Globalization: The Effects on Large and Small Firms

In this dialogue we explore the effects of Globalization on large and small firms. It has become evident that as the world becomes more accessible due to the systems of communication '" via technology, new challenges have arisen. With these new challenges businesses must seek new ways to cope with the changing environment.

According to Theme - "The Big & Challenges For Enterprise in the 21st Century" are:

n Cultural Diversity
n Human Resources
n Information Technology
n Ethics & Corporate Social Responsibility
n Government
n Backlash against Globalization
n Leadership

In this context, I examine two companies-Kraft Foods and Hansen's, which are both enterprises within the foods sector/industry. We look specifically at the impact of their institutional size, and then draw conclusions about how globalization affects their business models and positioning. Globalization is described by wikipedia, as the "integration between units around the world." Specifically units are broken down as follows; "economic, social, technological, cultural and political.

The mission of Hansen Beverage Company "is to satisfy consumer's needs for superior quality and great tasting, healthy, natural and functional beverages. Our beverages will be positioned as an upscale brand and will often be marketed at a premium to competitive mainstream products" (Hansen's Website). With 140,000 diverse employees, Kraft Foods is the world's largest food company; however, their website seems to stress the idea of the consumer as inspiration. The messaging seems extremely focused on the concept of putting the customer first. In fact, in very bold letters they affirm on their website "Consumers Inspire Us."

In light of the above, it is clear that the one primary difference between the two corporate philosophies is specialization vs. broad range appeal. Kraft, with its deft of product offerings has embraced the idea of "producing and selling whatever products the customer wants and needs." Hansen's seemingly has identified a market niche and continues to serve it with a high quality product, providing customer service and support sought after by their clientele.

Through the use of information technology, i.e. the internet, both companies are able to access their specific clientele and reach new prospects simultaneously. With the advent of internet, both enterprises are able to reach their client in any time zone and at any corner of the world. This, places Hansen's in a position to build its market share considerably with just a "click of the mouse." Kraft Foods, because of its world-wide presence enjoys global name recognition. However, when we delve into this idea of backlash against globalization which some see as being caused by mega-enterprises like Kraft Foods there might be "push back" to support it. Hansen's on the other hand could be perceived as the wholesome "little guy" working diligently and against the corporate giant which might endear still some to that brand '" particularly if there was occasion to choose between the two.

Apart from the above differentiation, I believe that both Kraft Foods and Hansen's have to deal with all "7 challenges For Enterprise in the 21st Century." When we compare financing and capital to meet the issues of Human Resources, and Government the outcome and impact for success of a smaller firm versus a larger enterprise could be greatly impacted.

Finally, in the areas of cultural diversity, the leadership structure and "mix" will ultimately affect how the management team effectively responds. The leadership and thus the corporate culture will also influence Ethics & Corporate Social Responsibility which will come from a leadership team that embraces the corporate mission while balancing mission of the enterprise as they both strive to co-exist with its global citizenry.

Overall, my belief is that innovation and availability of communication networks makes opportunity limitless. Success can no longer be predicted by the size of an enterprise. With the proper appetite for "RISK," also described as "How one manages the world and how one manages future time in relation to the change introduced into the world," anyone with vision, a well executed plan, strategic use of technology and proper implementation of communication tools can succeed in enterprise. That to me is the new paradigm intrinsic in globalization.

With these ideas in place, one wonders if in globalization we risk homogeny. This question of, the brand conforming to the culture or do the cultures conform to the brand? I believe strongly that this question can only be answered largely by how the enterprise sees RISK and then structures its response to it'" regardless of institutional size. In our dialogue around Kraft Foods & Hansen's, they both seem to elevate and place focus on their relationship with the consumer '" thus creating the perception that their corporate culture is driven by the customer need wherever they do business.