This paper advances prior knowledge on globalization and business
by empirically investigating how this phenomenon affects firm
performance. Building on environment-organization literature, this study
explores globalization-performance relationships. The results of the
analyses provide considerable support for literature arguing that
globalization acts as a two-edged sword, one that can be beneficial and
detrimental to business. Therefore, innovative and effective strategies
should be designed and implemented to enable firms to capitalize on
global market opportunities while carefully managing its inherent
threats in order to attain long-term victory in today's globalized
In the past two decades, the world has gone through the process of
globalization, one that causes increasing economic, financial, social,
cultural, political, market, and environmental interdependence among
nations. Yet, limited empirical studies have been conducted to
investigate how globalization actually affects firms. International
business scholars (e.g., Clark & Knowles, 2003; Eden & Lenway,
2001) point out the need to explore further the effects of globalization
on firms. Therefore, we aim to investigate the effects of globalization
on firm performance. In this study, globalization is defined as the
process of increasing social and cultural inter-connectedness, political
interdependence, and economic, financial and market integrations (Eden
et al., 2001; Molle, 2002). At the macro level, globalization is found
to undermine autonomy in domestic airline competition policy
(Clougherty, 2001). At the micro level, globalization (operationalized
as trade liberalization) is found to improve the performance of U.S.
multinational enterprises (Oxley & Schnietz, 2001). From these two
studies, we have learned that globalization is a multi-faceted
construct. Therefore, the classification of its effects into different
dimensions and the study of their impact on firms prove to be
Based on the aforementioned discussion, the purpose of this study
is twofold. We aim to classify and define the effects of globalization
based on a review of globalization-related literature. Furthermore, we
operationalize such effects and conduct an empirical test on the
relationships between each of the key globalization effects and the
performance of exporting firms in two distinct economic contexts, the
developed markets (the U.S.) and the emerging markets (Thailand). Hence,
this research attempts to answer two research questions: 1) Does
globalization affect firm performance? and 2) Is the relationship
between global market opportunities and performance stronger than the
relationship between global market threats and performance?
According to Harvey and Novicevic (2002), various factors that
drive increasing globalization can be grouped under four broad
categories: 1) Macro-economic factors, 2) political factors, 3)
technological factors, and 4) organizational factors. Macro-economic
factors include, for example, an acceleration of technology transfer
among countries and a rapid increase in populations in emerging
economies (Harvey & Novicevic, 2002). Political factors refer to
privatization, deregulation and trade liberalization of many nations in
favor of free flows of trade and investments (Eden et al., 2001; Hafsi,
2002). Technological forces such as advance development in communication
and transportation technologies, which promote growth in international
business transactions, are also key drivers of rapid globalization
(Graham, 1996; Knight, 2000). Organizations such as multinational
enterprises are another major agent of this process (Eden et al., 2001;
Harvey et al., 2002). Shifting organizational strategic attention
towards a more global mindset is an example of organizational forces of
globalization. Consequently, these forces have inevitably caused changes
in the global marketplace. Such changes can be viewed as effects of
globalization, which ultimately have impact on firms. These effects are
discussed in detail in the following sections.
Since the 1980s, we have witnessed dramatic changes in the
international and global marketplace. Liberalization of world trade and
capital markets led by globalization has created a new and challenging
competitive arena for all firms (Nolan & Zhang, 2003). With the
trend towards more interdependence among nations, several changes in the
business environment have emerged. There has been an emergence of global
markets for goods, services, labor and financial capital (Deardorff
& Stern, 2002; Hansen, 2002). Consumers' demands around the
world have converged (Fram & Ajami, 1994; Levitt, 1983). Increasing
trade and investment liberalization evoked by advances in transportation
and communication technologies has resulted in larger volumes of
international business transactions (Deardorff et al., 2002; Fawcett,
Calantone, & Smith, 1997; Fawcett & Closs, 1993). These
aforementioned trends have brought about two key effects of
globalization, global market opportunities and global market threats
(Hitt, Keats, & DeMarie, 1998; Molle, 2002; Sanchez, 1997). It is
obvious that globalization not only presents more opportunities to
firms, but also higher levels of threats (D'Aveni, 1994; Jones,
2002; Oxley & Yeung, 1998). While opportunities can arise from
globalization, competition and uncertainty are inevitable. Although
frequently mentioned in past literature, empirical studies relating
these effects to firm performance are still scarce. This calls for a
need to study globalization-performance relationships. These two
dimensions along with our theoretical framework and hypotheses are
THEORETICAL FRAMEWORK AND HYPOTHESES
We draw from environmental organization literature since our study
attempts to establish the link between the external environment (i.e.,
globalization effects) and firm performance. Due to the multi-level and
multi-dimensional nature of the environmental construct, the level and
dimension of the environment to be studied must be clearly specified to
minimize conceptual ambiguity and overabstraction (Castrogiovanni,
1991). Among the five levels of environmental conceptualization (i.e.,
resource pool, subenvironment, task environment, aggregation
environment, and macro environment), this paper focuses on investigating
the macro environment (i.e., globalization), which is the highest level
of environmental conceptualization and encompasses all the other lower
levels of environmental construct mentioned above. It is the context
containing forces, which significantly influence organizational
characteristics and outputs (Osborn & Hunt, 1974).
The environment in which firms operate provides resources that
influence their survival and growth and the ability of new entrants to
join the environment (Randolph & Dess, 1984). This refers to one of
many environmental dimensions, the environmental munificence, which can
be defined as the scarcity or abundance of critical resources needed by
firms operating within an environment (Castrogiovanni, 1991; Dess &
Beard, 1984a; Pfeffer & Salancik, 1978). Three sub-dimensions of
environmental munificence include: 1) growth/decline, 2) capacity, and
3) opportunities/threats. Amid globalization, firms are affected by the
changes in both market opportunities and threats (Frenkel & Peetz,
1998; Hitt et al., 1998; Kulmala, Paranko, & Uusi-Rauva, 2002).
These opportunities and threats are two dimensions of the macro
environment emphasized in this study. They can also be regarded as
forces, which affect organizational outputs, i.e., firm performance.
Hence, we hypothesize that there is a direct relationship between these
two dimensions of globalization effects and firm performance (see Figure
Global market opportunities can be defined as increases in market
potential, trade and investment potential and resource accessibility
resulting from globalization (Contractor & Lorange, 1988; Fawcett et
al., 1993; Jones, 2002; Levitt, 1983). Developments in information
technology, removal of trade and investment barriers, privatization, and
deregulation of trade and investment policies have provided firms
seeking international markets with tremendous opportunities (Scully
& Fawcett, 1994). Such changes in the business environment enable
firms to not only access new markets but also lower costs by relocating
their operations and exploiting cheap resources around the world
(Czuchry & Yasin, 2001). Firms can outsource their production in
various locations to lower their costs (Chimerine, 1997). Market
transactions have also become more efficient due to globalization of
technology (Peterson, Welch, & Liesch, 2002). These new market
opportunities have eventually fostered rapid growth in various economic
sectors in many regions around the world (Graham, 1996). A large volume
of cross-border flows of trade, investment, and technology during the
1990s and early 2000s is excellent evidence of increasing opportunities
driven by globalization (UNCTAD, 2003).
[FIGURE 1 OMITTED]
As discussed earlier, globalization increases market potential,
trade and investment potential and resource accessibility of firms. It
has become easier for firms to outsource their production to different
locations to gain benefits from location advantage since less trade and
investment barriers are present in today's global marketplace
(Chimerine, 1997; Czuchry et al., 2001). Firms are able to reach out and
serve many new untapped markets around the globe. Liberal movements of
financial and human capital also facilitate their business transactions.
Moreover, advances in communication technology and information systems
also lower search costs and improve efficiency (Peterson et al., 2002).
Hence, it is clear that globalization makes resources necessary for a
firm's growth and success more abundant. Given that these
opportunities are likely to enhance the firm performance, the first
hypothesis of this study can be stated as:
H1: Firm performance is positively influenced by global market
Global market threats can be further categorized into 1) global
competitive threats and 2) global market uncertainty. Global competitive
threats are defined as the intensified competition in global markets
resulting from larger numbers of competitors in the global marketplace
(D'Aveni, 1994; Hafsi, 2002). Along with higher competition,
another threat posed by globalization is global market uncertainty,
which refers to the increasing complexity and demand uncertainty in the
market (Burgers, Hill, & Kim, 1993; Chimerine, 1997; Courtney, 2001;
Oxelheim & Wihlborg, 1991). These two types of global market threats
and their hypothesized relationships are discussed in detail in the
Although globalization enhances a firm's market opportunities,
it also increases the amount and level of competition faced by such
firms. Trade liberalization, technological developments, and convergence
of governmental macroeconomic policies associated with globalization
have made it easy for firms around the globe to enter different
geographic markets, and thus, intensify the competitive atmosphere for
firms around the world (Hafsi, 2002; Harvey et al., 2002). Globalization
has dramatically changed the competitive terrain faced by firms from
both developed and emerging economies (Nolan et al., 2003; Scully et
al., 1994). Firms operating at different levels--domestic, regional,
international and global--are now competing against one another. Hence,
it is obvious that globalization has brought about a new competitive
landscape referred to as "hypercompetitive markets" (Hitt et
al., 1998, 24), one that presents enormous threats to firms in every
economic sector since it makes a firm's relative competitive
advantage very time-sensitive (Harvey et al., 2002).
In addition, globalization also enables consumers to gather
information easier, faster, and at lower costs. Thus, they become well
aware of alternative products, and are ready to switch. Given a growing
number of competitors, resources are becoming increasingly scarce
(Castrogiovanni, 1991; Dess et al., 1984a; Porter, 1980). Such
hypercompetitive situations coupled with scarce resources is harmful to
firm performance (Beard & Dess, 1981). Firms are now faced with less
pricing flexibility due to intensified competition and buyers'
resistance, which have led to a lower rate of return (Chimerine, 1997).
Therefore, we hypothesize that there is a negative relationship between
global competitive threats and firm performance.
H2: Firm performance is negatively influenced by global competitive
Global market uncertainty, which refers to the increasing
complexity and demand uncertainty in the market (Burgers et al., 1993;
Courtney, 2001; Oxelheim et al., 1991) is another threat confronted by
firms operating in the global marketplace. Firms are faced with
increasing difficulties in planning and making decisions (Chimerine,
1997; Hitt et al., 1998). Demand has become hard to forecast for various
reasons. Since a growing number of firms now participate in the global
marketplace, forecasting demand and/or competitors' responses has
become increasingly difficult. Moreover, technology is changing at a
rapid pace and information about new products is easily accessible by
consumers. This has enabled consumers to shift between producers, making
demand become less predictable and uncertain (Chimerine, 1997). Since
operating in the global marketplace increases the level of uncertainty
encountered by firms, their performance is affected. In addition, past
studies found a negative relationship between perceived uncertainty and
firm performance (Downey & Slocum, 1982; Gerloff, Muir, &
Bodensteiner, 1991; Waddock & Isabella, 1989). Thus, global market
uncertainty is hypothesized to affect firm performance negatively.
H3: Firm performance is negatively influenced by global market
The two countries selected as the research settings for this study
are Thailand and the U.S. These countries provide rich research contexts
due to differences in terms of their degree of globalization (Foreign
Policy, 2005), level of economic development, and national
competitiveness (Porter et al., 2005). While the U.S. is highly
globalized, Thailand is considerably less globalized. According to a
survey conducted by AT Kearney in cooperation with Foreign Policy
Magazine (2005), Thailand is ranked 46th, and the U.S. is ranked 4th on
the globalization index. Thailand is classified as a lower-middle-income
economy, one in which the Gross National Income (GNI) per capita is
between $826 and $3,255, while the U.S. is considered a
high-income-economy whose GNI per capita is above $10,066 (The World
Bank Group, 2006). Furthermore, the national competitiveness of these
two nations differs dramatically. The U.S. is the second most
competitive country in the world whereas Thailand is ranked number 36 on
the national competitiveness index (Porter et al., 2005). Given those
sharp contrasts, it is perhaps worthwhile to examine whether the
relationships between globalization effects and firm performance are
similar or different. Moreover, using sample groups from two countries
allows us to focus on the generalizability of this study in order to
provide useful information for further research.
The electronics and chemical industries were found to have a large
number of exporters in both Thailand and the U.S. due to lower
manufacturing costs in the former and more advanced technology in the
latter. For this reason, firms in these two industries were selected as
the population base of this study. Recent lists of exporting firms in
Thailand were identified from two sources: 1) Export-Import Bank,
Thailand (2001-2003) and 2) Department of Export Promotion, Thailand
(2003). These two sources are reliable and legitimate because they
represent the authorities that oversee and support exporters in
Thailand. Therefore, these sources provide the most complete set of
exporting firms in Thailand classified by industries. A total of 1,050
firms (450 electronic exporters; 600 chemical and pharmaceutical
exporters) are included in the sampling frame. The sample in the U.S.
consists of firms in manufacturing sectors having the first three digits
of the North American Industry Classification System (NAICS) of 334- and
325-. Lists of qualified firms were obtained from Harris
InfoSource's (2001) database and Ward's Business Directory of
U.S. Private and Public Companies by Gale Group (2001). We relied on
these two directories because they classify firms based on the NAICS and
provide information regarding a firms' export activity, necessary
information for this study. Therefore, we randomly selected our samples
from these lists. This yielded the final sample size of 692 U.S.
The main research instrument in this study was a questionnaire,
initially designed based on previous studies. The questionnaire was
designed in English and revised after discussing with fifteen experts
and managers and a pretest with twenty firms. It was then translated
into Thai and back-translated by two independent bilinguals using the
method suggested by Douglas & Craig (1983). This involved original
translation, back-translation, and extensive refinements until the
translated instruments possessed both conceptual and functional
equivalences (Cavusgil & Das, 1997; Mintu, Calantone, &
Gassenheimer, 1994). The key informant technique (Campbell, 1955) was
used to collect data. The targeted key informants included the
presidents, owners, or middle-level managers (general managers or
marketing managers) who are typically top decision makers of the firms
and are most knowledgeable about the firms' overall activities. The
questionnaires were mailed to 1,050 and 692 firms in Thailand and the
U.S., respectively. In both countries, three waves of mailings were sent
to the key informants in our sampling frame. In addition, a telephone
follow-up was conducted one week after each of the mailings to request
and encourage participation. After eliminating undelivered mail and
firms that are no longer exporting or out of business, the total valid
mailings were 767 in Thailand and 359 in the U.S. A total of 223
completed surveys were returned, and 208 were usable. The overall
response rate was 20%.
Firm performance was measured using four self-reported items that
reflect the level of a managers' satisfaction in terms of return on
investment, sales goals, profit goals, and growth. These items were
adopted from Grewal & Tansuhaj (2001) and were rated on a
seven-point scale (1 = very unsatisfactory and 7 = very satisfactory).
We used subjective performance measures in this study for two major
reasons. First, past studies indicate that both perceptual and objective
measures of performance yield consistent results (Dess & Robinson,
1984b; Hart & Banbury, 1994; Naman & Slevin, 1993). Next, the
secondary financial data indicating the expenses and revenues of firms
from emerging markets is either unavailable or difficult to obtain due
to the size and non-public nature of their businesses (Sapienza, Smith,
& Gannon, 1988).
Global market opportunities are defined as increases in market
potential, trade and investment potential and resource accessibility
resulting from globalization. Global market threats can be further
categorized into 1) global competitive threats and 2) global market
uncertainty. Global competitive threats refer to the intensified
competition in global markets resulting from a larger number of
competitors in the global marketplace. Global market uncertainty is
defined as the increasing complexity and demand uncertainty in the
market. Based on these dimensions of globalization effects, measurement
items were generated based on a review of past literature (e.g.,
Archibugi & Michie, 1997; Fawcett et al., 1997; Morrissey &
Filatotchev, 2000; Zou & Cavusgil, 2002). All items were rated on a
seven-point Likert scale. Scale items anchored by "strongly
disagree" (1) to "Strongly Agree" (7).
Given the scarcity of prior empirical research, the scale to
measure the effects of globalization was newly generated. Since observed
variables were manifestations of underlying construct, reflective
measures were used to assess the constructs of interest in this study
(Bagozzi & Baumgartner, 1994). Therefore, confirmatory factor
analysis by means of AMOS 4.01 (Arbuckle, 1999) was used to assess the
psychometric properties of the scales to validate the measures (Anderson
& Gerbing, 1988; Fornell & Larcker, 1981). Before merging two
national sub-samples for measurement validation, an assessment of
measurement invariance was conducted to ensure cross-cultural
equivalence of the constructs (Steenkamp & Baumgartner, 1998).
Following the procedure suggested by Steenkamp and Baumgartner (1998),
configurational invariance and metric invariance must be achieved. While
the former refers to the cross-cultural equivalence in the factorial
structure underlying a set of observed measures, the latter implies
equivalence in the scale intervals. Applying multiple group confirmatory
factor analysis, the results revealed full configurational invariance
and metric invariance. Hence, it can be concluded that merging the two
national sub-samples is valid. The chi-square (x2) of the measurement
model was 104.278 (degree of freedom = 82). The comparative fit index
(CFI), normed fit index (NFI), non-normed fit index (NNFI), and goodness
of fit index (GFI) were .98, .95, .98, and .94, respectively. These fit
indices of above .90 are considered acceptable (Bentler, 1992; Byrne,
2001; Diamantopoulos & Siguaw, 2000; Joreskog & Sorbom, 1993).
Root mean square of error approximation (RMSEA) was .036. This value of
RMSEA is indicative of good fit since it is less than .05, which is
commonly regarded as the threshold (Browne & Cudeck, 1993;
MacCallum, Browne, & Sugawara, 1996). Construct reliabilities were
assessed using squared multiple correlation (R2), Cronbach alpha and
composite reliability ("c). Every indicator was a reliable measure
of its designated construct since each squared multiple correlation was
substantial, i.e., greater than 0.5 (Diamantopoulos et al., 2000). The
Cronbach alphas of all constructs were greater than 0.7, the minimum
acceptable level suggested by Nunnally & Bernstein (1994). In
addition, the composite reliabilities of the constructs exceeded 0.6,
the benchmark recommended by Bagozzi & Yi (1988).
RESULTS AND DISCUSSION
We initially assessed the differences in the mean of the dependent
variable--firm performance--between two national sub-samples and two
industry sub-samples by using one-way ANOVA. The result revealed that
there is no difference in the mean of firm performance between Thai and
the U.S. exporters (F-statistics = 2.226 at p > .10) or between
electronics and chemical industries (F-statistics = 0.336 at p >
.10). Therefore, there is no significant difference in firm performance
between firms from these two countries and industries. This is not
unexpected since the performance of firms in similar industries (i.e.,
high-tech industries such as chemical and electronics) may be very
Since there is no difference in the mean of dependent variable
across industries and countries and the results of measurement
invariance have confirmed equality in the constructs across these two
countries, data were pooled for model estimation. Maximum Likelihood
Estimation (MLE) was used to fit the structural model presented in
Figure 2. Fitting the structural model after the measurement model has
been purified is the procedure suggested by Anderson and Gerbing (1988)
and is commonly practiced by many academic scholars such as Li and
Calantone (1998) and Zou and Cavusgil (2002). The estimates were
computed using AMOS 4.01 (Arbuckle, 1999). The structural proposed model
of globalization effects and firm performance is presented in Figure 2
along with parameter estimates and fit statistics.
[FIGURE 2 OMITTED]
As shown in Figure 2, the [x.sup.2] of 145.889 (degree of freedom =
84) is significant at .05 level. However, [x.sup.2] is very sensitive to
sample size (Marsh, Balla, & McDonald, 1988). Larger sample size
tends to yield significant [x.sup.2]. Therefore, it should not be used
alone in evaluating model fit (Bollen, 1989). Other fit indices included
goodness of fit index (GFI), normed fit index (NFI), non-normed fit
index (NNFI), and comparative fit index (CFI). The GFI of .915, NFI of
.931, NNFI .961, and CFI of .969 were above .90, the minimum desirable
level recommended by Bentler (1992), Byrne (2001), Diamantopoulos and
Siguaw (2000) and Joreskog and Sorbom (1993). Moreover, all the
standardized residuals were small. Thus, we conclude that the model fits
To test the hypothesized relationships between globalization
effects and firm performance, we used the estimates of the path
coefficients. The path coefficients in Figure 2 indicate that firm
performance is affected positively and significantly by global market
opportunities (t = 2.704, p < .01). As hypothesized, global
competitive threats negatively influence the firm performance. The path
coefficient between the global competitive threat and firm performance
is positive and significant (t = -2.139, p < .05). Thus, H1 and H2
are supported. Nonetheless, we found no support for H3 since firm
performance is not significantly influenced by global market uncertainty
(t = .652, p > .5). Overall, the structural model fits the data
adequately, and the hypothesized relationships between two effects of
globalization--global market opportunities and global competitive
threats--and firm performance are significant, and supported by the
findings. The insignificance of hypothesis 3 suggests that there is no
direct relationship between global market uncertainty and performance.
This is not surprising since the causal relationship between uncertainty
and performance has been debatable (Khatri & D'Netto, 1997). As
alluded to by Khatri and D'Netto (1997), it is the complex nature
of the uncertainty construct per se that obscures the causal
relationship between uncertainty and performance. Frequently, studies
have treated uncertainty as a moderator because it is difficult to
establish a direct causal link between uncertainty and performance.
However, we did not find a significant moderating effect of global
market uncertainty on performance when the variable was added as an
interaction term in the model. Another possible way to establish an
indirect relationship between uncertainty and performance is by
including some mediating variables. As shown in a recent study, the
relationship between uncertainty and performance can be indirect, i.e.,
mediated by networking activities (Sawyerr, McGee, & Peterson,
2003). The results of their study show that as uncertainty increases,
firms engage more in networking activities, which finally enhances firm
performance. This implies that uncertainty alone can be harmful for firm
performance unless certain strategies, such as networking activities and
alliance participation, are implemented to mitigate its negative impact.
Therefore, the investigation of an indirect relationship between global
market uncertainty and performance in future research proves to be
CONTRIBUTIONS AND FUTURE DIRECTIONS FOR RESEARCH
Despite a large volume of literature discussing the effects of
globalization, there is a scarcity of empirical research investigating
its effects on business performance. We advance the literature by
categorizing the effects of globalization into different dimensions, and
develop a model to test the relationships between these effects and firm
performance. The findings from this study support the argument that
globalization not only benefits firms in terms of increasing
opportunities, but also hurts business performance due to higher
competitive threats (e.g., Contractor and Lorange, 1999, D'Aveni,
1994, Jones, 2002). In addition, we expand literature on globalization
and environmental-organization interface by developing valid and
reliable measures of globalization effects, and testing the scale across
two distinct cultures. The measures were confirmed equivalent across
cultures. We hope that these constructs generate venues for future
research on globalization and related topics. The findings of our study
have several implications for managers in the global marketplace. This
study elaborated on the different effects that globalization has on
business. The results indicate that such effects are not significantly
different across cultures. This study also confirms that globalization
is a universal phenomenon and that firms are inevitably affected.
Globalization can affect firm performance positively and negatively.
While global market opportunities are likely to enhance firm
performance, global competitive threats tend to worsen it. Therefore,
managers must be aware of such double-edged effects, and try to
capitalize on opportunities while converting threats into opportunities.
Appropriate strategies, such as developing networking relationships with
other firms, must be carefully designed and implemented in order to take
advantage of global market opportunities and minimize the threats from
increasing competitive intensity.
LIMITATIONS AND DIRECTIONS FOR FUTURE RESEARCH
Our study is among a very few empirical studies of globalization
effects. Although the scales to measure globalization effects were
developed from a careful literature review, they are new, and thus need
further verifications and applications. Moreover, the model presented
here is limited to the effects of globalization on business but not on
society. In the short run, intense global competition may be deemed
harmful for firm performance. However, in the long run, such competition
will provide a healthier economy that benefits the overall society.
Higher competition will eventually encourage firms to aim for continual
improvements, which are good for both the firms and society. Therefore,
the results of this study must be viewed with these limitations. Future
research may attempt to find theories to explain the effects of
globalization and investigate the role of different strategies and
organizational structures in mediating the effects of globalization on
firm performance. Alliance formation and strategic flexibility have been
recommended as effective means to maneuver firms through globalization
(Contractor et al., 1988; Hitt et al., 1998; Spekman & Sawhney,
1990). A study examining such relationships would provide useful
information for managers operating in global industries on how to manage
the effects of globalization more effectively. Furthermore, research on
how the fit among different organizational structures (e.g., mechanistic
vs. organic) and strategies (e.g., cost leadership, differentiation,
diversification, etc.) may enhance firm performance in the presence of
globalization effects and offers another fruitful venue for future
In this paper, we have advanced our knowledge of globalization
phenomenon by defining its effects and categorizing them into
opportunities and threats. In doing so, we addressed the question of how
globalization affects firm performance by empirically examining the
influence that each globalization effect has on business performance.
This study provides considerable support for literature arguing that
globalization acts as a two-edged sword, one that can be beneficial and
detrimental to business. Managers should be prepared to cope with such
effects and try to capitalize on global market opportunities while
carefully managing its inherent threats. Innovative and effective
strategies should be designed and implemented to enable firms to gain
competitive advantage and attain long-term victory. Building on our
theoretical framework, further research should focus on how different
strategies help firms navigate successfully through today's
increasingly globalized condition.
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Amonrat Thoumrungroje, Assumption University Patriya Tansuhaj,
Washington State University