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The way that countries and people around the world have become more connected and
interdependent economically, politically and socially.
In terms of economic, it refers to interconnectedness of economies through trade and the
exchange of resources. The effect of globalization is for small businesses, they can have a
technological innovation due to exchange in information. They can simply access to global
market to find more buyers and suppliers around the world using just an internet connection.
This means that they have the potential to increase in revenue because every single customers
can easily reach and access their products online.
But as there is increase in globalization, there will be open competition which means more and
more buyers from other country will enter the market. This also will lead to price wars between
small business and large corporation. For a large corporation who already achieve economies of
scale, the small business may unable to fight them due to lack of resources, management and
skills and also market opportunities and make it hard for small business to survive in the
competition. They have to improve the quality of their products or lower the prices in order to
sustain. Due to the globalization, economic disparities become widen because for large
corporation, they are able to generate revenue while small businesses are burden with increasing
In terms of social, it refers to the sharing of ideas and information between different countries.
The information that flow without barriers will slowly alter the original culture which creating
culture homogeneity. For example, we can see that Malaysia had been exposed to many culture
especially western culture and it slowly alter the Malaysian culture where the western
philosophies and practices are usually being implemented in lifestyle. For example, Malaysian
corporate values are slowly evolve from collectivism towards western values which is
masculinity and individualism. In case of the Kitchen, the Pro Clean managers who received
education from western, were more practicing masculinity and individualism value which they
don’t even tolerate with the operators.
In terms of politic, it refers to the amount of political co-operation that exist between different
countries. As countries have become more interconnected, they have to work together in order to
achieve stability. This has led to the development of world government, which is the united
nation (UN). UN was formed in making sure that human rights are protected. One of the example
is the implementation of English law in Malaysia. We can see that most of laws in Malaysia are
extracted from English law and being used as a reference. For example, in the case of the
kitchen, the operators of the kitchen were forced to cease operation without justifications and
compensation and they decided to fight back. The managers then applied contract law which
from a legal perspective, it was not an offence for Pro Clean to evacuate the operators without
adequate justifications and compensation since the contract between operators and Global Effect
is already expired.