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Group Members

Roll No
A002 A003 A004 A011 A027

Umangi Bhatt Amar Bhatt Mahendra Chouhan Amrita Kamarath Harshal Gambhir

1) Management of Strategy by Michael A. Hitt, Robert E. Hoskisson, R. Duane Ireland 2) Strategic management by John A Pearce II, Richard B Robinson,Jr

Globalization is the process by which different parts of the world interact economically, politically and culturally.

Integration of economies and societies all over the world. Involves technological, economic, political, and cultural exchanges made possible largely by advances in communication, transportation and infrastructure.

The globalization of markets refers to the merging of historically distinct and separate national markets into one huge global marketplace
National Markets

One Huge Global Marketplace

International Market Flow of Investments Flow of Information Technological Development

Increase Market Share

Domestic market may lack the size to support efficient scale manufacturing facilities Large investment projects may require global markets to justify the capital outlays

Return on Investment

Firms should expand overseas rapidly in order to preempt imitators

Economies of scale in manufacturing as well as marketing, R&D or distribution can spread costs over a larger sales base increase profit per unit low cost markets may aid in developing competitive advantage may achieve better access to Raw materials, Lower cost labor & Key customers

Economies of Scale or Learning

Location Advantages

Exports Licensing Own & Control Assets:

Joint Venture Merger & Acquisition Foreign Direct Investment

Political environment
Economic environment Social & Cultural environment Technological environment Legal environment

Global companies face multiple political, economic, legal, social, and cultural environment as well as various rates of changes within each of them Interactions between national and foreign environments are complex because of national sovereignty issues and widely differing economic and social conditions

Geographic separation, cultural and national differences, and variations in business practices tend to complicate communication and control efforts between headquarters and overseas affiliates
Global firms face extreme competition due to differences in industry structure Global firms are restricted in selecting competitive strategies by various regional blocs and economic integrations Migration of labor and work

Industrial Growth, Technical Development

Increase of Free Trade, Production Market Liquidity of Capital, trans border data flow Flow of Communication, fiber optic, satellite, telephone, internet Better Logistics in Business management New markets to Manufacturers

Economic and Financial Development

Sound flow of money, decrease in currency difference FDI increased Integrations of Markets decline in inflation New job opportunities in developing countries

Political Advancement
Creation of world government, Better understanding Open policies for trade and commerce Global treaties and agreements Information connected remote locations

Cultural Transformation
Development of world culture ideas, practices Cultural diversity (Hollywood + Bollywood) World wide Fads World become smaller

Social Development
Humanitarian issues and policies Increase in travel and immigration Worldwide campaigns and developmental efforts World leadership coming together UNESCO, UNICEF, WHO and many such growth of organizations Language : English gained the status of Global language

Strategic Risk Operational Risk Political Risk Technological Risk Environmental Risk

Economic Risk
Financial Risk