Table of Contents
Globalization is defined as the process of developing a phase/stage of any organization or community as well as nation and culture. It changes time and again as per the time passes away.
Globalization can be defined as a process where worldwide interconnections are everywhere. It is becoming more important for the hospitality industry. Nowadays, globalization has been as a worldwide process which affects all elements of society. This leads to the disappearing of boundaries which makes it easier to do business with other countries.
Globalization is a process of interaction and integration among the people, companies, and governments of different nations, a process driven by international trade and investment and aided by information technology. This process has effects on the environment, on culture, on political systems, on economic development and prosperity, and on human physical well-being in societies around the world.
The effects/impacts of globalization on the hotel industry
- Poverty alleviation: As far as poverty reduction is concerned, globalization played a role in poverty reduction in developing countries. Indeed most developed countries experienced a reduction in poverty in the proportion of their living below the poverty line, including fast-developing countries like China, India, Vietnam.
- Employment situation: Through globalization, people from different countries are provided with jobs opportunities within the global. It has created the concept of outsourcing. Developed countries prefer to provide work to developing countries where costs are cheap. Work such as customer support, software development, accounting, marketing, and insurance are given to developing countries like India. Therefore the country that is given the work enjoys by getting jobs.
- Technology: People from different places everywhere wants all the things they have heard about, seen, or experienced through technology. Organizations through its managements can obtain knowledge from different places in the world that can be used in the organization.
Television and media played a big role in influencing the perception of the world, from a relatively small national unity and reality, into a global market and international concerns.
- Education: Globalization from the point of view has positive effects as well as negative effects. It has increased access to higher education. Example: universities are reducing the knowledge gap in developing countries, it equally has negative aspects which can seriously threaten universities in those countries. From point of view, it has brought more positive effects to developing countries through increasing access to higher learning institutions.
- Foreign trade: One of the most significant effects it has brought to developing countries is Trade. Before people used to exchange goods for goods or services for services but now people can trade goods for money. This is mostly through International trade whereby people exports and imports goods within countries. Globalization has led to the reduction of costs in trade within the globe. It has led to a reduction of tax of importation of goods.
- Foreign investment: Foreign investment is a direct result of globalization. Foreign investment is always welcomed as it provides resources, capital and technology to a country that will support the economic development of the host country. This improves employment as indirect and indirectly. Increases exports to a country and thereby improves the current account and therefore will help to the repayment of foreign debt.
- Market sector: Globalization of markets in developing countries is growing so fast. The emergence of global markets for standardized consumer products on a previously unimagined scale of magnitude. This brought benefits which are economies of scale in production, reduced world prices, distribution, marketing, and management.
- Unemployment: Globalization is blame to world’s unemployment situation though it brought some jobs opportunities. Despite the fact that it brought jobs opportunities to the global but it is still blamed to the current situation. “It‘s true that global economic integration and increased travel have resulted in increased competitiveness at the national and enterprise levels, forcing producers to find ways to cut costs, improve efficiency, and raise productivity.
- Spread of fast foods chain: Most people prefer to buy fast foods because it’s cheap and quick. This replaces home-cooked fare enjoyed with family and friends. Traditional diets and recipes are yielding to sodas, burgers, and other highly processed and standardized items that have a lot of fat, sugar, and salt resulting in a global epidemic of diabetes, obesity, and other chronic diseases.
- Western culture: Globalization has led to the spread of western culture and influence at the expense of local culture in developing countries like Africa. Most people now in developing countries cop what people in developed countries do. So, it’s like they ignore their own culture and practice western culture). For example dressing styles and eating habits, language. All these can affect management in one way or another example it can cause misunderstandings because of the language barrier.
- Trade: Average tariff rates continue to be high in many developing countries, including some that have recently implemented trade reforms. Trade policy continues to be an important aspect in globalization at least in some of the lower-income developing countries.
Advantages of globalization
- Globalization leads to a more financial interconnected world.
- It reduces geographical inequality.
- It stimulates competition between companies.
- It may increase employment opportunities.
Disadvantages of globalization
- Developed countries gain more advantage of free trade economies than developing countries.
- Due to globalization, companies choose outsources of the department to another country.
- The division of labor is also seen as its disadvantage.
- In conclusion, globalization is considered more important although there are several disadvantages.