GLOBALISATION

Globalization:- globalisation
is the word which basically means to the cross border relationship of two or more nations, as well as their economies, business, industries,cultures and trends.

 At the company level,globalisation means two things A) the company commits itself heavily with several manufacturing locations around the world and offers products in diversified industries. B)the ability to compete with domestic markets with foreign competitor

Need of globalisation
The primary motive for going global is that there is money in the overseas market.

Rapid shrinking of time and distance across the globe due to faster communication, speedier transportation, growing financial flows and rapid technological change

 It is being realized that domestic markets are no longer adequate and rich. Some govt. policies which are hindering the growth of business in home country. Deterioting competitions. Better growth perspective in other countries

How do companies go global

First stage- passive dealing with foreign individuals and organisation,involving third party Second stage-deal directly with their overseas party, company do not have employees based abroad but domestic employees would regularly travel abroad on business

 Third stage-the company has a direct hand in importing and exporting and produce goods or servicees abroad. In the final stage the company sees its activities as essentialy multinationalas opposed to domestic.

Benefits to the host countries

Improving the economies of less developed economic countries (host country) Creation of new job opportunities in the host country leading to decrease in unemployment. Using the resources, or proper utilization of resources like materials and manpower.

 Invading competitions brings the quality products in to the market for consumers as monopoly is dangerous and competition improves services. Cultivation of good managerial skills that tends to be scare in host countries particularly developing one Encouragement to world economic unity and through that, political and economic integration-all resulting in world harmony.

Benefits to home country

Acquisition of raw materials from abroad, ofetn from astedier supply and at lower prices than can be found domestically. Technology and management expertise acquired from competing in global markets. Export of components and finished goods for essembly or distribution in

 Inflow of income from overseas profits, royalties, licensing fees and management contract. Job career opportunities at home and abroad in connection with overseas operations. Subsidies and tax rebates in the host country.

Problems to the host country

Their resources are being over utilized. Labor is paid very less incomparision to their country, exploitation Problem of brain drain, people from host countries prone to other countries for their growth leading to the hamper in the growth of the host country

Problem to home country

Loss of employment in home country. Political pressure & threats Biasness of local government in host country. Acceptance and penetration in global market. Dependency on the host country.