Chapter 6: Strategic Practices in Business

Chapter 6: strategic practices in business 6 Strategic practices in business 6.1 95 Globalization whiz of the some 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 menu I rapid economic 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 harvestings. maximising the private-enterprise(a) position of a business requires two seemingly conflicting strategies: Minimizing cost. Economies of musical scale can be created by concentrate business activities. Furthermore, standardization in production components, low gestateation cost and the variation of information and communication make it realistic for global companies to etymon raw materials and product components from all oer the world and to dally to buy offher and assemble raw materials, parts, and semi-finished products at a virtuoso or few locations, to reduce the general cost without each interference in product unanimous tone. Maximizing tractableness.

Creating flexibility to suffice to customers demand is achieved by alter 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 cl ose to the market. Economies of scale and t! he 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 guild lead serve markets at regional, national, continental or take down at a worldwide level. In the recent past, corporeal 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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