Lesson aims
- Discuss the impact of globalisation on the growth and evolution of businesses.
- Discuss how businesses impact the countries in which they operate.
Globalisation refers to the increasing interconnectedness of countries across the world in terms of communication, culture, trade, and the movement of people. It can be considered both an opportunity and a threat for most businesses. Businesses both contribute to globalisation and react to it.
Task - How global are you?
Consider what you are wearing and using right now in class. For each of your items of clothing, accessories and 'attachments' (mobile phone, mp3 player, watch) find out where it was made and mark that information on the image. How global does that make you? How dependent are you on other countries? Which countries are dependent on you and your lifestyle?
Business opportunities from globalisation:
- Selling internationally - Expand markets beyond home country where market may already have reached saturation.
- Moving closer to customers - Reduce transportation costs and improve companies’ understanding of local needs.
- Producing internationally - Seek out lower-cost raw materials and production opportunities.
- Operate at a scale that can provide a competitive advantage.
- Reduce overall risk, as downturns in one regional economy may coincide with stronger growth in another.
Business threats from globalisation:
- Competition from international businesses that the enter the home market.
- Financial links could lead to negative impacts globally from one sector affecting other sectors
Further reading
What is the history of globalization? Spend some time getting a grasp of globalization's history. YaleGlobal Online is a good place to start.
Who Really Wins From Globalization? (Pros and Cons of Globalization)
Globalization I - The Upside: Crash Course World History #41
Globalization II - Good or Bad?: Crash Course World History #42
Map: All the Countries That Contribute to a Single Jar of Nutella [11 December 2013 ]