Dr B K Mukhopadhyay
(The author is a Professor of Management and Economics, formerly at IIBM (RBI) Guwahati. He can be contacted at firstname.lastname@example.org)
Dr. Boidurjo Rick Mukhopadhyay
(The author, international award-winning development and management economist, formerly a Gold Medalist in Economics at Gauhati University)
One could argue that Umbrella concepts like 'globalization', 'sustainability', and 'development' are ideologically charged. Globalization, in particular, has more than enough forces and dimensions to talk about, however, the most common take on it is from an economic viewpoint. Both proponents and opponents tend to perceive globalization largely from an economic viewpoint also. At the same time, studies on globalization try to identify the concept with the broad processes of technological, economic, political, cultural interrelationships.
'Glocalization', on the other hand, is an amalgamation of 'globalization' and 'localization'. Interestingly, the term was based around the Japanese word dochakuka, which means adapting farming techniques to one's own local condition. Further, in the business world, the idea manifested into a broader concept – global localization. Sociologist Prof Roland Robertson can be attributed for the term 'glocaliaation' that was initially picked up by Marketers, Japanese in particular, it meant that products or services of Japanese origin should be localised – that is, they should be suited to local taste and interests – yet, the products or services are global in application and reach. Interestingly again, Jan Nederveen Pieterse, a Dutch sociologist, used other terms which also captures similar processes with regard to culture, such as melange, hybridity, and syncretism.
Today, if you are in Shanghai, expect a Peking duck burger for your lunch from KFC. On your flight to Beijing, Starbucks would pour aromatic teas more often than they serve coffee. They are some examples of how businesses 'go glocal'. Practical marketing observations evidences that global processes, regardless of their origin, noticed the emphasis of social categories and practices that assume a local flavour or character despite the fact that these products were invented elsewhere.
Broadly, there are three views on the issue of globalization of cultures. First, clash of cultures or better, clash of civilizations. Second, towards a more homogenised world dominated by a single culture that erases differences of local cultures – e.g., "McDonalization", "CocaColonization", or "Tescoization". Third, the process of hybridization or synthesis. Therefore, one conclusion from all the three views above would be the fact that Convergence, rather than divergence, seems to have been the consequence of modernization.
Micro-globalization incorporates certain global processes into the local setting. Putting it simply, 'Glocalization' could in a way be defined as an attempt to create products or services intended for the global market while they are customised to suit the local cultures.
Social movements such as #blacklivematters or #metoo or 'go green' agenda for businesses emerge in a certain local context but over time they spread far beyond a particular locality into a much larger spatial, historic and intellectual arena. Overcoming space is globalization. Therefore, in this view, Globalization is Glocalization.
It is interesting because Anthony Giddens attempted to establish a relationship between global and the local. Globalization is the "reason for the revival of local cultural identities in different parts of the world". Local, therefore, responds to the forces that are global, and so local itself is constituted globally.
For the opponents of globalization, however, the concept of glocalization is a relief because the latter is like a wave that erases all the differences. While globalization attempts to establish a more uniform world where cultures amalgamate into a global whole, glocalization does not promise a world free from conflicts and tensions but retains the historical grounding while recognising the complex and pragmatic view of the world.
Glocalization involved blending, mixing adapting of two or more processes one of which must be local. It allows a space for fusion of ideas and not blind imitation. In a recent survey by PricewaterhouseCoopers of nearly 400 non-financial businesses in Europe, about 60 per cent had re-shored some operations in the past year, but more than half of the businesses had also done some new offshoring. Businesses aren't reshoring just for the sake of reshoring. The cost of labour has risen exponentially in many of the regions that were once appealing as sources for manufacturing, for example, China and India. And in some cases, businesses recognise that they can better control the quality of the product and the supply chain if they are closer to the end market.
There is no reason however to assume that globalization is going be paused or be shadowed under glocalization since cost efficiencies will always matter and not all of the efficiencies of outsourcing would wane suddenly. Some companies, particularly within automobile and steel, thinks that under the current strategic change options, both outsourcing and reshoring create the needed diversification. This leads to diminishing labour costs that would drive customisation on a large-scale fostering regional specialization which could in turn improve customer service.
Due to continued increased focus on customer experience in this aeon, clients around the world expect experiences that align with their personal tastes and preferences. Global organizations can't simply share the same brand image wherever they go and expect to achieve the same results. Therefore, the need to find a way of maintaining the inherent values and "essence" of their brand, while adapting to local trends. Today's global companies need a presence that resonates as "consistent" in every country, but also provides a personal touch to each region.
As Benjamin Franklin famously put it, "it can take endless good deeds to build an excellent reputation for yourself, but it only takes one wrong move to damage that reputation for good". Glocalization's popular saying goes as "Think Global, Act Local." On a broader scope, the idea of thinking globally and acting locally suggest that we consider the needs of the entire planet before we take action in our own city or home town.
A study by Harvard Business Review shows that 80% of a company's market share comes from the intangible assets that customers recognise like goodwill and brand equity, companies can't afford to ignore the rise of 'glocalization'.
For example, McDonald's currently has over 36,000 restaurants globally, and they all feature the iconic "golden arches," the unique McDonalds colour scheme, and the Big Mac hamburger. However, if you are in a restaurant in Brazil, croissants would come with cheese and ham for breakfast. Similarly, in Israel, one can tuck into a lemon tea and McKebab. A glocal strategy demands that companies concentrate on the needs and unique qualities of their local audience.
It is essential to understand that a "Glocal" strategy means re-thinking the unique elements of a company, from its messaging to its product portfolio, and adapting those components to suit the needs of your target audience. At the same time, it is crucial to ensure that the values of the company are shared clearly and in line with local aspirations when going glocal, for example, IKEA's brand mission is to "create a better everyday life" for customers. Also, Diageo's Johnnie Walker "Keep Walking" campaign is based around the idea that everyone, regardless of where they live would move forward regardless of their stage of life or goals.
On a warning note, the companies that go glocal also need to ensure that the meaning doesn't get lost in translation, for example, KFC's "finger-lickin' good" slogan meant "Eat your fingers" when translated in China. When it comes to translation to get the right meaning across, it is more than just getting the linguistics right. Companies need to be sensitive about the preferences of the audience that they are reaching out to. Product lines can also be glocalized to reach the sentiments and taste of a region, for example, KitKat would normally have flavours like peanut butter, chocolate, and ice cream in the west but in one of their biggest markets, Japan, they also sell wasabi, soybean, and green tea flavours.
Finally, glocalization require companies to expand their abilities to capitalise on leveraging economies of scale while also ensuring each 'local' markets are being heard and having their specific needs met. While the prospect of 'global presence, local touch' has still a long way to go, organizations keen on glocalization have to integrate three key strands that would tie people, processes, and technology to deliver an effective glocalization strategy.