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The proper and brief definition of Global warming is when the temperature of this earth rises in other words when the earth heats up. It will happen because greenhouse gases trap heat (carbon dioxide, water vapour, nitrous oxide, and methane) from the sun which results increase in the temperature of earth. In the result of increase in temperature many people, animal, and plants will affected and many of them will not survive because they cannot adopt this change so they will die. [library.thinkquest.org]
Some people think global warming is just a theory; and some people call it a proven set of facts. Difference in opinions is natural but we cannot neglect the reality and reality is we are going towards disaster. It will destroy everything our economic, social life etc. That is why the effects of global warming have catastrophic potential. Global warming as caused by greenhouse gas emissions can lead us to a definite imbalance of nature.The premise of global warming as an issue of debate is that industrial growth coupled with non-structured methods we as humans use to sustain ourselves has created a situation where our planet is getting progressively hotter. We have seemingly negatively affected our environment by a cycle of harmful processes that now seem to be feeding upon themselves to
exponentially increase the damage to our ecosystem. [http://globalwarming.com]
It is an alarming situation for the world. Latest research says, there is an 80% chance that 3 billion people in this world will have to choose between moving their families to milder climes and going hungry due to climate change within 100 years. The main critics are on the big industrial giants of the world. Climate change is expected to have the most severe impact on water supplies. "Shortages in future are likely to threaten food production, reduce sanitation, hinder economic development and damage ecosystems. It causes more violent swings between floods and droughts."" - Guardian: Global warming causes 300,000 deaths a year. [www.newscientist.com]
Global warming affecting strategic business management and planning
These days global warming has become an issue for many businesses worldwide. It's taking on ever increasing importance in business strategies. There is a hope to pass new regulations in this regards in the forum of UN if the industrial giants agree to limit the quantity of carbon dioxide and other gases which can emitted into the atmosphere, and or any other ways which affect the climate very badly, if these countries done this breakthrough then this is a big achievement. Even when these regulations do not directly affect small businesses, they can affect the business of their customers and suppliers, and thereby affect small businesses through the costs of the materials, supplies, and energy they purchase, and the products and services that their customers can, and want to purchase. The changes could mean greater restrictions and costs, but at the same time they could mean new opportunities. A sensible way to face the coming changes is to analyze the risks and evaluate the opportunities associated with the changes in climate trends, the potential changes in regulations, public opinion and how it affects people's image of business, and the changes in markets for goods and services. Companies that can mitigate the risks brought on by changes in climate, adapt to the regulations that are imposed, inform the public of its efforts to reduce adverse effects on the environment, and take advantage of new opportunities that present themselves, will be in better conditions to prosper. [http://www.associatedcontent.com]
Organizations which affected directly by climate changes like flooding prolonged droughts in some areas or stronger storms in some area which affect the asses of that company they should plan now. The value of properties located on coasts that are affected by storms could decrease, and it could become more difficult and costly to obtain insurance. Companies that seek insurance against wind damage and flooding could face requirements that obligate them to construct buildings and structures that are more solid and resistant. [ http://www.associatedcontent.com]
Global warming could cut the world's annual economic output by as much as 20%, an influential report by Sir Nicholas Stern. BBC News channel (http://news.bbc.co.uk/1/hi/business/6093396.stm)
Climate change affect business in two different ways
Climate change is affecting all aspects of life such as individual and social life and raising health issues and affecting businesses; it is more than a physical phenomenon. It is a drastic change in our environment, culture and politics which has given a new direction to our thoughts how we think about our society and businesses on Earth. Different business leaders observe climate change differently. For some this will lead the melting of Greenland ice sheet and for others is will disrupt the monsoon.
If we study climate change in the context of business strategy we will find that it has a direct impact on businesses. Climate change is going to affect the businesses strategies in two different ways:
1-Climate change is going to affect the society and eco systems. With increasing awareness regarding the impacts of climate change customers buying behaviours and their requirements are changing which increases the demand for environment related strategic plans. Businesses cannot work in isolation, so business leaders will have to design their plans according to the changing climate and business environments. So this is going to affect businesses directly.
2-As governments seem to be more concerned to these changes and they have to make policies and regulations to avoid or at least lessen the bad impacts of the climate changes. Government policies regarding these changes such as saving carbon emissions will have direct impact on the business strategic plans. And business leaders will have to take into account these changes, while designing the plans for their business. [static.london.gov.uk]
For business leaders climate change is not all bad; it is an opportunity to do the right things that are wrong for instance climate change has created new business opportunities such as hybrid cars and alternative energies (wind energy and solar energy). On the other hand some countries such as Siberia, for instance could benefit a great deal with a bit of warming. For innovative business leaders it generates a host of business opportunities.
Environmental changes will affect different business differently according to their area operations but one thing is sure that organisations need to treat these changes as important as they plan for the effectiveness of their operations.
Business leaders will have to assess the environmental changes in the context of their contribution towards these climate changes as well as affect of climate change on their business for example every operation of an organisation such as logistics, marketing, sales and after sales services could generate emissions, which contributes directly towards the climate change. This could be critical for leaders depending on their understanding and how importance they give to these contributions.
Change in temperature and weathers will have direct effect on the operations of the business such as employees' safety issues, their illness and insurance expanses.
Government legislations will bind them to make policies to avoid impact of climate changes to the society.
Impact of scarce commodities emerging economies (BRIC) and economic recession on organisations in the 21st century and the need for innovation
Scarcity refers to the economic problem of having unlimited human needs and wants of resources which are scarce.
Scarcity of these resources is resulting the price increase of these commodities. The biggest challenge of 21st century is not law and order but its feeding the world and resource allocation. Any system which consumes resources to grow or sustain itself will have one or more limiting resources. For example, in order to grow, a tree has to have water, sunlight, oxygen, carbon dioxide, fixed nitrogen, phosphorus, potassium, several trace minerals, and so forth. As the tree grows, it consumes these resources at least temporarily (oxygen, for example, is actually returned to the atmosphere in greater quantity than the tree uses, but the tree will still die if there's no oxygen in the air). If any of these resources is scarce enough that its absence keeps the tree from growing faster, then it is a limiting resource. If there's relatively little sunlight, then sunlight may be a limiting resource, and more light would cause the tree to grow faster.
There can be several limiting resources in a system, and if a limiting resource suddenly becomes plentiful, then usually a different resource becomes limiting. [http://en.wikipedia.org/wiki/Scarcity#cite_note-0]
Emerging Economies of the World (BRIC)
BRIC is referred to the fast growing develping economies of Brazil, Russia, India and China.
Brazil, Russia, India and China-the BRICs economies-could become a much larger force in the world economy. Three-quarters of the world'sopulation lives in emerging markets, 40 per cent of the world's population lives in a BRIC country, half of the BRIC population is under the age of 30. Demographics are a big part of it. Victoria Young, Investor Daily, (http://www.investordaily.com)
Growth in BRICs is creating new demand and higher growth in these economies. Higher growth could lead to higher returns and increased demand for capital which could increase the need for investments to these countries. The more investment done in these countries will strengthen the economies more.
Increase in income in these economies will make these countries a very favourable market for different kinds of products, which dramatically change the demand and pricing figures for a range of commodities. As today's advanced economies become a shrinking part of the world economy, the accompanying shifts in spending could provide significant opportunities for global companies. Being invested in and involved in the right markets-particularly the right emerging markets-may become an increasingly important strategic choice.
In December 2007 economic recession started from United States. Which within the period of 2007-2009 became global recession. This economic environment was created by various imbalances and was sparked by the outbreak of the financial crisis of 2007-2009. Although the late-2000s recession has at times been referred to as "the Great Recession," this same phrase has been used to refer to every recession of the several preceding decades.
Economics March 11, 2009, 'Great Recession': A Brief Etymology by CATHERINE RAMPELL
The US mortgage-backed securities, which had risks that were hard to assess, were marketed around the world. A more broad based credit boom fed a global speculative bubble in real estate and equities, which served to reinforce the risky lending practices. The precarious financial situation was made more difficult by a sharp increase in oil and food prices. The emergence of Sub-prime loan losses in 2007 began the crisis and exposed other risky loans and over-inflated asset prices. With loan losses mounting and the fall of Lehman Brothers on September 15, 2008, a major panic broke out on the inter-bank loan
market. As share and housing prices declined many large and well established investment and commercial banks in the United States and Europe suffered huge losses and even faced bankruptcy, resulting in massive public financial assistance. (http://en.wikipedia.org/wiki/Late-2000s_recession#cite_note-0)
Need for Innovation:
In the growing economic of BRIC economies, scarce commodities and economic recession to gain competitive advantages industries need to be innovative in designing their products as well as designing their strategies. The Business which senses these change first and makes their own position in its rivals will survive and gain competitive advantages over the rivals. Need of innovation is always there in the businesses. We can say that competition can be viewed a process driven by innovation.
During a period of rapid change when industry structure is being revolutionized by innovation, value typically migrates to business models based on new positioning strategies. In stock brokerage industry, value has migrated away from the full service broker model to the online trading model. In the book selling industry, value has migrated away from book stores to online book stores such as Amazon.com.