Globalization is one of the contemporary issues in management that has had a lot of impact on the business environment. This paper studies the impact of globalization on the ever-changing business environment. It also attempts to look at how negative impacts of globalization can be mitigated or dealt with. The phenomenon of globalization has already taken root, and its effects are being felt by all businesses regardless of whether they operate globally or just locally. Hence, it’s an important topic in the wider business context.

Globalization refers to the worldwide move towards economic, trade and economic integration (Herold & Fedor, 2004, p. 2). This has seen businesses in various countries abandon nationalistic views for broader perspectives. Businesses are now trying to take into account the needs of not only within its immediate business environment but also the needs of the wider global market. Globalization calls for businesses to be more interconnected and rely on one anther more. This makes it easier to transfer goods and services across the world without much regard to national boundaries and other traditional barriers (Dwyer & Crang, 2002, p. 21).

With Globalization, country and regional boundaries no longer take precedence, use of new technologies, as well as increased interaction between various cultures. Globalization is aided by developments in communication technology as well as in the transport sector.

Discussion

Globalization has allowed businesses to extend to areas beyond their traditional area of operation. Deregulation and improved communication have allowed businesses operate internationally as opposed to operating only within the boundaries of their nation of origin (Herold & Fedor, 2004, p. 3). With globalization, more companies are moving to extend their operations to the international market. This has increased the interconnectivity between the various markets in the world. Other than increasing international trade, globalization has also increased exchange of culture across the world. This has not only widened the business environment of most corporations, but it has also changed how those businesses operate. Businesses have had to change their mode o operation to accommodate the new cultures they interact with.

Globalization has a lot of impact on the dynamic business environment. Like all other phenomenon affecting the business environment, it has both positive and negative impacts. One of the effects globalization on the business environment is that it has led to increased competition (Lee & Vivarelli, 2006, p. 2). Competition takes various forms. Mostly businesses compete on the quality of goods and services, prices of goods as well as on the speed of response to customer needs by businesses. Companies also compete on the ability to adopt new technology. Globalization has allowed more corporations to join markets that traditionally were closed up increasing competition. Those companies that are able to produce high-quality goods at a lower cost are able to dominate the market. This calls for businesses to continuously innovate so as to survive in an ever-changing business environment.

Globalization has presented customers with a large array of products to choose from. This however makes it harder for businesses to sell even in what they have always considered to be their traditional markets (Lee & Vivarelli, 2006, p. 3). Due to easy availability of goods and services in the market, consumers have changed their purchasing behaviors. They now demand better goods and services at a better price and delivered to them in a more efficient way than was done previously. This has in turn forced businesses to make changes to accommodate the changes in the behavior patterns of their consumers. Companies have had to adjust the way they operate so as to be competitive in the global market.

One of the best known impacts of globalization on the business environment is the increased use of technology. Businesses are now using technology to exploit opportunities in nontraditional markets as well as make themselves more competitive in their traditional markets (Herold & Fedor, 2004, p. 4). Multinationals, for instance, are use internet and e-commerce tools to reach out to potential markets in far flung areas. Technology is being used as one of the factors on which businesses compete globally. Businesses that have access to better technology have an edge over the competition and are able to have a bigger presence in the global market. This realization has made businesses invest more in technology and innovation (Dicken, 2003, p.17). Businesses are competing to have the latest technology in the market, and this has increased the rate at which technology is transferred in the global market. Businesses are forced to adapt quickly to the changes in the business environment or else they will fail to meet customer expectations.

Globalization has made it easier for companies to acquire and transfer knowledge. This has made it easier for businesses to survive in new business environments (Dwyer & Crang, 2002, p. 22). With enough information delivered in time, businesses can adapt to changing business environment much more easily. How efficiently the business is able to utilize the knowledge determines how well it can survive in its business environment.

Globalization has led to decline of barriers in selling to other countries other than the country of origin. Reduced restrictions and lower tariffs have made it easier for businesses to venture into foreign markets (Dicken, 2003, p.16). Due to globalization several companies have found themselves having to cater for the global market as opposed to the usual domestic market. By widening the business environment, globalization forces companies to learn different cultures. This includes both the traditions of the new target market as well as the corporate culture expected in the new market. On several occasions, companies are forced to take some of their employees to their new subsidiaries in new markets.

With globalization, factors that determine the success of a business have changed slightly. The success of a business in the new market environment afforded by globalization depends on the language skills of the company staff, how well they understand the various cultural factors that influence business in a globalized business environment (Lee & Vivarelli, 2006, p. 3). Setting up shop in a new business environment may also require that the business studies the various communication styles in the area as well as the social behaviors appropriate in the area. This is because what may be taken to be appropriate an acceptable behavior in one country may be frowned upon in a different country. To avoid such conflicts, it is important that a business that decides to go global takes time to understand the cultural practices in the new business environments (Short & Kim, 1999, p. 27). The assumption that business practices in an offshore subsidiary will be the same as those in the home office is erroneous and can even lead to failure of the business.

Thanks to globalization, businesses are now keener to have multilingual employees as they now deal with people who speak different languages. Employees have to be always ready to move to whatever part of the globe where the company might decide to begin operations. Improved communication technology especially the internet has reduced the importance of the actual office. Employees are able to work even for months without the need to go to a physical office. Businesses are now more aware that the traditional cultural habits are now becoming less important. Globalization has led businesses to adapt world habits as opposed to sticking to those habits ad mannerisms acceptable in their culture of origin.

Due to having offices in many different cultures many businesses no longer have a monoculture. Unlike in earlier times when a company had a single culture in all its offices, several companies now have different cultures in their various offices worldwide (Short & Kim, 1999, p. 29). However, most of them make a lot of efforts to synergize their cultures so as to appear as if they have a single culture for all their operations worldwide. Other businesses have resulted to having different cultures for different offices depending on what works in the culture they have set up business. This places the business in the dilemma of not having a proper corporate identity.

Although globalization has made it easier for businesses to have operations worldwide, it has become increasingly difficult for employees working for the same company in different countries to interact. To counter this, businesses with subsidiaries in many different cultures have to encourage constant communication between subsidiaries. Employees have to be made to understand that there are cultural challenges to be met. The management also has to decide on how they will handle the culture question and communicate it to employees in good time. This will help ensure that all employees of the company present a uniform culture in dealing with customers in the various cultures where the business has operations. Other than creating cultural awareness businesses also have to search for employees who fit within their corporate culture. This stems from the realization that not all people who are able to adjust to other cultures easily. Some employees who are very effective in their home countries are unable to perform in other cultures hence businesses have to balance between effectiveness and the ability to adapt to other cultures. Even in those new cultures where companies set up businesses as a result of globalization they, always have to watch out for changes in culture. If the new culture changes without the knowledge of the business, this can lead to conflicts with the locals or even loss of business. Change of cultural environment as a result of globalization in a big way affects the business environment of the business not just in terms of culture but the general operation of the business as a whole. Hence, corporations have to at all times to watch out for any changes affecting their businesses, especially the offshore subsidiaries situated away from the home culture.

Globalization however is not just about heaping pressure on businesses. It allows businesses take advantage of economies of scale. With a wider market to serve, a business can engage in mass production. This translates to lower cost of production hence making its products more attractive in the market. Due to the greater awareness of customer needs on the part of the business, the business is able to cater for diverse markets effectively. The business benefits by borrowing some successful product ideas in one market and replicating them in other markets where it has operations. With globalization, businesses have to be flexible to survive. Companies ignore their own procedures once in a while to accommodate a customer who resides in market where such procedures would be inappropriate. To avoid the challenge of setting up shop in every potential market, businesses are now resulting to having partnerships and mergers as opposed to starting a subsidiary in every single market worldwide.

In this era of globalization, businesses conduct business in an environment that is much more complex and dynamic compared to how it was before globalization. Businesses are now operating in the information age where intellectual capital is the most important asset in the business, unlike a few years ago when machines were more valued than intellectual capital. Businesses no longer compete only nationally, but globally. Firms are no longer governed by only the legal requirements in their countries only. They also consider international requirements and standards as they operate globally. Changes in the business environment of one country affect even businesses that are situated in far away countries. Unlike in the past when businesses had operations in the areas where they were situated, businesses now have operations globally. Businesses are pursuing opportunities way beyond their national boundaries. For instance, Toyota, a Japanese company now makes cars in the USA and India. McDonalds now has operations in countries like India and China although it is an American company. There is no longer any guarantee that goods found in American store are made in America. They could be imported from another country or made by a foreign company on American soil.

With globalization Outsourcing has become a common phenomenon. Companies no longer have to struggle with all the processes in their operations. These days they only deal with their core business and give other processes to other companies to handle for them. Companies like India where labor is cheap have become a favorite outsourcing destination turning them into a manufacturing hub. Governments in the developing countries, on the other hand, have made changes in their policy to attract business and encourage outsourcing. Companies in developed countries are now investing heavily in developing countries trying to set up operations there to take advantage of the opportunities there. This in turn has widened their business environment to include the newly established offices in developing countries.

Due to globalization businesses now have to deal with different social values and political systems. This has in turn forced businesses to modify their management approaches so that it is in line with the new political and social environment (Dicken, 2003, p.17). For instance, from established democracies such as the USA find themselves facing unfamiliar political environment when the set up shop in communist countries such as China. Hence, they have to undertake some modifications so that they fit in with the new political structure. In such circumstances, employees find it difficult to undertake their global assignments hence the human resource arm has to ensure that the employees have the necessary adaptability to survive in the new environment.

Globalization has impacted on not just the business environment of companies in the developed world but also companies in the developing world. As companies in the developed world globalize their operations, companies in the developing world are following suit. For instance, Indian companies like Tata have through deals and mergers extended their operations to become global players.

Globalization has introduced a number of challenges in the business environment of most if not all companies (Lee & Vivarelli, 2006, p. 4). Managers are now managing a global workforce as opposed to the past when most of the employees shared a common culture. This means this they have to ensure that their employees now have the ability to handle global assignments. With the ever stiffening competition in the market place, managers now have to ensure that they hire highly competitive employees who will enable the business survive the stiff competition. To remain competitive companies now have to lay much emphasis on productivity than was the case previously. Another challenge brought about by globalization is that businesses now have to comply with more legal requirements than was the case previously. They now have to comply with legal requirements in the home country as well as in all other countries where they have operations or sell their products.

Frequent outsourcing and shipping business offshore has left employees worried. They are no longer sure that their jobs are secure. This requires the management to find ways to make their employees feel secure while at the same time keeping them alive to the fact that globalization is here to stay (Hirst & Thompson, 1996, p. 30). There is more need for management to come up with initiatives to keep the employee morale high in the face of possible outsourcing and other difficulties associated with globalization. Companies that have been unable to cope properly with the effects of globalization have resulted to downsizing. This has left the morale of the survivors seriously affected. They live in fear that their roles too might be outsourced or even relocated to other offices elsewhere. To ensure such employees remain committed and in high morale, companies are finding themselves having to come up with counseling programs. These help both the survivors as well as those who lose their jobs.

With globalization, working patterns have changed too. Businesses now are frequently finding themselves having to answer the question of whether to use the same work pattern used in home country or to adapt to the pattern of the host country. Companies with operations outside home country have to design flexible work patterns that are not in conflict with the cultures they are operating within. This includes coming up with incentives and programs designed to improve the productivity of the employee.

Globalization has also changed how workforce management is done (Held & McGrew, 2007, p. 50). Other than the traditional workforce, managers now are faced with having to manage a virtual workforce. These are employees who work online from distant places. Hence, employees are alienated from one another making it difficult to deliver uniform results. Management has to find ways to train such employees, so that produce similar looking products even they are operating from different parts of the world. There is always the fear that the management might lose control over its virtual workers. Hence, businesses are forced to continuously implement programs geared towards employee motivation and retention. It is now more difficult to keep the workforce committed to the ideals of the companies they work for than it was before globalization.

Due to globalization, demographic and workforce trends have changed. The composition of the workforce in most companies is now more diverse than it was a few years ago (Held & McGrew, 2007, p. 51). In response to market needs, most companies now have a workforce belonging to different generations and from different ethnic backgrounds. Hiring and retaining such a workforce is hence a challenge to the management. Ensuring work-life balance for such a diverse workforce is also a challenge. In some instances finding skilled labor that meets the company requirements is difficult. In some markets, finding replacement for skilled old workforce is not as easy as it is in home country. This has forced most businesses to come up with good succession plans to replace retiring workforce (Hirst & Thompson, 1996, p. 31). This takes care of the inconvenience that might arise as a result of an employee retiring without an appropriate replacement in place. Due to differences in culture and policy in the different markets, companies have to come up with programs to ensure that skills are passed from retiring employees to newly recruited employees. Employee training programs that work in home office may be totally inappropriate in other subsidiaries hence management has to come up with employee training programs that suit each subsidiary. Companies also have to take into account that demand and supply of skilled labor differs from one location to the other. This is made worse by the fact that despite deeper penetration of technology, thanks to globalization, the distribution is also not yet even. Hence, companies have to roll out programs aimed at ensuring that their employees can comfortably handle the technology used regardless of whether they are at the home office or in offshore subsidiaries. For instance, generally people in developing countries are not as exposed to computers as those in the developed world. A business that decides to go global by setting up shop in a developing country has to find ways to come up with training programs for its employees to ensure that they are at par with those in the home country.

Globalization has also brought a change in the nature of employee relationship. Unlike in the past where most employees were employed on a permanent basis, the marketplace has witnessed a rise in temporary employment. Employment is now more pegged on performance. With globalization, the practice of sending expatriates to overseas subsidiaries has become more accepted.

Conclusion

For a business to survive in the age of globalization, it needs to be flexible, efficient and have the ability to easily adapt to different business environments (Dicken, 2007, p. 31). This is because the business environment is a fast changing one and inability to change can mean death of the business. The business also needs to be profitable and have a dominant position in the market. Unfortunately, it is not easy for a small business to acquire all these attributes on its own considering that most businesses operate on limited resources. To deal with this new challenge most businesses have resulted to acquisitions and mergers. These assist companies by giving them access to more resources and new ideas making them more competitive in the global economy (Sklair, 2002, p. 69). Although mergers and acquisitions help companies deal with the global market better, they also present a number of challenges to the business. A merger or an acquisition may lead to employee retrenchment. Businesses that decide to go global are also faced with other threats not so common in their home countries. Some have to deal with the threat of terrorism and extremism at a higher degree in their new markets than in their home markets.

Globalization has a number lot of impact on the business environment. While some of its impacts are positive and serve to push the business towards better performance, others pose a challenge to the business (Dicken, 2007, p. 30). Performance of a company now depends on how well it is able to take advantage of the opportunities presented by globalization as well as how well it manages the challenges it brings. With globalization, the business environment has become more change intensive, and one can only expect that it will become more dynamic (Sklair, 2002, p. 71). Businesses now have more opportunities to expand their operations but at the same time are having to deal with more uncertainties. These are as a result of more foreign companies entering the market as well as businesses taking their products to new markets. Proper organization and effective communication have become an integral part of running any business in the age of globalization. One can say that globalization has had more positive impacts on the business environment than negative. Globalization has brought about change in the business environment, and it’s only when a business can manage this change that it can flourish.

Introduction

Change management involves a business applying structured processes and tools with the intention of achieving a predetermined outcome. This paper looks at the impacts of change management on the dynamic business environment. It also looks at the impacts of failing to manage change on the part of the business. With the many Changes that have come into the business environment as a result of globalization, businesses can no longer afford to ignore change management.

Change management focuses more on changing the attitudes of the employees and the way they go about their business. For change management to be effective, it has to be practiced in all levels of management of a business right from the senior most managers to team leaders (Anderson & Anderson, 2001, p. 17). When change management is done effectively, the rest of the employees feel like they are part of the change process and work more towards achieving a common goal. If well effected, change management has a lot of positive impact on a business environment. The importance of change management in the running of any business has underline by phenomena like which have brought a lot of changes in the business environment.

Change management involves the use of resources as well as taking caution not to injure the reputation of the organization. In managing change, the management must take caution not to affect the well-being of the existing employees. The business needs to move from the current state to the desired state without making the stakeholders feel targeted or left out. In effecting or responding to change a business ought to be careful not to affect the efficiency of the business or the output levels of the company. In managing change, the company seeks to align its needs and goals with the changes in the business environment.

Discussion

Change management involves coming up with strategies to deal with change at the individual level as well as the corporate level. Management is tasked with coming up with, and implementing strategies that seek to either adapt to change, control change or effect change (Anderson & Anderson, 2001, p. 19). In change management business comes with procedures and systems to deal with change with the goal of benefitting from it. The better a business is able to deal with change, the more likely it is to survive the dynamic business environment. Changes in the business environment include things like, fluctuation in the economy, increased competition, change in policy, and new technology among others. In this era of globalization, it is easier for a business to ride along with the change as opposed to resisting it. Change has become a constant phenomenon in business, and every organization has to learn how to manage it to survive (Beer, 2000, p 73). One common mistake is for most managers to underestimate the implications of poor change management within a business. For such managers, they only realize how important proper change management is when it is already too late.

Change management has a lot of positive impact on the business environment if well handled. To begin with, proper management of change enables a business remains current and up to date (Olsen, 2001, p. 26). With the high competition in the market place, it is important that a business remains aware of the current trends in the market to remain competitive. However, this cannot happen if the company is not willing to ditch its old practices for the current trends in the market. A business must aware of the most current products in the market so that develops similar products or else it will lose its market share. Proper change management has the impact of not only preserving a business market share, but also increasing its market share by acquiring that of other businesses that are not quick to implement change.

Good change management practice helps employees in creating new opportunities. This in turn widens the potential market of the business (Beer, 2000, p 58). For instance, when a worker learns to use new computer applications with enthusiasm, he can use the applications to acquire more business for the company. By learning new applications, the employee is in a better position to handle additional roles that demand use of the said knowledge.

Change management encourages innovation in a business environment. Studies show that businesses that are good at handling change create an environment that encourages innovation (Beer, 2000, p 64). A workforce that feels their opinions will be given due consideration will be more willing to think creatively and give their opinion as opposed to one where the management has not in place any measures to encourage delivery of new ideas. Employee giving their opinions and ideas is an important thing considering that in the marketplace a single product can determine the success or failure of the entire company.

Proper change management has the effect of boosting the morale of employees (Anderson & Anderson, 2001, p. 22). This in return results in an overall higher productivity in the company. For instance, a philosophical change that allows workers in a more relaxed environment has the overall effect of improving the performance of the company. This can even come as a result of replacing an insensitive manager with a more reasonable manager.

In this era of globalization, change management serves as a very important tool in management. It helps businesses anticipate and respond to challenges within the business environment. By managing challenges before they actually happen, businesses are able to avoid situations that could lead to losses or even closure of business. They are also able to deal with competition hence retain their market share. This is especially important considering that completion in most markets has more than doubled with the advent of globalization.

Another impact of change management on the business environment it encourages maximum utilization of available resources (Olsen, 2001, p. 22). With proper change management, a business is able to anticipate challenges hence can allocate resources to where they are required the most. With proper utilization of resources, a business is able to maintain its efficiency and profitability. This enables it survive in the highly competitive business environment. Change management involves measuring the overall effect of change, as well as the results of any previously instituted changes (Beer, 2000, p 59). Another important impact of change management is that it helps employees adapt to the change and adapt to it in a positively and efficiently. Studies have found that those businesses that take change management seriously are less likely to fail compared to that have no change management in plans in place. However, this only happens in situations where change management is done systematically and efficiently.

To appreciate the impact of change management on the business environment, one only needs to look at the consequences of not managing change. In such cases, businesses are unable to achieve their objectives, and the individual changes that are intended to make better employees also fails to take place (Anderson & Anderson, 2001, p. 27). Without proper change management company, projects fail to get completed on time and in most cases never get completed at all due to unforeseen changes in the budget. In other cases, teams working on a project are forced to re-work the design due to unanticipated or mismanaged changes. This causes delays leading to missed milestones on the part of the business. These delays serve to reduce the ability of the business to survive in a dynamic business environment. In cases where change management plans are not on place obstacles appear unexpectedly.

By managing change, a business is able to mitigate reduced productivity when the change happens, as well as mitigate lowering of the quality of production (Olsen, 2001, p. 21) Once a business is able to maintain its productivity and profitability, there is less likelihood that valued employees will seek to leave the company.

Conclusion

Although change management has many positive impacts, it also has many negative impacts, some of which lower the company chances of success in the business environment. Normally, implementing any new policy, including change management policy results in employee resistance. During this period, employee performance is reduced. Reduced employee performance reduces the ability of the business to survive in the highly dynamic business environment. This however can be minimized by explaining to employees the reason for instituting the changes. Change management is expensive and takes time. However, this is a worthy investment considering the cost that would be incurred in case the change is not managed.

Change management is a tedious and expensive process. However, it is a necessary process considering that businesses are now in an era of globalization and face competition from both local and foreign based firms. Improved communication has led to better informed customers who are demanding more from businesses and are less tolerant to substandard products. This has made change management an important aspect for any business that is keen on surviving in the dynamic business environment. The alternative which is ignoring change management can only have disastrous results for the business. Studies show that globalization is here to stay and with increased globa