Podcast
Questions and Answers
What should managers consider when designing a global supply chain network in the context of globalization?
What should managers consider when designing a global supply chain network in the context of globalization?
- Balancing both opportunities and uncertainties over the long term. (correct)
- Ignoring potential risks to maximize potential rewards.
- Only focusing on minimizing immediate costs.
- Prioritizing short-term gains over long-term sustainability.
Which factor has enabled significant cost reduction opportunities for the consumer electronics industry through globalization?
Which factor has enabled significant cost reduction opportunities for the consumer electronics industry through globalization?
- The ability to consolidate production of standardized components in a single location. (correct)
- High customization requirements for each local market.
- The complexity and high cost of shipping electronic components.
- The need for localized production to meet consumer demand.
Which of the following is a key characteristic that makes apparel manufacturing suitable for globalized supply chains?
Which of the following is a key characteristic that makes apparel manufacturing suitable for globalized supply chains?
- Minimal labor requirements and high material costs.
- Heavy, bulky products that require specialized transportation.
- High labor content, lightweight products, and cost-effective transportation. (correct)
- Low labor content and complex manufacturing processes.
How did globalization benefit Procter & Gamble (P&G) according to the text?
How did globalization benefit Procter & Gamble (P&G) according to the text?
What was a significant achievement of Samsung in the global market by 2012?
What was a significant achievement of Samsung in the global market by 2012?
What characteristic of consumer electronic products makes them well-suited for globalized production and distribution?
What characteristic of consumer electronic products makes them well-suited for globalized production and distribution?
Which of the following best describes the role of contract manufacturers like Foxconn and Flextronics in the context of globalization?
Which of the following best describes the role of contract manufacturers like Foxconn and Flextronics in the context of globalization?
Considering the impacts of globalization, what is a key difference between high-performance supply chains like Samsung and Zara, versus others?
Considering the impacts of globalization, what is a key difference between high-performance supply chains like Samsung and Zara, versus others?
Which factor does not directly influence the supplier price when evaluating the total cost of offshoring?
Which factor does not directly influence the supplier price when evaluating the total cost of offshoring?
When evaluating the total cost of offshoring, which of the following is primarily affected by 'net payment terms'?
When evaluating the total cost of offshoring, which of the following is primarily affected by 'net payment terms'?
Which of these factors is least likely to be a direct component of delivery costs when considering offshoring?
Which of these factors is least likely to be a direct component of delivery costs when considering offshoring?
Which of the following factors contributes most directly to 'inventory and warehousing' costs associated with offshoring?
Which of the following factors contributes most directly to 'inventory and warehousing' costs associated with offshoring?
Which of the following is an example of a 'cost of quality' associated with offshoring?
Which of the following is an example of a 'cost of quality' associated with offshoring?
What is the primary impact of focusing on reducing transportation content for successful global sourcing?
What is the primary impact of focusing on reducing transportation content for successful global sourcing?
What is the most significant result of wage inflation and currency appreciation in low-cost countries on offshoring?
What is the most significant result of wage inflation and currency appreciation in low-cost countries on offshoring?
For which type of product is offshoring to low-cost countries generally most suitable?
For which type of product is offshoring to low-cost countries generally most suitable?
How can designing modular products that are assembled by the customer help reduce transportation costs in global supply chains?
How can designing modular products that are assembled by the customer help reduce transportation costs in global supply chains?
What is the primary role of supplier hubs in global sourcing?
What is the primary role of supplier hubs in global sourcing?
What is a key danger of using an offshore location that is primarily targeting low costs?
What is a key danger of using an offshore location that is primarily targeting low costs?
In the jewelry manufacturing example, why was it cheaper to install stamping tools at the gold sheet supplier in the United States, rather than in Hong Kong?
In the jewelry manufacturing example, why was it cheaper to install stamping tools at the gold sheet supplier in the United States, rather than in Hong Kong?
What strategy can a company implement to effectively lower transportation costs when volumes are low, while still maintaining flexibility for high-volume direct shipping?
What strategy can a company implement to effectively lower transportation costs when volumes are low, while still maintaining flexibility for high-volume direct shipping?
How did Nissan reduce transportation costs for its globally sourced components?
How did Nissan reduce transportation costs for its globally sourced components?
What is generally likely to result in the greatest benefit from offshoring?
What is generally likely to result in the greatest benefit from offshoring?
Which factor most significantly undermines the anticipated benefits of offshoring to low-cost countries?
Which factor most significantly undermines the anticipated benefits of offshoring to low-cost countries?
What is a key way Toyota effectively managed market fluctuations, unlike some of its competitors?
What is a key way Toyota effectively managed market fluctuations, unlike some of its competitors?
What demonstrates the extreme volatility that global supply chains must manage?
What demonstrates the extreme volatility that global supply chains must manage?
What strategic advantage did Honda leverage to maintain high plant utilization rates during a shift in auto sales between 2007 and 2008?
What strategic advantage did Honda leverage to maintain high plant utilization rates during a shift in auto sales between 2007 and 2008?
What is a critical consideration for companies designing global supply networks given the fluctuations in demand, prices, and exchange rates?
What is a critical consideration for companies designing global supply networks given the fluctuations in demand, prices, and exchange rates?
What was identified as one of the primary sources of risk affecting global supply chain performance in the 2006 Accenture survey?
What was identified as one of the primary sources of risk affecting global supply chain performance in the 2006 Accenture survey?
How did the 2011 Japanese earthquake and tsunami affect the automotive industry?
How did the 2011 Japanese earthquake and tsunami affect the automotive industry?
What should companies consider when making global network design decisions?
What should companies consider when making global network design decisions?
Why is it important to build flexible production capacity at a plant?
Why is it important to build flexible production capacity at a plant?
In what way can comparative advantage in global supply chains be achieved, as recognized by Adam Smith?
In what way can comparative advantage in global supply chains be achieved, as recognized by Adam Smith?
What has been the general trend regarding the risk associated with global supply chains, according to a 2006 Accenture survey of executives?
What has been the general trend regarding the risk associated with global supply chains, according to a 2006 Accenture survey of executives?
What action exemplifies a company's effort to incorporate risk mitigation into its global supply chain's design?
What action exemplifies a company's effort to incorporate risk mitigation into its global supply chain's design?
What was the primary impact of the 2011 flooding in Thailand on the automotive and electronics industries?
What was the primary impact of the 2011 flooding in Thailand on the automotive and electronics industries?
Apparel imports to the United States are mainly from which countries?
Apparel imports to the United States are mainly from which countries?
What did the shift in auto sales between 2007 and 2008 demonstrate regarding consumer preferences and sales trends?
What did the shift in auto sales between 2007 and 2008 demonstrate regarding consumer preferences and sales trends?
Flashcards
Globalization
Globalization
The process of increased interconnectedness among countries, enhancing trade and investment opportunities.
Supply Chain
Supply Chain
A network between a company and its suppliers to produce and distribute a product.
Risk Mitigation
Risk Mitigation
Strategies to minimize potential losses in business operations.
Total Cost in Global Sourcing
Total Cost in Global Sourcing
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Consumer Electronics
Consumer Electronics
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Economies of Scale
Economies of Scale
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Contract Manufacturers
Contract Manufacturers
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Emerging Markets
Emerging Markets
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Apparel Manufacturing Shift
Apparel Manufacturing Shift
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Supply Chain Risk
Supply Chain Risk
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Natural Disaster Impact
Natural Disaster Impact
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Market Share Gain
Market Share Gain
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Production Capacity Flexibility
Production Capacity Flexibility
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Total Cost Evaluation
Total Cost Evaluation
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Offshoring Benefits
Offshoring Benefits
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Transportation Costs
Transportation Costs
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Comparative Advantage
Comparative Advantage
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Fuel Price Volatility
Fuel Price Volatility
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Product Demand Fluctuation
Product Demand Fluctuation
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Global Supply Chain Uncertainty
Global Supply Chain Uncertainty
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Exchange Rate Fluctuation
Exchange Rate Fluctuation
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Accenture Survey Findings
Accenture Survey Findings
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Automotive Production Flexibility
Automotive Production Flexibility
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Global Supply Chain Complexity
Global Supply Chain Complexity
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Supplier Price Factors
Supplier Price Factors
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Delivery Costs
Delivery Costs
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Cost of Quality
Cost of Quality
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Customs Costs
Customs Costs
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Cost of Risk
Cost of Risk
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Labor Cost Trends
Labor Cost Trends
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Transportation Efficiency
Transportation Efficiency
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Supplier Hubs
Supplier Hubs
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Modular Design
Modular Design
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High Labor Content
High Labor Content
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Production Process Review
Production Process Review
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Working Capital Requirements
Working Capital Requirements
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Recycling Waste Gold
Recycling Waste Gold
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Offshoring Decision Factors
Offshoring Decision Factors
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Study Notes
Globalization's Impact on Supply Chains
- Globalization presents opportunities (increased revenue, lower costs) and risks (supply chain disruptions) for companies.
- Examples of successful global supply chains include Samsung and Zara.
- Managers must consider both opportunities and uncertainties when designing global supply chains.
Factors Affecting Global Sourcing Decisions
- Globalization enables companies to increase revenues and decrease costs in developing markets.
- Industries like consumer electronics and apparel benefit from cost reductions through global sourcing.
- Companies like P&G and Samsung have significantly expanded their sales in developing markets.
- Significant risk is often associated with global supply chains, including natural disasters, fluctuating fuel prices, and unreliable supply chain partners.
- The 2011 Japanese earthquake and tsunami illustrate the impact of global supply chain disruptions.
- The 2011 Thailand floods further highlighted the risks to supply chains around the globe.
Evaluating Total Cost in Offshoring Decisions
- Companies should evaluate total landed cost, not just unit cost, when deciding to offshore production.
- Factors like supplier cost, terms (payment schedules, volume discounts), delivery costs (freight, packaging), and inventory/warehousing must be considered.
- Cost of quality, customs duties, risk factors, procurement staff costs, infrastructure, and exchange rate trends should also be assessed.
- Offshoring may prove less profitable due to increasing transportation costs and escalating labor costs in some countries (like China and India).
- Offshoring benefits most products with high labor content, large production volumes, low variety, and low transport costs relative to product value
Managing Supply Chain Uncertainty
- Uncertainty is inherent in global supply chains (fluctuation in demand, prices, exchange rates, competition)
- Building flexible production capacity helps companies react efficiently to fluctuating conditions.
- Toyota's global assembly plant flexibility allows response to demand, exchange, and price changes.
Risk Mitigation in Global Supply Chains
- Companies must account for risk in global supply chains to avoid failure.
- Diverse locations (onshore, nearshore, offshore) can improve resilience to disruptions.
- More sophisticated flexible policies allow companies to optimize cost during high and low volume periods.
Transportation Efficiency in Global Sourcing
- Companies in global sourcing should reduce transportation costs.
- Designing components that are shippable in high density, and utilizing supplier hubs can aid in successful global sourcing.
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