GLOBALIZATION

Globalization and its Consequences

Globalization and its Consequences

Introduction

Globalization offers numerous opportunities for companies to cash on their expertise in the international arena. Companies which were working in local environment opted for offshore supply opportunities and created a gap in the local market. The local market gap was filled by other foreign companies which had the potential of satisfying the requirements. The opening of international trade barriers provided opportunities for diversifying the risk associated with the dependence on one geographical market and economy (Schaeffer, 2009). Globalization has provided positive cash flows into the country as when local company's carryout work internationally they bring in their income into home country which enhances the economy and also provide more jobs (Kesselman, 2006). The downside is the capability of the companies to focus on local and foreign markets and mostly the deciding criteria is cost benefit analysis which leads to local industry being neglected due to lack of resources (Hill 2012, pp. 1-615). Built industry is a capital intensive industry and companies do have to make choices to focus on a particular opportunity to work on (Yang, 1997). We will be evaluating the companies which operated in the built environment and the consequences they faced after going global. We will be reviewing if they had to reduce their influence on the local industry to focus on the international projects.

Discussion

The construction engineering is a significant component in the UK economy due to its volume, major investment proportion and that the government is the customer for a great division of its work (Hillebrandt 1984). From 1982 to 1992, the proportion of the building goods to the gross domestic products (GDP) was 7~9% (Central Statistical Office, 1993 and 1995). More than half of the UK fixed capital creation was in the construction business (Central Statistical Office, 1993). There is at all times risk of venture for any business within an aggressive market. The danger in each business is not the equal. Because of huge scale and long time agreement, the construction business is predominantly defenceless to variations in the on the whole economic circumstances (Valence 2003, pp. 1). Although it has also been found that companies who don't keep track of their finances also lead to bankruptcy (Arditi et al. 2000).

The proportion of unsuccessful businesses each year in the building business is the uppermost amongst all the UK business. Typically 22.6% of unsuccessful UK companies throughout the period 1982-1992 were in the building industry and this percentage rose to 24% in 1992 (Central Statistical Office, 1994). The lifting of barriers of European limits in 1992 was observed as a chance by some British outworkers to get bigger into Europe. Though, UK outworkers such as McAlpine and Mowlem experienced serious financial losses, whilst in Britain a brutal recession destroyed many outworkers and caused to divest of unprofitable businesses, particularly house building sectors. Continental European outworkers such as HBG and Kvaerncr turn out to be a number of the UK's top contractors (Carrillo 1997: ...