Chapter 15 - Global production, outsourcing, and logistics. Explain why production and logistics decisions are of central importance to many multinational businesses. Explain how country differences, production technology, and product features all affect the choice of where to locate production activities;. | Global Business Today 8e by Charles . Hill Chapter 15 Global Production, Outsourcing, and Logistics Introduction In today’s global economy, firms must decide: Where to locate productive activities What the long-term strategic role of foreign production sites should be Whether to own foreign production activities or outsource those activities How to manage a globally dispersed supply chain and what the role of Internet-based information technology should be in the management of global logistics Whether to manage global logistics or outsource Multimedia Lecture Support Package to Accompany Basic Marketing Lecture Script 6- Strategy, Production, and Logistics Question: How can production and logistics be conducted internationally to lower the costs of value creation and add value by better serving customer needs? Production refers to activities involved in creating a product Logistics refers to the procurement and physical transmission of material through the supply chain from suppliers to customers The Six Sigma system, a direct descendant of total quality management (TQM), aims to reduce defects, boost productivity, eliminate waste, and cut costs throughout a company Where to Produce Question: Where should production activities be located? When deciding where to locate production facilities, firms must consider: Country factors Technological factors Product factors Strategic Role of Foreign Factories Question: Does the rationale for establishing a foreign production facility change? The strategic role of foreign factories and the strategic advantage of a particular location can change over time A factory initially established to make a standard product to serve a local market, or to take advantage of low cost inputs, can evolve into a facility with advanced design capabilities As governmental regulations change and/or countries upgrade their factors of production the strategic advantage of a particular location can change Make-or-Buy Decisions Question: . | Global Business Today 8e by Charles . Hill Chapter 15 Global Production, Outsourcing, and Logistics Introduction In today’s global economy, firms must decide: Where to locate productive activities What the long-term strategic role of foreign production sites should be Whether to own foreign production activities or outsource those activities How to manage a globally dispersed supply chain and what the role of Internet-based information technology should be in the management of global logistics Whether to manage global logistics or outsource Multimedia Lecture Support Package to Accompany Basic Marketing Lecture Script 6- Strategy, Production, and Logistics Question: How can production and logistics be conducted internationally to lower the costs of value creation and add value by better serving customer needs? Production refers to activities involved in creating a product Logistics refers to the procurement and physical transmission of material through the supply chain from .
