Assume you have the role of top management at a major global electronics company that is developing a wireless device capable of on-demand music and video downloads from anywhere on the globe.
What criteria should the company use to determine where to manufacture the device and whether or not to enter into a collaborative arrangement to manufacture the product or control it internally?© BrainMass Inc. brainmass.com June 4, 2020, 1:30 am ad1c9bdddf
GLOBAL BUSINESS OPTIONS
Criteria that a company should use to determine where to manufacture the device; collaborative arrangement to manufacture the product or control it internally
Where to manufacture the device: Criteria
1. Location of the target market. Proximity or accessibility to the target market is an important factor because it will mean cost in relation to distribution channels as well as the capacity of the company to meet customers' needs at the right time, in the right amount, and with the least cost possible.
2. Factors of production
a) Human resources. Their skills as well as the cost of labour in a particular country are important points to consider.
b) Raw materials. This is in terms of accessibility and cost. Supplies assurance and dependability are also important.
c) Machineries and equipment. Adequacy of these is an important criteria
d) Methods and processes
3. Political leadership
The political leadership in each country controls whether and how business will occur in that country (Daniels, 2000).
4. Domestic and international law. This determines the constraints on what a manager can do.
5. Taxes, tariff duties, ...
The solution discusses the role of top management at a major global electronics company.