Provides an overview of the social and economic forces that have combined to reshape modern organisations creating an imperative for change and renewal. The origins of globalisation are identified, and the heightened anti-globalisation protest activity at the turn of the century is highlighted.

1. Globalisation – And its Impact on Organisational Change
(Lecture 2, Module 1)
James Hunt
Trimester 3 2012
GSBS6120: Managing Organisational Change

2. Preliminary Notes – Aspects of Change
• The increasing intensity of competition on a global scale; the Japanese
ascendancy in the 1980s, the technology revolution of the 1990s.
• New forms of employment, and changes in organisation: Shamrock Organisations
• Organisational Development
• Resistance to change
• Approaches to change: structural, job-design, personnel, cultural change
• Restructuring and change: two time horizons – short term, long term
• Transition stages in the organisational change process: denial, resistance,
exploration, commitment.

3. Lecture Outline
Module 1: Background – Globalisation and its Impact on Organisational Change
Module 2: Forces for Change - Hyper-competitiveness and Organisational Change
Module 3: Four Frames for Understanding Change in Organisations
.

4. Globalisation – What Does It Mean ?
Most definitions centre upon economic aspects of globalisation.
But globalisation has many dimensions worth considering, because all of them
influence and shape our organisations:
– Socio-cultural dimensions: language, culture, value systems
– Political dimensions: rules of national and international governance
– Legal dimensions: international commercial law, patents, intellectual property
recognition.
– Financial dimensions: currency controls, financial regulations, capital flows.

5. Globalisation – What Does It Mean ?
Some aspects of globalisation are relatively benign and free from
controversy:
– The global postal system
– The global airline system
Other aspects of globalisation are increasingly being disputed in terms of
whether the benefits derived outweigh the costs incurred.

6. Globalisation – A Brief History
The beginnings of globalisation are very much a matter of debate and conjecture,
depending upon one’s preferred time-horizon.
Were the first real steps towards globalisation taken by imperial Rome? At the height
of its power, Rome’s influence in culture and commerce permeated much of the known
world.
Did globalisation begin in the 16th
century with the first great expansion of European
capitalism, following the circumnavigation of the world?
Some economic historians point to the sizeable expansion in world trade and
investment in the late nineteenth century, before WWI and the Great Depression
intervened.
Others have argued that globalisation really began in earnest between 1875 and 1925
with the time zoning of the world and the establishment of the international dateline
(and the near universal adoption of the Gregorian Calendar).

7. Globalisation – When did it Begin?
Some analysts view globalisation as a process beginning at the end of WWII. This
period saw a significant expansion in the flow of investment capital, and the
emergence of multinational corporations – looking to produce and sell in domestic
markets in many countries around the world.
Those with a more immediate time horizon, see globalisation’s direct origins gaining
momentum at one of the following points:
– 1980: Japan begins its ascendancy as host nation to a number of significant
multinational corporations.
– 1989: The fall of the Berlin Wall & the collapse of Communism: The apparent
triumph of Western capitalism, entrepreneurship, and the concept of creative
destruction.
– The 1990s: The dawning of the information age: personal computers, widespread
digitisation of information, the rise of Microsoft and the ubiquity of its products.

8. Globalisation – Advantages & Challenges
Proponents of the globalisation of world trade argue that intellectual, cultural and
economic progress is dependent upon the relatively free flow of commercial activity.
They argue that globalised trade and investment has the potential to raise the
standards of living of all those involved in the process; providing poorer countries
with access to superior infrastructure and living standards; cleaner water, better
education, improved literacy levels, and better medical care.
Proponents of globalisation also argue that globalisation as a process is
misunderstood by those who oppose it, often dismissing the protesters as a loose
coalition of misguided loony left radicals .
Many proponents further argue that globalisation is here to stay, and that those
protesting against it are simply wasting their time and disrupting sensible debate with
their civil disobedience.

9. Globalisation – Protest Groups & their Agendas
Opponents of globalisation have become more prominent and vocal, as well as more
persistent – particularly between 1999-2003, as globalisation itself became more real,
more pervasive and more recognisable.
In particular, the privatisation of government-owned entities (banks, airlines, rail
systems, telecommunications companies, electricity suppliers) in many countries
around the world, has produced visible shifts in pricing patterns of these services,
angering large numbers of consumers.
Industrial activity on the world stage has provided graphic examples of pristine
ecosystem despoilation, adding fuel to the cause of groups such as Greenpeace, and
Friends of the Earth.
Others have expressed concern over apparent exploitative labour practices in third
world countries, choosing to rally against globalisation as the driver of corporate
mercenary behaviour.

10. Globalisation – Who are the Protesters?
ANTI TRADE ACTIVISTS:
Predominantly concerned with the socio-economic dimensions of globalisation:
They object to what they see as the exploitation of workers in poorer, less
developed countries.
The International Forum on Globalisation is one such body which bears the
hallmarks of an anti-trade activist group.
These groups argue that developing countries are trapped in a ‘race to the
bottom’, locked into abusive labour practices, poor environmental quality and
poverty-cycle wages.
They argue that sweatshops do not represent a genuine economic opportunity for
labourers.
From a social justice perspective, these arguments are deontologically valid – but
can be refuted along the lines of relying excessively on an “advanced nations”
perspective of labour conditions, and for their reliance on emotive, altruistic
persuasive devices.

11. Globalisation – Protest Activity

12. Globalisation – Who are the Protesters?
ENVIRONMENTAL GROUPS:
Are extremely active in the campaign against the unrestrained advance of
globalisation.
Their central claims are that globalisation has a short but irrefutable history of
harming the environment.
These groups generally lay the blame on global corporations for global warming,
the depletion of natural resources, large-scale industrial accidents; Bhopal,
Exxon-Valdez and the Gulf of Mexico oil disasters, the manufacturing of harmful
chemicals, and the degradation of organic agriculture.
They view the damage that is done to the environment by large MNEs as the
effect of externalised cost. Businesses do not currently bear the full cost of
production in their commercial activities – a portion of the cost is borne by a third
party. Eg: Air pollution from factories, forest depletion by logging companies.
These interest groups have had some success in changing corporate behaviour;
DuPont (responsible for the production of 25% of the world’s CFCs).
Motorola (recycles its rinse water used to clean pc boards).

13. Globalisation – Protest Activity

14. Globalisation – Who are the Protesters?
LEFT ORGANISATIONS:
Are highly suspicious of the unrestrained advance of capitalist models of business
– largely because of the narrow perspective these models adopt.
They argue that free enterprise needs regulating by an independent body,
otherwise the pursuit of profit will override other more important societal concerns.
These groups (along with non-leftist economists) challenge the actions of national
and world governing bodies, including the WTO, the IMF, and the World Bank,
along economic policy lines.

15. Globalisation – Who are the Protesters?
LEFT ORGANISATIONS:
Their predominant concerns seem to centre on the growing acceptance of higher
levels of unemployment in the advanced nations.
They argue that high unemployment is an unacceptable waste of per capita
productivity, and that sound economic management would contain unemployment at
much lower levels than are currently acceptable.
In the 1980s and early 1990s, these kinds of views were dismissed by many as
irrelevant. More recently, however, these perspectives are being taken more
seriously by moderate, non-leftist economists and business analysts.
In 2001, Joseph Stiglitz, former World Bank Chief Economist, vehemently criticised
the imprudent role played by the IMF in the 1997 Asian Economic Crisis, for
example.

16. Globalisation – Protest Activity

17. Globalisation – Heightened Protest Activity: 1999-2003
Protests against globalisation escalated significantly between 1999 and 2003:
Seattle, December 1999: 40,000 protesters took to the streets rallying against
the World Trade Organisation. Skirmishes with police eventuated.
Davos, February 2000: At the World Economic Forum a McDonalds store is
violently trashed.
Washington, April 2000: A massive blockade by protesters threatens to disrupt
talks at the World Bank and the IMF meeting, eventually causing lengthy delays
as delegates are initially advised of the danger of the hostile crowds.
Prague, September 2000: A clash eventuates between 12,000 protesters and
authorities, again threatening to disrupt the World Bank-IMF annual meeting.
Melbourne, September 2000: Activists barricaded delegates to a World
Economic Forum conference, again disrupting parts of the meeting.
Nice, December 2000: Disruption of a European Union summit.

18. Globalisation – Protest Activity
Davos-Zurich, January 2001: The World Economic Forum Meeting has to be
locked down: Zurich gets trashed in the ensuing rampage.
Naples, Italy, March, 2001: Thousands of anti-globalisation protesters clash with
riot police. More than 100 people are injured in the violence.
Quebec City, April, 2001: At the Summit of the Americas, tear gas and water
cannons are used to control protesters.
Barcelona, June 2001: World Bank cancels conference as activists stage
massive protests.
Gothenburg, June 2001: Although 40,000 held a peaceful march, a core of
masked anarchists wielding cobblestones created bloody mayhem at the
European Union summit in the Swedish port city.
Genoa, Italy, July 2001: More than 500 people are left injured and one dead after
two days of intense clashes between riot police and anti-globalisation
demonstrators.
Washington DC, September 27, 2002: IMF and World Bank summit marred by
anti-globalisation protests.
Cancun, Mexico, September 14, 2003: Fifth Ministerial Meeting of the WTO
collapses.

19. Globalisation – Questions for the Future
Is globalisation, as some have argued, neither inherently bad, nor inherently good,
but merely an emerging system requiring the management of a diverse set of
interest groups and national agendas?
Is globalisation being driven predominantly by multinational corporate interests, or
rather, is it driving organisations to change and respond to new patterns of
commercial and social activity?
Can international economists effectively manage the process of globalisation, or is
it really beyond the control of anyone, including the so-called global titans? This
argument is advanced by Thomas Friedman in The Lexus & the Olive Tree. A
counter argument is provided by John Pilger in The New Rulers of the World.

20. Some Further Reading:
• Hunt, J. (2003) Chapter 1: The Anatomy of Organisational Change in the
Twenty-first Century. In Wiesner, R. & Millett, B. (Eds.), Human Resource
Management: Challenges and Future Directions, John Wiley, Queensland.
• Semler, R. (1989) ‘Managing Without Managers’, Harvard Business Review,
Vol. 67, Iss. 5 (September-October): 76-84.
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