Globalization
Barbara Parker and Stewart Clegg
The SAGE handbook of organizational study Chapter 2.9
Presented by Di Wu
Introduction of authors
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Barbara Parker
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Professor in Mangement, Albers School of Business and
Economics, Seattle University
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globalization and international management
cross-sector partnerships
strategic management of diversity
joint venture management
student learning outcomes
Stewart Clegg
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Professor, School of Management, University of Technology
Sydney
 Organisation and Management Theory, Power, Theory, and
Projects
First glance at Globalization
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Government Advertisement
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Made in China and Made with the world
Introduction
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The world are moving toward a single, highly
integrated system
Organizations contributed to, and were increasingly
affected by, global shifts in
 Political
activities
 Industries
 Culture
 Technology
 The natural environment
 Economics
Globalization Topics
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Research on globalization tackles disparate topics
 Economics:
focus on prime movers analyses singular
sources shaping globalization
 Communication and transportation technologies
 Increasing numbers of joint ventures
 The share of assets
 Culture factors
Three main approach
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Analysis a particular global sphere (Economics)
(Stiglitz, 2003; Bhagwati, 2004)
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Examines interconnections among two or more
global spheres. (Castells,1998; Giddens, 1999)
Cross disciplinary and organizational boundaries.
(Osland,2003)
Definitions of Globalization
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Global and international are synonyms.
(management scholar perspective)
Globalization is a process. (Held et al. 1999; Parker 2005)
Globalization characterized by:
 Growing
worldwide interconnections
 Rapid and discontinuous change
Research on Globalization
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International business
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IB Research emerged as a separate field only in 1965 while
international business began centuries ago. (Wright and Ricks
1994)
At the beginning, IB research excluded other disciplines such
as economic development, foreign trade, international
monetary system, foreign legal ,political, and economic and
social environment.
 Actually, IB research is borrowing theories from other
disciplines
 Debate: IB research should narrow the focus to enterprise or
expand to examine the global business
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Research on Globalization
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Sociology
 Focus
is broader than IB: tendencies to a worldwide
reach, impact, or connectedness of social phenomena or
to a world-encompassing awareness among social
actors
 A number of features develop from the 1970 onwards:
 Political
administrations
 New international division of labour
 New international financial system
 More complex notions of personal identity
Global Interconnections
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Nature Environment
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Defined to include “the oceans, the sea beds, the
atmosphere, space, Antarctica, the planet’s biodiversity, as
well as the Earth’s electromagnetic spectrum (Henderson,
1999:24)
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Two opposed perspectives on environmental preservation:
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A future “boom” leading to unprecedented prosperity
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Economic development generates technologies to address
environmental problems
Global warming, species reduction, and global disease as
harbingers of “doom” in an environmentally impoverished future
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Technology is part of the environmental problem rather than its
solution
Global Interconnections
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Global Economics
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Economic globalization: trade, foreign direct investment, and
capital.
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World trade has grown to about 25% of world GDP as
compared to 10% about 30 years ago (Govindarajan and Gupta
2000)
FDI increasingly moves between developing economies and from
them to advanced economies as compared to they moved mostly
between advanced economies (Mathews 2002; Aykut et al. 2003)
 Capital moves freely in the new worldwide market: “hot” money
flees or floods lead to more responsibility for central banks
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1992 English Pound Crisis
1996 Asian Financial Crisis
Global Interconnections
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Political/Legal Environment
Growing need for global governance system to agree on
weights and measures, provide a systematic financial system,
develop guidelines for sustainable development, ensure
equity, and provide unified responses to development needs,
disaster relief and security.
 The nation-state is a “robust” form of political organization
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(Sobel 2003:422)
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Trade agreements
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OPEC, EU, ASEAN, WTO
Common defense
North American Treaty Organizations
 UN global peacekeeping forces
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Global Interconnections
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Technologies
Focus on processes and products with greatest global impact
 Today’s technological revolution: Computerization
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Processing, micro computers, and networks
 Telephone, internet, television, and other media
 Just-in-time inventory management, total quality management,
and organizational learning
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The innovation rate has increased markedly during last 200
years
 Rapid speed of information transfer also alters many
traditional assumptions about knowledge
 Questions about justice
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Global Interconnections
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Culture
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There neither is nor could there be a global culture (Smith 1990)
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Explores tensions between existing and emerging global cultures
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English as business language but also limited
Smile Symbol “” shown in Beijing 2008, also shown in 2010 new
year Disneyland.
Hybridization or cross vergence in values (Robertson 1995)
Emphasis on environmental protection, women rights, participation
in decision-making in economic and political life, and national
cultural shifts toward secular-rational values (Ingelhart and Baker,
2000)
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Within-culture homogeneity set against a backdrop of increased
worldwide heterogeneity
Dissolving national cultures, economies, and borders.
Global Interconnections
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Business Activities and Industries
 Transnational
corporations: biggest 1000 generate 4/5
of world industrial output;
 A global industry
 Industry convergence: consolidation, alliance building
( Drucker,1999), and value (Porter, 1986) and supply chain
management.
 Debate on relationship between nations and business
 High
technologies, national security
 Real industry ( products, services)
Perspectives on Outcomes from
Globalization
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The skeptical Thesis
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Globalization is simply internationalization by another name
(Scholte, 2000)
G3: Europe, Japan, and North America
 Being significant regional players emerging in Latin America,
East Asian, and elsewhere.
 Pursues two themes:
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Empirical data and closely define terms
 Nations rather than businesses remain the global actors (Veseth
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1998)
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Critics: the issue is less one of historical comparisons per se,
but rather the scale of current interconnections.
Perspectives on Outcomes from
Globalization
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The Hyperglobalist Thesis
Globalization is a new stage of human history through which
the power of nation-states is supplanted by business
activities (Ohmae, 1995)
 Businesses more than nation-states are the primary economic
and political units of world society (held et al. 1993)
 Two variations:
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Self-interest perspective views organizations as dispassionate
actors on a global scale working pragmatically in pursuit of
economic ends.
 More malevolent form, global business primacy is coming about
by design and it is not indifferent.
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New World Order
Perspectives on Outcomes from
Globalization
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The end-point of the globalization process is not yet
decided
Interconnections and interdependence will forge
new links and dissolve some existing ones
Proponents of transformation comes from:
 Voluntary
sector and work through transnational
organizations
 Business activities
 Interconnections among businesses, governments, and
members of civil society.
Conclusion
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Globalization is a complex and confusing process
Challenges the increasing isolation of organization
studies, and challenges their dependence on a
limited rage of disciplines
Scholars need to reach out: out of their countries,
cities and faculties, to other places, other realities,
and other disciplines.
Can we engage the phenomena of globalization –
globally?
Big questions in OT
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Why do organizations exist?
Why are firms the same/different?
What causes changes in organizations?
Why do some firms survive and others don’t?
Emerging issue?
Thank you!