Impact of Globalization on Organizational Behaviour

Presented by:A.Raj Shravanthi

Introduction

• One of the other major environmental context impacting organizational

behavior is globalization.

• Today, well-known U.S.-based multinational corporations have more than

half their assets overseas.

• With trends toward similar clothes, entertainment, material possessions,

and recognition that English is the international business language, people

around the world still think and behave in different ways.

• The starting point of how the globalization environment affects and is

affected by organizational behavior is culture.

Definition

• Globalization means to increase their base of

operations, expand their workforce with

minimal investments, and provide new

services to a broad range of consumers

Two Sides of the Definition of Globalization

• Mainstream Approach: The expansion of global market improves the efficiency and living standards of

organization. From this perspectives, organization can use adequate rational decision making to resolve the

increasing internationalization problems. The Nike corporation and its products are well known throughout

the word. After some experiments, Nike moved toward a subcontracting system, reaching agreements with

independent manufacturers to produce the shoes and other goods. This gave Nike a high level of flexibility

as they could increase or decrease overall production according to market demand without carrying

unnecessary overhead costs, for example, they can set up some tight conditions and contracts.

•

Critical Approach: It exposes that we need to concern the cost of globalization. A few people who have the

power to influence on the process in terms of social power and concentration of economic . And it reveals

that how groups are struggling inside the organization. From a critical perspective, Nike reveals the

multinational firms contribute to global inequality. If they produce shoes in the US, they have to cut its profit

margins substantially because US employees are paid quite high wages. In contrast, producing the shoes in

China reduces the costs significantly.

Effects of Globalization• Industrial - Emergence of worldwide production markets and broader

access to a range of foreign products for consumers and companies.

• Financial - Emergence of worldwide financial markets and better

access to external financing for borrowers.

• Economical - Realization of a global common market, based on the

freedom of exchange of goods and capital.

• Political - Politically, the United States has enjoyed a position of power

among the world powers; in part because of its strong and wealthy

economy. With the influence of globalization and with the help of The

United States’ own economy, the People's Republic of China has

experienced some tremendous growth within the past decade.

Effects of globalization continued…

• Competition – To survive in the new global business, market calls for

improved productivity and increased competition. Industries have to

upgrade their products and use technology skillfully for facing the

competition and increasing their competitive.

• Cultural - Growth of cross-cultural contacts; advent of new categories

of consciousness and identities embodies cultural diffusion.

• Informational - Increase in information flows between geographically

remote locations. This is a technological change with the advent of

fiber optic communications, satellites, and increased availability of

telephony and Internet.

Threats of Globalization

• Increase of unemployment

• Diversity

• The multinational have only handful of

shareholders

• Health sector

OPPORTUNITIES

• Growth & development• . push the exports abroad and foreign

investment is much more convenient. • Increase trend of outsourcing HUMAN

RESOURCE functions• Free TRADE• TRANSNATIONAL REGULATORY

Advanced Globalization

• Sourcing resources• Delivering• Information exchange

Global Workforce in Some Indian Firms

COMPANY TOTAL EMPLOYEE

TOTAL SENIOR MOST JUNIOR MOST

TATA MOTORS

22,000 950 R&D ENG SHOPFLOOR WORKER

ASIAN PAINTS

4,600 1,400 COUNTRY MANAGER

PAINT FACTORYWORKER

INFOSYS 46,196 1,300 HEAD CONSULTINGBUSINESS

INTERN

GLOBAL EMPLOYEES

Thank you for your attention!