Global Business

Global business refers to international trade whereas a global business is a company doing business across the world. The exchange of goods over great distances goes back a very long time. Anthropologists have already established long-distance trading in Europe in the Stone Age. Sea-borne trading was commonplace in many regions of the world in times predating Greek civilization. Such trade, of course, was not by definition “global” but had the same characteristics. In the 16th century all of the continents came to be routinely linked by ocean-based communications. Trading activity in the modern sense rapidly followed at the beginning of the 17th century; it might be more accurate to say that it “returned” again because trading of such character had taken place in Roman times as well.

It is not intended here to discuss another and related subject covered separately in this volume: globalization. Globalization is a long-standing program advocated by the economically advanced nations to free up international trade across the globe through treaties. It has also come to mean the relocation of production or service activities to places that have much lower labor costs. Global business in the past—or currently—does not require what advocates of globalization seek, namely a so-called level playing field. International trade has always had a mixed character in which national organizations and private enterprises have both participated, in which monopolies have been imposed, frequently defended by armed forces, in which all manner of restraints and tariffs have been common and participants have made all sorts of efforts to counter such interference or to profit from it.

IMPACT OF INFORMATION TECHNOLOGY ON GLOBALIZATION AND BUSINESS

In the past few sections we have defined what globalization is, its effects on society and its relationship with business. The one topic I have yet to go over is how exactly globalization is able to have this much of an impact on the global landscape and the key catalyst for globalization is, information technology. The progression towards globalization has been around for centuries, but it really became noticeable in the early 1900’s with technological advances. The telegraph and telephone allowed people to communicate across borders in seconds when previously it would take weeks or months to relay messages. The invention of the airplane allowed for much quicker international travel, while communication devices such as the radio allowed people all over the globe to listen to news from all over the world in near real time.