Examining The Driving Forces Behind The Changing Global Business Scenario

The recent recession and inflation period has affected economies all over the globe with the international financial system remaining highly fragile during 2010. In today’s era of integrative globalization, an impact on any economy has a direct and relevant effect on all economies. It is this inter-connectivity between the components of the various economies that will compel them to work in synergy with each other in the coming times. International trade has further strengthened the dependency of individual economies on current financial stability for the global economics realm. However, economies are working towards recovering their position with rapid growth being evident, especially in the regions that have been targeted as emerging markets. Lets have a look at some of the key trends that are expected to have a long lasting impact on the global business scenario.

Transformation Holds the Key to Successful Recovery for The Global Banking Industry:

The prominent financial crisis that occurred recently may have caused a global uproar but in reality, most financial institutions from emerging markets managed to overcome it without much difficulty. The impact of outcomes for regulators as well as global financial institutions has mutual patterns wherein the regulators have been known to lay more emphasis on the existence of systemic risks posed by major names in the global finance industry while the banks have concerns over their ability to manage the oncoming competition dynamics along with the possible impact of regulations made on returns. Current statistics hold insufficient grounds for determining the final structure of the global framework for financial regulations. However, the changes that hold probability of occurrence include:

  • Corporate governance would experience heightened levels.
  • Consumer protection policies as well as initiatives would be strengthened.
  • Executive pay schemes are expected to be limited in keeping with current financial statistics.
  • Over the counter derivatives would witness greater regulations and increased transparency.

As is the general consideration that developed countries hold higher prospects of maintaining stability during economic recessions and financial crises, current statistics reveal that while financial institutions in the developed countries are striving for effective recovery, those in emerging markets are exhibiting better recovery results with most of the financial institutions overcoming the crisis with hardly any hiccups. However, in light of enhanced and revised regulatory frameworks, the cost of business would most likely hit a new high for most large financial institutions.

Global Workforce Expected to be Transformed Due to Demographic Shifts:

One of the most notable occurrences to have marked the current era is the dearth of potential candidates for employment opportunities despite the growing population numbers being witnessed on a global scale. Statistics indicate that almost 31% of employers throughout the globe are faced with the issue of dearth of required talent in the market due to which recruitment has become quite tedious. Demographic shifts have been credited with being the driving factor behind the recruitment issues. The problem of fewer talents in the population pool is not due to less population numbers. In fact the problem may be attributed to the evident decline in working age of the population in various regions. This in turn has caused the condition to worsen with a statistical probability of the labor gap becoming 8.3 million by the year 2030.. It would be wise to consider the gradient at which the issue is currently escalating instead of focusing on the current gap which is only 200,000.

There may be scope for profits from a larger segment of the population at retirement age, but there is also a major concern regarding the availability of new population members from the talent pool who are required to replace the retiring working population. Emerging countries like Brazil, Indonesia and Mexico have labor forces comprising of younger members of their demographics. While this may seem to provide benefit arising from increase in productivity, demographic dividend and growth, the only way in which success may be ensured is to provide the youth with economic as well as educational opportunities in the right form and at the right time. Only then will they be able to prepare themselves to manage the business scenario of their region in the years to come. One of the major complications arising out of the dearth of proper educational provisions is the reduction in the talent pool due to which the population members are unable to meet the rising talent and skill requisites. The need of the hour is to promote educational opportunities in all regions globally with emphasis on awareness being made about changing skill requisites as well as sophistication.

Women may prove to be major players in the future recruitment efforts as their empowerment and increased acceptance of women as an equal entity in social circles would ensure that they be considered for job opportunities. However, the decrease in talent pool in the population of various regions has led to employees gaining bargaining power. In light of these changes, it is pretty evident that in the near future, the workplace in organizations would be defined by the priorities of the employees themselves instead of being defined by the perceptions of the employer. The most appropriate solution for organizations to manage these changes is to work towards engaging and re-engaging the experienced segment of their acquired talent. Those who fail to keep up with these changes may very well lose the power to attract, retain and even develop the required talent which would be a direct result of the failure to define their EVP (Employee Value Proposition).

Going Green Would Prove to be Major Leverage:

The efforts for reducing carbon footprint can be seen extensively in all economies with various organizations striving hard to achieve and maintain greener policies. This green approach for creating a resource-efficiency economy may well be the precursor to the next major industrial revolution and in the long term may also churn out financial benefits in addition to the obvious environmental benefits. There is no stopping the transformation and inclination towards green technologies, so the only recourse available to organizations is to rework their strategies and come up with contingent measures to ensure that they maintain compatibility with the changing trends. Even statistics have gone ahead to reveal the rapid growth of investors in green technology with with the investments surging to 243 billion USD as reported by Bloomberg New Energy Finance. This is staggering 30% increase from the previous year and almost 5 times more than the figures calculated for 2004.

Despite these investments, there is a significant gap which exists between the required capital to fund the widespread implementation of green technologies and the available financial capabilities for meeting the requirements that are crucial for sustaining the transition being made towards low carbon economies. If current figures and data are to be considered, the energy demand would grow by approximately 36% over the period 2019 – 2035. The majority of the demands (estimated at 93%) is expected to emanate from the emerging markets.

If predictions by the International Energy Agency (IEA) were to be considered, then the period 201 to 2035 would experience the increase in renewable resource based power generation by 300%. Nuclear power and natural gas are major components of the “future energy mix” which is expected to gain prominence in the coming years in place of fossil fuel that would lose its market share gradually. While renewable energy is still available at high costs in most places, the prices would see a decrease as soon as solar and wind energy projects achieve successful completion. More than mere provision of green sources, it is the awareness of its implications which holds greater significance as people would be required to adapt to the changing technologies. As of now, the use of natural gas appears to be transition aiding component that is bridging the gap between the use of traditional fuels and the use of renewable energy sources.

If the business aspect of the implications of renewable energy were to be considered, then resorting to green methods would not only enhance the usage of resources but it would also bring visible cost benefits in the long run. The raw materials required in the production of a large number of products are not available in unlimited quantity and with the stringent rejection of raw materials owing to non-compliance with quality standards, the need for going green seems to be the only recourse in the current economic scenario. Such concerns revolving around resource utilization are expected to bring about an increased demand for organizations to prove their business’s adherence to sustainable practices. Sustainability reporting as of now is only voluntary and is mainly used to encourage organizations and businesses to declare their socio-environmental impact. However, the tides may turn pretty soon in light of the various developments being made due to which sustainability reporting may no longer be a choice, it would become a mandatory component of public declarations for all businesses.

Emerging Markets Would Increase their Power in the Global Scenario:

Emerging markets have become the global hub for aids that drive economic growth and may well become the key drivers of global growth. Earlier considered to be lucrative places for obtaining natural resources, cheap labor and inexpensive manufacturing, the emerging markets have achieved the status of becoming major players in the global competitive landscape. If we take into consideration the current statistics and figures of growth and economic development, then it is safe to estimate that the coming years would exhibit a 70% global growth with almost 40% of the growth being contributed by China and India. The IMF has expressed that the performance of the emerging markets could outperform the developed economies in terms of GDP and Purchasing Power Parity by as early as 2014. This is an impressive performance by the emerging economies which is further strengthened by the fact that they account for nearly 50% of global FDI inflows and 25% outflows.

One of the fastest growing trends that has been witnessed over the past decade is the emergence of new leaders in emerging markets that not only provide critical competition in home grounds but are also making substantial outbound investments in other economies. These power giants would eventually become a disruptive force in the global arena with stiff competition being provided to others. The key driving force which enables companies from emerging markets to come up with cost effective and innovative designs to products stems from the fact that the local markets in which they operate are more than often deprived of convenient facilities. This means that they need to work with whatever they have and with whatever they can manage with. The outcome of operating with such limited support systems is the emergence of an entrepreneurial culture that is infused with innovation in strategic implementation and greater flexibility in adapting to the demands of their customers. One of the most profound examples of this is the Nano, manufactured by Tata Motors, India. This car is priced at USD 2,900 internationally which is less than 50% of the costs of any automobile in the world. The mere presence of this car in the global market goes on to speak loads about the progress being made by businesses in emerging economies and markets.

Another key factor to be considered is the estimated growth in population numbers which would not only add to the customer base but would also result in the increase in the combined purchasing power of the middle class segment of the population to more than USD 56 trillion by the year 2050. These estimates represent global implications wherein the majority of the demand (more than 80% estimated) emanating from the Asian countries. In keeping with the expected as well as the current changes, there would be immense requisites for developing or upgrading the physical and soft infrastructure so as to accommodate the demands of the increasing numbers of urban middle class members.

While emerging markets seem to be getting prominence in the global business scenario, it would be wrong to interpret their presence on the international forefront as being the only ones to be able to reap the benefits. The developments in emerging countries have helped to escalate the position of middle class members in their own regions which in turn have become lucrative new markets for developed countries.

Rapid Developments in Technology Innovation Will Drive Mobility Trends:

The past decade has witnessed drastic advancements in the digital domain with this revolution giving birth to new technologies that have helped to define new approaches to business as well as individual needs. Interconnectivity has become the success mantra with the boundaries becoming non-existent as more people are connected through global communication systems. Current technologies are smart, dynamic and is capable of providing support for various applications. However, the expected levels of technical sophistication is still awaiting achievement. While customers desire powerful devices with impeccable applications, businesses prefer to possess and develop cost effective technological solutions that would help them to cope up with complex technical challenges.

The presence of analytical tools made more feasible with its integration with global internet communication systems has enabled businesses to evaluate their performance dynamically. Now they are able to see their levels of interaction with customers with their responses forming the base of the analysis conducted. Social networks have further increased the need for adding storage to the systems due to the fact that they have contributed to the creation as well as sharing of data throughout the world. Research studies estimate data storage requirements to go up to 35 trillion GB by 2020 itself. This requisite represents an increase of more than 40% for our current storage capabilities. With such capabilities it is but obvious for business intelligence to gain importance as being one of the key determinants of strategic decision making processes.

Smart devices (phones and tablets in majority) have become an integral part of our lives. The reason behind their widespread popularity may be attributed to high levels of portability offered by them. In simple terms, the possibility of remaining connected even while being on the move has brought into effect a whole new level of convenience that is playing a key role in redefining the way in which social connectivity and business communication is maintained. As is evident in other sectors, emerging markets will pose stiff competition mainly due to the fact that the absence of legacy systems will lead to faster profit generation from the integration of new technologies whenever they are made available.

The developments in mobility solutions and the integration of global technological systems would lead to the convergence of industrial realms where the differences in geographical boundaries, industries, products, demographics and economies would become blurred. Advancements in e-commerce facilities have literally brought about the transition of markets from being physical establishments to virtual hot-spots. This does not indicate that physical markets have become non-existent, it is only the approach that has been shifted to the virtual domain by means of which businesses are able to make their presence felt on the global platform. In keeping with these trends, it is not wrong to expect web semantics in the near future to provide the perfect amalgamation of web, machines and human beings.

Cloud computing in another key aspect of mobility solutions which enables dynamic working capabilities over the net with access being granted to multiple users. Since cloud computing offers dynamic access to data, simultaneous work capabilities are provided to the users even for a single file. Forecasts made by Gartner state that social networks would account for the primary business communication protocol for more than 20% of global employee strength. Governments are also joining in on this race for technological supremacy wherein they are not only providing the funds for the development of the required infrastructure, but they are also concerning themselves with the establishment of appropriate legislations by means of which the privacy of the users may be ensured.

Governments Expected to Enhance Cooperative Efforts With the Public Sector:

The post crisis scenario at the global level is marked by adjustments being made as major entities inclusive of governments, institutions and business organizations are working towards redefining their identity. While the economic recession has no major impact on the emerging markets, they are nonetheless left with the requirement of developing as well as upgrading their infrastructure and educational systems for being able to cope up with the increasing demands of the new middle class population. In light of these needs, the governments all over the globe are faced with the requirement for strengthening their financial position and securing their current levels of financial integrity. Additionally they are required to ensure the delivery of services not only in an efficient and effective manner, but the services also need to be made economic in nature to fully obtain their benefits. The private sector holds significance for any economy owing to its contribution levels in the growth and development of the respective region. The growth of the public sector needs to be done in an economic manner for sustainability and generation of employment opportunities.

The efforts of the government are clearly visible in the following initiatives:

  • In light of the rising debt-GDP ratios, there are immense efforts being made by the developed countries for reducing these values and organizing their finances.

  • Emerging markets possessing adequate surplus need to invest it for developing an effective safety nest for sustaining as well as promoting economic growth. The importance of safety nets in the economy may be judged from the fact that in certain markets, economic prosperity cannot be assured without their presence.

  • The investments made by the Tax Administration authorities of emerging markets also need to be improved such that the investments make their way into the right sectors in the right form and at the right time. PPP (Public Private Partnerships) are most likely to become major investment drivers in such markets.

  • Studies conducted by Standard & Poor indicate that public spending for developed economies with respect to median age is expected to rise from just over 17% of GDP in current times to over 27% of GDP in 2050. Emerging markets, however, reflect much less variations in these values with the change expected to be from 11% to 17%. Median age related spending, in addition to immigration, would affect future government spending in a significant manner.

  • Sovereign Wealth Funds are expected to become one of the most powerful sources for availing capital in the near future. Despite the drop in their valuation in light of the recent recession, their value is expected to increase over the years from USD 3.5 trillion as per 2010 data to more than USD 8 trillion as estimated for 2015.

  • State owned enterprises will continue to be popular means of safeguarding strategic industries and also assuring adequacy of critical infrastructure in most regions.

Global Business World – Three Strategies You Should Consider

This article introduced three strategies of globalization business and analyzed the relations among them; then offers some essential decisive-related questions for strategy scheme and decision making; and at last summarizes some issues for executives to think about.

The globalization directly affects the competitive situation of the world, it is necessary to make good use of strategies and reduce risks in order to establish and lift the power of business competition.

Because competition is emerging in very much different markets, today’s businesses are forced to be globalized in non-traditional ways. Before enterprises make a presence in markets just so that they know what competitors in that market are doing and use it as a window to look into new trends and new competitive strategies. These are just some of the reasons that require businesses today to have a global mindset-it is an essential factor for survival.

Followed are three strategies for globalization business.

The first is to adjust measures according to local conditions of target area, and it’s the essence of all global business strategies. There are differences in terms of costs for different raw materials, labor power, working skills, and institutional infrastructures. The decision makers with a global perspective, have to recognize the differences across countries and account for them in the strategic decisions. Those decisions may have to do with customers, raw materials, manufacturing, capital funds, market capacity or any of the dimensions on which strategic plans are made. Thus, a company in a labor-intensive business that fails to account for labor cost differentials across countries.

On the contrast, the second strategy is to fully use the similarities across countries. Because there are significant similarities, it means that products, skills and investments that are made or developed for one market have the potential to be leveraged in multiple geographic markets. The similarities imply that a product  created or developed in some market can be sold in another market without having to be reinvented. What that enables a business to do, for example, is to use its research and development dollars by selling a proven product from one market, usually the company’s home market, to different countries. This advantage is particularly significant in businesses like pharmaceuticals that are research and development intensive.

The above two strategies of similarities and differences across markets are not opposite ends of one scale. Rather, they are complementary dimensions and should both be leveraged. An executive needs to ask what the similarities and differences are across markets. It then becomes a matter of strategic choice whether to exploit similarities first or differences first or both simultaneously, in order to take advantages of the global potential that lies inherent in each business.

The third of globalization business strategy is about the fundamental choices. Typically, these decisions involve four considerations: operations and costs; customers and markets; competition; government policies. Does the product have a committed champion? Can a product sold in multiple markets increase competitive advantage in home market? Are the competitors in that particular market already global and therefore, does the company needs to have a presence in multiple markets to be able to defend against the competitors? Sometimes, answering these questions in the context of a company’s organization is as much an administrative as an economic and strategic process.

 
Ultimately, an executive must make sure that the company has a presence in multiple markets and view it like a global game of chess. He must coordinate competitive moves across countries; consciously decide in which country to launch a product, where the global competitors are strongest, where the cost structure is lowest, and where the business is likely to get the quickest market feedback. Then he must decide how to launch the product in other markets and how to manage pricing in multiple markets. It is the global chess game rather than individual market share games being played in local area. Unless all elements fit together, it is difficult to develop the competitive global business.

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eFoods Global Business – How To Make Money With eFoods Global

eFoods Global are a network marketing company selling quality foods than can be kept in the cupboard for up to 15 years. These products can be life saving when money is a bit tight, or in face of a disaster. The products can set customers’ minds at ease, knowing that they will always have some quality food in the cupboard. By starting an eFoods Global business, you have the chance to earn a substantial income. You could be making thousands of dollars every month. But, only if you know how.

Making money with eFoods Global is not guaranteed. It’s true that you can earn thousands of dollars every month, but it’s also true that you can earn nothing. Many people have been highly successful, earning an annual six-figure income. But even more people who have tried to make money with eFoods Global have not made a single cent. The reason for their failure has nothing to do with the company being a scam. It’s because the reps don’t know how to run their business.

A classic mistake made by many network marketers is to host home parties. Home sales parties used to be all the rage. You would throw a party, invite everyone you know, and get them to invite their friends and family. Before you know it, you have a room full of potential customers who are giving you their undivided attention. But like I said, this used to be all the rage.

These days, home parties tend to be poorly attended. They usually end up being a waste of time and money. Today, if you want to make money with eFoods Global, then you have to get online. The internet is the most time saving device at your hands. With the right combination of SEO, PPC and social media, you can leverage your business and have hundreds of interested people contacting you on a daily basis. This saves you time and money- you’re not chasing after customers; they are coming to you.

To make money with eFoods Global, you need to stop hosting home parties, and start embracing technology. Get online, and start seeing the money flow in.

Global Business Schooling Opportunities

Conducting business in a foreign country differs from how professionals perform work related duties in America. Many factors contribute to this difference and students can learn to perform business functions overseas by completing an educational program in global business. Colleges provide many opportunities for students to understand the global economy inside a business setting.

Educational study encompasses the entire global environment as is relates to business strategies, operations, and problem solving techniques. Students walk away from a program with a global mindset that is utilized to conduct business with foreign professionals and customers. Training covers everything from global trade to how different cultures affect the way countries carry out business. To fully grasp all the needed knowledge to work in the field students are required to have at least a bachelor’s degree. The two most common completed programs by students are at the bachelor’s degree and master’s degree level. Each program focuses on business practices as they relate to working with and managing a global business.

The education gained inside a bachelor’s degree program focuses on teaching students about:

  • Business Law
  • Accounting
  • Marketing
  • Global Trade
  • International Cultures

Coursework focuses on these areas and more to train students to help a business thrive in the global marketplace. Undergraduate study focuses on completely incorporating business practices with understanding the global economy. Many students complete a global management degree because of the skill set earned within a typical program. The combination of global business relations and management skills prepares students to work with a business on all areas including trade, investment procedure, finance, human resource management, and accounting. A prominent course inside a bachelor’s degree is a business strategies course. Work related to international payments and trades is emphasized. The goal is to teach students to create an effective multinational enterprise by identifying appropriate global operations.

A global business master’s degree centers on providing students with general and specialized knowledge in areas that include:

  • Foreign Politics
  • Customs
  • Global Institutions

Education follows not only the business aspect but also the cultural aspect of the global economy. Schooling focuses on the importance of cultural awareness and economical control of working with a global economy. Courses in political science, diplomatic strategy, global ecology, international law, and finance are worked through. These industry areas provide students with the understanding of how different countries conduct business with each other. Continuing education can be pursued in a related doctoral degree or a postgraduate certificate program.

Accredited Schooling opportunities are available to teach students to use the global economy to expand business. Accreditation is provided by agencies like the Association to Advance Collegiate Schools of Business (http://www.aacsb.edu) to schools that can provide a quality education. Other key components that students are able to use inside a career include advising companies on international matters and markets to meet the consumer demands for a particular product. Students that earn a degree will be able to work in management and top-executive positions inside a business. Enter the global economy industry by taking advantage of the many schooling opportunities available.

DISCLAIMER: Above is a GENERIC OUTLINE and may or may not depict precise methods, courses and/or focuses related to ANY ONE specific school(s) that may or may not be advertised at PETAP.org.

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