Chapter 11

INTERNATIONALIZATION AND GLOBALIZATION 

Philosophical sight, Miguel A. Giusti and Amalia Boyer professors of the theme, they focus the globalization like the increase of the relations that the various groups of the world maintain; of the reduction of cultural barriers upon interchanging products, ideas or services. The global term hints at the interrelation among different aspects that they can not observe themselves like themes isolated due to technological advances like the Internet and for political ideologies like the neoliberalism that he promotes the commercial interchange.

In an article published in the magazine Harvard Business Review professor Donald N. Sully of London Business School and Martín Escobari consultant of a signature of Brazil, rumor has it that the companies of Latin America encounter one thing or the other options: Spreading out or being acquired. I want to comment it adding my personal concepts and complementing with other consulted sources.

1. For better risk management to do business in the stormy markets of the region, avoid the concentration.

2. For lack of liquidity that he removes a lot of capability of maneuver and hinders the administration.

3. The tall capital costs that make difficult the capability to generate value.

4. The exhaustion of the opportunities of growth of local markets.

5. Survival: He is better than the company acting globally than to work for a foreign boss.

They refer to a series of obstacles that they call "THE LATIN COST", namely:

1. Tall tax burden.

2. Scarcity and raising capital cost; They estimate is equivalent to twice the amount of similar companies in other parts of the world.

3. Corruption.

4. The size of the market that he does not permit investing in research and development neither generating a cash flow enough to finance an international expansion, aggravated the technological disadvantage in some cases.

Besides they allege that Latin American companies have been slower to answer to defiances and opportunities of globalization than the European Japanese and North American; exchange rates are very volatile; the governmental policies are incoherent;  values them of inflation and non-predictable interests and the foreign competition is increasing.

However, the far-sighted companies have answered aggressively to these changes. For example, EMBRAER of Brazil, the manufacturer of airplanes works with French associates; part makes of production at China; perceive capital in London and New York; hire originating better companies' executives of the world and they establish offices close to clients but big anywhere in the planet using software of the last generation without caring from where he comes. Also, they mention CEMEX, BUNGE, CVRD, ARCOR, TELMEX, and TELECAST like companies that have become global leaders in their respective industries to weigh of obstacles.

1. CRITICAL STEPS

According to them, the companies that have been globalized have taken common steps, that is to say:

1. They were committed to a global mentality.

2. The executives undertook daring actions to make their commitment irreversible.

3. They realigned the totality of the organization to compete globally.

With respect to step one, the world from the point of view of the company can not see itself. The local perspective avoids the fact that he represents in the portfolio of global investors, clients, suppliers, and executives whose resource needs in order to fend off big corporations. The treaties help the local intention change. Just the same the exploratory journeys, studies out-of-doors, quoting stock in stock exchange global markets, the good corporate governance, them macro - you roll of business, among others.

An excellent practice consists in identifying the best company of the world in the category and evaluating the breach utilizing benchmarking, in order to analyze the variables that they dial differences. The reality must have the intellectual honesty to watch the head-on facts and humility subject to acceptance itself.

With respect to the second step they recommend:

1. Focalizing: He must concentrate on an only business and not commit the imprudence to penetrate into many fields.

2. Making a bet on the checkmark with investments in marketing strong.

3. Looking for an alliance even selling company communication.

4. If it is ringing, changing home womb and official idiom.

5. Establishing a loud relation with a customer keeping to the height of his requirements. The leader must be a company and besides, the tall risk is run.

6. Becoming stronger in technology to achieve productivity by investing in critical processes.

7. Making the logistic process perfect.

As to the third step, a decade to become effective requires a vision and a long-term commitment that sometimes takes over itself. The strategic marks must become established that they direct the expansion; knowing when and where doing acquisitions or alliances; doing obvious processes for aspects but critics of transformation; generating solid relations at international capital markets; with suppliers and with clients keys and above all, globalizer the executive team and corporate moral values.

2. BASIC QUESTIONS TO RESPOND

a. ¿Does we have a local base? If he has it, should be as strong as an ox for that he generate funds enough that they permit standing the operating losses that generally present itself when it is tried to penetrate international markets.

b. ¿Are they attacking it?: is very difficult to defense and y attack at the same time.

c.¿It too much afternoon?: if right now the other ones are positioned it is preferable to go into another type of alternatives.

d.¿it his local business by nature?: certain types of services and products that are not exportable exist.

e. ¿Does he prefer to be rich or king?: "poor person king" or "rich without reign". Globalization demands a good corporate-orientated government to protect the little shareholders and offer foreign investors confidence.

f. ¿Does he have the stomach to do it?: the defeats hurt very much and who the globalizers make a decision is willing to it.

g. ¿Is he determined to invest in the long run?: these processes take long and in some cases to 10 years according to authors.

When all human teams talk to me about globalization he must understand that he is serious. He implies breaking with the past and to impede that he go back to incur in the initial situation. Credibility must be instilled, speaking plainly, and acting with courage (breaking off habitual the way to do business).

Who talks about these themes has to look at China. The World presented important reflections: the absolute poverty of 250 reduced 2003 of 1978 to 30 million his population and under 80%'s illiteracy in 1949 to 6,72% (number of the latter poll). After having been the nation but advanced in the century XV (the compass, the printing house, the paper, and the maritime fleet but modern of the planet) decided to turn off his frontiers in 1433. At a later time, in 1978 he has placed the process of inaugural reform initiated by Deng Xiaoping on a modern country with gigantic companies again that they get the most out of the economies of scale. His economy grew 9,1 % during this year; his gross national product (PIB) apiece climbs to 1092 dollars in 2003 and his international reserves estimate around to the closing of this year 470,600 million of dollars, them but big worldly after Japan. His foreign trade comes from 851,250 million dollars, of whom exports are 438,400 and imports 412,800 million of dollars, they turn that into the competitor but threatening for the United States and the main character of the century XXI that turned upside down the worldwide equilibrium and country it must try to strengthen his relations with.

At 2,003 Forum cheap to run worldwide (Davos, Switzerland) the assistants concluded that the present-day worldly situation is fragile, complex, and dangerous and that the increasing interconnection among distinct spheres has created a great impact.

Economic development is narrowly related to social progress, free trade, the good governance practices at countries and companies potentiating, with united work, productive chains in search of common objectives of value generation.

The trusty crisis became a dominant level factor of governments, institutions, and companies. An arduous government job, businessmen, and academy to recover the ethics, moral values, and honesty are required. It is fundamental to be able to come through to recover the confidence and advance toward prosperity.

Poverty (4,000 million in the world) and hunger get constituted in the seed of fanaticism, intolerance, violence, and chaos.

The governability is based on the political legitimacy that is needed urgently. This does not turn out well if they do not distribute the benefits of the progress of a balanced form and are not happy just to be powerful to have the final say. The worldly poor (if they get busy) become an enormous potential for companies with idle plant capacity.

Globalization has to become inclusive. The rich countries must give a free entrance to the products of poor countries and require these improving the governability, the social aspect, and productivity.

The companies must respect all of the interest groups and therefore the good corporate government¹ becomes imperative; Just the same they must assume crucial themes and get engaged with communities; equally being made sure not to go back to harm the countries where they act, preserving the ambient midway and respecting the cultural moral values.
The Daw Jones Sustainability Index (DJSI), which has been applied for 21 years, measures progress in sustainability, social and economic factors. The world's large financial institutions tie loans to these indicators.

An almost indispensable complement, in terms of globalization, would say certification is BASC like the element of competitiveness because he reduces the supervisory costs, he speeds up the step and the logistic makes easy.

The Coalition Empresarial anti-smuggling (BASC) turns the variable certainty into a strategic element to develop the external markets because it is devoted oneself to promoting actions for a provisional remedy to avoid the smuggling and drug trafficking making easy the international trade.

In order to complete, let's remember the practical importance of international certification in quality, human development, and preservation of sustainability which at all quarrel, and on the contrary, they complement with certification BASC. It is another universal idiom with which steps in international business because it breaks the base of respect to worldly modern requirements are shortened and very specially to the end consumer accepting his right to satisfaction like a customer.

1. THIS WAY IS THE  ‘GOOD GOVERNMENT COPRPORATIVO’ INFORMATION

It provides information in English to its investors.

He communicates opportune, transparent, and effective form his information.

It has channels of communication with his investment telephone route or web page.

The sheet of life of his principal members can be consulted at any moment.

It uses the section of excellent information on Financial Supervision.

MANAGEMENT

It has independent members in its directorates.

It facilitates access to the managers.

He adopts financial countable international norms.

It has committees to protect the good government of the company.

STOCK EXCHANGE

It enters the market, which forces her to open his books so that they could be consulted by the investors.

It has only one typology of action.

He adopts high standards of good government that are translated into a major interest in the action.

Concept of AI: the text provides a broad vision of globalization and internationalization from a business and economic perspective. Below we highlight some key points and offer a general opinion:
Globalization and Technological Innovation: The text highlights the importance of globalization and technological innovation in today's world. It is emphasized that the Digital Revolution has transformed the way in which companies operate and relate in the global market. This is a crucial point, since globalization and internationalization are closely linked to the adoption of advanced technologies and the need to reinvent products and services.
Challenges for Companies: Several challenges that Latin American companies face in their globalization process are mentioned, including the need to improve risk management, lack of liquidity, high capital costs and foreign competition. These challenges reflect the complexity of entering international markets and the importance of solid strategies for global success.
Critical Steps for Business Globalization: The text proposes three critical steps for companies seeking to expand globally: commit to a global mindset, take bold actions to make that commitment irreversible, and realign the entire organization to compete globally. These steps are essential for a company to be successful in its globalization process.
Ethics and Good Corporate Governance: Emphasis is placed on the importance of ethics and good corporate governance in globalization. Companies must respect all stakeholders, engage with local communities and respect the environment. This ethical approach is crucial to gaining the trust of investors and society in general.
BASC Certification: The importance of BASC (Business Anti-Smuggling Coalition) certification is highlighted as an element of competitiveness in international trade. This certification focuses on security and smuggling prevention, which can reduce costs and facilitate international trade.
In general, the text emphasizes the need for companies to adapt to a constantly changing globalized and technological environment. It also highlights the importance of ethics and good corporate governance in the context of globalization. The central idea is that globalization is an opportunity for companies, but it requires a proactive mindset, adaptability and ethical responsibility.