You are the operations manager of an electronics manufacturer based in Vermont. You currently use locally-made materials and assemble electronics in your Vermont facility. Your company does both wholesale and retail, selling to mid-channel distributors like Best Buy or selling directly to the buyer. You also offer in-house repairs and maintain a customer service department. The CEO of the company has come to you to explain that the company is being ‘priced out’ of the industry because the products are priced too high and the current production processes are not scalable. If expenses can be reduced, the company could lower the cost of the products and be more competitive in the market. If production processes can be increased, market share can grow, particularly internationally. The CEO has asked you to use your knowledge of the global business environment, multinational operations, and diverse work teams to come up with ways to lower costs and increase production, including possible outsourcing and expansion of operations to overseas locations. Please create a proposal that compiles your analysis and recommendations for the CEO.
In your proposal, be sure to include the following elements:
The possible advantages and disadvantages of the different types of global sourcing for your company. Identify areas in the company that may benefit from a form of sourcing. Identify specific countries that may serve as sources of materials, components, and labor. Explain how global sourcing could impact the existing issues with pricing, competition, and production.
The managerial impact of using a global workforce. Include a description of the in-house management required to implement a global workforce scenario in the countries identified as potential sources of labor. Discuss the qualifications and characteristics that should be sought when recruiting and hiring an international management team.
Cultural and ethical concerns with using a global workforce. Offer some possible solutions to overcoming these concerns and negotiating cultural conflicts that may arise.
An evaluation of communication and decision-making for your recommendations. Identify the managerial philosophies and the technology needed to keep everyone ‘in the loop,’ no matter how remote that person may be.
Evaluate whether globalization of production and expansion in the global marketplace can improve competitive advantage while decreasing costs.
A final summary of your recommendations, tying together the components so that the CEO understands the potential benefits, risks, and changes to the company.