copyright © 2015 pearson education, inc.18-1 international business environments & operations...
TRANSCRIPT
Copyright © 2015 Pearson Education, Inc. 18-1
International Business
Environments & Operations
15e
Daniels ● Radebaugh ● Sullivan
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Chapter 18
Global Manufacturing and Supply-Chain
Management
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Learning Objectives Describe the different dimensions of a global
manufacturing strategy Examine the critical factors in successful global
supply-chain management Show how supplier networks function Explain how quality affects global supply and
effective inventory management Discuss how to establish successful transportation
networks as part of the global supply chain
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The Global Component Network for Ford’s European Manufacturing of the
Escort
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What is Supply-Chain Management?
The supply chain: the network that links together the different aspects of the value chain, coordinating materials, information, and funds from the initial raw material supplier to the ultimate customer
Supply chain management aka operations and supply-chain management (OSM): the design, operation, and improvement of systems that create and deliver the firm’s primary products and services
Logistics (aka materials management): that part of the supply chain process that plans, implements, and controls the efficient and effective flow and storage of goods, services and related information from the point of origin to the point of consumption in order to meet customers’ requirements
An integrated supply chain and operations model
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Global Supply Chain Strategies
The success of a global manufacturing strategy depends upon good strategies in three specific areas: Compatibility Manufacturing Configuration Coordination and Control
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Compatibility
Compatibility-in the context of manufacturing strategy, the degree of consistency between a firm’s foreign direct investment decisions and its competitive strategy
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Manufacturing Configuration
The three basic configurations that MNEs consider en route to developing their global manufacturing strategies are: centralized manufacturing in a single
country regionalized manufacturing in specific
regions served local manufacturing in each country
market served Multidomestic manufacturing or marketing
is common among multinationals
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Coordination and Control
Coordination: the linking and integrating of participants and activities throughout the (global) supply chain into a unified system
Control: embraces systems such as organizational structure and performance measurement that are designed to help ensure that strategies are implemented, monitored, and revised, as appropriate
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Global Sourcing
Sourcing: is the process of obtaining a supply of inputs (raw materials and parts) for production. Firms pursue global sourcing strategies in order….
To reduce costs through cheaper labor, laxer work rules, and low land and facilities costs
To improve quality To increase exposure to worldwide technology To improve the delivery-of-supplies process To strengthen reliability of supply–supplementing domestic suppliers
with foreign ones To gain access to materials that are only available abroad To establish presence in a foreign market To satisfy offset requirements To react to competitors’ offshore sourcing practices
Global Sourcing
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Global Sourcing-A Few Terms Outsourcing is when a company externalizes a function or
process to another business. Contract Manufacturing is when the entire
manufacturing process is being handled by another firm. Vertical Integration is when a company owns the entire
supplier network, or at least a significant part of it. Industrial Clusters occur when buyers and suppliers
locate close to each other to facilitate doing business. Dell Computer in Malaysia
Keiretsu – Japanese group of independent companies that work together to manage the flow of goods
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Total Quality ManagementTQM is a process that stresses customer
satisfaction, employee involvement, and continuous improvement of quality
Quality: conformance to specifications, value enhancement, fitness for use, after-sales support, and psychological impressions (image)
Six Sigma: aims to eliminate defects, slash product cycle times, and cut costs across the board. An idea perfected by Japanese manufacturers who refuse to tolerate defects (zero-defects) of any kind
Kaizen: the Japanese process of continuous improvement, which requires identifying problems and enlisting employees at all levels of the organization to help eliminate them
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Quality Standards Levels of quality standards
General ISO 9000 Malcom Baldridge National Quality Award
Industry specific Company specific
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Inventory Management Inventory management: the planning and
control of the levels, flows, and storage of inputs, unfinished, and finished goods
Just-in time manufacturing (JIT): focuses on reducing inefficiency and unproductive time in the production process to improve continuously the process and the quality of the product or service. The system reduces inventory costs by having inputs delivered just as they are needed in the production process
Foreign trade zones (FTZs): government-designated areas in which goods can be stored, inspected, and/or manufactured without being subject to formal customs procedures until they actually enter a country
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Information Technology and Global Supply-Chain
Management Electronic Data Interchange
links suppliers, manufacturers, customers, and intermediaries
Enterprise Resource Planning/Material Requirements Planning links information flows from different parts of a business
and from different geographic areas Radio Frequency ID (RFID)
labels products with an electronic tag, which stores and transmits information regarding the product’s origin, destination, and quantity
E-Commerce joins together suppliers with companies and companies
with customers
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Chapter 18: Discussion Questions
1. Define and explain the role of “supply chain management” in firm strategy.
2. Explain how the success of a global supply chain strategy depends upon compatibility, manufacturing configuration, and coordination and control.
3. Define Total Quality Management and explain its importance in global supply chain management.
4. Define global sourcing and explain the role it plays in global supply chain management.
5. Explain Inventory Management in global supply chain.
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