The Effects of Technology on Globalisation

& Davos 2010 Contribution

Bangor University

MBA Banking and Finance

International Business Module

 Contents

Page
Introduction 2
The Effects of Technological advancements on Globalization Process 2
The World Economic Forum and Davos 2010 3
Davos 2010 and Technology 4
Recommendations 6
References 7
Introduction:
The growth of Globalisation is affected by several forces. These forces include
Market forces, Production forces, Labour forces, Technology forces, Environment
forces and Regulation forces. The purpose of the assignment is to chose one of these
forces, analyse it, relate it to Davos 2010 and give recommendation to governments
and business on the importance of this force. The Technological force is used force
for this assignment as it had tremendous effect on the process of globalisation.
Therefore, the main body of this assignment starts with analysing the effect of
Technology on the process of globalisation. Then it will shed some light on the World
Economic Forum and its Davos 2010 meeting. Then, Davos 2010 contribution to this
force will be critically assessed. Finally, after having a general idea of the importance
of technology for globalisation and its effect on different economies,
recommendations will be given to governments and businesses to improve their
efficiency and economy in general.

The Effects of Technological advancements on Globalization Process:

Rose (1993) describes the importance of technology to globalization as an important
one and they go hand in hand. Media If (2007) considers the developments in the
technology industries as the main driving force and facilitator of most of the
globalization processes.

Understanding what is meant by technology is very important to give a better

knowledge of why and how technology is affecting the process of globalization.
According to Media If (2007) Technology can be described by important elements:
production, instruments, possession and change.
In terms of production, technology is needed in productions as it improves the quality
and capacity of production whether producing goods or services.
Technology can be considered as instruments. Instruments are used as extensions of
the human body to do or perform something. These technological Instruments can be
in physical form such as computers, factory machines and vehicles. In addition to that,
it could be in the immaterial form such as computer databases.
Technology has something to do with possession where it gives control to those who
possess it and such control usually has something to do with economics and politics.
 Finally, with regards to change, recent innovation in technology has changed the
world drastically. These technological innovations and advances have very important
effects on the lives of peoples and businesses all over the worlds.

With regards to businesses, recently globalization lead to the unleash of technology

which in turn drives business to plan and organize for production and sales on a large
global basis. New trends in Technology caused a lot of changes to the way business
work where new skills and equipments are required which in return increase business
production and efficiency (Ross, 1993).

According to Muroyama, J. & Stever, H. (1998) advances in technology made it

possible to combine the units of small-scale production with high productivity and
high quality efficiently at a comparatively low coast which is very important for
business competition.

One of the many different aspects of technology is the Information Technology (IT)
and there are many other. According to Opara, E. (2003) the IT industry has shown a
rapid growth in the last decades and is playing an ever-increasing role for business
strategies and transformation. Recent development in IT has major impacts on almost
all aspects of the workplace and most of everyday life. Information technology plays a
major part in the global economy and such part will be increasing over next decades
which makes it an opportunity business to improve and be a threat to other
competitors who are falling behind (The World Economic Forum, 2010).

The World Economic Forum and Davos 2010:

The World Economic Forum (WEF) is a non-profit making independent international

organization based in Switzerland. It is dedicated to improve the state of the glob by
engaging leaders in partnerships in order to shape global, regional and industry
agendas. The WEF aim is to create a system of world-class corporate governance
where values are in the core of the system and considered as rules. The WEF believes
that social development is an important aspect for economic growth to sustain.
The WEF has created several communities with the aim of interacting together in
order to improve a specific sector of the globalization process and meet the overall
goal of the forum. An example, is The World Economic Forum’s Community of
Global Growth Companies (GGC) which was formed to engage several dynamic
firms, with the potential to be leaders of their future industries, in order to become a
driving force of economic and social change. Such communities facilitate opportunity
for its members to create networks with world leading businesses and policy maker
where collaboration and experiences are exchanged cross industries. The WEF
organizes several annual meetings such as Davos annual meeting. Davos 2010 is
latest meeting which took place between January 27th and 31st 2010 under the theme "
Improve the State of the World: Rethink, Redesign, Rebuild". During this meeting
more than 2,500 leaders, from many different countries representing business,
government, civil society, academia and cultures worked together under that theme
(The World Economic Forum, 2010)

Davos 2010 and Technology:

With regards to Technology, the Technology Pioneers Community is one of the
different communities under the WEF. It is considered as one of the WEF most
recognized initiatives. This community is the designated community to integrate in
activities to identify and address future-oriented technological issues on the global
agenda in innovative and proactive ways to achieve the main goal of improving the
state of the world by gathering executives together with scientists, academics, policy-
makers, NGOs and Forum Members and Partners. In addition this community might
be engaged in discussions on essential global issues and turn these issues into
initiatives such as the task forces on climate change. (The World Economic Forum,
2010).

The Technology pioneer community has a program that identifies and integrates
companies that are involved in the design and development of new technologies
regardless of their location. These companies innovations mirror society’s efforts to
harness, adapt and use technology in a way to improve how business and society
operate. Each year, the program recognized as Technology Pioneers several
companies as Technology Pioneers. In 2010 the Technology Pioneer community
recognized 26 Pioneers who were invited to Davos 2010 annual meeting and
participated in different activities with regards to technology as a force of improving
the state of the world and benefited from being integrated into the Forum's on-line
community "WELCOM" that is designed to locating and accessing expertise, sharing
knowledge, and meeting and functioning with peers. (The World Economic Forum,
2010).
The Technology pioneer community published a brochure titled Embracing
Disrubtion: Redesigning the Future. This brochure listed the 26 Technology Pioneers
and indicated the reason why they were selected. In this report, the community
observed that "a remarkable rise in the number and quality of candidate companies,
especially in the case of cleantech-related ventures, suggesting that concern
surrounding the environment and climate change coupled with the “green stimulus
package” are driving resources and top innovation to this area" as stated by The
World Economic Forum (2010).

According to Bennhold, K. (2010) Clean Technology is becoming the great game of

this century as it was topic A for the top officials and business executives during
Davos 2010. The Clean Technology is a critical factor in reshaping the world
economy and senior officials from Europe and the US showed concerns that china
might be ahead of their states with regards to clean and renewable energy. Senator
Lindsay Graham who has been involved in climate change issues said that “my
concern is that every day that we delay trying to find a price for carbon is a day that
China uses to dominate the green economy" and, at the same time, Christine Lagarde,
the French finance minister said that “It’s a race and whoever wins that race will
dominate economic development,” as stated by Bennhold, K. (2010).
In addition to the clean technology, other technologies that can improve the state of
the word were presented and discussed. An example of that, is the technology of
reusing rubber wheels by changing it to low price applications to be used as in fillings
for sports fields, new tires, insulation materials for buildings cooling systems and
many other uses as presented by Barton, A. (2010) during Davos 2010 meeting.
Such technologies can make the world better place and open opportunities for
governments and businesses to compete and, at the same time, these technologies
could be threat to the falling behind nations and businesses.
Recommendations:
As, current development in the technology and word economy drive governments and
firms to look for new business models that can meet the demand of higher efficiency,
competitiveness and long term growth (The Strategy group, 2010). Also, as it has
been very obvious that economies are getting better due to advancement of
technology and resulting in growth of countries growth, it is important for both
governments and businesses to invest in the development of new technologies and
improving current technologies to the competitive edge on other countries and
businesses. Such investments could be focused technological institutions, including
Universities and other types of research institutions in all aspects of technology.
Governments should as well, provide guidance to these institutions and assist in
facilitating required services.
Governments and businesses should compete with each other to ensure their own
success, but at the same time collaboration is another way of increasing the chance of
achieving things that are difficult to achieve. For example, it the US and collaborate
and unite their competitive advantages would increase and could accomplish
achievements that are not easy to achieve without such collaboration and unity.
Finally, as the Technology Pioneer Community has shown a lot of benefits to the
improvement of technology, governments and businesses could form many similar
communities and programs to share their expertise and knowledge and cause a rapid
improvement in the technological sector which in turn would improve their state of
economy.
References:-
Barton, A. (2010) Revolutionary solutions in green technologies (Presentation).
Available from: http://www.22frames.com/video.aspx?id=189540 (Accessed 07 Mar
2010)

Bennhold, K. (2010) DAVOS 2010:Race Is on to Develop Green, Clean Technology

(Online). Available from:
http://www.nytimes.com/2010/01/30/business/global/30davos.html?
partner=rss&emc=rss (Accessed 15 Mar 2010)

Media If (2007) Effects of Technological Developments on Globalization Process.

Available from: http://mediaif.emu.edu.tr/pages/atabek/GCS7.html (Accessed 01 Mar
2010)

Muroyama, J. & Stever, H. (1998) GLOBALIZATION OF TECHNOLOGY:

INTERNATIONAL PERSPECTIVES. Available from:
http://books.nap.edu/openbook.php?record_id=1101&page=R1 (Accessed 07 Mar
2010)

Opara, E. (2003) The effect of information technology on global business. Journal for
International Business and Entrepreneurship Development (Online), 1(2) pp 45-49.
Available from: http://inderscience.metapress.com/app/home/contribution.asp?
referrer=parent&backto=issue,6,13;journal,7,8;linkingpublicationresults,1:119856,1
(Accessed 07 Mar 2010)

Ross (1993) Innovations in Technology and Globalization. Available from:

http://workinfonet.bc.ca/lmisi/making/CHAPTER2/TANDG1.HTM (Accessed 27 Feb
2010)
The Strategy group (2010) New Accenture Study on Globalization released at World
Economic Forum (Online). Available from:
http://tobiaslist.wordpress.com/2010/01/30/new-accenture-study-on-globalization-
released-at-world-economic-forum/ (Accessed 10 Mar 2010)
The World Economic Forum (2010) Available from:
http://www.weforum.org/en/index.htm (Accessed 27 Feb 2010)