Forces for global coordination

• Forces for 'global coordination/integration'

  • Removal of trade barriers (deregulation)
  • Global accounts/customers
  • Relationship management/network organization
  • Standardized worldwide technology
  • Worldwide markets
  • 'Global village'
  • Worldwide communication
  • Global cost drivers
• Forces for 'market responsiveness'

  • Cultural differences
  • Regionalism/protectionism
  • Deglobalization trend
• Deregulation has an impact on globalization, as it reduces the time, costs and complexity involved in trading across boundaries
• As customers become global and rationalize their procurement activities, they demand that suppliers provide them with global services to meet their unique global needs
• Networked organizations need more coordination and communication
• Worldwide availability of products and services should escalate due to the desire for gaining scale and scope in production
• Worldwide markets are likely to develop because they can rely on world demographics
• Cultural homogenization implies the potential for the worldwide convergence of markets and the emergence of a global marketplace
• New internet-based 'low-cost' communication methods ease communication and trade across different parts of the world
• Outsourcing of lower-value activities to emerging and developing countries with lower labour costs has enabled local players to source 'plug-and-play' modular designs to big multinationals, or even to develop local brands themselves
• Cultural differences often pose major difficulties in international negotiations and marketing management
• Regionalism is the grouping of countries into regional clusters based on geographic proximity, which may represent a significant barrier to globalization
• Deglobalization is a trend where there could be a return to old values, promoting barriers to the further success of globalization
• McDonald's experience in Japan

  • McDonald's first restaurant in Japan opened during 1971, when fast food in Japan consisted of either a bowl of noodles or miso soup
  • By 1997, McDonald's had over 1,000 outlets in Japan, keeping its lead with its first-mover advantage
  • McDonald's has adapted its menu to local tastes, offering rice burgers and green tea ice cream