturing new markets, global growth and improvement of economies of scale.
Capturing new markets
As such, through the venture into newer markets, businesses have been able to venture into lucrative regions. As well, among the various markets that are bound to rake in colossal profits in which Wal-Mart should venture into include Japan, Africa and India. Dawes (2012) asserts that the humongous effect of globalization have been evidenced in the business scene whereby operational efficiencies have emerged leading to a more effective operational obligation. Globalization has given rise to a more effective environment of operation among various businesses due to the increased flexibility in operations. Countries have opened up their business environment for other businesses to make ventures and operate within a competitive mandate.
Global growth
For any business success, uninterrupted ventures into new markets ensure growth due to the operational foundations that are established. As such, through ventures into other markets, Dawes (2012) asserts that many businesses have expanded and grown at a formidable rate. Dawes (2012) asserts that the opening up of new markets has led to a market expansion of businesses at a great proportion. Dawes (2012) further asserts that research undertaken has revealed a more than 20% increase in multinational corporations in the past decade. Hence, globalization has led to the emergence of effective frontier of operation and growth.
Improvements in economies of scale
International trade enhances the commercial network portfolio of any business. Admittedly, through international trade, Wal-Mart enjoys improved trade terms in different locations. Hence, the disparities in trade terms enhance the level of profits and systemic risk which arises from concentration in one area of trade.
Improved foreign relations
In the global scene, political stability has ever been a factor to the expansion of various businesses. Globalization has paved way to a social scene whereby interstate interactions have increased formidably. Consequently, countries have formed strategic unions such as EU, COMESA and UAE which have been fuelled as a result of enhanced environment of communication. On the other hand, the business sector has been witnessed by enhanced business relations. As such, businesses have managed to ensure cross cultural competency hence cementing their ventures to other regions. Access to information, flexibility in regards to worker operations has sustained an impeccable frontier of operation. Admittedly, through improved relations, companies such as Wal-Mart have managed to set up its operations in various countries. Case in point is Brazil, in the aforementioned country; Wal-Mart has managed to inculcate business operations through partnership with over 1000 suppliers within the region.
Change in economic systems
Globalization has had a profound impact on the various countries that were deemed unfavorable for business operations. Countries such as China and Russia have embraced a form of mixed economy hence benefiting greatly the multinational companies with a view to venture. Wal-Mart has not been left behind as a result of the change in economic systems by the various regions evident from the various stores they have in china (Humby, Hunt & Phillips 2008).
Problem statement
In the ever-changing global environment, Wal-Mart has been expanding their operational tentacles. Admittedly, the globalization phenomena has exposed Wal-Mart to improved global infrastructure and better working conditions. As such, improved infrastructure entails the major changes in communication and transport networks. On the other hand, working conditions entail the supports from various governments in terms of international businesses commencing operations. However, it is important to note that much of the research undertaken to evaluate the impact of globalization has been based on the positive aspects without much emphasis on the negative side of globalization on Wal-Mart. As such, it is significant to note that globalization has brought about significant vices that require acknowledgment within the research field. As some of the key examples, globalization has significantly led to the sophistication of crime, piracy and rise of the black market. Thus, I will evaluate the various effects of globalization from own perspective that require further evaluation within Wal-Mart’s operational environment.
Piracy
Globalization has extensively led to the growth of infrastructure especially in the transport sector. Through the growth in the transport sector, the shipping industry has grown formidably leading to intercontinental trade. However, it is sad to note that the development of shipping industry has presented an avenue for modern day pirates to prevail. Within the gulf of Eden, Indian Ocean and across the shores of Nigeria, piracy has been evidenced within a shocking manner. As such, ships have been hijacked leading to profound financial losses emanating from the ransoms paid to the kidnappers to release the staffs in the various ships. Furthermore, through piracy, trade has been affected significantly with many businesses such as Wal-Mart opting to seek other trade partners apart from those from the affected regions. It is worthwhile to note that despite government efforts, piracy has continued to rick havoc on the trade aspects among nations.
Rise of the black market
The extensive rise of the black market in which counterfeit and illegal goods are sold has become an aspect of concern. Fueled by the emphatic growth of online businesses, transactions through the internet platform have been on the rise with minimal measures in overseeing the kind of transactions that prevail. The reduced monitoring of online businesses has led to the rise of transactions of counterfeit goods among clients from different nations and continents. As such, the growth in telecommunication sector fueled by globalization has sustained flexibility in operations. Within the global spectrum, illegal trade in guns, drugs, sex and so forth has been increasing at an alarming rate. Moreover, counterfeit products have led to leakages in organizational profits posing a detrimental environment for operation among international businesses. Furthermore, through globalization, an avenue for further transactions has been evidenced through online payment methods such as PayPal. Through an easier form of payment, individuals have benefited profoundly in terms of their illegal businesses.
Purpose statement
Globalization has become a novel aspect of concern within the organizational operational policies. As a prospect of imperative evaluation, it has given rise to various noteworthy positive effects that require plausible recognition. However, it is important to note that there are various negative effects that may impede organizational operations as evidenced from the negative effects of globalization on Wal-Mart. Hence, the main purpose of this proposal is to highlight the crucial effects that Tesco requires to evaluate properly in order to succeed in the global sphere.
Scope
Wal-Mart is a multinational retail chain business that has been acknowledged among the various countries. As a market leader in US within the retail chain industry, it has sustained its operations through extensive market research and proper pricing policies. Through its regional market control or domination, the company has invested highly into ventures to other markets. However for the organization to succeed in the global sphere, it is important that it acknowledges the various challenges that are bound to prevail. Thus, the scope of this research proposal is based on a global scale of evaluation of the operations at Wal-Mart.
Recommendations
Wal-Mart has witnessed increasingly profound effects of globalization on its operations. However, it is imperative to note that globalization has led to significant losses to the organization due to the increasing prospects of piracy coupled with rise of the black market. Thus, for organizational sustainability, it is imperative to note that the organization should extensively invest into cross national competency. Cross national competency entails extensive research into the various markets in which the organization plans to venture. A competency mandate that is based on emphatic data mining into the various aspects that circumvent global operations is bound to sustain Proper Avenue in mitigating the challenges posed within the global frontier. As such, organizational investment into human resource that is highly competent in operations is likely to give rise to more profitable ventures.
Conclusion
Globalization is an integral aspect in the social and economic aspect within the different countries. As an on-going aspect fuelled or emanating from the growth of telecommunication and transport infrastructure, it has resulted into varied effects. Majority of the effects have been positive and plausible within the business frontier. Its effects have been quite significant with economies rising at an effective and impeccable rate. However, it is imperative to note that the growth of sophisticated crime. Crimes aforementioned need tackling and form a major setback towards the ever expanding globalization mandate at Wal-Mart.
Proposed plan
The Effects of Globalization on Wal-Mart
Thursday, May 8, 2014
8:00 am – 8:30am Registration
- Breakfast coupled with refreshments
8:30 am-9:00am Pleasantries and introduction to topic of examination
9:00 am- 10:30 am guest speaker
- John Dawes, renowned author on international trade
10:30am-10:45am short break
10:45am-12:30pm film projection
- Film is based on Wal-Mart’s corporate social responsibility activities across the world
12:30pm-1:30pm lunch break
1:30pm-2:30pm guest speaker
- Robert Kaplan, author and motivator on business global operations coupled with strategic models of operation
2:30pm-2:45pm short break
2:45pm-4:00pm discussions on globalization and its effects on business operations
References
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Dawes, B. (2012). International Business: A European Perspective. Nelson Thornes Publishers, London.
Dicken, P. (1998). Global Shift Transforming the World Economy. Paul Chapman Publishing, New York City.
Gerhad, R. (2008). Customer relationship management: A global perspective. Aldershot: Gower Publishing, Ltd. Harvard University Press.
Hitt, M., R. Ireland, and R. Hokinson. (2003). Strategic management. 3d ed. St. Paul, MN: West.
Hornby, W. (2011). Business Economics. Prentice Hall, New York City.
Humby, C., Hunt, T., & Phillips, T. (2008). Scoring points: How Tesco continues to win customer loyalty. London: Kogan page publishers.
Parkin, M. (2010). European Economics, Pearson Education, London.
Shubik, M. and R. Levitan (2000), Market Structure and Behavior, Cambridge, MA:
Thompson, J. D. (2003). Organizations in action. New York: McGraw-Hill.
Trice, H. M., J. Belasco, and J. Alutto. (2001). The role of ceremonials in organizational behavior. Industrial and Labor Relations Review 23: p40–51.
