1. Concepts of Globalization
Wollo University Post Graduate (MA) Program in Tourism Management Course Title: Current Issues in Tourism Industry Course Instructor: Mohammed Jemal Ahmed (PhD)
Concepts of Globalization

2. What is Globalization?
Globalization refers to the integration of goods, services, and culture among the nations of the world. It is a border-free world
It defined as the process of rapid economic, cultural, political and institutional integration among world countries
It is the shift toward a more integrated and interdependent world
The movement towards the expansion of economic and social ties between countries through the spread of corporate institutions and the capitalist philosophy that leads to the shrinking of the world in economic terms
World is moving a way from self-contained national economies toward an interdependent, integrated and global economy system
Globalization makes the world accessible to everyone.
We have been experiencing globalization since the days of European colonization.

3. What is Globalization?...
Globalization is a multidimensional process, covering all aspects of cultural relations, politics and economics.
Globalization can also be simply described as the movement of goods, ideas, values, and people around the world.
The term was first used in the early 1950s to recognize the increasing interdependence of economies and societies around the world.
Globalization, however, has existed for centuries by way of evolving trade routes, including the slave trade, colonization, and immigration
Among the different dimensions of globalization, the cultural dimension is particularly important.
culture and communication is the heart of the globalization phenomenon
So any analysis nowadays has to be sensitive to the growing integration of cultures as well as respective justified effects
That is why recent globalization theorists have shown particular attention to the cultural aspects

4. Globalization Touches the following issue

5. Drivers of Globalization
Two factors underlie globalization
Decline in barriers to the free flow of goods, services, and capital” that has occurred since the end of World War II
Technological change
Free-Market
Liberalization of trade, investment and capital flow
Declining barriers to the free flow of goods, services, and capital
Advanced industrial nations of the West committed themselves after World War II to removing barriers to the free flow of goods, services, and capital between nations.
II. Technological Advancement
Advances in communication and transportation technologies accelerated globalization.
The Internet has made all nations next-door neighbors
microprocessors and telecommunications
the Internet and World Wide Web

6. Types of Globalization
Financial Globalization
Economic Globalization
Technological Globalization
Political Globalization
Cultural Globalization
Ecological/environmental Globalization

7. Financial Globalization
World’s financial systems have become intimately interconnected
Stock market trading in New York stock exchange can affect Tokyo and Addis Ababa
The are global financial institutions such as:
The International Monetary Fund /IMF/ (1944) maintains order in the international monetary system
The World Bank (1944): promotes economic development via low interest loans for infrastructure and projects

8. Economic Globalization
● In past, most corporations were linked/identified within a country, but today corporations are now transnational
● Companies move their production and capital to any market that will benefit the company (increase profits and share values)
Since the 1960s, there has been a rise in non-U.S. multinationals
● Coca Cola, Nike, Shell are all over the world
The World Trade Organization (WTO) Global economic organization that regulate world trade and economy
WTO is responsible for policing the world trading system and ensuring that nations adhere to the rules established in WTO treaties
promotes lower barriers to trade and investment
It has 154 members in 2011

9. Integration of Economies
Made possible by:
Technology
Communication networks
Internet access
Growth of economic cooperation – trading blocs (EU, the North American Free Trade Agreement (NAFTA), etc.)
Collapse of ‘communism’
multinational corporation (MNC) is one that has business operations in two or more countries.
These companies are often managed from and have a central office headquartered in their home country, but with offices worldwide.

10. Technological Globalization
 Technological revolution has meant the “Global Village” has expanded to everything corner of the globe with growth in travel communication and computer technology, and mobile (smart) phones communications
I can be around the world live, in 1 second by internet or smart phone or 12 hours by plane
The remotest village can now use hand crank computers to communicate via internet

11. Technological Globalization
The graphical user interface for personal computers
The Internet infrastructure
The open source movement
Mobile technologies
The introduction of software to automate and integrate business processes.
Software that allows people to work together more easily
Software that allows different software packages and databases to integrate with each other more easily.
i.e. payment processing systems and shipping calculators

12. Political Globalization
As countries become more economically and technologically interdependent, there is pressure to adopt uniform policies
The United Nations (1945)
maintains international peace and security
develops friendly relations among nations cooperates in solving international problems and in promoting respect for human rights
is a center for harmonizing the actions of nations
The G20 AU

13. Cultural Globalization
Harmonization of worlds cultures at the expense of distinctly different local cultures
We will eventually all listen to the same music, watch same TV, eat same food, have the same values.
Loss of worlds cultural diversity, replaced by primarily Americanized world cultures
Major issue for cultures where religion is directly connected to their culture, “western” values can often come into conflict with tradition religious beliefs

14. Ecological Globalization
the planet must be treated as a single ecological system (ecosystem) rather than a collection of separate ecological systems.
Ozone depletion, global warming impacts the world not just nation that did original damage

15. Pros and Cons of Globalization
Loss of unique cultures
Loss of indigenous culture, replaced by homogeneity Loss of jobs because of economic globalization
Environmental concerns over demands put on Earth’s resources
Destroys manufacturing jobs in wealthy nations
Wage rates of unskilled in advanced countries decline
Companies move to countries with fewer labor and environment regulations
Loss of sovereignty
Homogenized cultures
Increase in gap between the rich and the poor
Dominance of global trade by the rich, northern hemisphere countries
Lack of opportunities for the poor to be able to have access to markets
Exploitation of workers and growers

16. Pros Lower prices for goods and services Economic growth
Increase in consumer income
Creates jobs (for many)
Countries specialize in production of goods and services that are produced most efficiently

17. Summary Explained the concept of globalization.
Described the role of information technology in globalization.
Identified the issues experienced by firms as they face a global economy.

18. Globalization and the tourism industry
Travel and tourism are among the major drivers of globalization and cultural change.
Globalization affects tourism through:
Transportation
Communication technologies and the internet
Accommodation
Culture

19. Transportation
Emerging technologies in transportation has greatly improved tourism sector.
Globalization eases mobility and travel
Modern aircraft, cruise ships, trains, and other modes of transport allow people to move quickly and relatively cheaply.
Aircraft such as the Boeing 787 Dreamliner have opened new routes by creating an aircraft capable of flying “long haul” distances with a smaller passenger load.
Fast trains, road systems, and even city bike rental programs enable people to move, tour, and explore the world. These changes have allowed more people to travel more often in less time.

20. Communication Technologies and the internet
the spread of new technologies and the transportation systems played positive role in tourism industry
Smartphones are one of the main parts of this development.
Today, we use them to buy and show airline tickets at the airport. With them, Google map to reach the city center from the airport.
And based on them, some visitors also choose where to go on vacation

21. Technologies…
modern internet allowed tourist quick and easy access to information such as travel destinations, lodging and dining options at the destination.
technology allows for advertising of attractions at various tourist destinations to target visitors.
85% of travelers do their research on the internet about potential destinations and the average traveler does 55 online searches for bookings, travel guides and visas before a booking.

22. Technologies…
IT allows companies to directly market their services, cut out global intermediaries
Creating an Internet website is a common route for developing country firms that do not have computerized reservation capabilities.
Travelocity, Expedia, and hotel-owned Orbitz are now emerging as new virtual middlemen between outbound tourists and destinations.
The growth of Internet and social media is changing the tourism industry, as travelers are collecting information on line, are booking online, are using online and mobile payment during the trip; they are sharing their holidays experience and they review destinations.

23. Accommodations (Multinational Hotels)
A multinational company (MNC) is defined as a business entity that operates in its country of origin and also has a branch abroad.
The headquarter usually remains in one country, controlling and coordinating all the international branches.
It is widely accepted that most of developing countries are seeking opportunities to introduce multinational hotel companies because developing countries could obtain several benefits from the presence of multinational hotel companies, such as provision of capital, transfer of technical and managerial expertise, provision market connections, etc

24. Examples of Multinational Hotels
Marriott International
Wyndham Worldwide
Hilton Worldwide
Intercontinental Hotels Group
AccorHotels
Best Western Hotels
Choice Hotels
Hyatt Hotels Corporation