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Monday, February 19, 2007

"The Globally Integrated Enterprise"

An email says:

You might wish to discuss this article on your blog. The article traces the development of MNC’s up to the present. It is a celebration of the MNCs and their positive impact on globalization.

Unfortunately, Palisiano (CEO of IBM) does not address the issue of corporate power in distorting the market place and in controlling governments themselves (think K Street). Nor does he seriously address the rising global inequality of wealth (think sweat shop labor).

Nor does he address the issue of global warming, environmental decay, and resource depletion—and the ability of MNC’s to cast doubt on the seriousness of these issues. All of these issues are the dark underside of globalization, on which I tend to focus. He frames the discussion in such a way as to avoid these issues—most economists follow his lead.

Anyway, the article is worth discussing. Most economists would agree with Palisano. ...

I'm a bit rushed until much later today and can't do much with this, so, quickly, here's the beginning and end of the article along with a link to the whole thing. Hopefully, some of you can provide analysis:

The Globally Integrated Enterprise, by Samuel J. Palmisano, Foreign Affairs: Beyond Multinational The multinational corporation (MNC), often seen as a primary agent of globalization, is taking on a new form, one that is promising for both business and society. From a business perspective, this new kind of enterprise is best understood as “global” rather than “multinational.”

The corporation has evolved constantly during its long history. The MNC of the late twentieth century had little in common with the international firms of a hundred years earlier, and those companies were very different from the great trading enterprises of the 1700s. The type of business organization that is now emerging—the globally integrated enterprise—marks just as big a leap.

Many parties to the globalization debate mistakenly project into the future a picture of corporations that is unchanged from that of today or yesterday. This happens as often among free-market advocates as it does among people opposed to globalization. But businesses are changing in fundamental ways—structurally, operationally, culturally—in response to the imperatives of globalization and new technology. ... I believe that rather than continuing to focus on past models, regulators, scholars, nongovernmental organizations, community leaders, and business executives would be best served by thinking about the global corporation of the future and its implications for new approaches to regulation, education, trade, and commerce.


Global Collaboration The spread of shared technologies and business standards is creating an unprecedented opportunity for further global integration, not just within each sector of society, but across them all. ... Government leaders will find in business willing partners to reform health care and education, secure the world’s trade lanes and electronic commerce, train and enable the displaced and dispossessed, grapple with environmental problems and infectious diseases, and tackle the myriad other challenges that globalization raises.

Among the most urgent of the challenges facing emergent global institutions in all spheres of society is global security and order. Without them, nothing is possible. Companies will only invest in global systems of production if they believe that the geopolitical relationships that enable their investments will be stable and lasting. ...

One promising trend toward greater global stability is the growth of horizontal, intergovernmental networks among the world’s regulators and legislators. Built on shared professional standards and relationships among cross-national communities of experts, these networks are interesting analogues to new forms of organizing work in business, such as globally integrated supply chains, commercial “ecosystems,” and open-source communities.

The alternative to global integration is not appealing. Left unaddressed, discontent with globalization will only grow. People might ultimately choose to elect governments that impose strict regulations on trade or labor, perhaps of a highly protectionist sort. Worse, they might gravitate toward more extreme forms of nationalism, xenophobia, and antimodernism. The shift from MNCs to globally integrated enterprises provides an opportunity to advance both business growth and societal progress. But it raises issues that are too big and too interconnected for business alone or government alone to solve.

The globally integrated enterprise is a promising new actor on the world stage. Now leaders in business, government, education, and all of civil society must learn about its emerging dynamics and help it mature in ways that will contribute to social, economic, and human progress around the planet.

    Posted by on Monday, February 19, 2007 at 12:51 PM in Economics, International Trade, Technology | Permalink  TrackBack (0)  Comments (183)


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