Globalalization - Globalization MeaningandRationale Nature...

Info iconThis preview shows pages 1–7. Sign up to view the full content.

View Full Document Right Arrow Icon
Globalization Meaning and Rationale 
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Nature of Globalization Globalization refers to the process of integration of the world into one huge market At the company level it means: existence in several locations around the world for manufacturing, and offering products in diversified industries ability to compete in domestic markets with foreign competitors In popular sense it means multi-plant operations
Background image of page 2
Nature of Globalization A global company can also be referred to as a Multinational or Transnational Characteristics of a global company: It is a conglomerate of multiple units but all linked by common ownership Multiple units draw on a common pool of resources The units respond to some common strategy
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Why Do Companies Go Global? The availability of money in the foreign market Rapid shrinking of time and distance Domestic markets are no longer adequate Vernon’s theory of Product life-cycle Levy and Sarrat’s theory on foreign investments – spread the risk
Background image of page 4
Why Do Companies Go Global? Nature of industry – factors of production may be cheaper elsewhere Nationality of a company – to find political stability and take advantage of technological and managerial knowledge Reduce high transportation cost – produce final product close to major markets Stay close to the source of raw materials and to the markets Generation of more sales to meet high costs Other factors like trading blocs – makes going global easier
Background image of page 5

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
How Do Companies Go International? Stages of internationalization:
Background image of page 6
Image of page 7
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

Page1 / 19

Globalalization - Globalization MeaningandRationale Nature...

This preview shows document pages 1 - 7. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online