Chapter 17 - Global production, outsourcing, and logistics. The goals of this chapter are: Understand the concept of supply chain management, recognize the relationship between design and supply chain management, describe the five global sourcing arrangements, appreciate the importance of added costs of global sourcing, | International Business 9e By Charles . Hill McGraw-Hill/Irwin Copyright © 2013 by The McGraw-Hill Companies, Inc. All rights reserved. Chapter 17 Global Production, Outsourcing, and Logistics What Are The Main Production Issues For Firms? International firms must answer five interrelated questions Where should production activities be located? What should be the long-term strategic role of foreign production sites? Should the firm own foreign production activities or outsource those activities to independent vendors? How should a globally dispersed supply chain be managed, and what is the role of Internet-based information technology in the management of global logistics? Should the firm manage global logistics itself, or should it outsource the management to enterprises that specialize in this activity? How Are Strategy, Production, And Logistics Related? Production - activities involved in creating a product Logistics - procurement and physical transmission of material through the supply chain, from suppliers to customers Questions: How can production and logistics Lower the costs of value creation? Add value by better serving customer needs? LO1: Explain why production and logistics decisions are of central importance to many multinational businesses. How Can Quality Be Improved? Most firms use the Six Sigma program - a direct descendant of total quality management (TQM) aims to reduce defects, boost productivity, eliminate waste, and cut costs throughout the company in the EU, firms must meet ISO 9000 standards before gaining access to the EU marketplace Improved quality reduces costs How Can Quality Be Improved? The Relationship Between Quality and Costs Where Should Production Be Located? Firms should locate production so that production and logistics can be locally responsive and production and logistics can respond quickly to shifts in customer demand Firms should consider Country factors Technological factors Product factors LO2: Explain how . | International Business 9e By Charles . Hill McGraw-Hill/Irwin Copyright © 2013 by The McGraw-Hill Companies, Inc. All rights reserved. Chapter 17 Global Production, Outsourcing, and Logistics What Are The Main Production Issues For Firms? International firms must answer five interrelated questions Where should production activities be located? What should be the long-term strategic role of foreign production sites? Should the firm own foreign production activities or outsource those activities to independent vendors? How should a globally dispersed supply chain be managed, and what is the role of Internet-based information technology in the management of global logistics? Should the firm manage global logistics itself, or should it outsource the management to enterprises that specialize in this activity? How Are Strategy, Production, And Logistics Related? Production - activities involved in creating a product Logistics - procurement and physical transmission of material through
