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(a) In the above paragraph, two major concepts related to government policy have been discussed. The five major kinds of drivers, all based on changes that are leading international firms to the globalization of their operations, include political. Competition resulted in reduction in prices, thereby benefiting the customers. Success of the company attracted many other players to enter the market. In a short span of time, the company emerged as a market leader. It set up its office in Gujarat with a view to capture the Indian market. The company was also aware that there had been increased level of interaction and interdependence among the various nations of the world and India could be made a base for its international trade. The company decided to take advantage of the fact that licensing requirements had been abolished. While in search of markets abroad, the company found that in India, the reform process was underway with the aim of accelerating the pace of economic growth. It has a large Research and Development team which invented the first smart watch W-I, which besides showing the time would also monitor few health parameters like heart beat, blood pressure, etc. Thus, we can say that, market convergence, competition, exchange rates and cost advantages are the key drivers of globalization.
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Most companies move their head quarters to overseas to avoid their respective home countries' high taxes and other costs associated in business operation in those countries. Adverse business environment in home country pushes the companies to look for global market. To set up a business in a place which is politically more stable. To cut down the manufacturing cost, industries may set up manufacturing units overseas where manufacturing cost is favourable.
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For the development of business a new technology is needed which could be taken from overseas. An organization named WTO (World Trade Organization) was established for the development of cross border trade.
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World is shrinking because of the development of the transportation, communication, technological changes etc. has 300,000 unique visitors a day on its website and produces approximately 30,000 transactions a month during group buying events in Beijing, Shanghai, Guangzhou and elsewhere.- Domestic markets are not enough and other markets are required for the progress of industry. Shanghai-based, founded in 2003, which sells everything from paint to ceiling lamps, now has 1.6 million members. The growth of social networking and digitization enables consumers to form clusters that boost their bargaining power. International peer-to-peer microfinance platforms are making possible new forms of lending to small entrepreneurs in high-growth economies. Individuals can form groups that provide products and services to reduce the market power of existing suppliers or to exert greater control over the way a product or service is produced or consumed. Business leaders in emerging markets are especially alert to this trend, with 67 percent expressing this view, compared with 52 percent of executives in developed markets. Market and competitive drivers are some other related factors of globalization. Accenture’s research reveals that 57 percent of executives believe the growing bargaining power of knowledgeable consumers will significantly affect competition in their industries over the next five years. Technology is enabling like-minded consumers to form clusters of cooperative structures that span multiple countries and regions in order to share information, evaluate products and services and conduct purchases. This is an especially powerful trend that is helping make cost structures more variable in a volatile world. Hong Kong-based Li & Fung, for example, has used information technology to transform itself into a global, horizontal provider of services traditionally performed internally by retailers and wholesalers – services such as supply chain management, production and operations. New forms of B2B activity are becoming technologically possible, advancing the promise of “e-markets” first discussed a decade ago.