"The Globalization of Markets" at 25: An Appraisal

♠ Posted by Emmanuel in at 5/05/2008 02:02:00 AM
Let me test your mastery of the social sciences once again by posing this question:

Which academic discipline popularized the concept of "globalization"?
(a) Economics
(b) Political Science
(c) Marketing
(d) Geography

The answer, surprising as it may be to some, is (c). When you visit this blog, you will undoubtedly notice that I feature a lot of marketing-related books concerning new product development, services marketing, etc. on my virtual bookshelf. Once in a while, people do ask me what exactly these books have to do with international political economy in general or globalization in particular. In my mission to wipe out ignorance--as one of my mentors said an educator's duties should be (she takes teaching very seriously)--I feature a classic article that still defines a lot of the globalization literature. Theodore Levitt may be more familiar to you as the the guy who coined the phrase "marketing myopia." In that memorable article, he said companies should look beyond what their current products were to determine the broader benefits they conferred to their clients. For instance, an oil company is not merely in the oil business but the energy business, and an automaker is not merely in the car business but the transportation business.

Yet, Levitt's other memorable work is not as closely identified with him, strangely enough. This is perhaps due to the term "globalization" spreading far beyond the realms of marketing. In 1983, he dropped another bombshell on an unsuspecting world (which also appeared in the Harvard Business Review) entitled "The Globalization of Markets" (this linked version is a reprint). Although some had used the term "globalization" prior to 1983 and certainly the phenomenon of globalization was already well underway before then, it was the HBR article that set the stage for today's endless debates about globalization. In a prior post, I wrote about the three waves of globalization thought. The first is the hyperglobalization or "B-school" thesis that sees the all-conquering effects of market-driven globalization a la Kenichi Ohmae. Of course, "The Globalization of Markets" falls under this category as a granddaddy of the genre. It is interesting that both corporate elites and ardent new millennium collectivists who foam at the mouth over the very mention of the term subscribe to the same idea of globalization as all-conquering.

Aside from the world not being flat at all--especially for migration--one of the things which hasn't really been panned out is the notion of a singular "global market" as Levitt forecast. Sayeth he: “Different cultural preferences, national tastes and standards, and business institutions are vestiges of the past." This, of course, is hardly the case. World homogenization is not nearly as complete as that. While technology has eroded some of these peculiarities, differences in culture, income, and political economy still thwart many efforts to create a "global market." Moreover, it always seemed curious to me that the guy who wrote about "marketing myopia" would also put forward rather short-sighted ideas repeating the hoary lines that "there is no such thing as society" in the words of Margaret Thatcher and that "the end of history" is nigh in the words of Francis Fukuyama.

The debate rages on about globalization, overwrought as it may be, as we sit in the pumpkin patch awaiting the unity of the world under a single market entity. Until that time comes (probably never), we can ponder Levitt's original thoughts on the matter as well as a rejoinder by his erstwhile colleagues at Harvard on the occasion of the article's 20th anniversary in 2003. While some of his ideas about it fell flat, there is no doubting that the idea of globalization has indeed been globalized care of Theodore Levitt.