New Problems and Challenges in Global Management
Globalization and the absence of conventional, large-scale warfare are facts of life but the expected efficiencies have brought about new challenges for the leaders of global enterprises. Traditional intercultural barriers have merely manifested on new levels as the expectations and educational attainment of people in developing nations grow. The ideological conflict between democracy and laissez-faire economics on one hand and Marxist central planning, on the other hand, has been supplanted by religious strife as Muslim terrorists pervert their religion to sneak death and destruction on each other, on Israel and any convenient target among the OECD nations.
Steadily wider acceptance of the World Trade Organization treaty terms has definitely helped global enterprises gain market access without as much bribery, politicking, or long waiting times as in prior decades. However, newly-industrializing and developing nations do not necessarily attain reciprocal access for their processed goods, and this fuels resentment. Furthermore, American businessmen under pressure at home to demonstrate ethics, good governance, and transparency continue to be surprised that Arabs, Asians, and Africans think corporate social responsibility is best practiced among their own relatives.
In the face of a lingering recession already more than two years old, pious pronouncements of free trade wilt when American workers continue to lose jobs to China, India, Mexico, and the rest of Latin America. The present political leadership would rather send the Federal deficit sky-high with halfway measures that sound good on the evening news but do not stem the torrent of dollars and jobs overseas.
In the last fifteen years or so, the Internet revolutionized business, driving down the costs for getting to market or monitoring competition. But this same technological marvel also freed call centers from domestic toll-free lines. Voice-over-IP allowed large contact centers and business processing organizations like Accenture and Convergys to expand overseas and take advantage of “labor arbitrage”. The new global enterprise operates 24 x 7 x 365, giving managers no rest when the email reaches them in an instant on their Blackberrys.
The Research Process
In synthesizing how corporate strategy is arrived at, Michael Porter had it exactly right with his “Five Forces” model. The opportunities and constraints global managers operate under are so numerous as to make strategic decisions a complex and risky undertaking. These “strategic factors” include geopolitics, regulatory environments that differ from one country to another, the bargaining power of markets, suppliers, distributors, and direct, indirect, and potential competitors.
This lesson is immediately brought home when doing a database search for “global management”. Such a search quickly fragments into core and “global” subtopics. Examples of the former are “leadership”, “strategy”, “participatory management”, “occupational psychology”, “labor relations”, “quality management” and the related matters of “ISO accreditation” or “Six Sigma”, and of course, “marketing”. On the other hand, researching the “global” paradigm naturally brings up “globalization” and “global economy”. By country and region, there seems to be a great deal of reading and therefore author interest in “China” as the world’s dirt cheap workshop. “Canada” also merits substantial attention for being the proximate and most culturally compatible location to outsource offshore/”near-shore” work for USA companies.
References
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Ojasalo, J. (2009). Risk, cultural theories and global management. The Business Review, 14(1), 83-91.
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Tubbs, M. (2010). Worldwide R&D investment growth slowed in 2008/09, new scoreboards show. Research Technology Management, 53(1), 2-4.