Project

reason to globalize

1 reduce cost (labor, taxes, tariffs)

2 improve supply chain

3provide better goods and services

4understand markets

5learn to improve operations

6attract 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, CAFTA

 European Union (EU)

Improve the supply chain

-locating facilities closer to unique resources

Provide better goods and services

-objective and subjective characteristics of goods and services

on time deliveries, cultural variables, improved customer services

Understand Markets

-interacting with foreign customers and suppliers can lead to new opportunities

cell phone design from europe, cell phone fads form japan, extend the product life cycle

learn to improve operations

-remain open to the free flow of ideas

general Motors partnered with a Japanese auto manufacturer to learn new approaches to production and inventory control, equipment and layout have been improved using scandinavian ergonomic competence

attract and retain global talent

-offer better employment opportunities

better growth opportunities and insulation against unemployment

relocate unneeded personnel to more prosperous locations

cultural and ethical issues

culture can be quite different

attitudes can be quite different towards

(punctuality, lunch breaks, environment, intellectual property, thievery, bribery, child labor)

developing mission and strategies

-mission statement tell an organization where it is going

-the strategy tells the organization how to get there

mission-where are you going?

organization's purpose for being

answers what do we provide society?

provides boundaries and focus

factors affecting mission

-environment, customers, philosophy and values, profitability and growth, public image, benefit to society...