Business Strategies and Globalization

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Questions and Answers

What is a potential advantage of globalization for businesses?

Higher production costs

A larger source of market opportunities (correct)

Increased tariffs on trade

Decreased access to international materials

What is a disadvantage of globalization that impacts businesses?

Increased competition in the global market (correct)

Limited access to technology

Simplicity in supply chain management

Reduction in free trade agreements

Which driving force of globalization relates directly to trade practices?

Improvement in technology

A larger source of labor

Increased acceptance of e-commerce

Removal of protectionist trade barriers (correct)

How can outsourcing benefit businesses in a globalized market?

By providing access to cheaper overseas labor Signup and view all the answers

What implication does globalization have on operational strategies for businesses?

It increases the complexity of integrating overseas suppliers. Signup and view all the answers

What impact does an increasing volume of global trade have on businesses?

It allows for economies of scale. Signup and view all the answers

What is global sourcing?

Buying inputs from overseas suppliers. Signup and view all the answers

What change might businesses need to implement due to globalization?

Alter task design in operations. Signup and view all the answers

What is the primary focus of legal compliance for a business?

Adhering to legal regulations and standards Signup and view all the answers

Which of the following is considered a component of labour law compliance?

Minimum wage requirements Signup and view all the answers

What is the purpose of environmental and public health compliance?

To meet regulatory standards for waste disposal and pollution Signup and view all the answers

Which of the following describes the role of intellectual property laws?

To protect moral rights and creative works Signup and view all the answers

What is typically included within taxation requirements for businesses?

Levies, duties, and profit taxes Signup and view all the answers

What aspect do trade practices regulations primarily address?

Market competition and fair conduct Signup and view all the answers

What is the purpose of financial and accounting regulations?

To standardize financial reporting and rules Signup and view all the answers

Human rights regulations in a business context restrict discrimination based on which of the following?

Cultural differences Signup and view all the answers

What type of production is typically used for high-variety, low-volume manufacturing?

Process production Signup and view all the answers

What is a characteristic of product production?

Manufactures a high volume of constant quality goods Signup and view all the answers

Which layout is most commonly used in product production?

Assembly line layout Signup and view all the answers

In which type of production does the product remain in one location due to its weight or bulk?

Fixed position production Signup and view all the answers

What aspect does the product layout focus on?

Arrange equipment based on task sequence Signup and view all the answers

Why might process production be particularly useful in hospitals?

It groups machines by the function they perform. Signup and view all the answers

How does the assembly line layout enhance production efficiency?

By matching workstations to the order of operations Signup and view all the answers

What is a significant advantage of process production in supplier management?

It promotes geographical efficiency in supply chains. Signup and view all the answers

What is one method businesses can use to achieve low operational costs?

Maximizing efficiency by minimizing waste Signup and view all the answers

How can a company differentiate its products from competitors?

By offering unique or leading edge technology Signup and view all the answers

Which of the following is NOT a way to achieve low cost through operations?

Offering specialized custom services Signup and view all the answers

What does product differentiation primarily focus on?

Creating outputs that stand out from competitors Signup and view all the answers

Which factor can contribute to a competitive position regarding pricing?

Using less expensive inputs Signup and view all the answers

What does scheduling mainly refer to in the context of project management?

The length of time activities take within the operations process Signup and view all the answers

Which of the following is an advantage of Gantt charts?

They make it easy to monitor and compare actual progress against planned activities Signup and view all the answers

What is one disadvantage of using Gantt charts for scheduling?

They are difficult to use for projects with multiple interdependencies Signup and view all the answers

What essential information does Critical Path Analysis (CPA) provide about project tasks?

What tasks need to be done and how long they take Signup and view all the answers

In project management, why is it crucial for managers to plan the steps needed to complete a task?

To specify the time required for each task and manage resources effectively Signup and view all the answers

Study Notes

Competitive Position

A business can achieve a competitive position in terms of price through:
- Using less expensive inputs
- Maximising efficiency by minimising waste and saving time
- Producing more outputs from less inputs
- Using technology
- Producing faster
- Having lower quality outputs
- Increasing the size of operations to reduce the average cost of making each item
Differentiation aims to obtain an advantage over competitors by having outputs that are different, unique, or use leading-edge technology
Product Differentiation: distinguishes products (goods or services) from those of competitors

Globalisation Advantages and Disadvantages

Advantages
- Larger source of market opportunities
- Source and choice of materials and labour
- Opportunity for outsourcing (reduce production costs)
Disadvantages
- Increased competition in the global market
- Changes in global/regional economies can negatively impact businesses
- Changes to currencies and trade agreements can negatively impact businesses

Implications of Globalisation on Operational Strategies

Access to larger markets for cheaper or better quality overseas resources influences input decisions.
- This is driven by a need to global source, buying from overseas suppliers, and outsourcing, where a function is fully performed by an external party
- These strategies lead to cheaper overseas labour
Integration of overseas suppliers adds complexity and requires a global web strategy for supply chain management.
Increasing volume impacts all aspects of the transformation process.

Legal Compliance vs. Ethical Responsibility

Legal Compliance: follows the letter of the law and prescribed standards of behaviour
Ethical Responsibility: goes above and beyond legal requirements, considering the impact on stakeholders

Operations Management in a Globalised World

Labour Law Compliance: Minimum wages, award wages, working hours, breaks, leave pay, employee benefits, workers compensation, and health and safety laws.
Environmental and Public Health Compliance: Regulations on dumping, pollution (air, land, water), and waste disposal.
Business Licencing Rules: Requirements for training and certification, and operational conditions (such as restricted working hours, zoning restrictions, and content and disclosure restrictions)
Taxation: Levies, duties, taxes on profits, and superannuation.
Trade Practices and Fair Market Dealings: Addresses market power, misleading conduct, price collusion, monopolies, market concentration, and product safety.
Migration and Rules around Offshore Skilled Labour: Minimum standards are applied to labour brought from other nations
Intellectual Property: Copyright, patents, trademarks, designs, and original ideas
Financial and Accounting Regulations: Standardising methods and rules for financial records, reports, and company directors' responsibilities as fiduciaries.
Human Rights: Rules restricting discrimination on various grounds such as disability, culture, sexual preference, gender, age, or any other distinguishing feature.

Scheduling Techniques

GANTT Charts: outlines activities to be performed, their order, individual duration, and total project duration
- Advantages: simple planning, easy to understand, monitor, and compare progress against planned activities.
- Disadvantages: not suitable for complex projects
Critical Path Analysis (CPA): technique that maps tasks, duration, and necessary order for completion
- Advantages: visualises dependencies and potential delays

Production Processes

Process Production: Machines and equipment are grouped by function (e.g., hospital with dedicated wards)
- Advantages: High-variety, low-volume production
Product Production (Mass Production): High volume of goods with consistent quality
- Common Layout: Assembly line for optimal personnel and machine use
- Focus: Sequencing of tasks between work stations
Product Layout: Equipment arranged based on the manufacturing sequence
Fixed Position Production: For heavy or bulky products that remain stationary during production

Example Production Systems

Apple (Foxconn) Production: Assembly line production with geographically efficient suppliers
Foxconn Employment: 1.2 million employees, including 200,000 for iPhones, to promote efficiency.

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Description

This quiz explores competitive positioning strategies in business, focusing on price competition and differentiation. Additionally, it examines the advantages and disadvantages of globalization, highlighting market opportunities and increased competition. Test your knowledge on these crucial business concepts.