OM 300 Lecture Notes - Lecture 2: North American Free Trade Agreement, World Trade Organization, Pizza Hut

• School: University of Alabama
• Department: Operations Management
• Course: OM 300
• Professor: David Cooper

Document Summary

Reasons to globalize: reduce costs (labor, taxes, tariffs, etc. , improve supply chain, provide better goods and services, understand markets, learn to improve operations, attract and retain global talent, list is in order of tangible reasons intangible reasons. Reduce costs: foreign locations with lower wage rates can lower direct and indirect costs. Improve the supply chain: locating facilities closer to unique resources. Provide better goods and services: objective and subjective characteristics of goods and services. Interacting with foreign customers and suppliers can lead to new opportunities. Learn to improve operations: remain open to the free flow of ideas. General motors partnered with a japanese auto manufacturer to learn new approaches to production and inventory control. Equipment and layout have been improved using scandinavian ergonomic competence. Attract and retain global talent: offer better employment opportunities. Better growth opportunities and insulation against unemployment. Relocate unneeded personnel to more prosperous locations.