Chapter 6: Strategic Practices in Business

Chapter 6: strategic practices in business 6 Strategic practices in business 6.1 95 Globalization whiz of the just nigh far-reaching developments in the world economy has been the process know as globalization. Globalization has been set in motion by the following(prenominal) factors: I the liberalization of international trade and capital markets I technical developments in ICT and conveyance of title I rapid frugal development in emerging markets. Businesses give way in a real-time global marketplace and their revolve about is upon maximizing comparative advantage through sourcing and supplying wares. maximize the private-enterprise(a) position of a business requires two seemingly inappropriate strategies: Minimizing cost. Economies of musical scale can be created by centralizing business activities. Furthermore, standardization in production components, low impartationation cost and the variation of information and commun ication make it doable for global companies to etymon raw materials and product components from all oer the world and to dally to deposither and assemble raw materials, parts, and semi-finished products at a virtuoso or few locations, to reduce the overall cost without each interference in product unscathed tone. Maximizing tractableness.

Creating flexibility to suffice to customers demand is achieved by modify business activities. Changes in the cost/quality trade-off from a customers perspective, reduced lead measure and shorter product life cycles require customization and postponement of final g ather in or close to the market. Economies! of scale and the cost of investing in site, plant and equipment favour centralization. Pushing factors to decentralize are transport costs, flexibility and proximity to the customer. Depending on the balance of these two forces, the society lead serve markets at regional, national, continental or until now at a worldwide level. In the recent past, integrated decision makers did not face such conflicting...If you want to get a amply essay, order it on our website: OrderCustomPaper.com

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