Impact of Globalisation on Engineering Firms - Term Paper Example

RUNNING HEAD: IMPACT OF GLOBALIZATION ON ENGINEERING FIRMS Impact of Globalisation on Engineering Firms [Name of the Writer] [Name of the Institution] Table of Contents Introduction………………………………………………………………………………… 3 What is Globalisation………………………………………………………………………..3 Global Economy: "A Rising Tide Raises All Boats"……………………………………...4 Engineering in a Global Era………………………………………………………………..6 How Globalisation affects Engineering……………………………………………………7 The Next Evolution………………………………………………………………………….9 New Competitors from Rising Economies……………………………………………….10 Conclusion………………………………………………………………………………….12 References………………………………………………………………………………….14 Impact of Globalisation on Engineering Firms Introduction With regard to human actions, the strength of the systems perspective is the assistance it provides in recognizing what is really going on. Engineers may often feel they are victims of policies made by others with the obligations of carrying them out--even if deficiencies seem obvious. With an active systems viewpoint, engineers can recognize what is going on, maintain continuous evaluation much earlier in the game and seek effective input before policies are fixed, because policies result in plans and orders. Engineers must become more interested in the political system and policy development at all levels-they will be affected more than ever. They must seek to help set policy and become proactive rather than reactive. The systems tool may help to ensure that the "logical" solution is employed more frequently. This report covers briefly about the topic globalisation and its impacts upon Engineering firms. What is Globalisation?” Globalization is unidirectional, involving a move from smaller to larger units. For example, nation states in Europe are expected to integrate into a larger unit—the European Union. But allegiances to and identification with smaller states, such as France, Great Britain, and Spain, evolved over very long time periods, spanning at least many centuries. Another definition globalisation says “Marketing and promoting a product outside a company's home country.” (Stiglitz, 2002) Globalization means that something is growing: There is further of it. Globalism is a condition of the world connecting networks of interdependence at multi continental remoteness. The linkages happen through run and controls of funds and goods, information and thoughts, and people and services, as well as environmentally and physically relevant matter. Globalization and deglobalization submits to the boost or refusal of globalism. (Barkawi 2006) The conventional view of globalization can be summed up simply: the more international trade, the better. Therefore all trade should be as free as possible. This conventional view of free trade rests on the economic principle of comparative advantage, meaning that if one nation is better at producing a product than another nation, each should specialize in what it does best. When conventional economists talk about people being better off, they mean that the Gross Domestic Product (GDP) of both nations will rise. Unfortunately, GDP as conventionally measured is a lousy way to tell whether people are really better off or not. Higher GDP means people are spending more, not that they are happier or more prosperous. The supposed benefits of globalization get even murkier when you realize that the conventional analysis of comparative advantage assumes that transportation costs between the trading nations are low. In reality, transportation costs are fairly low, which is why toasters, toys, and most other products are made outside the U.S. these days. But why are transportation costs so low? That's easy: they are subsidized. Most international transport travels by ship, rail, truck, or airplane, all of which run on fuels distilled from crude oil. Crude oil is essentially sunlight in solid form, produced naturally from the decay of prehistoric forests and swamps. It takes thousands of years' worth of sunlight falling on an acre of swamp to make a single barrel of oil. Unfortunately, today's crude oil prices do not reflect oil's true scarcity. Instead, oil prices are based largely on the cost of pumping the oil out of the ground. Oil prices also ignore the huge costs of climate change caused by burning the oil. As if that weren't enough, oil prices also do not include the costs of wars fought over control of oil-producing regions, such as the Iraq war and the first Gulf War. Globalization as we know it today is little more than a fantasy supported by cheap oil. Where transportation costs are highly subsidized, globalization is a ticket to impoverishment for all. Global Economy: "A Rising Tide Raises All Boats" Economic globalization is the extension of export-centered, free-market capitalism from the developed countries, led by the United States, to the developing nations (Friedman, 1999; Stiglitz, 2002). It is based on several deeply held principles that include the primacy of growth; the need for free trade to stimulate growth; the removal of governmental laws that inhibit the international movement of goods, services, and money; and the belief that every country should produce only those products that it can competitively market in the global economy, while importing everything else, a philosophy called comparative advantage (Cavanagh & Mander, 2002; Mander, 1996). Globalists claim that when followed, these principles will lead to unprecedented global wealth, the end of poverty, the improvement of living conditions everywhere, the spread of freedom and democracy, and the protection of the environment (Cavanagh &. Mander, 2002) The global economy is being molded by a number of international trade and economic institutions, such as the WTO, International Monetary Fund (IMF), and World Bank, as well as by international trade agreements such as the General Agreement on Tariffs and Trade (GATT), North American Free Trade Agreement (NAFTA), the European Union's Maastricht Agreement, and the proposed Free Trade Area of the Americas (FTAA). These institutions and treaties serve both to bring developing countries into the global marketplace and to monitor and regulate international trade (Stiglitz, 2002). The WTO, which evolved from the GATT, determines the rules and regulations governing international trade and settles trade disputes, whereas the IMF and World Bank provide loans to countries for development or during economic crises. The various trade agreements increase free trade among regions of neighboring countries (Stiglitz, 2002). As such, these institutions and agreements are responsible for many of the benefits attributed to globalization (Friedman, 1999; Stiglitz, 2002). Engineering in a Global Era Engineering is an extension of science that uses applied mathematics and real-world experiences to construct a suitable solution to a problem. Through practical analysis and design, an engineer's role is to create a people-centric applications, bounded by the laws of science. An effort is people-centric because it exists to fulfill a need that is perceived by an individual or group. This concept first emerged with the invention of ancient mechanisms such as the lever and wheel. Civil engineering gained notoriety at first in the ancient structures erected by the Egyptians, Incas, Mayans, and Greeks. By the nineteenth century, the discipline had been accepted within the bounds of modern science and mathematics. This newly recognized profession then began to foster the creation of modern industrial technology and its continued growth. Each technological age (Industrial Revolution, Space Age, Information Age, etc.) spurred a subsequent period characterized by further accelerated growth. These progressive increases in complexity and size resulted in the application of systems theory to the creation of engineered systems. Projects such as the Hoover Dam employed this new approach to thinking and system practices for successful execution of the system (Crisp ei: al. 2005). The technological advancements we enjoy today are the visible fruits of engineering labor. As the tools and methodology behind this discipline become more realized, there is an exponential increase in the significance and achievements of resultant technology. There is typically a lag between the identification of a new technology and the time when it appears in the market and become viable. This lapse is typically referred to as the "S-curve" (Smaling and de Weck 2006). Increasing complexity has forced the engineering community to begin evaluating potential projects from a systems-level viewpoint, as opposed to the traditional component optimization approach. With the interactions between parts of an engineered system becoming less predictable with greater complexity, emergent properties become apparent. These outcomes are not evident when the separate components are evaluated individually and this unanticipated reaction to increased complexity has stemmed the application of systems science and complexity theory in traditional engineering. Starting with the development of communication and defense technologies during World War II, engineering practices have become increasingly relevant to the successful execution of ever-more complex engineering systems. When a system, defined as various interacting parts, exhibits a cumulative behavior that would not be realized by the individual components alone, it is apparent that these behaviors represent the product of engineering efforts over a considerable period of time. Earlier systems were designed from well established architectures, which allowed subsequent evolutions to follow minor improvements to the original design (for example, automotive transportation technology). How Globalisation affects Engineering As business and the technological knowledge base expand on a global scale, connectivity and collaboration efforts across time zones will become commonplace in the design and development process. The reduced costs of communication and economies of scale created through the Internet become a driving force towards a new synergistic global approach. Current outsourcing efforts by large multinational corporations to countries like India demonstrate this trend to exploit salary variations to obtain comparable technical services at lower cost. Rapid development cycles can also be utilized by shifting work across multiple time zones and use of three-shift operations, although there are various challenges (Boehm 2006). Boehm outlines the challenges: bridging cultures, agreements on a common vision, contracts and incentive approaches, handover and change management, as well as governmental interests. This global engineering model will require a deeper knowledge of cultural intricacies, language variations, national policies, economic implications, and perspective preferences. Measurable benefits from this approach will be realized through progress on key international problems such as poverty, world peace, sustainable development, climate change, natural re resource management, and health. A current example of this approach, within a system-of-system framework, can be seen in the international Space Station and its many contributing states. Despite current setbacks, continuous reductions in the costs associated with global communication will promote greater cooperation and better matching of localized skills. This global optimization will likely continue at an accelerated pace, given the high number of engineers and scientists being produced in countries such as India and China, when compared to the United States. Recent research findings indicate accelerated growth in the two Asian countries (awarding 220,000 and 575,000 undergraduate degrees respectively) when compared to essentially flat lined U.S. engineering and technology degree output (approximately 129,000) (Gereffi et al. 2008). While the Duke University study completed by Gereffi et al. offers compelling background on these numbers, it is evident that distribution of effort will change for future engineered systems. A recent example of global cooperation can be seen in the recent win for the U.S. Air Force Tanker program, where the contract was originally awarded to a Northop Grumman (U.S.) and Airbus (EU) cooperative bid over U.S.-based Boeing. These cooperative approaches will cause significant changes as multidisciplinary teams function ever more seamlessly within networked and virtual environments. Moreover, tomorrow's engineers will feel right at home working on these distributed work-products and Web-based applications as a result of spending a majority of their lives interacting via the Internet (Crisp et al. 2005). With these drastic changes in the global technological environment, potential conflicts regarding different countries' policies on intellectual property may need to be assessed. Global technology cooperation and internationally integrated systems-of systems mean that the kind of protectionism common in the twentieth century may significantly hinder growth in the twenty-first century and beyond, But the emergence of open source technology for software development may serve to into the strengthen overall systems collaboration, if open systems methodology proves more effective than traditional nationalistic protectionism and promotes faster technological growth. Rapid change is apparent in trends like Moore's law (affecting transistor and semiconductor design), system diversity, and accelerated spiral development which will only be enhanced through global connectivity (Boehm 2005). This will help to optimize the pace of development, lower costs, reduce time-to-market, and exploit windows of opportunity promptly. New Competitors from Rising Economies Companies like General Motors and Ford roll off key partitions to generate main new companies like Delphi and Visteon. More and more, the chosen model was to seek economies by permitting suppliers to add to technical growth. In past impressions of the globalization of trade, new participants confront U.S. and European companies in the automotive, customer electronics, semi-conductor and other businesses. Such companies as Toyota, Samsung, Sony, and less-recognised manufacturer in Taiwan of lap-top processor, cell handset and electronic mechanism appeared to come out of nowhere. We imagine this to be a increasing happening in coming years with the difference that China and India joint have further than ten times the mutual inhabitants of Japan, South Korea, Singapore and Taiwan. It may fit be that the invasion of new challengers to today’s multinationals will be likewise bigger and, because of their huge domestic economies, may be fewer dependent on Triad nation marketplace and thus less unnatural by Triad norms of business application. The multinationals are under rising pressures to globalize to the peak that they are at danger of losing view of their extended term wellbeing. They need to re-examine what individual competencies they can uphold or develop in the features of new competitors from new spaces. The Next Evolution As our technology development migrates towards more people-centric networked systems of- systems, it will be increasingly relevant to note the nontechnical parameters that ensure effective technological development. The focus of engineering companies will widen in scope to cover vital considerations in such realms as life cycles, value stream, and return on investment — issues once considered outside technology, pertaining to politics, culture, environment, etc. As technological systems become increasingly pervasive in our daily lives, a strong multidiscipline approach will be essential to ensure that we are creating appropriate systems that both resolve a problem and adhere to accepted "moral" viewpoints. A rise in engineering ethics, much like the new focus on ethics within the medical profession, will be necessary to balance our technological capability with desired objectives for society. This concept is especially relevant in the emerging fields of genetic engineering and biotechnology. The start of what is to come can already be seen in the debate surrounding stem-cell research and the human genome. Moral responsibility will increasingly be promoted both by academic institutions and professional societies, as the technologies of tomorrow come on line. The true benefits of systems-level architecture will be realized as multidisciplinary application expands. The large-scale adoption of systems- of-systems and expanded modeling capabilities will allow the engineering community to realistically map potential impacts of technological changes on economies and society. Intelligence in computing may even help extend these complex systems into economics, geopolitics, and social issues, where rigorous engineering design can create controlled measurable outcomes (Ren 2003). Potentially, the engineering and architecture approach can devise solutions to many complex problems, ranging from energy production to political and business operations. Numerous advantages can also be realized through applying engineering for practical problem solving within the complex self-creating and self-arranging systems of the future. Current research has shown advantages of evaluating the complexities of traditional electromechanical systems and impacts of globalisation on engineering projects, modular building architecture, networked infrastructures, business decisions, and even strategic decision making. The engineering potential is bright, you might say at slightest from the employment viewpoint. Look at the healthy order for civil engineers in the service section of any newspaper. But even if the thrilling job market continues, many of today’s new hires with up-to-date technical talents will rapidly become technically decayed and overpaid. If the economy doesn’t get them, the next amalgamation, gaining, or reengineering will. There will be a few civil engineers who, having knowledgeable one or two technical half-life sufferers, will be quietly asked to go away by the back door as their strictly current and lower priced substitutes joyously walk through the front. The content and environment of the education of civil engineers arrange them for short-term job safety, not lifelong career safety. While globalisation has been around for a long time, with its early origins traced to the great empires of ancient Persia, Greece, and Rome, as well as the later empires of Spain, Great Britain, and other European nations, modern globalisation began to take shape after World War II. (Rowland, 2004) It continued with the rise of transworld corporations, the United Nations, the International Monetary Fund, the World Bank, the World Trade Organization, and the powerful states of the North. Technological innovations helped accelerate the globalisation process boosted by the fall of the Soviet Union and extended by expansionist global corporations that claim the entire world as a new frontier with no boundaries. Thus, globalisation is nothing new. What is new, however, is the character, power, pace, and capacity of certain global institutions and processes that are capable of penetrating and integrating states, markets, and economies worldwide through economic inducements and sanctions, political instruments (inducement and coercion), military intervention, and even war (Barkawi 2006). Conclusion Globalization has been associated with spectacular progress in science, technology, and trade, including advancements in communication and transportation systems, medicine, and agriculture. Engineering at its core is directly tied to society and human behavior, and, as systems thinking spreads throughout the academic engineering community, more and more innovative solutions to current and future problems will apply these principles to manage complexity. These efforts will secure the future of engineering companies to become a meta-discipline, employing fundamentals from diverse subject areas, to create an effective way to manage complexity and its technological foundations. As stated by Honour (2008), engineering is and will continue to be as we progress into the future, the engineering of complexity. We can now electronically communicate with other humans across the other side of the earth, land people on the moon and use international collaboration to help run space stations, and carry out medical treatments that just a few years ago were assumed to exist only in the realm of science fiction. However, these miraculous scientific and technological advances are in sharp contrast to our continual struggles to overcome intergroup discrimination, conflict, and multinational wars. We continue to fight, kill, and destroy—so much so that our aggression threatens to annihilate us. It is not clear whether we will survive our own "advanced" weapons. As the world is brought closer to the realization of a global village, we must apply ourselves more diligently and sincerely to improving intergroup relations and conflict resolution. References Barkawi, Tarak. 2006. Globalization and War. Lanham, MD: Rowman & Littlefield. Boehm Barry, "Some Future Trends and Implications for Systems and Software Engineering Processes," Engineering vol 9, no. I (2006): 1-19. Cavanagh, J., & Mander, J. (Co-Chairs). (2002). Alternatives to economic globalization (a better world is possible): International Forum on Globalization. San Francisco: Berrett-Koehler. Charles N. Galvano and Philip John, "Engineering in an Age of Complexity," Engineering vol. 7, no. 1 (2004): 25-34. Crisp et al... Harry E. "Engineering Technical Vision," International Council on Engineering, ver 1.1 in the INCOSE Connect Digital Library, https://connect.incose.org/. Friedman, T. (1999). The lexus and the olive tree. New York: Farrar, Straus and Giroux. Gereffi Gary al., "Getting the Numbers Right: International Engineering Education in the United States, China, and India," journal of Engineering Erica- (JOM (laniary 2008): 13-25. Gordon, R. (2002, July 31). Coat carpet cleaning tower? S. F.'s name game. San Francisco Chronicle, pp. A15-A16. Hayenga Craig, "Complex and Complicated Engineering companies," ¡NCOSE INSIGHT vol. 11, no. 1 (2008): 17-19, Honour Eric, "Engineering companies and Complexity," NCOSE/NS/CHT vol. U, no. 1 (2008): 20-21. Matthew R. Silver and Olivier de Weck, "Time- Expanded Decision Networks: A I-'framework for Designing Evolvable Complex Systems," Engineering 10, no. 2(2007): 167-86. Pin Chen and Jennie Clothier, "Advancing Engineering for Systems-of-Systems Challenges," Engineering vol. 6, no. 3 (2003): 170-82. Ren Chiang H., "Expanding the Role of Engineers in the Age of Escalating Complexity," Engineering vol 6, no. 2 (2003): 116-21. Smaling Rudolf and Weck Olivier de, "Assessing Risks and Opportunities of Technology Infusion in System," Engineering vol, noel (2007): 1-2S Stephen Cook, "The Science of Engineering and the Engineering of Complex Systems," ¡NCOSE /NS/GHTvol. H.no, 1 (2008): 8-11. Stiglitz, J. (2002). Globalization and its discontents. New York: W. W. Norton Read More