In this paper, the researcher looks at globalization and its effects of work. With the advancement in technology in the past three decades, has seen globalization move to the peak. The researcher therefore seeks to address some of the impacts of globalization in general and more specifically of managerial decision making. The paper gives a brief introduction to globalization, provides some of the many definitions given by different scholars and highlights on the theories that help understand globalization. Finally, the author looks at the impact of globalization on the management of organization, bringing out the positive and negative effects and what managers should know. A brief conclusion is given at the end summarizing the key issues in the paper.
Globalization has been a major topic of discussions for close to three decades. Although it began long ago, years after 1970’s, have seen major strides in terms of technology, global education standards, and internationalization which served as an impetus to the process. Whether one is in business, education sector, administration or any other field, globalization has had some significant impact. Globalization, internationalization, and cross-border activities characterize work in the modern world. What is actually transforming work (Gratton, 2012), is the extraordinary connectivity through the intra and internet, improved transport technologies and generally the pursuit of high end efficiency in almost all fields. In this paper, the research begins by providing a definition of globalization, explaining what it is globalization in a deeper sense, what it entails, analyzing a BBC news business item on “globalization of work”, providing theories to explain globalization, consequences of globalization on work, and finally Managerial implications of globalization of work.
There are several definitions given for the term globalization of which, they mainly take a given perspective or approach sometimes influenced by the field or discipline of the person defining. The first written definition of the word was placed in the Merriam Webster Dictionary in the year 1944, several other definitions have emerged after that. For example Beck, (2000), defines the term as “an increasing number of social processes that are indifferent to national boundaries”. On the other hand Castells, (2000), has defined it as 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”. Giddens, (1990) defines it as the ‘Shrinking World’
Different definitions by Held and McGrew, (2007), explain globalization as “circumstances where territorial space is substantially transcended”. Also, Huczynski & Buchanan, (2001) “…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” (Lecture slide).
Generally we can explain globalization to mean the current state of the world where technology has removed the barriers of distances and boundaries hence achieving the highest efficiency of working and interacting across the world as a small village.
Globalization issues, the process of internalization and activities that are done across borders are part and parcel of today’s business environment (Yücel, Elibol, and Dağdelen, 2009). There are several new issues emerging that are continually putting pressure to the management of organizations. For example, managers are faced with the obligation to properly account for the opportunities and challenges present in the borderless, high technology and competitive twenty four hour economic environment (Drori, 2008). Of great importance is the realization that, no business will succeed without embracing new ideas and innovations that will enable it to continue to exist in the global market economy.
There are several dimensions of looking at globalization, and more specifically are because of the influence of the different discipline trying to define the term. For example, we have the economic perspective explaining the phenomena in relation to globalization of trade in the areas of banking, money, corporations and capital (Li, and Guisinger, 1992). The political perspective focus on globalization on the basis of governance issues, peace, wars, science, International Non-governmental organizations, regimes and Non-governmental organizations (Kellner, 1998). From a sociologist’s perspective, communities, classes in the society, conflicts, agreements, and nations are of greater concern. The other disciplines also including psychology, Anthropology, geography and communications will explain globalization based on the particular aspects that shape their perspectives (Kellner, 1998).
Some scholars have argued that (Blumentritt, 2011), Capitalism is not a new phenomenon, claiming that it is inevitable because it emerged from historical developments of imperialism and capitalism. Although it rid itself of the expansionist characteristic of the imperialist and the domination nature of the western capitalism, it still carries with it the ability to advantage others and create disadvantages for others. Some groups will be disenfranchised for not being able to move at the fast pace adopted in the technological world, while others will reap of the benefits of being able to adopt. For example, local production in local economies can reach a dead end due to cheap products from developed economies, yet they will not be able to resist because they will be forced to adjust their policies in order to participate in the global market place.
Consequences of globalization on work: An analysis of BBC article on a contemporary management issue
It is projected that in a few years to come, not more than five years, more than 5 billion people across the world will be using gadgets that will be able to connect them to the internet. As a result of this connectivity being witnessed in the globalization era (Gratton, 2012), millions of jobs across the world are disappearing. As a result of the connection to the internet, people will be able to download information share and possibly teach and learn through the internet.
Those lucky to possess some special skill or ability will be in a position to reap out of opportunities available online. There will be a desire to join the global pool of labor, and for that reason, people will be moving to some urban setting across the world. When the rural urban movement (Blumentritt, 2011), take place prompted by the desire to achieve, competition for jobs will be high therefore necessitating possession of an extra skill or being more fit in a way. Globalization of work will then result in:
(a) Hollowing out of work
The hollowing out of work is a result of outsourcing mainly associated with the use of internet in the globalized world. The groups that will be most affected will be middle-wage, middle-skilled jobs such as managers, secretaries, or assembly line workers. The reason for outsourcing will be the cheap labor available in other parts of the world. The result will be elimination of the middle skilled jobs while retaining high skilled and the low skill where technology cannot help to eliminate. It will be an end to end situation where in the developed countries with partial education one can be greatly disadvantaged. You will either be high skilled or low skilled and no middle (Blumentritt, 2011).
(b) Globalization of virtual work
The high quality education associated with the west and many developed countries will begin to lose the advantage they carried. Several programs similar to theirs are offered nowadays enabling other scholars from developing nations gain similar skills (Blumentritt, 2011). For someone looking to fit into this category middle skilled low labor category in developing countries, the national economies will not affect their ability to get work. Virtual work always transcends the national economies and may not be affected by the issues taking place within the country.
(c) Rise of the ‘transnational’
The impact of “Transnational” will mean high relocations across the world because of available borderless global employment and investment opportunities. This era (Blumentritt, 2011), will see great changes in all phases of a countries development including leadership and policies. This is the period where dual citizenship is allowed even in the developing countries, contrary to the past where it was a characteristic of developed countries. Trade barriers will be removed by countries intending to increase their trade corporations, the issue of currency will no longer be a barrier in foreign trade relations.
Territorial integrity will be threatened by the increased borderless interactions, cultures will be eroded, and economic failures in major economies will be more pronounced in the small peripheral economies of developing countries.
Theories explaining globalization
There have been several efforts in the late twentieth and twenty first century by scholars to research on globalization and provide explanation about the various changes witnessed across the globe in almost all facets of life (Blumentritt, 2011). For example economy, culture, education and the other aspects of humanity have witnessed a great transformation due to globalization. To get a clear understanding therefore scholars in their attempts adopted two broad categories of research. On one hand, some have focused efforts on specific problems or issues as they relate to globalization (Robinson, 2007). On the other hand, there are others whose research is specifically on the concept of globalization itself. This is the group that has come up with specific ways to understand globalization using theories.
These particular theories view the whole process of globalization as being modernization but one which is market lead extension. In the simplest understanding, it comes out of the natural human desire for political and economic liberty. In that sense, the planetary connectivity witnessed in the global world is out of utilizing the available resources in a way that assures more freedom. The achievement of the desired states is made possible through
(i) Advancing technologies specifically in information communication, transport and information processing.
(ii) The creation of suitable legal and institutional arrangement that will make it possible for markets and liberal democracy to spread across the world.
Theory of Marxism
This theory explains globalization from the perspective of modes of production, social freedom achieved through transcendence of capitalism and social exploitation of unjust distribution. Marx the proponent of this theory actually anticipated long ago the idea of globalization. In his proposition, it was evident that capital would conquer the world as those with the ability would overcome all barriers of space and distance in the attempt to make more profit. According to Marx, globalization is possible because of the connectivity across the world which would create surplus necessitating market expansion.
This theory explains that the growth of globalization is because in the modern societies, languages, symbols, interpretations and certain images which have come to be understood on the same way hence creation of a new social order. Simply, it is the creation of a dynamic conciseness that does not respect culture or a geographical position on the globe, but rather will allow a way of understanding things widely. The proponents of this theory concern themselves much about how individuals construct their own worlds both in the mind and the inter-subjective communication with others. The culmination of this is a group of people who see themselves as national, international and world class. This will impact on business, culture, management styles and all interactions.
This theory does not actually see globalization as a new phenomenon. The proponent of this theory, Immanuel Wallerstain sought the idea that globalization is not new. He views globalization virtually as portraying the same features and characteristics as those of Capitalism that emerged in c1500. This means Wallerstain conception of globalization, constitute the proposition that, the appropriate unit of analysis for macro studies is not the issues of class, state or society but rather the whole historical systems where this categories are found.
In the explanation, the capitalism that emerged in c1500 in Europe has over time expanded to observe all the other mini-systems and empires that were there and eventually ending up in market and production networks which have logically and singly brought people across the world into a structure. This is the way world systems theory can be seen as a theory of globalization.
Theory of Postmodernism
Postmodernists understand globalization to be a result of the significance of structural power in the construction of some identities, norms and knowledge. The idea is that power structures shape knowledge and certain knowledge structures support certain kinds of power hierarchies. The dominant knowledge structure in the modern world is modernism. In modernism, emphasis is on the empirical world, being an objectivist science and instrumental efficiency. The society constructed out of Modern Rationalism, produces a society that is basically committed to technological control, economic growth, bureaucratic organizations and disciplining desires.
Theory of Feminism
The theory of feminism emphasizes on the social construction of musicality and femininity. The Biological sex is today seen to affect the overall social order across the world. The other theories focused so much on the issues of trans-border or planetary communication. This feminist theory concerns much on the position of a woman and their ability to enjoy the same privileges as their male counterparts. Today almost all countries across the globe have policies that ensure gender balance in employment and gender rights protection.
The theory put across the idea that globalization is a reflection of the high level of interconnectedness in political, economic and cultural matters across the world. When this interconnectedness is considered, then globalization is seen as a process which embodies transformation in spatial organization of relations, expressions and interaction of power.
The difference between this theory and the others is that in transformational theory, it sums up the definitions of globalizations by several other theories in more rigorous analytical framework developed by coming up with three part typology of the explanation of globalization consisting of hyper-globalist, skeptic and transformational categories.
The hyper-globalist emphasizes on the idea of global market the importance it is given nowadays. Given the perceived importance of the global market place, the Multi-national enterprises (MNE’s) and intergovernmental organizations (IGOs) which are regulators of activities at this level are therefore the key actors. This ensures the expansion of international trade, multinationals, transnationals, and international NGOs expand. Skeptics say globalization is a myth that only conceals the importance of the national governments, yet they remain so powerful. Lastly transformation list believe globalization has occurred as the states in the world experience profound change trying to be more interconnected but highly uncertain of the world.
Managerial Implications of globalization of work
The idea to outsource for cheap labor (Gratton, 2012), will result in the disappearance of the middle skilled category of workers and therefore, those who need to be employed will be required to have very high skills. In some types of tasks, technology will replace the human labor reducing the number of people needed to work in certain companies or organizations. Receiving high education is different from getting a dissent job.
In the developed countries the middle jobs will be disappearing yet this advantages someone able to perform the task in a developing nation. The question that will remain unanswered is where the high skilled in developing countries will get employment. It would mean therefore that high skilled will have to relocate to developed countries where the population is lower and the aging group in employees is greater than those entering employment. The impact of transnational is that the elite group will work to achieve universal standards for work and therefore overcome the challenge of management styles, social networks, and cultural sensitivities. The transnational’s’ will be able to probably speak more than one language, have dual citizenship and live anywhere in the world (Gratton, 2012).
Globalization has given great relevance to the people offering consultancy services to help managers always refocus their goals to take care of the rapid changes. If managers are not well advised (Li, and Guisinger, 1992), they can easily get caught in a situation where they focus on only immediate elements of globalization, forgetting their long term effects on their work. Consultants and writers and those in management studies are the ones to provide guidance on the next breakthroughs in terms of ideas to increase profits by joining the world market place and offer solutions to the most obvious problems. The importance of training, mentoring and coaching is increasingly becoming a way to introduce changes in organizations.
In conclusion, globalization is a tide that cannot be stopped. Cultures will be affected, there will be the emergence of a world cultures, multinational and transnationals will have greater control over policies in developing countries, and there will be universal education standards. The advantage will be (Herrmann, 2013) increased profits due to new markets for products, better paying jobs for middle skilled in developing countries and better technologies. On the negative however some jobs disappearing in developed countries will likely affect their economies, an effect which over a long period will bring a balance between the developed and the developing countries. Globalization will definitely have an unprecedented impact on all facets of life over the coming years.
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