The impact of globalization on the business world is incalculable,
and much of this impact can be directly linked to the advent of the
Internet, said Richard Gorman, a successful Internet entrepreneur. The
World Wide Web has made it easier and easier for companies to make
smooth transitions into global markets. For business leaders that know
how to harness its power, globalization can mean the difference between
stasis and dynamic international success.
“The advent of the Internet has made the world flat,” Richard Gorman
said. “Through social media and online technologies, countries can
easily interact with one another and work in other markets. There are
more opportunities than ever before for motivated business leaders to
extend their reach internationally.”
Harnessing Globalization
While the Internet makes it easy for businesses to expand their reach
internationally, it does not necessarily deliver new, global customers
directly to a business’ front door. Companies need to truly embrace
globalization if they want to reap its benefits, something that Elaine Pofeldt of Forbes challenges them to do.
“Try a small experiment this year,” Pofeldt wrote. “See if you can
find at least one overseas customer for your business, if you don’t
already work internationally… It’s a great way to get ahead of the
trends that are likely to affect your industry in the next decade–and
chances are, your competitors aren’t doing it.”
Pofeldt pointed out that globalization is something of a
four-letter word in some circles – the shrinking and increasingly
connected world has led to the loss of American jobs. While
globalization has put some at a disadvantage, it also has opened new
opportunities, and frankly, it is here to stay. The best way for
businesses to adapt to the new global landscape, then, is to harness it
and make it advantageous.
“If we use our ingenuity to make the most of technologies that make
international business easier–instead of feeling victimized by practices
like outsourcing–globalization can bring tremendous good to our economy
and individuals within it,” Pofeldt said.
Using Globalization Advantageously
Richard Gorman agreed with the Elaine Pofeldt’s assessment.
“There are far more potential customers outside the U.S. than there
are within it, and plenty of opportunities to pick up new business,”
Gorman said. “Moreover, the economy is bouncing back, so a lot of
companies are in a good position to expand.”
The question, of course, is how?
The first, most obvious step is to develop an online presence.
Companies need to have polished, optimized websites, easily accessible
to customers at home and abroad.
Additionally, the Pofeldt offers several recommendations for companies looking to expand their customer base overseas:
- Know the receptive markets. Canada, Mexico, and China were the top
market exports for the U.S. as of 2011; Japan and the United Kingdom
round out the top five. The list is hardly static, though, and within
the next several years, Brazil and India are expected to advance into
the top five. As Gorman recently told AllFacebook.com, “The key here is to find a specific market with international leverage that has a good growth potential.”
- Think along the lines of infrastructure, especially when
doing business in emerging markets. “Fast-growing emerging economies can
be an exciting place to expand, and they need more roads, buildings and
other infrastructure,” Pofeldt said. American businesses that are in a
position to help with these goals—directly or indirectly—are the ones
most likely to succeed in these emerging markets.
- Ensure you have good team to support you with international laws
and guidelines to do business in another country. “Avoid making really
costly mistakes as you branch into markets that may be unknown to you,”
Richard Gorman said. “Enlist lawyers, accountants, and other
professional services that can help you navigate foreign markets.”
- Keep ample cash on hand. For companies looking to receive loans to
expand overseas, it is important to present data supporting the future
revenue growth of business. With ample liquidity, lengthy payment cycles
with overseas customers will not put too much of a strain on
operational resources. The bottom line is global businesses need to have
adequate cash to “insulate them against common hazards of overseas
trade, like slow payments.”
Globalization is an Opportunity
Globalization can be either a blessing or a curse.
“It all depends on how you view it, and whether or not you choose to
embrace it and use it to your advantage,” Richard Gorman said. “The
tools of globalization, such as online tools and e-commerce resources, level the playing field, and give all businesses the opportunity to compete on a global level.”
This does not mean that global success is guaranteed for all
businesses, however. Business leaders must strategically seize these
opportunities.
Richard Gorman concluded in accordance with Elaine Pofeldt, saying,
“I would encourage business leaders to make this the year in which they
secure at least one international client—really using some of these
strategies and tools to extent their customer base.”
