ZGE 4304 - LIVING IN THE IT ERA

MODULE 1:
CONCEPTUAL FRAMEWORK
INTRODUCTION
GLOBALIZATION
GLOBALIZATION
 Globalization is the word used to
describe the growing interdependence
of the world’s economies, cultures,
and populations brought about by
cross-border trade in goods and
services, technology and flows of
investment, people, and information 
 NATURE OF GLOBALIZATION
 Globalization can be defined as a process by which businesses or other organizations
develop international influence or start operating on an international scale.
 Factors that have contributed to globalization include:
 increasingly sophisticated communications and transportation technologies and
services,
 Mass migration and the movement of peoples,
 a level of economic activity that has outgrown national markets through industrial
combinations and commercial groupings that cross national frontiers,
 and international agreements that reduce the cost of doing business in foreign
countries.
WATCH THE VIDEO

https://www.youtube.com/watch?v=JJ0nFD19eT8
Pros and cons of globalization
The pros of globalization
 With globalization, there is a global market for
companies to trade their products and a wider
range of options for people, to choose from among
the products of different nations.
 Developing countries benefit a lot from
globalization, as there is a sound flow of money
and thus, a decrease in the currency difference.
 The pros of globalization

 To meet the increasing demands that follow

globalization, there is an increase in the production
sector. This gives loads of options to the manufacturer as
well.
 Competition keeps prices relatively low, and as a result
inflation is likely to occur.
The pros of globalization
 The focus is diverted and segregated among all the
nations.
 Communication among the countries is on the rise,
which allows for better understanding and broader
vision.
 As communication increases amonst two countries,
there is interchange of cultures as well. We got to
know more about the cultural preferences.
 The pros of globalization

 As we feed other’s financial needs, the ecological

imbalance is also met. Government of countries show
concern about each other.
 The CONS of globalization
 Globalization is causing Europeans to lose their jobs as work I
being outsourced to the Asian countries. The cost of labor in
the Asian countries is low as compared to other countries.
 The high rate of profit for the companies, in Asia, has resulted
in a pressure on the employed Europeans, who are always
under the threat of the business being outsourced.
 Companies are opening their counterparts in other countries.
This results in transferring the quality of their product to other
countries, thereby increasing the chances of depreciation in
terms of quality.
The CONS of globalization
 There are experts who believe that globalization is the
cause for the invasion of the communicable diseases and
social degeneration in countries.
 The threat that the corporate would rule the world id on
high, as there is a lot of money invested by them.
 It is often argued that poor countries are exploited by the
richer countries where the work force is taken advantage
of and low wages are implemented
CHALLENGES of globalization
CHALLENGES of globalization
 Productivity: Productivity is improved by producing in
countries where production is most efficient. However,
this often means workers in one country lose jobs as their
work moves to more efficient locations.
 Consumers: Consumers benefit from a wider array of
competitively priced goods. However, they have less
control over supplies coming from abroad than over
goods produced domestically.
 CHALLENGES of globalization
 Employment: Employment may increase as economic growth
and specialization take hold. However, domestic employment
fluctuates according to foreign conditions (such as economic
crises elsewhere that reduce demand for employment
domestically).
 The Environment: As global consumption increases due to
globalization, more natural resources deplete. Differing
environmental standards across countries create opportunities
for businesses to exploit resources in countries with the least
amount of environmental protection regulation.
CHALLENGES of globalization
 Monetary and Fiscal Conditions: As money moves
more freely, it is better able to seek out the best
investment opportunities on a global scale.
 However, governments have less control over the inflow
and outflow of funds. Furthermore, capital seems to be
flowing more freely to countries with lower tax rates and
less regulatory restrictions, putting additional pressures
on national fiscal and monetary policies.
 CHALLENGES of globalization
 Sovereignty: Globalization may undermine national
sovereignty in two ways:
 First, contact with other countries creates more cultural
borrowing and may dilute a country's cultural uniqueness.
 Second, countries are concerned that important decisions may
be made abroad by foreign owners of domestically located
firms.
Role of ict in the era of globalization
 GLOBALIZATION AND ICT
 Globalization is a multifaceted word that does not refer to a
single notion, but can be characterized as a systematic
integration of commercial, cultural and technological
advancements.
 The information and communication revolution is one of the
most important factors in globalization, and has changed
people’s relations and the relative meaning of time and space,
reducing communicative distance, demolishing physical
boundaries while increasing relations between people,
governments and cultures.
 STOP! AND THINK…
Through information and communication technologies, substantial populations on earth are
exposed to foreign cultures and ideas and feel the threat of loosing their national and
religious identities.

Can you sight an example of this, make it specifically applicable in the Filipino Culture.
 ICT IN globalization
 Information and communication technology (ICT) is a driving factor in the process
of globalization.
 Improvements in the early 1990s in computer hardware, software, and
telecommunications have caused widespread improvements in access to information
and economic potential.
 These advances have facilitated efficiency gains in all sectors of the economy. IT
provides the communication network that facilitates the expansion of products, ideas,
and resources among nations and among people regardless of geographic location.
 Creating efficient and effective channels to exchange information, IT has been the
catalyst for global integration
 MAIN DRIVING FORCES OF
GLOBALIZATION OF THE WORLD’S
ECONOMY
 Due to technological advancement time and space has ceased to exist.
 E-Commerce, E-business and E-banking have replace the old trend of
doing business with the new online business models making full use of
technology.
 Large pools of skilled and quality human resources
 Dramatic fall in international telecommunication cost.
 TECHNOLOGY:
PRINCIPAL DRIVER OF
GLOBALIZATION
 Advances in information and communication technology have
transformed economic life of consumers, investors,
businesses.
 It has led to identification of new economic opportunities,
include faster and more informed analyses of economic trends
around the world, easy transfers of assets, and collaboration
with far-flung partners.
 Forces of ict driving globalization
 Complexity and enormity of products and services – The costs, risks and complexity
involved in the production process for many industries require a minimum effective market size
larger than that of the domestic market.
 Organizations moving from hierarchical to network organizational structures. Networks
are replacing hierarchies in the basic organizational structures. The noncentralized character of
networks distributes the authority exercised by any discrete geographic entity. Team working in
different countries in a network contributes to the efficient making of the final product, each
using their core skills.
 Forces of ict driving globalization
 Integration of market and cyberspace – The integration of market to cyberspace renders
geographic space redundant as a basis of effective economic governance. Workflow software
allows individuals and teams geographically far apart working on different components of a
product to collaborate by working in parallel and produce the final product more efficiently.
ICT enables the organization of such collaborative efforts that employs core competencies
economically and efficiently, wherever they may be.
• Open source software – Open source software, developed as a result of a collective intellect of
peers, downloadable free with source code has further given impetus to globalization.
 Forces of ict driving globalization
 Complexity and enormity of products and services – The costs, risks and complexity
involved in the production process for many industries require a minimum effective market size
larger than that of the domestic market.
 Organizations moving from hierarchical to network organizational structures. Networks
are replacing hierarchies in the basic organizational structures. The noncentralized character of
networks distributes the authority exercised by any discrete geographic entity. Team working in
different countries in a network contributes to the efficient making of the final product, each
using their core skills.
 Forces of ict driving globalization
 Transfer from the physical domain to the digital domain – ICT, in particular the internet,
enables the shift in value of products and services from the physical to the digital domain. The
strong growth of computing devices used throughout the business processes is tilting the
balance from the physical to the digital domain. The measure of digital domain is the degree to
which a product or service can be digitized or stored in a computer.
 New business models – The internet also has the potential to create new business models and
bring about changes in the value chain. E-Commerce, all transactions in information, trade in
goods and services including financial services as well as government and social services over
the internet interactively and instantly have given rise to several new and innovative business
models. Transaction efficiency and access to suppliers of products and services anywhere by
buyers located anywhere in the world form the basis.
 Forces of ict driving globalization
 Internet’s effect on markets and products – The effect of the internet on globalization as a
driver for markets depends on:
 The degree to which a product or service can be digitized
 The transaction efficiency
 The extent to which products or services could be globalized using the internet.
 KEY FACTORS FOR THE ROLE
OF ICT IN GLOBALIZATION
 Information – globalization will drive the development of products and services with higher
information value and be driven by it.
 Network access and ICT infrastructure – the penetration and growth of internet access
through wire-line or wireless will determine the timing and extent of globalization.
 Economies of scope – the ability to alter the traditional value chain with consequent economic
advantage will drive the globalization of the industry.
 Language / culture – the effective use of the internet in different languages and cultural
settings will be a strong driver for globalization.
 KEY FACTORS FOR THE ROLE
OF ICT IN GLOBALIZATION
 Facilitating FDI – ICT has facilitated the growth for foreign direct investment (FDI) allowing
global business management along the whole supply chain through effective
information and communication networks.
 ICT allows process and product innovation, creates new factors of production helping
economic restructuring and transition, and provides a new means of organizing activities
through its synergy with other technologies, thus changing the classical view of managing
business operations.
 KEY FACTORS FOR THE ROLE
OF ICT IN GLOBALIZATION
 Information – globalization will drive the development of products and services with higher
information value and be driven by it.
 Network access and ICT infrastructure – the penetration and growth of internet access
through wire-line or wireless will determine the timing and extent of globalization.
 Economies of scope – the ability to alter the traditional value chain with consequent economic
advantage will drive the globalization of the industry.
 Language / culture – the effective use of the internet in different languages and cultural
settings will be a strong driver for globalization.
IMPACT of ict in THE
globalization

ECONOMIC
ICT has specifically affected the new economy as a result of its speed, low cost, flexibility,
networks, and applications.
 Firstly, geographical distance has become less important and financial markets have become
more transparent. Thus, technology has helped the operations of stakeholders by providing an
opportunity to monitor the performance of managers.
 Also, ICT has increased transparency in pricing and process by giving examples of track
orders, and the ability to compare prices, and develop consumer relationships. For example,
local SMEs (Small-Medium sized Enterprises) can demonstrate their products to the customers
in foreign countries thus allowing them to search independently for products that are to their
own advantage

ECONOMIC
ICT also provides a network that plays a significant role in establishing greater
interconnectedness.
 Hence, ICT is contributing to the spread of the e-economy by supporting decentralization,
providing interactions among participants more freely, and causing opportunities for novel
variations and development.
 From this point of view, e-commerce is related to the e-economy.
 New firms which use e-commerce have been doing business since the 1990s.
 Traditional firms have also started to use e-commerce on the grounds that e-commerce is a
direct and rapid way to reach customers
 Additionally, because of ICT`s property of availability, e-commerce has grown dramatically.
 Social and Cultural
 ICT has also affected the social and cultural dimensions of globalization, similar to economic
globalization.
 Cultures have been involved in more cross cultural communication processes. At this point,
ICT has an important role to play by providing communication and interaction among all
peoples, anywhere.
 It can include and combine all forms of cultural expression, therefore, the development of ICT
has caused the development of a new global culture as well.
 “The global culture is a patterned way of behaving under global conditions and processes,
sustaining the exchange and flow of goods, people, information, knowledge, and images. These
exchanges and flows of people, logistics, and minds give rise to communication processes that
gain some autonomy on the global level.”
 Social and Cultural
 Thanks to ICT, people can make social connections regardless of physical distance on a global
scale.
 The reach of ICT makes it possible to interact and communicate in new ways has led to the
emergence of the network society.
 In this present society, people today are also assembled online around shared concerns and
values. As a result of this process, ICT has become the center of social activity for many.
 The numbers of online shoppers are increasing, online banking is encouraged by banks,
universities are commencing a new type of teaching - online teaching or distance learning -,
and email is becoming a common communication method among the people.
 These improvements show that ICT has helped to create a new global pattern of social
interactions. It provides interactions among people more easily and more effectively than ever
before
 environmental
 Information and communication technologies, such as decision support systems (DSS),
database management systems (DMS), special software, geographic information systems (GIS),
remote sensing, and multimedia, are tools that have recently been developed and are used for
analyzing and solving environmental problems.
 These problems include environmental pollution, which is a serious problem. The waters have
been polluted, air quality of majority of the cities in the world is low, and the noise level in
cities is still under the environmental standard.
 To fix these problems, many applications of ICT have been used in many ways, such as
monitoring, management, and creating statistical data. ICT also assists environmental
management employees in decision making process by sorting, processing and monitoring
environmental data.
 environmental
 The databases are the main component of these systems. By using these databases,
environmental information systems can be applied successfully in the area of decision making.
 In addition; geographic information systems (GIS) are used in many areas of environmental
studies such as city planning, earthquake forecasting, and meteorology
 The other important impact of ICT on the environment is related to its basic advantage.
 ICT affects forests positively by reducing paper usage (Schultz, 2010). Many ICT applications,
such as document management and electronic archive systems, have been developed for
institutions in order to reduce their paper use