Globalization

In 1996 two executives from a Sioux Chief Manufacturing are on a plane destined to Kansas City. On the flight back from Japan, they are discussing the events that just took place that morning in a presentation to several Japanese plumbing distribution companies. Sioux Chief Manufacturing is a mid-size plumbing manufacturer in south Kansas City. It started in 1958 by Ed Ismert and is now owned and operated by Ed’s son, Joe. Joe, and another VP of Sioux Chief, Mike, discuss the possibilities of the distribution in Japan of their best selling product. Sioux Chief’s water hammer arrester division is the fastest growing division in the company. Utilizing the innovations and ideas of �small town, every day hard workers’ as Joe Ismert put it, Sioux Chief created products like the water hammer arrester that was rarely seen in several Asian countries. Water hammer arresters are a necessity in newly built homes, relieving the immense pressure felt in pipes when shutting the water on and off.

Japan was a market in which Sioux Chief needed to do business. Prior to 1996, hardly any homes in Japan had water hammer arresters and Sioux Chief wanted to take advantage of that. Their presentation was successful and Japanese distribution centers started selling the neat devices almost faster than they could be made. Sioux Chief had a successful two years in Japan. Two years is all it took for Japanese companies to catch on to what Sioux Chief was trying to do. They improved on Sioux Chief’s design, while also manufacturing it cheaper. They had the advantage of expertise in local markets and faster manufacturing turnover. Finally, by the year 2000, Sioux Chief was no longer a major player in the Japanese arrester market. Their small size and proximity disparity with the Japanese and other foreign countries was too big of a margin to overcome.

However, Sioux Chief was not defeated. It utilized its so-called �small town, every day hard workers’ concept and took it to other countries outside of Japan. They went to Australia and sold their innovative drainage systems. They also went to Canada and sold their unique hangers and brackets. They sustained a desire to constantly create change and innovation; and they did it across several continents and cultures.

Off the top of my head, the previous sentence would be my definition of globalization вЂ" To sustain a desire to constantly create change and innovation across continents and cultures. However, globalization is not bound to any one definition. That is why it is so great. If one were to Google (used as a verb) the term “Globalization” the first thing to come up would be Wikipedia’s definition; “Globalization is the increasing interdependence, integration and interaction among people and corporations in disparate locations around the world. It is an umbrella term, which refers to a complex of economic, trade, social, technological, cultural and political interrelationships.” (www.wikepedia.com). Another definition is one we described in class regarding the connectivity, or the equaling out of business and cultures around the world.

Globalization can also be described in the example of Sioux Chief Manufacturing. Before 1996, it was confined to sales only in the continental US. But it saw a need for change within its own company and a need for change in other countries. It created a market for a product in a different country than its own and just as quickly was knocked out of that market because of the adaptations and innovations of others. The Japanese utilized Sioux Chief as much as Sioux Chief utilized the Japanese. Sioux Chief was a global entrepreneur. It used a creative idea and product and made a successful launch of it in a different country. But Japanese companies were a different kind of entrepreneur. They used an entrepreneurial style in which they took an existing product and improved upon it. Constant innovation and change was the key for both parties. Sioux Chief realized what had happened to this new market they created and thought best to get out of it while they could. They created change and innovation doing the same thing, in a way, in other countries and cultures, but with new and creative products as well as differentiating their marketing style.

This constant change or globalization of the world can be measured on several levels and in many different ways. For example, the term globalization could be broken down to describe several types of industries, cultures, political, and/or financial markets. Measuring globalization as a whole can be determined by producing scientific studies like the AT Kearney and Foreign Policy Globalization Index. This index uses four factors to measure the influence and importance of globalization in each country. Each factor has several underlying conditions, all of which were weighted and tallied to come up with a final score. The factors included (1)Economic Integration вЂ" “Trade and foreign direct investment”.