Explain the concept of globalization. Critically discuss the main Essay

Explain the concept of globalization. Critically discuss the main features of globalization - Essay Example Globalisation is also a product of investment and cultural exchange between nations. Although globalisation possesses many economic, social and political benefits it has negative impacts on most global economies as well as the environment e.g. pollution and tampers with the sovereignty of various nations. Globalisation can be divided into five categories; internationalisation, universalisation, modernalisation, liberalisation and respatialisation (Ferendinos, 2009:4; Clayton, 2004: 274-294). Internationalisation portrays globalisation as an aspect of cross-border relationships while liberalisation discusses the aspect of creating open world economy by elimination of interstate movement restrictions among countries. Universalisation views globalisation as a process of distributing a wide range of knowledge and products all over the world. International business aspects such as capitalism and industrialism determine the modernisation aspect of globalisation (Egan, 2005: 559–64). Globalisation increases global economic interdependence. This involves the rise in the sensitivity of individuals and companies on the changes taking place around the global business circle and the measures necessary for curbing possible challenges emanating from such changes. Global dependence can be unilateral i.e. a country depending on the global economy, or bilateral i.e. a country benefitting from the global economy and the global economy benefitting from that country, in return. The free movement of goods created by the globalisation process provides multi-national corporations with an opportunity to establish a global competitive advantage. Globalisation is caused by various factors. The prominent cause of globalisation is the enhancement in technology which most multinational corporations have adopted in a bid to improve production. Technological progression has led to reduced cost of transport as well as communication. The availability of cheap, rapid and reliable communi cation channels is the key to integration of the international capital markets. This nurtures the growth of multinational corporations as they exploit intellectual property efficient in various locations from a central point. The change in lifestyle has also led to increasing demand that makes most enterprises establish branches in other locations. The dimensions of globalisation include economic, political, psychological, sociological, anthropological, geographical and communications. The economic perspective of globalisation focuses on economic drivers such as trade, money, banking, corporations and capital. Economic dimension posits that globalisation has taken the form of an increase in trade liberalisation, expansion of world markets and the increase in the international mobility of capital. This has made many countries to come together under supranational trade unions such as the European Union as well as the formation of multinational institutions such as the World Trade Orga nisation (Ingham, 2004). Economic globalisation has also enabled firms gain the ability to locate their production facilities everywhere in the world. Most of these multinational firms take advantage of globalisation to target less developed countries that provide cheap labour which, in turn, reduces operational costs. Economic globalisation enables multinational corporations to establish their business close to the sources of raw materials, capital, technology and other business components; thus improving

TARGET CORPORATION FINANCIAL ANALYSIS AND INTERPRETATION Essay

TARGET CORPORATION FINANCIAL ANALYSIS AND INTERPRETATION - Essay Example The  ratio  is  mainly  used  to give an idea of the companys ability to pay back its short-term liabilities (debt and payables) with its short-term assets (cash, inventory, receivables). The higher the current ratio, the more capable the company is of paying its obligations. A ratio under 1 suggests that the company would be unable to pay off its obligations if they came due at that point. Target is 1.32 suggesting that it would be able to pay its debt .32 more than is owed. However, Wal-mart size require much more debt to finance it operations. Wal-Mart .85 is not the best financial position, buy it may be because the company has a longer inventory turnover than Target. Wal-Mart is by its very nature a company with huge warehouse of inventory and other current asset. Target, on the other hand is a smaller operation. Asset Turnover reflects a company’s ability to use its assets to generate sales and is an important indication of operating efficiency. It tells the analyst how many dollars of sales a company generates for each dollar invested in assets. It is computed by dividing net sales by average total assets. As we can see, Asset turnover ratio for Target Corporation has gone up from 1.43 to 1.52 mostly due to increase in Net Sales. It is a good indicator of the efficiency in utilization of the assets and should be viewed positively by investors when comparing Target Corporation with its competitors like Wal-Mart