ADMS 1010 Lecture Notes - Lecture 3: Balkanization, Northeast Megalopolis, Basf
27 Mar 2016
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Document Summary
Whether we look at electrical equipment, motor vehicles or chemicals in the 1880"s, The most dominate companies are the ones whose founder and senior execuive understood what is called the logic of managerial enterprise. The dynamic logic of growth and compeiion that drives modern industrial capitalism. Begins with economics, cost advantage that scale and scope provide in technological advanced, capital intensive industries. Large plants produce products at a lower cost than smaller plants. Cost per unit drops as volume of output increases (economies of scale) Large plants can use many of the raw material and semi-inished materials to make diferent products (economies of scope) Entrepreneurs who build large plants must make two related investments. Create naional then internaional markeing and distribuing organizaions. Recruit teams of lower and middle managers to coordinate low of product and top managers to coordinate, monitor, plan and allocate resource for future aciviies.
