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Explain the term 'global business' - Leaving Cert Business - Question 3A - 2014
Question 3A
Explain the term 'global business'. Discuss the effects of 'globalisation' on the Irish economy. Provide examples to illustrate your answer.
Worked Solution & Example Answer:Explain the term 'global business' - Leaving Cert Business - Question 3A - 2014
Step 1
Explain the term 'global business'.
Answer
A global business refers to a company that operates in multiple countries, utilizing a unified market approach to provide goods and services across various regions. It treats the world as a single marketplace, optimizing production and distribution by leveraging global resources. This often involves a global marketing strategy that may include adapting marketing elements like product offerings, pricing, placement, and promotions to fit local contexts, while maintaining an overarching brand identity. Notable examples of global businesses include Coca-Cola, Dell, and Microsoft.
Step 2
Discuss the effects of 'globalisation' on the Irish economy. Provide examples to illustrate your answer.
Answer
Globalisation presents both opportunities and challenges for the Irish economy. It allows Irish businesses to access international markets, enabling them to expand their reach and customer base. For instance, companies like Kerry Group and Glanbia Plc benefit from global networks to sell goods and services abroad.
Moreover, globalisation impacts the labour market significantly. With the influx of multinational corporations, such as Google and Microsoft, there is a notable demand for high-skilled workers in Ireland, pushing local firms to enhance their training and skill development initiatives. However, this also highlights a potential skills gap in the local workforce.
Additionally, global companies often contribute to job creation, which boosts the economy. With many foreign companies establishing operations in Ireland, the local economy experiences growth through job opportunities and increased tax revenues.
Despite these benefits, globalisation can lead to increased competition, potentially driving local businesses to find efficiencies and innovate. It can also affect pricing strategies, as international firms may provide lower-cost products, impacting local businesses.
Finally, there can be consequences for the balance of payments, as profits generated by foreign companies may be repatriated to their home countries, which could affect the overall economic stability.