Impact of Globalization on Management - Coursework Example

Globalization Name Institution Introduction Globalization has been defined as the integration of capital, markets, technology and nation-states in a way that allows corporations, groups, countries and individuals to reach out the world faster, farther, cheaply and successfully than before (Mark, 1997, p.221). The literature which is relevant to research into the managerial implications of global organizations describes various interactive elements that constitute the proper construction of an efficient management system for a borderless organization. The arguments of discussion revolve around the effects and impacts of globalization on management. There are unique challenges that a manager faces in managing in cross cultural contexts and also ethical issues to be dealt with. What realities must international companies come to terms with in relation to managing multi-cultural, multi-national workforces in a sustainable manner? This paper seeks to argue out the managerial implications of international organizations, as introduced above. The paper will first give an overview of the impact of globalization on management, and then delve into various management challenges in maneuvering a global landscape, as well as the ethical issues involved. Finally, the paper will discuss the internal management policies and practices of Australia and New Zealand banking group in terms of managing across cultures and boundaries, while examining a number of relevant management theories. The conclusion will highlight the key points while summarizing the argument. The Body In the face of a globalized economy, there are unique challenges for managers to deal with. Additionally, certain ethical issues must be considered for successful implementation of management practices. Success in a global market requires various ingredients, among them: competitive labour, innovative ideas, savvy marketing and sustainable supply modes, stable financing and proper logistical support. However, one central player - perpetually forever caught in the mid-ground - is the international manager. As the pressures of competition and global engagements mount, so does the pressure for managers to deliver tangible results increase (Ruigrok & Tsuyushi, 2003, p.226). As companies find themselves growing across borders, there are endless lists of cultural dynamics that managers must learn if the company is to succeed in new frontiers. For instance, criticizing heads of government for bad policy is a common pastime in many countries. However, criticizing the Thai king is a felony that is punishable by not less than twenty years in jail. In Russia and many formerly USSR countries, it is common practice for companies to offer money to government officials to raid and vandalize business rivals or instigate endless criminal investigations against them (Miller & Vaughan, 2001, p.19). In Nigeria, a number of corporate heads have been sued for seeking the help of witch doctors to vanquish rivals or increase business certainty. Dressing for business meetings in the global arena is very challenging: for instance, adorning yellow attire in Malaysia is reserved for royals; in some parts of Asia, white attire is worn for mourning; and in India, adorning anything made of leather can be very offensive to the Hindu populace (Mansour et al., 2007, p.32). Many local customs and norms are likely to stay for quite some time and the best managers can only prepare adequately to not ignore the global differences, but to capitalize on them (Wren, 2004, p.44).These are some of the realities that organizations must come to terms with in managing international business. With these huge tasks and complex challenges, what then do managers require in succeeding, surviving and conquering in these complex environments? Simply, they need to have an understanding of both macroeconomics and microeconomics. They require the fundamentals of global business practice, strategy, operations, finance, logistics, accounting and marketing. Additionally, they must understand other issues such as political risk, outsourcing, local cultures, national laws and emerging technologies (Tom & Robert, 1982, p.37). Perhaps of greater ramifications is the need for managers to know how to work with people from around the world, not just employees and customers (Rosenzweig & Nohria, 1994, p.233). In the global arena, managers face a number of challenges that are people related, and which will determine success or failure. The first challenge is the development of a strategy for guiding both long-term and short-term professional goals. Effective planning is a major cornerstone of management. The second challenge is the development of basic knowledge on how various cultures work, how they are unique and how one can work successfully the various environments. If cultural differences play a very important role in organizations and it is only logical and prudent for a manager to understand how culture influences behaviours and attitudes at the workplace (Kalburgi, 1995, p.43-44). Another challenge is developing effective and efficient strategies for dealing with other managers of different cultural extractions, who are likely to offer new insights in unfamiliar mannerisms. Such multi-cultural extraction of managerial knowledge will enable a manager to know when and how to act in different situations (Michael et al., 2005, p.32). The fourth challenge is the understanding of competing demands and interests of all the stakeholders in the organization, including the processes required to achieve favourable outcomes. Any large organization consists of many stakeholders of conflicting interests. These could be employees, investors, strategic partners, customers and governments. The manager must balance all these competing interests and build a consensus to articulate the divergent goals (Wren, 2004, p.60). Managers need to develop an understanding of the organization of business enterprise across cultures and the implications of the differences to overall business practice (Miller & Vaughan, 2001, p.17). Managers generally should know how organizations operate in their cultures, where authority and power reside and also the interrelationships that ought to work together for success to be achieved. The sixth challenge revolves around building good multi-cultural communication tactics and skills. Communications at all levels is one of the binders that hold organizations together (Sadri & Tran, 2012, p.228). Managers must have a deep understanding of leadership structures across cultures and how this affects business. Additionally, they must possess the ability to develop good negotiation skills, coupled with the ability to apply the skills in building and sustaining various global partnerships (Mayerhofer et al., 2007, p.81). Finally a manager should have knowledge on the scope and nature of workers motivation as influenced by cultural difference. (Thomas et al. 2004, p.15). Corporate social responsibility is at the centre stage in the management of organizations. The organizations have a responsibility to improve the lives of its workers and the community at large. As such, managers must balance the economic objectives with social responsibility and ethics for sustainable progress to be achieved. An organization is valued highly when moral and ethical practices are carried out consistently and efficiently. At the heart of success is the implementation of a proper balance between the non-financial and financial concerns (Kline 2012, p.169). This calls for a strong corporate governance code by which all employees should be called to adhere by. International organizations should ensure that all employees respect cultural differences and diversity at the workplace, manage conflicts amicably, maintain safe working environments. Additionally, there should be emphasis on gender equality, prevention of sexual harassment, inclusion of disabled and marginalized people as well as enabling a flexible work environment (Dillard et al., 2013, p.14). Zwetsloot (2013) states that all businesses and corporations should aim at doing the right things, show consistency in their moral conduct and genuinely improve the lives and conditions of their employees, stakeholders and customers. Any malpractices contravening the ethical standing of an organization should be investigated and dealt with immediately to prevent further degeneration and mediocrity. Therefore, all managers should focus on improving moral and ethical standards of their organizations if they ever hope to achieve astounding success in the global business arena. In the face of all the afore discussed, the Australia and New Zealand banking group is a good example of a borderless organization that strives to implement the best management practices and policies. On business strategy, ANZ focuses on customer segments and geographies. The group manages business via a corporate sustainability governance code of ideal conduct and ethics, while working on the goal of delivering long-term profitable shareholder return (ANZ, 2013a, p.3). Integrity, honesty, trust and quality are ANZ’s key values. As such, ANZ seeks to deal quickly with arising problems, such as the audit done by Finance Union Sector (2008), which showed that ANZ had low level availability of staff. This caused the available staff to feel a lot of pressure and suffer from fatigue. While this decreased wages, an ethical question emerged on ANZ’s internal practices. Another identified problem was the discrimination against women and other minority groups (Finance Union Sector, 2008). The business strategy is in line with three factors: customers; geography and capabilities. ANZ managers have their work clearly cut out and their concerns rotate around the following issues: interaction of business opportunities and geography, recognizing the shift of business to a more global perspective, the balanced approach and attention to developing Asian nations, promotion of inter-regional connectivity and the extension of cooperation between the Euro-zone and Asia-Pacific, expansion of networks to capture emerging regional and global markets, the strengthening of existing domestic markets in Papua New Guinea, Australia and New Zealand, helping close the social divide and economic disparity in areas of operation, improving the access to easy banking with unbiased inclusion, multi-cultural and diverse hunting for talent, creation of technology hubs across operational regions, adherence to strict and ethical corporate standards, building a stronger focus on customers’ needs, reaching out to medium and small scale businesses and the support of community initiatives in all areas of operation. This is ideal for becoming a super cross-national bank by strengthening business in New Zealand, Australia and the Pacific, whilst establishing business in other Asian markets (Vijay, 2014, p.2). ANZ recognizes that issues arise in companies when practices carried out are in contravention to the set ethical standards and social responsibility (Kline, 2003, p.165). To achieve above, ANZ management primarily focuses on recruitment, training and development, performance/appraisal systems and remuneration (Vijay, 2014, p.3). Recruitment covers the searching and obtaining of favourable candidates of high caliber to work for the organization. The systems theory points out that an organization is a unified sum of its parts. As such the employees coming in will become part of this structure and will affect it positively or negatively (Mark, 1997, p.207). ANZ relies on community networks, liaisons with learning institutions and public adverts to source for suitable candidates for any open positions. Training and development focuses on acquisition and systematic development of skills, attitude and knowledge possessed by employees. ANZ has an effective management framework for identifying specific training needs in line with organizational goals (ANZ, 2013a, p.5). Taylor’s Principles of Scientific management theory purports that management is the keeper of company knowledge and training has the sole noble purpose of achieving workers’ efficiency (Mark, 1997, p.213). Additionally, according to the Motivation and leadership theory, a leader must consistently support employees in their various needs (Michael et al., 2005, p.39). The managers themselves undergo training to facilitate their engagements with a global market. Performance appraisal systems are implemented for the purpose of identifying measurement factors and criterion of evaluating performance. ANZ’s performance appraisal system is very objective and fair to all employees regardless of nationality, culture or other affiliations. The focus is on individual performance, not personality. Finally is the issue of remuneration. ANZ has a performance based pay system where equal work is equally paid for regardless of employee location, nationality, ethnicity or religion (Vijay, 2014, p.6). This is important in creating equality and cohesiveness in the Group in all its global operations. Conclusion Managers face unique challenges when managing multi-cultural and multi-national workforces. Additionally, they have to deal with moral and ethical issues in order to succeed. This means that there are various interactive elements that constitute the proper construction of an efficient management system for a borderless organization. Whatever dimensions that globalization takes; many companies face the same challenges, which are mainly related to how their employees do business, serve customers and continually innovate as well as the proper integration of social corporate responsibility. Management is at the root of company excellence, as discussed above. Thus, the training communities strongly advocate for a change in the analyses criteria for management success in the global spectrum. A large cadre of managerial experts have zeroed in on the requirement for managers to grow perspectives that look beyond the domestic experience (Michael et al., 2005, p.30). It is a call to multicultural competence, a global mindset. Additionally, managers serving in a global platform should understand the need for corporate social responsibility and ethical issues. They must also understand the drivers of globalization and how they affect their organizations. These include: shifting customer demands; new technologies and innovations; the influence of emerging markets and economies; the need for multi-national and multicultural labour and the evolvement of government policy in a new world (Thomas, 2006, p.4). All managers should understand how these drivers are interconnected and their influence on the quality and delivery of management practices. The Australian and New Zealand banking group exemplifies how management can be best modeled to achieve excellent outcomes in the face of globalization. References ANZ, 2013a, Code of Conduct & Ethics, ANZ Ltd, viewed 9th October 2014 http://www.anz.com/documentslaulpoliciesfANZ-Employee-Code-of-Conduct.pdf. 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