FARE 3310 Chapter Notes - Chapter 2: Flexible Response, Avail, Product Differentiation
2 Feb 2013
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Todays operations manager must have global view of operations strategy. Globalization is the result of developing countries overcoming cultural, religious, ethnic, and political barriers that constrain productivity and also advances made in technologies, reliable shipping & cheap communication. Globalization means that domestic production and exporting may no longer be a viable business model. New standards of global competitiveness that impact quality, customization, timeliness, cost etc. The globalization of strategy contributes efficiency and adds value to products & services but also complicates an operation managers job. Foreign locations with lower wages can help lower both direct & indirect costs. Less stringent government regulations on a wide variety of operation practices (health & safety, environmental etc. ) reduce costs. Opportunities to cut the costs lf taxes & tariffs encourage foreign operations. Maquiladoras (free trade zones): mexican factories located along the u. s-mexico border that receive preferential tariff treatment. Allows manufacturers to pay only on the value added by mexican workers.
