Heizer 9 Ch2 F Operations Management
Heizer 9 Ch2 F Operations Management
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Global Strategies
Boeing sales and production are worldwide Benetton moves inventory to stores around the world faster than its competition by building flexibility into design, production, and distribution Sony purchases components from suppliers in Thailand, Malaysia, and around the world
Global Strategies
Volvo considered a Swedish company but it is controlled by an American company, Ford. The current Volvo S40 is built in Belgium and shares its platform with the Mazda 3 built in Japan and the Ford Focus built in Europe. Haier A Chinese company, produces compact refrigerators (it has one-third of onethe US market) and wine cabinets (it has half of the US market) in South Carolina
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Reasons to Globalize
Reasons to Globalize Tangible 1. Reduce costs (labor, taxes, tariffs, etc.) Reasons 2. Improve supply chain 3. Provide better goods and services 4. Understand markets Intangible 5. Learn to improve operations Reasons 6. Attract and retain global talent
Reduce Costs
Foreign locations with lower wage rates can lower direct and indirect costs
Maquiladoras World Trade Organization (WTO) North American Free Trade Agreement (NAFTA) APEC, SEATO, MERCOSUR European Union (EU)
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Understand Markets
Interacting with foreign customers and suppliers can lead to new opportunities
Cell phone design from Europe Cell phone fads from Japan Extend the product life cycle
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Strategy
Action plan to achieve mission Functional areas have strategies Strategies exploit opportunities and strengths, neutralize threats, and avoid weaknesses
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Competing on Differentiation
Uniqueness can go beyond both the physical characteristics and service attributes to encompass everything that impacts customers perception of value
Safeskin gloves leading edge products Walt Disney Magic Kingdom experience differentiation Hard Rock Cafe dining experience
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Competing on Cost
Provide the maximum value as perceived by customer. Does not imply low quality.
Southwest Airlines secondary airports, no frills service, efficient utilization of equipment WalWal-Mart small overheads, shrinkage, distribution costs Franz Colruyt no bags, low light, no music, doors on freezers
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Competing on Response
Flexibility is matching market changes in design innovation and volumes
Institutionalization at Hewlett-Packard Hewlett-
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