Globalization, Multinational Organisations and Cultural Aspects - Assignment Example

? GLOBALIZATION, MULTINATIONAL ORGANIZATIONS AND CULTURAL ASPECTS Introduction 3 What is Globalization? 4 Dimensions of Globalizations 5 General Perception about Globalization 7 Globalization and Culture 8 Role of Multinational Corporations 10 Critics of Globalization and Counter Criticism 10 Globalization and Economic Integration 11 Conclusion 12 References 14 Summary 15 Introduction Global citizenship is not a new phenomenon but it dates back to ancient Greece history. It is reflected in the fact that the word “Cosmopolitan” is a composite of Greek words for “order”, “universe” and “citizen”. In fact the idea of global citizenship is older than the concept of nationalism. But the words such as “globalization”, “globalize” and “globalizing” started being commonly used in the 1960’s. The concept of globalization gained momentum in the 1990’s with the onset of internet. The advance in information technology which has transformed the way of communication and advancements in the transportation system along with a whole battery of other factors have played a pivotal role in the spread of globalization. The concept of globalization has entered almost in all areas of our lives be it business, language, education, culture, lifestyle and other psychological and social behavior patterns. This proliferation of globalization has totally changed the concept of business, and its role not only in defining the respective economies, but also shaping cultural, political and social values. It is argued that we are fast losing our unique identity. Global identity has transcends all geographic boundaries and has defined mass behavior and consumption patterns. The growth of Multinational organizations which was first restricted to a few countries in the post modern era has transcends all geographical boundaries and resulted in globalization; globalization of businesses, economies, societies and even to some extent, globalization of human capital. This paper aims at studying the nature of globalization and its impact on the economy, politics, cultural and social values. Is global perspective sensitive to cultural diversity and social inequalities? What are the role and behavior of multinational organizations and their implications with special reference to cultural dimensions? What is Globalization? The term globalization can be traced back to 1960’s but it became the buzz word only in the 1990’s. By the end of the first decade of the twenty first century there are millions of references available in virtual and physical form making it the most contested topic. Globalization is argued as the most contested concept that refers to the shrinkage of time and space. Manfred Steger defined globalization as “A social condition characterized by tight global economic, political, cultural and environmental interconnections and flows that make most of the currently existing borders and boundaries irrelevant.” There can be many different social manifestations of globalization. One perspective can be about individualism, competition and capitalism while other can be about cooperation and communal norms. It gives globalization an indeterminate character. The term globalization refers to a social process that transforms our present social identity that is bounded with nationality into a global identity. What we observe today is global cities like New York, London, and Tokyo etc that has transcended regional, local and national boundaries. This global imagery is growing people’s perception of belonging to a global community (Steger, 2009). What we are experiencing right now is a period of global change. People all around the globe are affected by common economic, political and social and environmental changes. Hence globalization has economic, social and environmental dimensions. These global changes include increased competition, fluctuating interest rates, advancements in technology, ecological and climate changes, the fall of communism, rise of China, and the growing ethnic violence. Each individual is affected in some way by all these global changes. These global changes have made the globalization inevitable. These interconnected global change are neither omnipresent nor a uniform process. Its impact has also varied greatly in intensity from country to country to country and individual to individual. Its implications are often unexpected and consequences can be good or bad depending on the setting (Schaeffer, 2005). Dimensions of Globalizations Although globalization can be traced back to hundreds of years ago but its recent form is unique especially because of the advancements in communication and transportation. The dimensions of globalization whether it is economic such as global capitalism, social such as transnational migration, cultural such as changes in consumer tastes, identity politics or modes of communication there are some salient characteristics in common. These characteristics are Delocalization Acceleration Standardization Interconnectedness Movement Mixing Vulnerability Re-embedding Globalization makes the distance or location irrelevant or at the least very less important. Ideas, technology, books, capital and human resource etc has transcended all geographical boundaries. It travels very easily, fluidly at an unimaginable speed. In fact its geographical location has become irrelevant, and it even does not have to move from one to another. The main driving forces behind this aspect of globalization are technological and economic forces. This delocalization aspect of globalization has its political and cultural implications as well. It includes all aspects and manner in which social life is alienated from its local context. Acceleration in the modes of communication and transport is one of the driving forces making globalization inevitable. Instantaneous communication through internet, telecommunication industry and satellite television has evaporated any delays in the communication. Inexpensive and speedy modes of transportation along with the ever increasing usage of internet have also contributed in integrating the world. Standardization is another important characteristic of globalization. This standardization process started with nationalism and national economies and now is finding shared values and shared standards all over the globe. There are many examples of standardization such as wide spread usage of English as a foreign language and standardization in dressing and food etc brought by the global chains. McDonalds is considered the pioneer of standardization of food and process etc all over the globe. It is argued that this McDonalization or standardization has seeped in every aspect of our lives and hence has led to McDonalization of society. Interconnectedness has resulted in network societies. Connecting people across continents and all over the globe is becoming much easier, faster and denser with the passage of time. This interconnectedness has resulted in mutual dependence and many international agreements as well as reframing of foreign policy. This network not only create opportunities but also many challenges and constraints. Movement in the human capital is revealed through large scale migration. This movement in the form of migration, business travel and international conferences has steadily increased over the years. This characteristic of globalization also has its implications on communities, politics and economies. Mixing of varying cultures has led to the phenomena of multiculturalism. Although this phenomenon is not new, urban cities have always been reflective of mixing of cultures but its speed, diversity and size is increasing every day. Vulnerability of national boundaries has also increased as a result of globalization. Flow of capital, knowledge and immigrants has made it difficult for countries to control the unwanted flow. Political instruments are too weak to deal with this economic and technology driven globalization (Erickson, 2007). General Perception about Globalization According to Robert Wright “A common stereotype of globalization is that it is something done by the rich, for the rich, and to the poor.” But Wright disagrees with this perception and believes that in fact globalization is making the poor happier and the rich dysfunctional. He argues that due to globalization human beings are a lot wealthier and independent than at any time in history. Globalization is still a very debatable topic but all its critics and supporters agree over two things about globalization. First it is inevitable and hard to stop and secondly globalization if properly balanced will make the world more prosperous. These two points make one thing clear that all efforts should be directed towards taming or balancing globalization instead of trying to put halt to it. The opponents of globalization do not disagree with the prosperity and increased production that globalization brings but the major issue is distribution of the resources. These two properties of globalization are interrelated. Globalization cannot be stopped because the driving force behind is the will of people to increase their prosperity. This can be understood at ease with the assistance of an illustration. Nike a global firm faces immense pressure from its shareholders to minimize cost and hence increase profits. In an attempt to reduce cost Nike starts its production in far eastern countries such as Malaysia where labor is cheap. This situation which is a result of globalization is beneficial both for Nike and the Malaysian labor who finds employment. This employment increased their income level. Nike manages minimization of cost. Nike customers also want to improve their standard of living and demands continuous product development with added features. This cycle results in ever increasing and growing investment and production. This human nature to amass and accumulate resources is the driving engine behind this transformation of the world. It is argued that this selfish pursuit of one’s own well being and race for accumulating more wealth and power does not bring any happiness. It may bring prosperity but may be cannot guarantee happiness. Thus globalization is in a way more beneficial for the poor who are becoming prosperous with the new opportunities but it is not making the already prosperous rich any happier (Wright, 2000). Globalization and Culture Ever accelerating pace of globalization has greatly affected the culture of different countries. What we observe today is the emergence of global culture. This globalization has restricted the role of government and hence the reliance on national identity of citizens. This has led to internationalization of values and hence global cultures. What we observe today is proliferation of identities and multi belonging citizens. This trend is further enhanced by globally produced goods and fuelled by the culture of individualism, consumerism and hedonism (Bosselmann, 2008). This globalized culture has also its impact on loyalty with national identity. Loyalty is closely related to identity. The emotional, intellectual and psychological aspects of loyalty define the bond and allegiance to the value system. It determines the level of patriotism and nationalism. Globalization has weakened loyalty and it has now moved from blind obedience to critical commitment (Miller, 2005). Loyalty is not restricted to a nation or state any more, the allegiance is now for the values be it at family level or the humanity as a whole depending on the level of moral obligation. This decreased level of loyalty for the national identity has resulted in the concept of global citizenship. It is inspiring youngsters to grow into global citizens; it requires them to be morally responsible, intellectually competent and culturally perceptive to diverse cultures (Giddens, 2010). Cultures are highly permeable and it is impossible not to draw influence from other cultures. He goes to the extent that it is impossible to identify people from their cultural tags. Globalization has resulted in multiculturalism due to increased interaction of varied cultures. It is quite possible to have multiculturalism without culture. We have observed this phenomenon with the emergence of transnational cosmopolitan cities such as New York, London, Tokyo etc. the critics of this theory argue that material inequality such as income, education, health and housing etc can form an important factor of group identity but it cannot surpass or transcends race, gender, ethnic and national boundaries (Phillips, 2007). Role of Multinational Corporations It is argued that multinational corporations (MNC’s) have played a pivotal role in transforming the global culture. The growth of the business of MNC’s has increased interaction with people of foreign culture. It has also resulted in large scale immigration in search of employment. Such cultural and workforce diversity leads to the absorption of foreign culture with every interaction. These MNC’s in search of maximum utilization of resources and minimizing cost not only hire the best human capital available anywhere in the world but also utilize cheap labor wherever possible. This is reflected in workforce diversity in these MNC’s. Each MNC along with it bring its own culture. (Kleinert, 2004)This results in national identity being replaced with multinational or global identity. Multinational corporations also encourage standardization of culture reflected in consumer behavior and life style to promote and sell their products. The examples of it are Levis jeans sold all over the world along with McDonald’s food chain present all over the globe (Pieterse, 2009). Critics of Globalization and Counter Criticism Critics of globalization claim that it has resulted in social degradation. It is argued that the highly competitive market conditions of the globalized world the exploitative cosmopolitan conditions only favors the global organizations and has degraded the existent social system and has brought humiliation. These dynamics of humiliation should be taken into account in our analysis of social behavior. Humiliation and degradation to anger and action shapes the social behavior of those who have suffered it. Such humiliation, degradation, fear, revenge and victimization are actually a result of defeat, relegation and exclusion which is a product of globalization. Imperial impulse of globalization is responsible for this degradation. When core cultural values are ignored, this degradation results in political, religious and ethnic conflicts. Anger, fear, resentment and revenge all these negative feelings fuel each other and lead to violence (Smith, 2008). The counter criticism of this theory proposed by proponents of globalization such as, Amartya Sen, one of the few renowned intellectuals; proposed globalization as a solution to this violence. He argues that our societies today are reeking with murderous violence, great confusion and inescapable hatred. This violence is a result of our identity based upon various factions such as nationality, race, language, religion etc. All this division or factions of identity leads to ideology of hate. That results in ethnic and religious violence. He believes that this violence can only be countered through the concept of global citizenship. It has one single dimension of defining our individual identities which is made up of multiple factors like class, sex, politics and personal interests etc. He argues that this extremism can be countered through freedom to choose one’s identity affiliations. According to him violence can only be countered through humane pluralism. This concept is akin to global citizenship. He propagates monolithic identities and multiculturalism (Sen, 2006). Globalization and Economic Integration The problems and implications of economic integration and globalization on individual countries have been the most debated topics recently. It is argued that globalization has opened new vistas of opportunities and threats. This globalization has led to trade and capital liberalization. The extent of gain and loss from this globalization is different for each country depending on its ability to adapt and tap the opportunities. But an analysis of the world economies revealed picture is not that fair and rosy for all countries. Globalization has been especially beneficial for the already developed countries and developing countries are facing difficulties in adapting to the fast changing economic conditions hence making their economies more volatile (Cerqueira, et al. 2008). Many observers believe that the greatest negative impact of economic integration on political arena is the diminished role of the state and reduced national sovereignty. It reduces the degree of leverage by the governments to maintain and sustain their macroeconomic policies. The critics of economic integration believe that it not only aggravates economic inequality and economic volatility but also restricts government’s ability to address these issues (Gaston et al 2010). The proponents of globalization argue that globalization has been beneficial for the developing countries as well in terms of raised standard of living and high employment levels due to the presence of MNC’s. Globalization can be beneficial for developing countries as well with a balanced policy and economic management. Conclusion The major driving forces of advancement in information and communication technology and modes of transport have made globalization inevitable. Globalization has its advantages and otherwise. Hence all efforts should be directed towards taming or balancing globalization to make it beneficial for all. Globalization has proliferated in economic, social, political and cultural values of every country and individual in varying degrees. Multinationals have a profound impact on economic and cultural dimensions of a country. It is argued that MNC’s have brought prosperity in developing countries and increased their employment level with their production plants and investment in developing countries in search of cheap labor. On the contrary opponents of globalization believe that economic integration brought by globalization has been beneficial for the developed countries and has made the economies of the developing countries more volatile which in turn leads to conflict. Globalization also has its strong impact on the culture and it has actually led to multiculturalism. The concept of global citizenship, multiculturalism and cultural diversity will help reduce conflicts and violence. Globalization has in short been beneficial in terms of cultural diversity and tolerance and economic prosperity but special measures should also be taken to safeguard the economies of the developing countries. Globalization has been beneficial for both developed and developing countries and hence probably has made us happier. References Bosselmann, K. (2008) The principle of sustainability: transforming laws and governance, England: Ashgate publications Cerqueira, P., Marques, H., Soukiazis, E. (2008) Perspectives on Integration and Globalization, UK: Transaction Publications Erickson, Thomas H. (2007) Globalization: the key concepts, Oxford: Berg publishers. Kleinert, J. (2004) The role of multinational enterprises in globalization, Springer Gaston, N., Ahmed, M. (2010) Globalization and Economic Integration: Winners and losers in Asia Pacific, UK: Edward Elgar Publishing Giddens, A. (2010) Sociology: Introductory Reading, Cambridge: Polity Press Miller, Max H., (2005) Worlds of capitalism, Institutions, governance and economic change in the era of globalization, New York: Routledge Phillips A. (2007) Multiculturalism without culture, Oxford: Princeton University Press Pieterse, Jan N. (2009) Globalization and culture: global melange, Oxford: Rowman &Littlefield Schaeffer, Robert K. (2005) Understanding Globalization: the social consequences of political, economic and environmental change, Oxford: Rowman & Littlefield Publishers Smith, D. (2008), Globalization, degradation and the dynamics of humiliation, Current Sociology, vol. 56, no 3, pp 371-379. Steger, Manfred B. (2009) Globalization, New York: Oxford University Press Sen,A. (2006) Identity and Violence: the illusion of destiny, UK: Allen Lane Wright, R. (2000) ‘Will globalization make you happy?’, Foreign Policy, No 120 (Sep-Oct 2000), pp 54-64 Summary The advancement in communication and transportation is the major driving force behind globalization making it inevitable. Some of the characteristics of globalization include delocalization, acceleration in communication etc, interconnectedness, standardization and large scale movement of capital and human capital in the form of immigration etc. Globalization brought by MNC’s has many dimensions but the most important dimension is its cultural and economic impact. Globalization has transformed culture and led to the concept of multiculturalism and global citizenship. Economic impact has largely been beneficial for developed countries but it also has raised standard of living and employment levels in the developing countries where investment has been made by MNC’s. Globalization along with its certain disadvantages such as social degradation and volatile economies of the developing countries has generally been beneficial and has made us happier. Read More