How globalization is impacting organizations; companies are being operated in a way that is much different that the model we may have been accustom to in the past. Many organizations have developed strategies that reduce the barriers to trade. They have either moved operations to other parts of the globe or brought the work force to their physical (or virtual) locations to fulfill their work force needs.
As a result of globalization, many countries have seen rapid industrial growth. In many cases, the process is happening many times faster than it would have prior to the free trade environment we see developing today. The average household income in some countries has multiplied several times over. For example; a recent report on National Public Radio discussed a small farming community in rural China where the incomes have tripled. Over the past year this community has transitioned from farming to the manufacturing of goods because they can make more money.
This rapid growth is the direct result of a global search to produce products in the most economical way possible. If it were not for the free trade happening in the “global village” these countries would not be able to expand at this expedited rate. “Because of globalization many people in the world now live longer than before and their standard of living is far better.” (Stiglitz, 2003)
There is a large body of evidence that supports the positive aspects of globalization. However, there are also many less desirable outcomes identified. Countries that are less developed have fewer regulations imposed on them and the industries they are involved in. The lack of sensible rules and regulations leads to the headlines we are seeing all too often today; environmental concerns, Health and safety, child and unfair labor practices, job losses in developed countries, company relocations and market value erosion due to the highly competitive global environment. All of these factors have an impact on the overall global picture.
Looking forward; according to a recent study published, the world population will grow by another 1.5 billion people before the year 2030. Most of this growth will happen in the developing countries. The population in current higher earning countries will not grow at the accelerated rate expected in developing countries, therefore; the population in those countries will consist of an older work force. These factors will impact demographics in these countries and influence trends in many areas including, earnings and productivity. “The global economy would grow from about $35 trillion in 2005 to $75 trillion in 2030, an overall increase of 2.1 times.” (The World Bank Group, 2007)
Based on the trends that have been published, it would...