The Kinds Of Globalization Drivers

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Table of contents

  1. Market Globalization Drivers
  2. Cost Globalization Drivers
  3. Government Globalization Drivers
  4. Competitive Globalization Drivers

Market Globalization Drivers

Market Globalization Drivers defined the develop of the consumer behavior whose are from all around the world, which include the degree of consumer needs compile around the world, consumer purchases behavior on global basis, distribution develop of all around the world. (Lardbucket, 2012) Current customer needs and taste who’s from different countries but want the same things in product or service category that the industry offers. Nowadays, the globalization trends of losing regulation and increasing the privatization of government are causing the competitive of global airline service become more intense. The company now are not only provided the needs of the customer but also good customer service and how to make customer use the easiest way to purchase the ticket. This trend make AirAsia facing a lot of challengers and potential competitive. As the slogan of AirAsia is “Now everyone can fly”, the low cost air fares is enough competitive with other country aircraft company, but nowadays the improve of technology and the demand of customer, only low cost air fares is just a simply factor to competitive, to enhance the population of AirAsia still need to promote better plan. On 3 July 2019, the Western Australia State Government has an agreement with AirAsia. The aim of the agreement is to developed an affordable flights to Western Australia to enhance the number of visitors. AirAsia had increase a stable marketing which was provided but Australia government, working with the government not only can develop a huge market but also enhance company reputation. (Sepang, AirAsia partnership to bring more holidaymakers to Western Australia, 2019)

Cost Globalization Drivers

The Cost Globalization Drivers is more involve in economics aspect. Cost drivers are usually decided productivity capital which also can know as distribution of capital standardized. A company set a cost of capital are usually to achieve the goal of various department and the cost globalization can decide the capable of company to competition with others. (Lardbucket, 2012)Although the world economic turndown may bring effect to the firm but it is also an opportunity for AirAsia. As we know, the turning bad of global economic will cause the aircraft leasing price reduce about 40% , the leasing of the aircraft dropping that means the AirAsia may lease the aircraft cheaper and reduce their cost. This may increase the income of AirAsia or reduce the ticket price to attract more customer to choose their company. In other word, different currency in various country also impact the globalization cost. For example, the business that involve in overseas market can be affect by currency in the way importing or exporting goods from Asia to Europe because Asia country currency are usually different with Europe. The payment may influence by currency rate exchange. The exchange rate may bring positive or negative influence to the firm. To solve this problem multinational companies are usually using dollar as trade currency and also depend on international market rates. (Hardy, 2017) In AirAsia company, they are using dollar as indicate aircraft operating lease expenses. From the studies we know that the weakness of Malaysia Ringgit is key element that impact company decide to use dollar to indicate in US dollar. (Reuters, 2017) Logistics is also very important to a firm. Logistics is defined as a process packed and deliver the goods or service to the customer to satisfy their needs. For international business, the logistics is not just easy deliver the goods from manufacturing facilities to customer doors. The multinational company logistics included send the goods to warehouse from manufacturing facilities and pack the goods in warehouse confirm the number of goods that customer needs, confirm which counties are they going and finally distribute out. The movement of product is very important, the inefficient logistics way may directly influence companies profit or cause the loss of company. (Craig, 2019) Although AirAsia is an aircraft company and its main duty is not to product and sold the goods all around the world, but sometimes the aircraft components or others consumables also need to import from other country or supplies, this process may involves logistics. Based on AirAsia is a low cost carrier company, they are trying to reduce the cost from all aspects. An efficient logistics way help company cut down a lot unnecessary expenses. AirAsia Group is discovering the potential logistics business with the help of EasyParcel which is a company using online parcel delivery services. (Saieed, 2019) EasyParcel is a logistics service platform that allow customer to check for delivery rate and what delivery way is most economically. (Yan, 2019)

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Government Globalization Drivers

The Government Globalization Drivers is an important factor that shaping the global competitive of a company. Government Globalization Drivers included existing trade policies, technical standards and international import or export regulations. Government controlling can be known as protect the country trade or national safety. (Lardbucket, 2012) Nowadays, the regulation are become more focus on how to improve a company competitive in global environment but no really to protect the country. As AirAsia, the company has just announced that the company would collaborate with the Ministry Of Domestic Trade and Consumer Affairs. The aim of campaign is to support the government project which called “Buy Malaysia Product” this may help to drive the economic growth and improve global awareness of the quality of Malaysia made goods. This is a very good opportunity to AirAsia to let the consumer knowing the company providing excellent service and even the government also chosen the company as represented service company of Malaysia. AirAsia also not need worry about the ownership of the company because government doing this is just aim to increase more visitor from outside country to Malaysia and promote the Malaysia excellent local product by the first line that the visitor will first interact with, the aircraft company will be the best choice. The ownership are still with AirAsia group. (Sepang, 2019) On technology part, the aircraft of AirAsia will do all of the maintenance, repair and overhaul in Malaysia which government and Airbus company have a deal to establish sustainable aviation product line in Malaysia. This deal may increase the competitive through application of new digital technologies. AirAsia also can save a lot of cost in this deal, because they no need to import the expensive component from oversea and waiting for repair, all the step doing in Malaysia will be rapidly and efficient. (Sepang, AirAsia inks major deals with Airbus, 2019)

Competitive Globalization Drivers

Competitive Globalization Drivers defined as the factor which effect a firm competition in globalization. Globalization competitive also included several of competitors whose are from different national origin, global competitive allow that company having trade such as buying or selling the product at international platform, this provided a bigger market to the seller but also has enhance the difficult of selling the product because to stand out between the so many competitors the firm must require some special which others don’t have. (Lardbucket, 2012)The global competition of aircraft industry is very tough nowadays, every aircraft companies are trying to execute different or better strategy to compete with each other. However it is not easy to success in the competition, the company have to identify their operating and management strategy, because a suitable strategic may lead the companies to achieving their vision and mission. Due to that, AirAsia need to create a wonderful strategy which offering to their customer. If AirAsia successful launch the lowest cost carrier in world it definitely will enhance the competitive of AirAsia. (Catatan, 2009) The global competitor of AirAsia included Cathy Pacific Airway, Southwest Airlines, Alaska Airlines and Norwegian Air shuttle. Although these international aircraft not provide cheaper than or as cheap as AirAsia carrier cost, but they service, quality and good reputation are creating big pressure to AirAsia. As nowadays customer are not only want the cheapest price but they also request good customer service, so company are not only aim to compete at price aspect but also the service they provide. For AirAsia was suggested to provide a more convenience way to purchase the ticket such as provide customer to purchase the ticket online and use the QR code or bar to entry the departure hall. Customer no longer need to print out a piece of paper as a prove to enter departure hall, this action surely attractive many consumer choosing AirAsia just for the convenience. To make some special which different with other aircraft company, AirAsia encourage to have some new idea on it inflight menu. It will be fantastic if the AirAsia can provide delicious and special local food to it passenger. The food is not compulsory Malaysia local food, it may be some Asia favor food such as Thai tomyam sup, Thai boba milk tea, Hong Kong style Dim sum and Laksa. This is aim to the passenger is having the flight toward Malaysia or other country for tourism but they can try a different country food just like they only paid one journey fees but already travel to numbers of different country. (Paul, 2019)

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The Kinds Of Globalization Drivers. (2022, February 18). Edubirdie. Retrieved July 16, 2024, from
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