According to the Merriam-Webster dictionary, globalization is the act or process of globalizing, the state of being globalized. The development of an increasingly integrated global economy marked especially by free trade, free flow of capital, and the tapping of cheaper foreign labor markets.
Globalization impacts businesses in different ways and those who decide to take on international expansion may find benefits as, for example, lower costs for products, access to new talents, access to new cultures and markets, and spread of Innovation/Technology.
As globalization allows companies to find lower-cost ways to produce their products in other countries, they probably can increase their profit margin. In this case, many times companies from developed countries have their manufacture being held in emerging countries, where the production cost is cheaper and they can increase their profit margin but on the other hand they are also helping the emerging country to increase employment and the company might find new talents in this other country.
With the trade market between not only companies but countries, there is cultural intermingling and each country is learning more about other cultures, which had made us more open and tolerant towards each other and people who live in the other part of the world.
Another key point is that globalization leads to increased competition, hence leading companies to increase their creativity and innovation. From this point, we saw in the past decade a new field arising, the Innovation field, with studies, courses, workshops, to prepare professionals to deal and work only with innovative solutions for businesses. Furthermore, the competition between companies is supposed to drive prices down.
Innovation is the action or process of innovating, it can be a new idea, creative thoughts, new imaginations in the form of a device or method. Also, innovation is often viewed as the application of a better solution that meets new requirements or existing market needs. Diffusion of Innovation is the process by which the adoption of an innovation spreads. In other words, diffusion refers to the process by which innovations are spread/implemented and globalization helps to speed up this process.
Thus, globalization creates opportunities for many countries, not only developed countries but also emerging countries also, to experience economic growth in different ways.
AUTHOR
Thais Soalleiro
Trilingual English-Portuguese- Spanish with 10+ years of experience in the business industry, mainly digital marketing. Graduated in Business, Marketing, and Data Processing.
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