Globalization and Impact on Companies Essay Example | Topics and Well Written Essays - 1750 words

Globalization and Impact on Companies - Essay lessonThe major problems faced by the MNCs in the current era areProblems associated with differences in the culture crosswise the national borders. It is very decisive to recognize that key to winning globalization lies in both economical cultural aspects. Due to cultural differences, the workforce within an organization cannot converse with each other efficiently then this obstructs the overall efficiency of the company. Human resource (HR) management becomes highly complex for the companys that operates across different markets. There are problems faced by the HR managers in while organise diversity in workplaces. Lesser diversity in organizations lowers its business efficiency (International Labour Organisation, 2004). This model go away help to analyze that since globalization, the business expansion process of a firm in the international market, makes it go through structural changes. This implies that at different stages of bu siness internationalization, the multinational corporations (MNCs) should go through separate organizational structures (Veder, 2008). At this stage, an MNC either only increases its geographical interpenetrate of business or increases product diversity. If the geographical spread is diversified, then the companies entail less product diversity. However, if the product diversity is more, the firms expand its business within the bound geographical spread.If the scope of internationalization is wide, then a firm should not allocate much capital is product diversification. This is because under such cases the strategy of expansion should be guided by duplication or coordination. Hence the firms should encourage specialization of its factors of production under this strategy (Schenk, 2011).