ON GLOBALIZATION על גלובליזציה

1. ON GLOBALIZATIONעל גלובליזציה Corporations without roots. תאגידים חסרי שורשים

2. GLOBALIZATION IS CHANGEגלובליזציה מסמלת שינוי Forces that impel individuals, groups, and institutions to engage in similar forms of behavior. (Rosenau, Current History, 1997) גורמים אשר דוחפים אנשים קבוצות ומוסדות לצורות התנהגות זהות.

3. FOUR TYPES OF CHANGEארבע סוגים של שינויים • Stretching of social, political & economic activities across political frontiers. פרישה של פעולות חברתיות, פוליטיות ו - כלכליות מעבר גבולות. • Growing magnitude of interconnectedness of flows of trade, investment, etc. הקף גובר של זרימות מתוקשרות של סחר, השקעות, וכו’.

4. Evolution of world-wide systems of transport and communication. • התפתחות של מערכות תחבורה ו- תקשורת בכל העולם. • Increasing intensity and velocity of global interactions. • גידול בעוצמה ובמהירות של פעולות הדדיות.

5. TYPES OF GLOBALIZATIONסוגי גלובליזציה • ECONOMIC -Integration of economies, through trade and financial flows. Movement of labor and knowledge across international borders. • כלכלית - אינטגרציה של משקים באמצאות סחר ומימון. תנועות של כוח אדם ו-ידע מעבר גבולות.

6. POLITICAL - Participation in international governmental organizations (IGOs); integration with regional IG networks (e.g., EU, Organization of American States). • פוליטית - שיתוף עם IGOs ; אינטגרציה עם מרקמי IG. כמו ה - EU וה - Organization of American States.

7. CULTURAL - Flows of science, concepts of liberalism, socialism, capitalism, etc. • תרבותית - זרמי מדע, מוסגים כגון ליבראליזם, סוציאליזם, קפיטליזם, וכו’. • ENVIRONMENTAL - Global warming; ozone depletion; production and reception of cross-border pollutants (e.g. acid rain). • סביבתית

8. GROWTH OF TRADE גידול במסחר CAPITAL FLOWS זרימות הון MIGRATION הגירה (ניידות) IT and the WEB DIFFUSION OF TECHNOLOGY נפיצות של טכנולוגיה GLOBALIZATION גלובליזציה

9. BENEFITS Economic Growth Reduction of Poverty Improved Health, Life Expectancy Spread of Knowledge Flexibility of Production COSTS Inequality Worker Displacement Risks of Banking & Currency Crises Domination of Trade & Production by TNCs Degradation of the Environment Loss of Authority BENEFIT versus COSTתועלת לעומת מחיר

10. CONCEPTS OF GLOBALIZATION • GLOBAL INFRASTRUCTURE תשתית גלובלית • GLOBAL HARMONIZATION הרמוניזציה גלובלית • BORDERLESSNESS בלי גבולות • GLOBAL DIFFUSION • נפיצות גלובלית • DISPERSION OF CORE COMPETENCIES • פיזור של יכולות תווך

11. ENGINES OF GLOBALIZATION • TRANSNATIONAL CORPORATIONS • TRANSNATIONAL MEDIA ORGANIZATIONS • INTERGOVERNMENTAL ORGANIZATIONS • NON-GOVERNMENTAL ORGANIZATIONS

12. INTERNATIONAL ACCOUNTING STANDARDSכללים חשבונאיים • International Accounting Standards Comm. • ועדת הסטנדרטים החשבונאיים הבינלאומית • קובץ כללים חשבונאיים בינלאומיים אחיד • Financial Accounting Standards Board (FASB) • מועצת הסטנדרטים החשבונאיים הפיננסיים

13. EXAMPLE • Smith Kline Beecham (1993) $1.5 Billion Profits according to British Accounting Standards • $1.2 Billion Profits according to United States Accounting Standards

14. HARMONY OF VISION? ?הרמוניה של חזון The Leaders of the world’s great business enterprises continue to differ in their most fundamental strategic visions. (Keller & Pauly, Current History, 1997)

15. MULTINATIONAL STRATEGIES • AMERICAN - SHORT-TERM PAYOFFS • GERMAN - FOCUS ON A NARROW BAND OF INDUSTRIES IN WHICH THE BENEFITS OF NEW TECHNOLOGIES TEND TO BE DIFFUSED WIDELY. • JAPANESE - LONG-STANDING CORPORATE NETWORKS.

16. GLOBALIZATION - THEN AND NOW “The World is a City” Karl Meyer Rothschild (1875) • The Workforce is less mobile today then in the 19th century. Example: There was no need for passports and most people moved freely from one country to another. 60 million Europeans migrated to North and South America, Australia. In 1900, 14% of the American population were immigrants, compared to 8% today. • In the 1860s and 1870s, many goods were traded freely. Example: 95% of German imports were customs free. According to the “Capital Mobility Index” of the IMF, the volume of capital movements in relation to GNP is less today than in the 1880s.

17. YES, BUT... • 19th Century trade was primarily in commodities, today it is primarily in goods and services. • 19th Century capital movements were concentrated in the hands of small groups of wealthy people for long term investment. • Capital movements today are faster, but shorter term.

18. WHAT IS A GLOBAL INDUSTRY?מה היא תעשייה גלובלית? “An industry in which there is some competitive advantage to integrated activities on a worldwide basis.” כאשר פעילות משולבת במישור הבינלאומי תתרום ליתרון תחרותי Michael Porter

19. THE MULTINATIONAL CORPORATION • A company with significant operations and market interests outside its home country. • Affiliated firms are linked by ties of common ownership. • The MNC draws on a common pool of resources. • Its affiliates are linked by a common strategic vision.

20. GLOBAL INDUSTRY • One MNC’s entire worldwide system of product and market is positioned against a competing MNC(s). • Strategy is centralized. • Response to local market needs where and when necessary.

21. TWO INDUSTRIES: TWO STRATEGIES MULTIDOMESTIC INDUSTRY • The MNC pursues separate strategies in each of its foreign markets. • Each overseas subsidiary is strategically independent. • MNC headquarters coordinates financial controls and marketing worldwide. • Each subsidiary is a profit center.

22. GLOBAL INDUSTRIES Caterpillar & Komatsu (heavy construction equipment) Timex, Seiko & Citizen (watches) GE, Siemens & Mitsubishi (heavy electrical equipment) MULTIDOMESTIC INDUSTRIES P & G (household products) Honeywell (controls) Alcoa (aluminum) General Foods (branded foods) SOME INDUSTRY EXAMPLES:

23. GLOBAL STRATEGY LEVERS

24. ORGANIZATION FEATURES FOR TYPES OF GEOGRAPHIC BUSINESSES

25. INTEGRATION - RESPONSIVENESS GRID • High Integrated Product Strategy, Worldwide Business Management Need for Integration Product Emphasis Multifocal Strategy, and Organization Area Emphasis Locally Responsive Strategy, Autonomous National Subsidiaries Low Need for Responsiveness High Low

26. Sales increased market reach broadens volume base falling costs and prices, as a result of globalizat- ion, improve sales increasing sales

27. Margins increasing sales higher margins decreasing costs + expansion into “virgin markets” allows firms to set higher margins to take advantage of the imbalance in supply and demand

28. How Globalization Affects Costs, Sales and Margins Costs competitive pressure drives firms to cut costs synergetic gains result from the consolidation of acquired businesses overseas in a globalization initiative exposure to best practices improves productivity productivity gains and the capture of R&D spillover result from operating in “lead country” catering for demanding clients in different jurisdictions decreasing costs scale economies via global participation spread R&D costs over large volume base

29. ANALYSIS FOR STRATEGY DEVELOPMENT Global Businesses Electronic Components, Medical High Multifocal Businesses TV, Ophthalmic Products Global Locally Responsive Businessses Corningware, labware Low Local Low High