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Industry News

 

Globalization Is 'Inevitable, Accelerating and Positive' Say Leading Business Executives

Monday May 19, 2008

 

Houston and London — May 12
Globalization is viewed by top executives at leading organizations around the world as an inevitable but positive business challenge that is here to stay and rapidly growing, according to an in-depth study of business leaders revealed by EquaTerra and World 50.

The findings also reveal that politically led trade protectionism or a major economic downturn are seen by study participants as the only major threats to the continued growth of globalization. Yet, despite these perceived threats, 90 percent of the 217 executives questioned viewed globalization as inevitable, indicating trade protectionism or an economic downturn will not ultimately stop, or even slow, globalization's expansion.

Seventy-two percent agreed it is likely to have a positive overall impact on their companies. More than a third also saw increased globalization as a challenge, but one that will be outweighed by opportunities such as the chance to expand into new markets or to improve their companies’ brand exposure and sales.
 
The “EquaTerra Globalization Study” was conducted by the Economist Intelligence Unit on behalf of EquaTerra, a business advisory firm, and World 50, a knowledge-sharing community for C-level executives. It assessed in detail the perceptions of global competition and the challenges of expanding one’s global footprint, according to more than 200 leading executives and senior managers from the Americas, Western Europe and Asia Pacific.
 
Regardless of the apparent overall optimism, 44 percent of respondents also made clear that finding and retaining high-quality talent is their No. 1 concern during the next three years. This was true among study participants at all levels and across all geographic regions. Notably, executives based in North America were 12 percent more likely than their European counterparts to cite globalization as making it more difficult to find and retain local staff with required skills and experience, highlighting current issues within the tight North American labor market.
 
While finding and retaining talent is still a big issue for those in Western Europe, its two primary challenges resulting from globalization are funding expansion into new markets, followed by growth of competition.

Increased competition from global regions was a concern for more than 36 percent of respondents, suggesting the two main challenges executives are uneasy about as a result of increased globalization could have both a positive impact for organizations — access to lower-cost, high-quality talent — as well as a negative one — more competition.
 
"These study results give us a detailed and realistic gauge of how executives perceive globalization, and what decisions they are making in reaction to it. It is certainly clear that globalization is fast changing the dynamics of the world economy and this, in turn is driving a worldwide quest for talent across all business sectors," said Mark Toon, CEO at EquaTerra.
 
In spite of these challenges, participants worldwide said they planned to use globalization initiatives to make business processes more efficient and effective (54 percent); invest in foreign markets (46 percent); accelerate globalization plans (41 percent); redesign product and service development processes (40 percent); and locate and recruit local, qualified talent (35 percent).

For more info: http://www.equaterra.com/kr/research/The-Benefits-and-Challenges-of-Globalization-all.aspx