BUAD 331 Study Guide - Final Guide: Offshoring, Activity-Based Costing, Wwti
Document Summary
Why companies go global : reach international markets to grow their business (increase markets, offshore to decrease costs by economies of scale. Twin challenges for global supply chain: world markets are not homogenous- variation is still very much required. How to offer local markets variety, while still gaining the advantage of standardized global production: requirement for exceptional coordination to offset potentially higher costs in global supply chains. Different languages, cultures and time zones are barriers to success. Trends affecting world trade: an increase in economic integration and free trade. ( nafta, eu, apec) Economic integration- goes all the way back to wwii- if you trade back and forth, you are less likely to fight with each other: decline of economic protectionism. Economic protectionism- putting a large tariff on imports to make it more. Fair to domestic products (steel)- not really done anymore: global competition among global companies for global consumers, technological advances that ease and lessen cost of communication.
