THE

EFFECTS OF GLOBALIZATION ON
INTERNATIONAL COMMUNICATION IN THE WORLD
BUSINESS

Aldilla Ranita Purba1 Chontina Siahaan2
INTERNATIONAL RELATION, SCHOOL OF SOCIAL AND POLITICAL SCIENCES.
CHRISTIAN UNIVERSITY OF INDONESIA, MAYJEN SUTOYO NO.2 CAWANG, JAKARTA INDONESIA
aldillapurba@gmail.com




ABSTRACT

Globalization makes international communication and business
management easier and efficient for the world trade. we can expand
business relations to all corners of the world. Globalization connects
businesses and customers across the world. Companies open satellite
offices to decrease production costs, forge relationships in new territories
and access new consumer markets. The importance of communication in
globalization is paramount because individuals from different countries,
ethnicities, languages, cultural attitudes and other variations must
understand one another and express themselves to another effectively in
order to work together.The ability to communicate with people both
inside and outside your organisation is a key characteristic of successful
business builders in the world trade. Connecting with people on the other
side of the world is now much easier than it was a few years ago. Satellites,
fiber-optic cables and the internet make it effortless to share information
with those in different time zones and locations. Global communication is
directly affected by the process of globalization, and helps to increase
business opportunities. Although globalization has many benefits for
international communication and world trade. Globalization also have its
side effects. These include some factors which are jobs insecurity,
fluctuation in prices, fluctuation in currency, capital flows and so on.

Keywords : Globalization; International communication; International
relations; World business; Side Effect

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1. Introduction

Recent events and developments have repositioned etiquette and
intercultural communication as fundamental topics requiring critical
analysis in light of the increasing number of countries participating
in global business transactions, various strategic international
alliances, and multinational joint ventures. As organizations from
developed and developing nations struggle to establish their ethical
identity, business etiquette, and engage in intercultural communication,
the business environment becomes challenging and complex as a
result of differing standards, expectations, and language patterns.
International business etiquette as defined by Chaney and Martin
(2007) refers to the manners and behavior considered acceptable
behavior in internationally social and business situations. In social
setting, proper social behavior includes cultural differences in making
introductions, exchanging business cards, acknowledging position and
status, communicating interculturally, dining practices, tipping
etiquette, giving gifts, and traveling. In international business
situations, how competent and competitive firms are both
domestically and internationally and how they effectively
communicate to their stakeholders will determine how successful a
firm is internationally. Furthermore, as the authors expound, building
global business relationships depends on the innate ability to learn
about other cultures and proper training to help a person adjust once
he or she is in another culture. In addition, it refers to the customs and
regulations dealing with diplomatic courtesies expected in official
negotiations with persons in various cultures. Chaney and his
colleague explain that when interacting with colleagues or
counterparts of other cultures in a business or marketing context, it
is important to know their customs to ensure that an intended meaning
is not conveyed in order to avoid unintentionally offending them.

International communication (also referred to as the study of global

communication or transnational communication) is the communication
practice that occurs across international borders. The need for
international communication was due to the increasing effects and
influences of globalization. As a field of study, international
communication is a branch of communication studies, concerned with

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the scope of "government-to-government", "business-to-business", and
"people-to-people" interactions at a global level. Currently,
international communication is being taught at colleges worldwide. Due
to the increasingly globalized market, employees who possess the
ability to effectively communicate across cultures are in high demand.
International communication "encompasses political, economic, social,
cultural and military concerns"

2.Suggestions
The Effects of Globalization on International Communication
Connecting with people on the other side of the world is now much
easier than it was a few years ago. Satellites, fiber-optic cables and the
internet make it effortless to share information with those in different
time zones and locations. Global communication is directly affected by
the process of globalization, and helps to increase business
opportunities, remove cultural barriers and develop a global village.
Both globalization and global communication have changed the
environmental, cultural, political and economic elements of the world.

2.1 Considerations for international communication

When communicating internationally it is important to take culture into
consideration. Though English has become the language of business,
many businesses fail to recognize that the language used doesn’t
determine how business is conducted. Therefore, it is important to
understand that intercultural and international communication are
interchangeable. Effective communication between international
business partners is critical for global success, and underlying national
and organizational cultural differences in international business-related
relationships can create hurdles to effective communication, which can
hinder performance. As a tourist it may be acceptable to maintain the
cultural norms from a country of origin when visiting, though
attempting to adapt would be appreciated. However, when conducting
business it is important to recognize cultural differences, especially
when communicating.

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 3.Four Major Benefits of Internasional Communication
for Global business :

While the advantages of global communication can be numerous on any
case-by-case basis, these can be described in four major benefits for a
business:

3.1. More markets to reach:

With just a webpage or smartphone, you can expand your market of
potential customers to nearly everyone in the world.
3.2.More suppliers to access:
If you can legally import products from a country, every manufacturer
there is a potential supplier.
3.3.More talent to hire:
No longer are you limited to the talent pool in your city or town. You can
hire remote workers anywhere in the world.
3.4.More ideas to harness:
If someone in Singapore has figured out a better way to make widgets
and to sell them to millennials, you can adopt those ideas for your
business, provided you know about them.

4. Barriers in Internasional Communication

There are three barriers to communication in the global marketplace.
4.1 The first is governmental barriers. Just as governments can
restrain global trade with tariffs and embargoes, they can restrict
communication to other countries with limited access to the internet.

4.2 The second barrier is language. As good as Google Translate may

be, the subtleties and nuances of a language and its regional variations
are still elusive unless you are fluent in a language.

4.3 The third barrier, cultural differences, can also cause significant
problems in business communication. This may not seem as apparent as
the first two barriers, but underestimating it can be disastrous. For
example, China has copyright laws, but it doesn't take them as seriously
as the U.S. takes them.

5. International Communication Errors

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Understanding the local meaning of a word or phrase is a vital aspect of
international communication. Errors can cause embarrassment and can
show disrespect. According to Kwintessential, a communication
company, an example of a communication error occurred with the
Kellogg company. It was selling a cereal product in Sweden. The cereal
name, Bran Buds, can generally mean, "burned farmer," in
Sweden.Another example is the ad, "Come Alive with Pepsi," by Pepsico.
In Taiwan, the translation became, "Pepsi brings your ancestors back
from the dead."

6. The Importance of Internasional Business Etiquette

and Intercultural Communication
Etiquette is a combination of behavior and communication. Making an
error in etiquette can cause a business deal to fail. For example, when
you are meeting with a group of people from the Asian culture, you have
to be aware of hierarchy issues.

Increased globalization has been one of the most important

developments in in the past decade. Business across borders has grown
significantly. In the twenty first century, the ability to conduct business
effectively with trading partners around the world relies on cross
cultural knowledge and cultural intelligence.

Savvy companies who view the development of international business

etiquette and communication skills as a strategy will have the business
advantage and will distinguish their company from competing firms.

Being attuned and aware to cultural diversity is essential in business

interaction. Companies who fail to understand the importance of
cultural differences will result in embarrassing and unprofessional
encounters with business partners, which may harm the business
relationship. Cultural diversity will be revealed at daily practices and
business situation such as: Greeting, Handshakes, Table Manners
(Business Meals), Body Language, the Spoken Words, the Written Word
(email, texts messages) and other face to face interactions.

Intercultural communication will present one’s personal character

reflected in his or hers behavior, projecting personal values, habits and
etiquette. Employees’ image and personal branding is the company’s

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image and branding, as the employees are the face of the company. It is
crucial to maintain a business ethics and etiquette policy, combining
both values and behavioral guides to enable all employees follow and
present one united business image.This will create a polite ethical
environment both in group (for employees) and out group (for business
partners).

7. The Importance of Communication in International

Business
Businesses are selling products around the world. Partnerships are
being formed with people from diverse cultures as business
relationships are formed. Each country and the cultures within a
country bring communication challenges to businesses. Good
international business communication practices help maintain these
intricate business dealings. Bad communication practices can cause
loss of business and even international tension among countries.
Communication is intricately blended with non-verbal communication
and etiquette.

7.1 Communication ability can result in better chance of

promotion
Technical people with good communication skills earn more, and
those who are weak communicators suffer. William Schaffer,
international business development manager for computer giant Sun
Microsystems, made the point emphatically: "If there's one skill that's
required for success in this industry, it's communication."

Over 90% of the personnel officials at 500 US businesses stated that

increased communication skills are needed for success in the 21st
century. Subscribers to the Harvard Business Review rated "the ability
to communicate" as the most important factor in making an executive
"promotable," more important than ambition, education, and capacity
for hard work. Research spanning several decades has consistently
ranked communication skills as crucial for managers.

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7.2 Training employees in communication for improved
profitability
"New York Times” Bob Kerrey, chairman of the National Commission
on Writing, said, “Writing is a ‘marker’ of high-skill, high-wage,
professional work. People unable to express themselves clearly in
writing limit their opportunities for professional, salaried
employment.” Whether you are competing to get the job you want or
to win the customers your company needs, your success or failure
depends to a large degree on your ability to communicate. If you learn
to write well, speak well, listen well and recognise the appropriate
way to communicate in various business contexts, you’ll gain a major
advantage that will serve you throughout your career. Moreover,
because your communication plays a key role in efforts to improve
efficiency, quality, responsiveness and innovation, your
communication affects your company’s success.

8. Effect of globalization on the world trade/business

8.1. Interconnectedness
Globalization has resulted in greater interconnectedness among markets
around the world and increased communication and awareness of
business opportunities in the far corners of the globe. More investors can
access new investment opportunities and study new markets at a greater
distance than before. Potential risks and profit opportunities are within
easier reach thanks to improved communications technology.
Products and services previously available within one country are made
available to new markets outside the country due to globalization. In
addition, countries with positive relations between them are able to
increasingly unify their economies through increased investment and
trade.
8.1.1 Global market
Most successful emerging markets in developed countries are a result of
privatization of state owned industries. In order for these industries to
increase consumer demand many of them are attempting to expand and
extend their value chain to an international level. The impact of
globalization on business management is seen by the sudden increase
of number of transactions across the borders. In protecting yields and
maintaining competitiveness, businesses are continuing to develop a

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wide range of their footprint as it lowers cost and enjoys economies of
scale (Shah A.,2009)
Multinational corporations is a result of globalization. They occupy a
central role within the process of globalization as evidenced through
global foreign direct investment inflows. Their concentrations within
Europe in western economies has led to size constraints, therefore there
is a need for new geographical areas to operate whereby they will face
a lot of competition in the market. Through this they will enlarge their
market and enjoy economies of scale as globalization facilitates time
space compression, economies compete at all levels including that of
attracting investors (Smith V.A and Omar M.,2005).

8.2.Maintaining Competitiveness
Globalization has had the effect of increased competition. Companies
are broadening their target area, expanding from local areas and home
countries to the rest of the world. Suddenly, some companies are
fighting strong competition from outside their home country. This
forced them to source materials and outsource labor from other
countries. This story of ‘sourcing and outsourcing’ turned many
companies into global ones, actively seeking for production locations
and partners for new ventures. Globalization has facilitated this and
made the transition to global markets easier.
8.2.1 Foreign trade
Globalization has created and expanded foreign trade in the world.
Things that were only found in developed countries can now be found
in other countries across the world. People can now get whatever they
want and from any country. Through this developed countries can
export their goods to other countries. Countries do business through
international trade, whereby they import and export goods across the
global. These countries which export goods get comparative
advantages. Organizations have been established with a view to control
and regulate the trade activities of the countries in the world so to have
fair trade. World trade organizations emerged as a powerful
international organization capable effectively influencing individual
governments to follow international trade rules, copyrights, policies on
subsidies, taxes and tariffs. Nations can not break rules without facing
economic consequences
The number of nations that are dependent on trade, foreign capital, and
the world financial markets increased greatly. Countries engaged in

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foreign trade enjoy comparative advantage. The post Ricardian trade
theories predicted that specialization in labor and capital intensive
goods would bridge enormous wage gaps between the poor and the rich
countries, that is the developing and developed countries, sparing the
latter from massive labor immigration
8.3 Technology and Efficiency
More advanced systems are needed to facilitate global trade.
Globalization pushed us to create better systems to track international
trade. ERP systems are one of the solutions provided to support global
trade.
Enterprise resource planning (ERP) is a processing by which a company
(often a manufacturer) manages and integrates the important parts of
its business. An ERP management information system integrates areas
such as planning, purchasing, inventory, sales, marketing, finance and
human resources.
This technological innovation in global trade has enabled a more
efficient environment. Technology empowers efficiency in global trade
and reduces cost and time. In addition, production processes became
more efficient due to globalization as companies want to maintain their
competitive advantage.

9. NEGATIVE EFFECTS OF GLOBALIZATION IN THE WORLD

BUSINESS

9.1. JOBS INSECURITY

In developed countries people have jobs insecurity. People are losing
their jobs. Developed nations have outsourced manufacturing and white
collar jobs. That means less jobs for their people. This is because the
manufacturing work is outsourced to countries where the costs of
manufacturing goods and wages are lower than in their countries. They
have outsourced to developing countries like China and India. Most
people like accountants, programmers, editors and scientists have lost
jobs due to outsourcing to cheaper locations like India.

Globalization has led to exploitation of labor. Safety standards are

ignored to produce cheap goods. “In practice, however, the recent
experience in Latin America has been that many such open-handed

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multinationals moved their operations to, for example, China or South
East Asia because of cost and market considerations

9.1.1 Solutions

• Demonstrate your value. Demotivation can creep up on you when

you’re thinking of the possibility that you will soon be terminated from
work. Resist the urge to slack off. You’ll be giving your boss more reason
to phase you out. Do your best work at all times.

• Make a new plan, Job insecurity is especially stressful because it can

feel like the situation is out of your control. Take back your power by
actively directing your life. Plan, set new goals and make a clear action
plan.

•Be open to opportunities, Explore job opportunities within the

organization you’re working for. See if there are other departments that
can use your skills. If there are no internal opportunities, conduct a
regular job search on your free time or during weekends. Actively
network by attending job fairs, lectures and symposia.

9.2. FLUCTUATION IN PRICES

Globalization has led to fluctuation in price. Due to increase in
competition, developed countries are forced to lower down their prices
for their products, this is because other countries like China produce
goods at a lower cost that makes goods to be cheaper than the ones
produced in developed countries. So, in order for the developed
countries to maintain their customers they are forced to reduce prices
of their goods. This is a disadvantage to them because it reduces the
ability to sustain social welfare in their countries.

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9.2.1 Solutions

• Conducting Macroeconomic Policy, In implementing a

macroeconomic policy, it is basically a plan and action from the
government to provide knowledge related to economic growth. Because
this policy really needs to be done properly so that economic growth in
this country can take place in a healthy manner so that it can overcome
fluctuations.

• Planning the Quantity of Supply and Demand, The way to deal with
changes in the price of goods is to plan for the amount of supply and
demand. With the supply and demand can certainly affect the price of
goods in the market. So it is better if supply and demand can be expected
to be stable so that there is no change in prices.

10. THE NEGATIVE EFFECTS OF GLOBALIZATION IN

INTERNATIONAL COMMUNICATION


10.1 CYBERCRIME
Cybercrime is any criminal activity that involves a computer, networked
device or a network. While most cybercrimes are carried out in order to
generate profit for the, some cybercrimes are carried out against
computers or devices directly to damage or disable them. Others use
computers or networks to spread malware, illegal information, images
or other materials. Some cybercrimes do both target computers to infect
them with a computer virus, which is then spread to other machines
and, sometimes, entire networks. with globalization in the field of
technology and communication. it makes cybercrime more widespread
and easier to happen.

10.1.1 Solutions

• Use strong passwords, Don’t repeat your passwords on different
sites, and change your passwords regularly. Make them complex. That
means using a combination of at least 10 letters, numbers, and

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symbols. A password management application can help you to keep
your passwords locked down.
• Strengthen your home network, It's a good idea to start with a
strong encryption password as well as a virtual private network. A
VPN will encrypt all traffic leaving your devices until it arrives at its
destination. If cybercriminals do manage to hack your communication
line, they won't intercept anything but encrypted data. It's a good idea
to use a VPN whenever you are a public Wi-Fi network, whether it's in
a library, café, hotel, or airport.

10.2 LACK OF PHYSICAL COMMUNICATION WITH PEOPLE AROUND

With globalization, we can access anything easily. We can get
information, knowledge, entertainment, marketplace easily. it
sometimes makes us forget to communicate with those around us. If in
the past we communicated to buy something, now we can carry out
transactions without communication. globalization makes it easier and
eliminates healthy communication habits with friends, relatives, family
and parents

10.2.1 Solutions

• Recognizing poor communication, before you can get to work on
improving your communication skills, it’s important to first identify the
areas that need some work.

• Reduce gadget addiction, Limit the use of gadgets. Humans are social
creatures, therefore it is important for us to socialize and communicate
with people around us. gadget addiction can hinder it. so use the gadget
when it’s needed

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