Future of Business - Coursework Example

Future of business Globalization, Privatization and Liberalization have brought many changes in the Business environment and many of the traditional business concepts is currently undergoing drastic changes. The current business environment is highly globalized or interconnected and the future seems to be even more complex. Even a small fluctuation occurring in the business world at some part of the world now is affecting other parts also. Unexpected things can happen in business quiet regularly now. The recent financial crisis is one best example for the vulnerabilities of business. It is difficult for the business people to predict the future accurately. At the same time, it is possible for the entrepreneurs to formulate better strategies for their survival in future. Out sourcing, offshoring, cross border alliances, mergers, acquisitions etc are some of the prominent business strategies utilized by the business people to survive in the market. Looking to the future of the business, an entrepreneur should; broaden his knowledge and skills, set benchmarks, achieve greater influence and respect, etc in order to manage his business successfully in future. This paper briefly analyses the future of business in my own perspectives, considering me as the entrepreneur. Future of business “An effective work environment is vital to the success of small businesses and large corporations alike” (Kingston, 2007). As an entrepreneur, I should be able to adapt myself to the changing requirements of business world. Earlier, entrepreneurs did everything possible to maximize their profit. Injudicious exploitation of the resources, unhealthy competition, undercutting, spreading rumors etc were some of the common business strategies played by the entrepreneurs. At present mutual cooperation seems to be the winning slogan adopted by many of the prominent business people. In my opinion, the cooperation between the business groups could be increased further in future because of globalization. For example, even Wal-Mart, the biggest supermarket chain in the world established collaboration with Bharti group of India in order to exploit the opportunities of Indian market. The Indian news daily, The Hindu dated November 28, 2006 reported that “the worlds biggest retailer, U.S. based Wal-Mart, has tied up with Sunil Mittals Bharti Enterprises to make a direct entry into Indias retailing sector” (Wal-Mart enters India with Bharti tie-up, 2006). Nobody can match the financial abilities or the resources of Wal-Mart and it is not necessary for Wal-Mart to seek the advice of others in supermarket business. Even then, instead of establishing a free business unit in India, Wal-Mart sought the help of Bharti group which clearly shows the importance of mutual cooperation in this extremely globalized business environment. This cooperation in all probabilities may double in future when we forecast the business climate. In short, as an entrepreneur, I must focus more on establishing sound relationships with the fellow entrepreneurs even if they happen to be in the same lines of my own business. Internationalization of business is important for me to compete effectively in the market. Earlier internationalization of business was extremely difficult because of the complexities of formalities in entering another country for business purpose. But now, almost the entire countries have reduced the norms required to start a business in their soil because of the awareness of the importance of foreign direct investments in the economic growth of a country. “Cross border alliances “gained momentum as the best way to access the capabilities of other companies, as well as the best ways of dealing with fragmented and deregulated markets”(Goliath). Merger, acquisition, establishing a new business unit etc are expensive and time consuming strategies of internationalization business whereas strategic alliances can be established quickly and it can start functioning straight away after the agreements were signed. Time required to establish strategic alliance, is the time required to conduct a successful negotiation process to reach the agreements. In short, I should think in terms of establishing business alliances with the international firms in order to stay active in the global market. It is impossible for an entrepreneur to manage a business successfully in future, if he fails to evaluate the trends at present. For example, gay bars were so popular in America, till recent times. Many people started gay bars and reaped profits. However, gays and lesbians are getting more acceptances now in the society and hence the popularity of gay bars is decreasing. In short, an entrepreneur should consider the changing life styles of the people seriously while formulating business strategies for the future. Business philosophies are also undergoing changes at present. Outsourcing and offshoring like business principles have revolutionized the business world. Earlier, the entrepreneurs evaluated the business climate in their country before starting a business since most of the businesses utilized the domestic resources. However, at present business people are not only utilizing the domestic resources, but also the overseas resources as well because of globalization. For example, many of the American IT firms outsource their works to India like developing countries in order to exploit the cheap labor market there. A project which needs $1000 for completion in America can be completed for $ 5000 if it is outsourced to countries like India. American companies are saving billions of dollars every year through outsourcing of their businesses to overseas countries. In short, exploitation of the cheap labor markets as much as possible could be a winning business strategy in future. We should remember that Chinese products are causing big problems to the American and European products in the global market. China is able to reduce the prices of their products because of the cheap labor available in their country. On the other hand Americans and Europeans are struggling to reduce the prices of their products because of the expensive labor associated with the production activities in this region. In order to compete effectively in the consumer goods market, American and European countries have the only option of reducing the price. However, this could be impossible of they rely only on the domestic labor market. In short, outsourcing and offshoring like business strategies could be the winning business strategies in future also. As an entrepreneur, I must find out the cheapest labor markets in the world in order to compete effectively in future. Anybody, irrespective of his country of origin or culture can work anywhere in the world at present. I must utilize such opportunities judiciously in future in order to mange my business successfully. “Telemarketing has been hit hard by the national Do-Not Call list that was established five years ago, and sales have been stagnant, but the industry still managed to bring in $393 billion in revenue last year”(Williams, 2007). The ever increasing popularity of mobile phones helped the marketers to use telemarketing strategies effectively to market their products. Perhaps telemarketing is the cheapest method of marketing at present. Instead of conducting huge sale promotion campaigns, and advertising, telemarketing will help an entrepreneur to reach the individual customers. Individualized marketing is going to be the future marketing strategy. Telemarketing and internet marketing would help me in reaching all the customers individually and to cater their needs. “Often the present is difficult to read. Understanding the present is of limited help in projecting the future” (Heller, 2008). Business climate is changing or fluctuating rapidly because of its close connection with several parameters like economy, political stability, social and cultural set up, environmental issues etc. In some cases, unexpected things can cause immense damage to the business. For example, Gulf of Mexico oil spill created immense problems to British Petroleum. The company is one the verge of bankruptcy now because of huge compensation it forced to pay the revival of the affected region. Huge fluctuations in world economy affected almost all types of business badly, not only in U.S. but all over the world. Even the multi billionaire companies found it difficult, to exist in the market. Because of the implementation of globalization, the vulnerability of business has been increased a lot. For example, the poor performance of the share markets in America can affect other countries also because of the huge investments made in American share markets by overseas companies. In short, it is difficult for even smarter people to predict the present or future prospects of business and hence as an entrepreneur, I must formulate a risk management strategy well in advance for the future use. Risks can occur anywhere and anytime. Natural disasters and manmade disasters can strike the business in future. As an entrepreneur, I must formulate a risk management strategy well in advance in order to deal with the future disasters either expected or unexpected. Conclusions We are leaving in a society which is advancing rapidly because of the tremendous advancements happening in science and technology. Along with advancements, lots of threats are also entering in to the business world. An entrepreneur should be able to manage both the expected and unexpected calamities of business in order to stay in the market. Many people are of the view that it is difficult to predict the trends in future business. Even big business gurus failed to predict the future of the business accurately. In my opinion, those who are utilizing the current situation will be benefitted more than those who are looking for the future alone. Current situations should be considered as the benchmark for the future. References 1. Goliath. (2005). Cross-Border Alliances: Advice from the Executive Suite. Journal of Business Strategy. 01 Jan 2005. Retrieved from http://goliath.ecnext.com/coms2/gi_0198-225211/Cross-border-alliances-advice-from.html 2. Heller. R. (2008). Future Business: The importance of being a visionary for future Success. Thinking Managers. Retrieved from http://www.thinkingmanagers.com/management/future-business.php 3. Kingston D. (2007). Creating a positive, productive and successful work environment Retrieved from http://www.the-success-factor.com/successful_work_environment.htm 4. Wal-Mart enters India with Bharti tie-up, (2006). The Hindu (November 28, 2006). Retrieved from http://www.hindu.com/2006/11/28/stories/2006112804951700.htm 5. Williams, G. (2007). 10 businesses facing extinction in 10 years. Entreprenuer.com Retrieved from http://www.msnbc.msn.com/id/20873711/ns/business-future_of_business/ Read More