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Internationalization drivers and Global Markets

Article in Information Technology and People · October 2014

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Internationalization drivers and Global Markets

By Raul Bernardino, B.Sc., M.Sc.

Abstract:
Nowadays organization and companies will be different in next 5 to 10 years‟ time. The
world moves rapidly. The world leaders often met and put their intervention in order to have
a clear direction of the global market. Moreover, technology innovation helps to spread out
today‟s world decision and information to a very remote location in matter of second.
Therefore, innovation becomes a biggest part business strategy components and planning
whereas to be an updated organizations.

Furthermore, organization faces a time compression which means an organization is no

longer similar to last 20-30 years operations. In other hands, the employees are also facing a
past education very soon and therefore organization needs strategizing the available resource
within an updated knowledge and also uses of the innovation technology for delivering a
product and service within high quality standard and in time.

We are living in instant information and 24 hours news cycles. A 30 second story on the
evening news, Capitol Hill new legislation, new UN approach, a competitors or business
partner could shifting and playing in the field on any business landscape. There are too many
complexity and complicate things around internationalization and globalization.

In initial stage of the technology centered company is challenged with the complexity of the
foreign markets and global competition from their earliest stage of development. It is not only
to be a technology entrepreneurs who keeps certain technology based offer products, but they
must simultaneously stay abreast of the competitors and industry trends in the multiple
countries.

The findings suggest that resources necessary to pursue international sales have an important
impact on both foreign market intensity and diversity. Additionally, company age was
positively associated with the global diversity but not international intensity. Therefore,
business today should not necessary to have it owns resources; the important how to deploy
the available resources in the timely manner. These findings support the notion of small
technology companies become „instant internationals‟ but suggest that is proceeding to the
next step of achieving the global diversity will require a greater time and resources.

Introduction:
With the presence of the technology innovation and the existing of the internet, the
globalization such as global financials flows, transportations and market competition become
bases of adjusting and adapting the needs within the new products and services delivers. This
includes doing a strategic for new market environment. Additionally, the global market
becomes booming in all parts of the globe whereas it utilizes the means of the communication
by accessing the transportations (private and public) and multi financial resource.

Some factors need to consider in the global market competition:

1. ‘Global competition in the home market’: There are a lot of new products arrives and
supplies in the home market and probably we will lose our own customers very soon;
because our competitors may offer good quality of the products and services than we did.
 The competitor prices may also lower than our product price. The global competitions at
home markets are also speeding up a new innovation and added value to the customers, it
includes developing and improving the current products and services with the high quality
of standard.
2. ‘Stagnant or shrinking home market’: The global communication also helps stagnant the
home market. E.g. a new product which not launch yet however the promotion of product
has adverted and this will allow customer to wait that new product instead going to buy
an existing product with old fashion.
3. ‘Foreign markets with more opportunity’: the globalization gives an opportunity to
expand the market in the foreign countries, however the businessmen have to understand
several issues such as „International Trading System, foreign country economic
environment, foreign country political and legal system, foreign country culture and it is
environments’,Armstrong and Kotler (2010:580-585). The international trading system
may have a restriction from one country or nation to the other countries. For example, to
protect their domestic products and its company, the government of the country may put
high tariff or taxes to the imported goods which gain additional revenue to the
country. The economic environment, the businessmen have to analyse „foreign country
industrial structure and income distribution’, Armstrong and Kotler (2010:582). The
industrial structures are consisting of economic subsistence, export raw material
economics, and industrialization economics. They are also look at income distribution for
low individual incomes, medium, and high household. The foreign country political and
legal system. The political stability, bureaucracy, and legal system are the major factors
and metrics point for the new market entry into the country. The businessmen have also
need to know the new target country‟s culture and norms before trying to expand their
products and services marketing. Each country has different norms and beliefs. For
example, we cannot sell fast food with pork meat in the Islamic countries and etc.
4. ‘Expansion of customers to international markets’: Build a good relationship with new
customers and with the existing customers can be seeing as the point to expand new
product and service, it includes introducing new product from foreign countries.

In general a globalization is an integration of the societies, economies, cultures of the globe

over of process of technology innovation, politic and trade.

The advantages of globalization:

1. Free trade is which a country does not pay a levy taxes on import or export goods or
services.
2. Globalization allows company tries to find new market and earn more customers.
Subsequently, companies are competing each other by provide goods a service with high
quality because customers have more choice in new market.
3. Globalization brings up employment rate because new market need both skilled and un-
skill labor. The globalization increases living standard.

The disadvantage of globalization:

1. Although, the globalization increases employment's rate in new market, meanwhile
unemployment's rate increase in developed countries. Industries are moving from
developed nation to less develop countries. It‟s because in less develop countries have
low labor cost.
2. People immigrate in to other countries and bring their own cultures to the destination and
forget local culture.
 International standards and best practices become and standard for ever organizations such as
health and safety environment policies and procedures, quality management, ISOs, etc. In the
organization where I work, we use OPEC prices as a standard for determine oil and gas
prices; ISO 27001 for information security management system, etc.

This international standards drives the organization to lift up their standards whereas to
compete with other organization and to be an excellence and up to dated organizations. This
also bring local company become international deliver service globally.

In case of Siemens company that‟s operates across 190 nations all decision must in the best of
Siemens interest. Moreover, the design keeps concentering in manufacturing and economics
scale through specialization. Those product can ship to anywhere within the group. The
weakness part is currency changes fluctuation that can affect to the price in the market.

There are many globalization challenges to the Seimens. For instance customer can buy raw
material from any supplier but not have a technical expertise, therefore Seimens comes with
product and services at once. This is a deliberate strategy for Siemens. Seimens in the UK
share the customer culture and it group focuses on think customers.

As we know that in the global market there are lots of competitors therefore Seimens
established global center of excellence that can serves the special request for entire group.

Conclusion:
According to Professor Gary Hamel, London Business School on „Creating the Future‟
presentation to the senior executive course at Stanford University (December, 1997) stated
that: “Ninety per cent of what you need to learn, you will learn from outside your own
business sector.” Therefore, we do need a coping from other organizations and adapt them
into our own business environments. Especially the changes are more quickly than ever
(time compressing era).

Therefore internationalization becomes vehicle for the globalization.

Reference List
 Armstrong, G. and Kotler, P. (2010) Principles of marketing,13th edition, Global edtition:
Prentice Hall
 Miles, G.,Preeece,S.B., Beatz, M.C. (1998), Explaining the international intensity and
global diversity of early-stage technology-based firms [on-line]. Available
from: http://www.sciencedirect.com/science/article/pii/S0883902697001055(Accessed:
22 October 2014)
 Stiglitz, The globalization [on-line]. Available
from: https://www.youtube.com/watch?v=sV7bRLtDr3E (Accessed: 8 November 2014)

 Meeting Global and Local Needs [on-line]. Available

from: http://businesscasestudies.co.uk/siemens/meeting-global-and-local-
needs/introduction.html#axzz32685SAnm (Accessed: 8 November 2014)

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