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  • Essay / New Balance sports shoe, Indonesia and globalization

    With the constant quest for greater profitability, American companies are increasingly seeking opportunities around the world. Factories are being built in third world countries, and sales efforts continue to intensify in the world's fastest growing economies, such as China and Brazil. Consumer product companies, in particular, are looking for the cheapest and most efficient method of production, and many are starting to look to Indonesia for answers. According to the Indonesian Shoe Association, “Sports shoes produced in Indonesia are expected to increase by about 25% to $1.6 billion since 2007” (Abelson 1). One of the U.S. companies leading the global initiative, New Balance Athletic Shoe Inc., alone plans to increase its number of shoes made in Indonesia to nearly 6 million pairs over the next two years ( Abelson 1). This vast migration of manufacturing facilities is driven not only by corporate hunger for profits, but also by the new international system of globalization. This system breaks down international barriers and improves communication, efficiency and cultural understanding. When developing production operations in Indonesia, New Balance must be aware of both the country's cultural and geographic differences, as authors Thomas Friedman and David Landes explain, as well as the potential benefits and costs of globalization , explained by authors Amartya Sen and Paul Collier. Before building its new factory in Tangerang, New Balance Athletic Shoe Inc. must be aware of all the obstacles to development, including cultural differences in religion and view of authority, as well as geographical differences that influence the work pace of employees and constitute a threat. powerful...... middle of paper ......rld, they often lose these ancient traditions passed down from generation to generation and we begin to experience Americanization through "Western domination and l 'imperialism' (Sen A2). Furthermore, Collier explains that “the lower countries coexist with the 21st century, but their reality is that of the 14th century” (Coullier 3). As New Balance begins to build its new factory and hire the workforce, it must keep in mind that Indonesia is not as advanced as the United States. Therefore, some technologies and ideas come as a culture shock to people. Although globalization has both benefits and costs, if New Balance can overcome cultural and geographic differences and help preserve the culture and traditions of its employees, the Indonesian people and the company will. benefit.Works CitedLandes, David “The Wealth and Poverty of Nations"