Globalization and the Challenges
The dominant feature of the world economy in the next decade will be increasing pace of change and expanding reach of global markets into national economies. People and businesses will need to be increasingly flexible to respond to these changes.
1. Establishing Stability in an Open Economy – further trends in increasing cross-border trade and investment, more integrated capital markets and greater global competition pose challenges to every country. These changes reinforce the need for a stable macroeconomic environment to address the potentially increased uncertainties. The India needs to capitalize on the new opportunities that increasing investment flows and trade can offer, while balancing this with flexibility to adapt to greater uncertainty
2. Promoting an Outward Looking Economy – macroeconomic stability and long-term sustainability are important in attracting foreign investment and retaining and encouraging domestic investment in increasingly integrated global financial markets, in which the sources and destinations of investment are becoming ever more diverse. As the balance of global economy shifts, firms need to establish string links with emerging economies and other trading partners to access the opportunities of the changing global economy. Investment is a crucial driver of an economy’s productivity and hence of the level of prosperity prevailing in the economy. In a world of more closely integrated global financial markets and mobile capital flows, mobile investment will increasingly locate in those economic environments where it can achieve the greatest, risk-adjusted, returns. A range of factors contributes to an economy’s investment environment, and hence to the expected returns on investment. A key challenge for the is to provide an economic environment that is able to attract high quality domestic foreign investment, not by attempting to compete with emerging economies on the basis of labor costs, but through high levels of productivity built on a foundation of macroeconomic stability and driven by skills, competition, enterprise and innovation
Challenges to business
External dialogue focuses on the explicit development of the collective learning cycles of evolving projects and programs, in which stakeholders and company representatives learn to jointly craft and implement new policies for progressive steps towards corporate social and ecological responsibility (CR) policies for sustainable development. Plotting of new business directions requires interactive shifting of company limitations expressed in the expectations and demands of stakeholders The complex business challenge is the ability to understand present and potential stakeholder demands, and the willingness to overcome such obstacles in creative and open change processes of joint learning. When companies aim for long-term success and continuity, they must improve the level of knowledge and ability in their organization, enabling staff to understand the company's limitations and to build strategies to shift these. Responding to and understanding stakeholder demands requires the highest degree of professionalism in the organization on a great variety of issues in order to create the business conditions for continuity.
Enterprises need to be open and willing to learn in interactive stakeholder approaches at the levels of the direct physical and social surroundings of the firm, of the supply and technology chains, and of the total production and consumption systems, including the private and public firms providing and developing infrastructure services. Firms can develop an approach to stakeholders with a focus on jointly developing and maintaining a collective learning cycle where progressive steps can be made toward CR policies for economic continuity and social and ecological value creation and a sustainable development. Connecting internal processes to this collective learning cycle is vital .The transition to sustainable business requires the plotting of a new direction by engaging the stakeholders of the company to understand needs and to develop common goals. It is equally important to achieve appropriate social, ecological and economic conditions and technical infrastructures for future production. Therefore, the central concern of the company is to understand its stakeholders, and to continue satisfying stakeholder objectives, thus creating the right conditions for sustainability.
Business strategies for sustainable development aim to achieve the essential conditions for long-term continuity of the company, and a stakeholder approach is crucial to determine the related requirements. The complex business challenge here is nothing less than the ability to understand present and potential stakeholder demands, and the willingness to address issues in a creative and open change processes. When companies aim for long-term success and continuity they also need to strive to improve the level of knowledge and ability in their organization, enabling staff to understand the company's limitations and to build strategies to shift these. As a business operates many challenges hound it and may cause the business process to be stopped. The different business challenge may come from its internal and external environment. With proper strategies the business may survive such challenges
