Organizational Commitment in the Global Environment

In the age of increased globalization (refer to appendix 1.a, pg 12), and as many corporations are becoming international in scope and scale, organizations are faced with making radical restructuring choices in order to remain competitive and flexible in today’s environment. The impact of globalization has altered the manner in which businesses function and conduct their operations, and it has influenced virtually every area of business practice.

Technological advancements such as high speed information transfer and videoconferencing have brought the world within reach while redefining the traditional views of a workplace by allowing employees to perform duties from home, while on an international assignment or on a holiday.
Technology has also enabled consumers from all over the globe to access products and services and in doing so, has stimulated the market into a state of hyper-competition (refer to appendix 1.b, pg 12), where producers from different international locations all participate in the same global market. This state of competition has forced firms to adapt more flexible structures, to reorganize their workforce, to seek out cost efficiencies in other countries and to utilize their workforce diversity to an advantage in an effort to stay globally competitive.

As Maznevski, Stager & Amann (2007, pg 2) have stated;
‘geographic expansion offers the vast potential benefits of a much larger market area, spread risks, scope and scale, and location based cost advantages and exposure to a variety of new products and process ideas’.

The diversification of the product market has changed the nature of employment through operational restructuring, increased efficiency and flexibility, changes in structural and job design and the use of cross functional teams. Traditional hierarchies are disappearing, being replaced by more flexible structures that promote efficiency and communication, resulting in new types of employment relationships.

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