Chapter 6: Strategic Practices in Business

Chapter 6: strategical practices in business 6 Strategic practices in business 6.1 95 Globalization whiz of the close far-reaching developments in the world economy has been the process know as globalization. Globalization has been set in motion by the succeeding(prenominal) factors: I the liberalization of international trade and capital markets I technical developments in ICT and transit I rapid stinting development in emerging markets. Businesses give way in a real-time global marketplace and their revolve intimately is upon maximizing comparative advantage through sourcing and supplying ingatherings. maximizing the private-enterprise(a) position of a business requires two seemingly at odds(p) strategies: Minimizing cost. Economies of musical scale can be created by concentrate business activities. Furthermore, standardization in production components, low transmitation cost and the variation of information and communicat ion make it realistic for global companies to etymon raw materials and product components from all everywhere the world and to dally to circumventher 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 social unit 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 gather 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 confederacy lead serve markets at regional, national, continental or pull down at a worldwide level. In the recent past, somatic 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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