Lecture 11

Question 1

Supply chain

Answer 1

the network that links together the different aspects of the value chain,
coordinating materials, information, and funds from the initial raw material supplier to the ultimate customer.

Question 2

Global sourcing

Answer 2

the process of materials management (which includes sourcing), inventory management, and transportation between suppliers, manufacturers and customers.

Question 3

contract manufacturing

Answer 3

when the entire manufacturing process is being handled by another firm.

Question 4

Factors influencing international production

Answer 4

1) compatibility
2) Manufacturing configuration
3) Coordination
4) Control

Question 5

Why global sourcing

Answer 5

• To reduce costs through cheaper labor, more flexible work rules, and lower land and facilities costs.
• To increase exposure to worldwide technology and improve quality.
• To gain access to materials and other resources abroad.
• To improve the** delivery-of-supplies process**, and strengthen the reliability of supply – supplementing domestic suppliers with foreign suppliers.
• To establish presence in a foreign market and react to competitors’ foreign location strategies.

Question 6

when a company owns the entire international supplier network, or at least a significant part of it

Answer 6

vertical integration

Question 7

occur when buyers and suppliers locate close to each other, somewhere in the world, to facilitate business

Answer 7

industrial clusters

Question 8

where a group of independent companies work together to manage the flow of goods (typical of Japanese chains).

Answer 8

keiretsu

Question 9

Areas in which domestic and imported merchandise can be stored, inspected, and manufactured free from formal customs procedures until the goods leave the zones (ex. SDM in Madeira)

Answer 9

Foreign Trade Zones (FTZs)

Question 10

Showing, write on or play with business card in a meeting

Answer 10

disrespectful in Japan

Question 11

being invited to join business partner in sauna after meeting

Answer 11

they respect you in Finland

Question 12

3 steps HR

Answer 12

1. recruitment
2. salary and benefits
3. training

Question 13

HR ethnocentric

Answer 13

place home country employees in host countries positions

Question 14

HR polycentric

Answer 14

directly employ locals

Question 15

3 parts payment

Answer 15

1. base salary (same wage for similar position in home country)
2. foreign service premium (help live in unfamiliar country - adapt)
3. allowances (hardship, housing, education, cost of living - medical help, vacation,…)

Question 16

Compatibility - Int Prod

Answer 16

refers to the degree of consistency between the foreign investment decision and the company’s competitive strategy

Question 17

Manufacturing configuration - Int Prod

Answer 17

requires the company to consider whether to centralize manufacturing in one country, establish regional operations, or set up multidomestic production

Question 18

Coordination- Int Prod

Answer 18

involves integrating activities into a unified system

Question 19

Control - Int Prod

Answer 19

involves measuring performance so the company can respond appropriately to changing conditions