What is Global Competition in Business? - Definition & Challenges

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  • 0:01 What Is Global Competition?
  • 1:09 Gaining the Competitive Edge
  • 2:02 Challenges
  • 3:01 Internet & Global Competition
  • 3:44 Lesson Summary
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Lesson Transcript
JC Wright

JC has an MBA.

Expert Contributor
Steven Scalia

Steven completed a Graduate Degree is Chartered Accountancy at Concordia University. He has performed as Teacher's Assistant and Assistant Lecturer in University.

In this lesson, you will learn about global competition and some of the challenges faced by companies when conducting business internationally. Also, this lesson will outline the ways in which technology facilitated companies' ability to conduct business globally.

What is Global Competition?

Growing up in America, all children heard of the story of Christopher Columbus: 'In fourteen hundred ninety-two, Columbus sailed the ocean blue. He had three ships and left from Spain; He sailed through sunshine, wind and rain…'. But more importantly than this story, his infamous thinking that the world is flat is the most notable. Maybe ol' Chris was on to something - what if he was right? Of course, he wasn't when it came to the physical shape of the world, but his theory does have merit if we think in terms of global competition in business.

Global competition is the services or products provided by competing companies that serve international customers. Think about how you can have a pie-eating contest or a race. These are examples of competition on a local scale where people are competing against one another for one common goal - the best in their core competency. Core competency is what a company does best. Global competition has allowed companies to buy and sell their services internationally, which opens the door to increased profits and flattens the playing field in business.

Gaining the Competitive Edge

Successful leaders recognize the need to adapt to the ever-rapidly changing ways to do business in the global environment. These leaders seek to build competitive advantages around the core competencies of the organization, while also reducing costs to conduct their business.

These organizations also understand that doing the best they do is not always enough to be on top. In order to keep the competitive position in the domestic market, they will need to acquire knowledge of other key competitors in the global marketplace. They need to stay informed of other domestic and foreign competitors' potential strategies, as well as their competitors' strengths and weaknesses. Global competitors understand that with increased competition, new ways to differentiate their products and services need to be developed. One of the best motivations to innovate for a company is knowing that they can lose business to the opposing team.

Challenges in the Global Market

The result of successfully competing in a global market has its benefits, but it's not without its challenges. Companies are seeing that what works domestically, doesn't necessarily work internationally. Cultural differences play a large role in the global market, and there are a couple factors that companies must consider when competing globally.

Value of Time

The value of time in certain countries (i.e., Germany) is considered high and is seen as unprofessional if you are late to a scheduled appointment. Meanwhile, in other countries, such as several in South America, the time of the appointment is more of a general guideline than a carved-in-stone absolute. Global companies understand the need to adapt to the country that they serve.


In some areas of the world, you must adjust the way that you address your foreign colleagues. The use of the last name and recognition of title could be the make-or-break determination of respect. Knowing the do's and don't's in business is essential to international success.

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Additional Activities

Global Competition in Business - an Essay Prompt:

The following essay prompt is designed to allow you to apply your knowledge of Global Competition in Business by researching its impact on various companies and brands that you deal with on a daily basis.

The past 10 years has seen a drastic increase in Global Competition in the Consumer Electronics industry. Notably, the United States' biggest consumer electronics maker, Apple inc., expanded into the Chinese market in order to capitalize on the booming Chinese middle class. In addition, almost paradoxically, China's largest consumer electronics maker, Huawei Corporation, expanded into the American market to boost its sales in the largest consumer market on earth.


In this assignment, you will need to perform online research regarding the expansion of Apple and Huawei to new, global markets (i.e. China and the United States, respectively). Following your research on these companies, answer the following questions in a short essay format (minimum 250 words total):

  1. Explain one of the techniques used by each of these companies to gain a competitive edge in their new market.
  2. What were the main challenges due to cultural differences faced by Apple in China and Huawei in the United States?
  3. Would both Apple and Huawei's global expansions be possible without the internet? Please explain.

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