Globalization of business can be define as multi-directional because globalization is at the same time leading to greater emphasis on nation identity and leading to greater cooperation between nations. Globalization is creating a situation where manager must able to work with people from different cultures, nations, regions and continents. As China's economy has attracted attention from all over the world, lots of international companies can be found in China (Rodriguez, 2007). Due to globalization, most of the firms are workforce diversity. To be deal smoothly in China, foreigner should have ability to perform to a great extent when dealing with the Chinese.
Globalization became a buzz word in the 1990s because of its influence in creating a world in which geographic location became increasingly irrelevant. In essence globalization refers to the unrestricted flow of goods, capital, information, technology and people across national borders (Chow, 5).
Globalization is, however, by no means a new phenomenon and China has been subjected to its effects for many centuries (Alford, 1999). In fact, the effects of globalization in China go "as far back as the Han dynasty (206BC-220AD) when trade took place between the Han Chinese and neighboring people in the North-west through the Silk Route" (Chow, 3). Despite this, in the Qing Dynasty and the early stages of the Chinese Communist Party's rule, right up until Deng Xiaoping's open door policy, China tried to close its doors and restrict the influence of globalization (Street, 2000 and Chow, 11).
This was not the first time that China was forced to confront and implement a national strategy to either embrace or combat the effects of globalization. In fact, as recently as the 1990s, China was confronted by this conundrum, namely: whether to continue its global economic expansion in the face of the Asian financial crisis or to once again close it doors and retreat inwards to protect itself from the economic fallout of a struggling region (Fishman, 25 and Nolan, 31). However, by carefully weighing the advantages and disadvantages of economic openness the Chinese government decided to open up the Chinese economy even more, and eventually joined the World Trade Organization by implementing large economic reforms (Bijian, 2).
There is no doubting that these economic reforms and China's embracement of globalization has brought stunning results. Since starting to open up and reform its economy in 1978, China "has averaged 9.4 percent annual GDP growth, one of the highest growth rates in the world" (Bijian, 3). One of the reasons for the huge leaps in growth has come from direct foreign investment that has been facilitated by China's admission to the WTO. For example, in the space of a few days in 2004, a North Korean Steel Company launched a $500 million steel project in the Dalian development zone; France's St Gobain invested $70 million in one of its presented glass production lines in China; Germany's Siemens inaugurated its 14th office in China for development of software; and Finland's Stora Enso invested $1.6 billion in a paper pulp project in Guandong Province (Hall et al, Press). Such results have seen China become the third largest trading country in the world and the