Impact of Globalization on U.S.A Businesses

Assignment Instructions

Think about what you have read and seen in the news on globalization. Consider the fact that the clothing we wear, the cars that we drive, the cell phones we use to communicate and the computers we use to work, are each likely to have been manufactured in whole or in part in different parts of the world. While there are still companies and firms that maintain local and national borders, it is almost unheard of in the 21st century that an industry does not maintain an international strategic position.

  • From an executive’s position, identify and explain at least three challenges and opportunities that might face an international executive over the next five years. Provide possible solutions of how the executive might address these issues in order for their firm to maintain a competitive advantage.
  • Prepare a 4-6 page paper that describes the impact of globalization on U.S. businesses. In your analysis, please include information about the impact of at least four economic drivers that might impact globalization.

Globalization in the United States –

Sample Answer

Globalization is not a new thing to businesses all over the world. With the ever advancing technology and growth of markets, globalization has generally become a staple for commerce. While globalization has brought about challenges to business that has perpetually attempted to bring them down in one way or another, it has equally provided opportunities for improvement and this has consequentially initiated growth.  For the United States, the term globalization is often associated with negativity apart from being a necessary evil the US must accommodate. Globalization has affected the US businesses in the following ways:

  • Increased cultural diversity

As globalization increases and becomes more prevalent, companies and businesses are forced to embrace cultural diversity especially at their workplaces. Businesses are obliged to understand, adjust and manage cultural diversity within their workforce. In light of cultural diversity, businesses have sought to develop policies and guidelines that control their workforce to ensure cultural diversity does work for the best interest of their businesses. Differences in work ethics and cultural inclinations have also opened up new frontiers in businesses especially in regards to management and marketing.

  • Changes in payments

Today, companies and businesses are outsourcing services from other countries. This has greatly affected the earnings of the US workers despite businesses making profits. For example, third world countries, given their low standards of living, can offer services in those countries that have high standards of living at reduced rates. This has reduced the earnings of US workers as well as other countries that embrace outsourcing.

  • Increased Standards

Globalization has enlightened the world and technological advancements have improved the status quo of businesses and livelihoods. Today businesses have heightened their working standards ranging from their methods of production to how they handle their employees. Employees today work under flexible working environments where they have a choice on when to report to work provided they accomplish their duties pursuant to the rules and regulations given by their employers. Manual labor is slowly being becoming extinct because mechanization has invaded businesses and this is increasing the standards of operations.

  • Increased competition

Consumers are always at the receiving end when every producer is competing for a share of the economy. This is because such competition results to improved quality of products and reduction of prices (Kate, 2014). The decision of businesses to venture into the international market only subjected them to introduce a new standard into the global market where consumers have more options to choose from. Globalization has therefore affected businesses because it has resulted to competition that has in turn ensured reduction in market share hence reduced revenues for these businesses.

Challenges international executives might face over the next five years

Increased public expectation

People, regardless of their countries, look to their governments and institutions for assurance that their interests such as health, safety, economic and social well-being are taken care of. While information has become readily available to everyone, people still feel that someone else has to make certain decisions and this is a problem international executive must face over the next few years. Public expectation is high especially on institutions to provide for them goods and services that befit the global standards.

Advances in knowledge and technological change

The rate at which technology is changing should worry international executives. Knowledge is advancing and new products are being developed with new methods of doing things. There is need to adjust to these changes to be able to survive the competition that is arising due to these inevitable global changes. This is a challenge because institutions are forced to keep pace with the changing technologies. Additionally, knowledge is becoming diverse and new inventions are coming up each and every day and this has a direct impact on businesses which are dependent on efficiency and quality to secure a competitive advantage.

Knowledge-based economy and society

Knowledge, science and technology play a critical role in the development and growth of the economy and social progress of people. Knowledge-based economy and society is the rising functional identity and market value of knowledge. Companies are today producing knowledge-intensive products and services and this increases the market value of these products. This means that the global community must be up-to task to embrace knowledge based economy and society to ensure that competition is fair. Knowledge has become the foundation of business competitiveness across the global and this is a global standard international executives must embrace.


Increase in jobs

Globalization has led to reduction of trade barriers between countries. The effect is increase in job opportunities. Additionally, production has been decentralized with some of them taking advantage of the benefits specific to location of facilities. This is in regard to reduced cost of production in certain locations where labor is cheap. Subcontracting is another development brought about as a result of globalization. Businesses and companies are able to outsource services and expertise and this increases opportunities for people who are in need of jobs (Joan, 1996).

Mixed experiences

Globalization has initiated a knowledge-based economy and therefore the economy is vast with experience. This enables people to share experience by learning from other people’s experience. This diversity in experience has increased efficiency in production as well as management. It is a window of opportunity for small and rising businesses because they need this experience to be able to overcome problems that they are likely to face as small businesses and new entrants.

Generally, globalization provides opportunities to flourish. People assume that globalization is merely a toot to provide equality in this dynamic world. They forget that globalization only provides equality for the people with the right mindset. Globalization has developed markets, restructured institutions and created regulatory policies that in the long run has added value to the lives of people.


The only solution to keeping pace with the growing technology is to keep pace with it. The world market has become very competitive where quality of products and services and efficiency is the order of the day. For businesses to fit in this market, they have no option but to adopt the technological systems in place. However, it is also important for governments to encourage innovation by funding innovative projects.

As far as solving the problem of knowledge-based economy is concerned, business should initiate training measures to help equip employees with the recent skills and methods of doing things. For the sake of having an added advantage employees should take it as a personal initiative to advance their knowledge in their careers to help keep pace with the ever advancing systems.


The future effects of globalization will differ from country to country. However, there are no backward strategies to counter the advancing technological systems and the going is still as good as it gets. While it is important to prepare for the future by developing flexible systems and policies, it is also imperative to redouble our efforts at international economic cooperation.

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