The Challenges of Global Market – Dr. Daniele Trevisani – Formazione Aziendale, Ricerca, Coaching

Article written by Ginevra Bighini, www.interculturalnegotiation.wordpress.com; mentoring by Dr. Daniele Trevisani, www.studiotrevisani.com

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In today’s article I’m going to talk about the pros and cons of global market, paying particular attention to the skills that every company must have to overcome all its challenges.

Before listing the advantages and disadvantages of this new globalized world, we must understand what the word “globalization” means.

To explain the term I will use, as usual, a Wikipedia’s definition:

“Globalization is the process of interaction and integration among people, companies, and governments worldwide. This increase in global interactions has caused a growth in international trade and the exchange of ideas and culture.” (1)

In other words, our world is more connected than ever, but this speed in the distribution of goods, ideas and services can have positive and negative consequences.

The benefits of globalization are surely the following (2):

access to new cultures
the spread of technology and innovation
lower costs for products
higher standards of living across the globe
access to new markets
access to new talent

Globalization is not something perfect, because many challenges are just around the corner:

High Investment Costs: globalization presents challenges for multinational corporations in terms of capital investment and leadership. Setting up a business in a new country, especially a developing country, requires substantial upfront capital. It can also be difficult to find and retain managers with the requisite skills to add value to the company and work effectively within the local culture.
Confusing Local Systems: companies also face the challenge of contending with different laws in different countries. Sometimes they must contend with different types of legal and banking systems entirely. Difficulty navigating these systems may lead to impediments in expanding to new countries and severe repercussions for missteps made.
Weak Regulation: fewer regulatory bodies exist for international business enterprises. Navigating the international markets can thus sometimes feel like the Wild West.
Immigration Challenges: increasing populations of immigrants and refugees present a challenge for industrialized nations, because countries find themselves limited in the aid they can provide without detriment to their own citizens.
Localized Job Loss: globalization can contribute to a decline in job opportunities as companies move their production facilities overseas. (3)

These are only few of the challenges that companies and countries must face because of globalism.

Focusing our attention on companies in particular, let’s now look at the skills that every small or big corporation must possess to survive in this globally interconnected economic and financial system:

Intercultural communication and collaboration: these are the first and most important skills that businesses need to be successful in the globalized market. If we are unable to communicate and collaborate effectively with different cultures – inside and outside the company -, we are doomed to failure.
Cultural understanding: this means being flexible and open-minded. If we start a business with prejudices, we won’t be able to absorb the positive aspects that diversity can bring out. At the same time, if we do not understand our target culture, we are going to destroy our sales and marketing strategy, which will become ineffective.
Creation of one’s own original identity: what can you do if you are the same as other billion companies in the world? Nothing, because you won’t be noticed. Just consider what makes you so competitive on the market and highlight the qualities of your business in a new, original way. This is the only way to attract attention and to make your brand shine.
Strategy planning: any decision to go global must start with developing a long-term action plan that aligns corporate vision, mission, and activities and leverages corporate strengths while identifying opportunities in desirable and compatible markets. It’s about strategy, not tactics. Realistically, before any tactical questions can be answered, its necessary to thoroughly examine individual markets and get the expertise necessary to understand the people and their culture. (4)
Embracing digital platforms: globalisation and technology go hand in hand. Without technology, we just wouldn’t be able to reach new markets. through the use of digital platforms and tools, businesses can sell in global markets whilst keeping their virtual teams connected in real-time. (5)

To conclude, we must accept the fact that our world is changing and if we want our business to be successful in this new globalized world, we must set our prejudices aside and embrace these new challenges with a strong and competitive mind, never forgetting that being original, open and collaborative will be a huge advantage in any international negotiation and also in globalization.