Global Production

Global production provides unparelled opportunity for the companies to

grow into new markets while at the same time boosting their competitiveness Production facilities due to following reasons: - Import Restrictions Imposition of restrictions on imports by the foreign countries forces the MNCs to establish the manufacturing facilities in other countries

-Raw Material
Availability of high quality raw materials countries -Inputs Availability of inputs at low cost in foreign countries -Human Resources Availability of skilled labour/human resources at low cost and components in other

Global Production
- Labour Laws Liberal labour laws in the foreign countries - Logistics Management To reduce the cost of transportation and easy logistics management - Export Facility of exporting to other neighboring foreign countries - Different Customers To design and produce the products as per the varying tastes of customers in foreign countries

Global Production Strategy

A bond between the Manufacturing and Business Strategy

Business Strategy
Strategic Resources 1. Skills 2. Assets 3. Proximity 4. Manufacturing Strategy 5. Unique R&D 6. Superior IT
Manufacturing Strategy

1. 2. 3. 4.

Responsiveness Capacity Suppliers Customers Interface

 Manufacturing Compatibility Efficiency reduction of Manufacturing cost Dependability Degree of trust in companys product, its delivery and price promises Quality Performance reliability, service quality, speed of delivery and maintenance quality of products Flexibility ability of the production process to make different kinds of products and to adjust the volume of output Innovation ability to develop new products and ideas

 Manufacturing Configuration Centralized Manufacturing in a single country: - Where the companys small niche product is patent protected One centralized operations for the entire world Regionalized Manufacturing in the specific regions served - Strategy which focuses on providing goods or services which match to the different region Local Manufacturing in each country served - Strategy focuses on increasing profitability by customizing the firms goods and services so that they provide a good match to taste and preferences in different national markets Coordination and Control Linking or integrating of participants all along the global supply chain into a unified system. This activity included from purchasing to warehousing to shipment

Local Decisions in Global Production