Globalization as Radical Economic Transformation: Critical Implications

ABSTRACT Globalization is a highly complex process of enormous significance for business organizations across the world. However, compared to the research attention received by globalization in several other social scientific disciplines, the topic seems to have remained somewhat under-studied within business scholarship itself. This article, accordingly, seeks to make a contribution to business research by way of offering a comprehensive conceptual discussion of different aspects of economic globalization, and what these might imply for business. Toward that end the article discusses the major processes that constitute the phenomenon of economic globalization, their potential effects and consequences, and the implications of globalization for businesses and management. The article suggests that the dynamics of globalization may be seen as leading the way to a radical transformation of the entire economic landscape of the world. Thriving in such a brave new economic world will require an extraordinary degree of creativity and ingenuity, and a willingness to give up established patterns of thought and old mindsets on the part of individual firms. INTRODUCTION Globalization is widely viewed as a highly complex process of enormous significance for business organizations across the world. However, researchers have also noted that compared to the attention globalization seems to have received in some of the other social scientific disciplines (e.g., economics, political science, sociology, or anthropology) the topic remains surprisingly understudied within business scholarship itself (Jones, 2003 ; Parker, 2003). Accordingly, this paper seeks to make a contribution to business research by way of offering a comprehensive conceptual discussion of different aspects of economic globalization, and what these might imply for business. Toward that end the paper discusses: (1) the major processes that constitute the phenomenon of economic globalization, (2) their potential effects and consequences, and (3) the implications of economic globalization for businesses and management. Globalization is a much discussed topic with an extensive popular as well as scholarly literature, the latter in turn stretching across a range of different disciplines. Not surprisingly, perhaps, there is considerable disagreement among analysts about the overall nature and significance of the phenomenon. Even the definition of globalization is a matter of some debate, with Parker (2003) pointing out that there already exist some 35 different definitions of the term. In general, however, scholars tend to agree that globalization needs to be viewed as a multi-dimensional phenomenon involving not only economic aspects but also cultural, political, technological, ideological and similar other features (Appadurai, 1996; Held & McGrew, 2003; Singh, 2005; Stiglitz, 2002; Pieterse, 2004). The specific focus of this paper extends only to the economic aspects of globalization. Economic globalization may be conceptualized as the growing economic interdependence among countries as reflected in increasing cross-border flows of... goods and services, capital, and know-how (Govindaraj an & Gupta, 2000). Much has been written on the long history of economic globalization, with scholars pointing to the various phases or waves of globalization occurring over the past several centuries (Arrighi, 1999; Held, McGrew, Goldblatt & Perraton, 1999; Robertson, 1992). The focus of this paper is on the contemporary phase of economic globalization, a process seen as beginning during the post-World War II period and gathering substantial momentum since the decades of the 1970s and the 1980s. The accelerating pace of the current phase of economic globalization is attributed to a number of factors, including technological advances in the areas of transportation, telecommunication and information processing, as well as political and ideological developments (Friedman, 2005; Govindarajan & Gupta, 2000; Jones, 2003; Prestowitz, 2005). …