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International Business 10e Daniels/Radebaugh/Sullivan

International Business Chapter Eighteen Global Manufacturing and Supply Chain Management
International Business
Chapter Eighteen
Global Manufacturing and
Supply Chain Management

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Chapter Objectives Describe different dimensions of global  manufacturing strategy  Examine elements of global supply
Chapter Objectives
Describe different dimensions of global
manufacturing strategy
Examine elements of global supply chain
management
Show how quality effects global supply chain
Illustrate how supplier networks function
Explain how inventory management is a key
dimension of the global supply chain
Present different alternatives for transporting
products along the supply chain from suppliers to
customers

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Supply Chain Terms 
Supply Chain Terms

Supply chains the coordination of materials, information, and funds from the initial raw material supplier to the ultimate customer

 Logistics (materials management) – that part of the supply chain process that plans, implements, and
Logistics (materials management) – that
part of the supply chain process that
plans, implements, and controls the
efficient, effective flow and storage of
goods, services, and related information

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Global Manufacturing and Supply

Chain Management in International Business
Chain Management in International
Business
Global Manufacturing and Supply Chain Management in International Business 2004, Prentice Hall, Inc 18-4

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Factors Managers Must Consider
Factors Managers Must Consider
 Efficiency/cost-reduction of manufacturing costs Dependability-degree of trust in a  company’s products and its delivery
Efficiency/cost-reduction of
manufacturing costs
Dependability-degree of trust in a
company’s products and its delivery
and promises
Innovation-ability to develop new
products and ideas

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Factors Managers Must Consider, con’t  Quality-performance reliability, service quality, speed of delivery, and maintenance quality
Factors Managers
Must Consider, con’t
Quality-performance reliability,
service quality, speed of delivery,
and maintenance quality of the
product
Flexibility-ability of the production
process to make different kinds of
products and to adjust the volume of
output
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Manufacturing Configurations Centralized manufacturing offering a  selection of standard, lower-priced products to different markets Regional
Manufacturing Configurations
Centralized manufacturing offering a
selection of standard, lower-priced
products to different markets
Regional manufacturing to serve
customers within a specific region
Multi-domestic manufacturing (market
expansion) in individual countries as their
demand becomes significant so
manufacturing is closer to customers and
meeting local needs

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Studying Supply Chain Alternatives
Studying Supply Chain Alternatives
Customer requirements  Plant and distribution center network design  Inventory management  Outsourcing and 3
Customer requirements
Plant and distribution center network design
Inventory management
Outsourcing and 3 rd -party logistics relationships
Key customer and supplier relationships
Business processes
Information systems
Organizational design and training requirements
Performance metrics
Performance goals

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Quality  Quality is the ability to meet or exceed the expectations of the customer •
Quality
Quality is the ability to meet
or exceed the expectations of
the customer
• Conformance to specifications
• Value
• Fitness for use
• Support provided by the
company
• Psychological impressions
(image)
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Quality  Quality is the ability to meet or exceed the expectations of the customer •

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Quality Terms Acceptable Quality Level (AQL) premise  allows an acceptable level of bad quality 
Quality Terms
Acceptable Quality Level (AQL) premise
allows an acceptable level of bad quality
Total Quality Management (TQM) is a
philosophy to eliminate all defects
• TQM stresses:
Customer satisfaction
Employee involvement
Continuous improvement
• TQM focuses on:
Benchmarking
Product and service design
Process design
purchasing
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Levels of Quality Standards General level  • ISO 9000 • Malcolm Baldridge National Quality Award
Levels of Quality Standards
General level
• ISO 9000
• Malcolm Baldridge National Quality
Award
Industry-specific level
Company level

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Levels of Quality Standards General level  • ISO 9000 • Malcolm Baldridge National Quality Award

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2004, Prentice Hall, Inc

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Supplier Networks  Companies can manufacture parts internally or purchase them from external manufacturers “make or
Supplier Networks
Companies can manufacture parts
internally or purchase them from
external manufacturers
“make or buy” decision
Outsourcing is the process of a
company having inputs supplied to it
from outside suppliers for the
production process

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2004, Prentice Hall, Inc

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