Introduction
Manufacturing companies have started venturing globally to take advantage of low cost manufacturing, geographical location, imagination availability so forth. Developing and managing global manufacturing operations have endlessly been a challenging task for company's world wide. This clause attempts to explore 10 most significant issues of concern, challenges faced, and potential solutions for multi-national manufacturing organizations as they start operational globally.
1. Management Philosophy
Management philosophical system guides the stakeholders of the organization in providing an understanding of what the Company's operations are, where they are heading towards, and why they are in business. Companies need to provide a clear statement of their vision, mission and values to the stake holders. It becomes vital especially in a global company to dedicate thought and efforts in frame this philosophical system, as individual companies may have slightly different focus, but the group as such should sail towards a focused destination. Equally important are the business policies and strategies by which the Company targets to reach its vision. As the company's grow and become multi-national, it becomes imperative to have a clear structure structure at entity level and individual level. This would form the basis for better communication, development of cooperative operations, and effective decision making. Notably, organizations should adopt ways of proving its commitment to the strategies and philosophies, link their operational and plan of action activities towards their vision, and endlessly communicate them to their stakeholders.
2. Systems and Systems Thinking
Systems are procedural approach that channels the individuals, departments and the direction in effective operations the to the last-place degree bit levels. An organization operational in different countries need to have a common system by which they deal with operations at same level in their entities. This provides a visibility for individuals from different entities in collaborating their work with each other. Also, a system gives the Company less dependency on a particular individual or group of individuals, which growing organizations will realize to be important in the long run. A system provides the multi-national organization a dynamic work culture, and easier adaptability to working procedure.
The conception of Systems Thinking evolved with the development of supply chain integration. Organizations that center on the individual development of the entities often fail to notice the integrated golf links and the advantages they can extract off them. Systems Thinking would help look the whole network of entities as one organization, with one business and one objective, and revolve around overall development crosswise the supply chain.
3. Collaborative Operations
Collaborative operations help organizations take advantage in areas such as employment of low operations cost, adept labor, material availability, so forth though it poses high demands on seamless business processes, interoperability, supply chain visibility, demand forecasting, and client integration.
As the individual entities of the organization grow, they tend to develop functional expertise in specific disciplines. Often the companies that operate at multi national level concentrate less on acquiring trained in that expertise from their fellow entities, but involve in sourcing the specific activity to this expert entity of the group. This approach has to be assessed on case to case basis. In a typical organization where the entities do similar activities at different locations, it may not be suitable to source a particular activity to a location. Also an imbalance in a specific functional expertise level among the entities power grow to be a roadblock in overall growth.
4. Branding
As companies go global, brand direction becomes a key aspect. Customer's perception for a product varies with the country in which it is manufactured. This urges Multi national companies to center on development of brand and powerfully commit to their offerings. This becomes an issue of concern especially for companies that go global before creating a niche brand in the market. Multiple brands and four-fold product offerings are to be handled with appropriate concern.
5. Sigma Level
Sigma is a applied mathematics term to express how much a process varies from the target. Sigma level allows comparison of process performance through out the entire organization, provides figures on overall yield, and DPMO. Though industries have up to the level of six sigma targeting 3.4DPMO, a sight majority of the companies dwell 3 sigma level where they spend at to the last-place degree 30% of its revenue on defects, corrections, reworks, and rejects. Global companies should have a focused roadmap on rising the sigma level and link them to their business strategies.
6. Global Distribution and logistics
With the evolution of global supply chain direction, organizations have centralized or localized distribution/procurement systems. Applications of appropriate principles of direct shipment, warehousing, or cross dockage dependant on the Manufacturing/client locations, client dispersion and concentration, and transportation involved have saved billions of dollars for multi-national corporations. Also appropriate push-pull systems are designed to their product and demand requirements. Many companies choose to maintain component level inventory of their standard products some provide bespoken parts assembly at the final stages.
7. Human imagination & Cultural Impacts in Global scenario
As globalisation develops and boundaries shrink, growing economies have started acceptive and developing multi-cultural working environments. Companies have already accomplished the need for greater majority of local employees in their established ventures overseas. These companies spend lot of efforts in understanding and promoting cross cultural communication and psychological feature activities.
Another vital factor would be the Company's HR policies, and training and development. HR policies may vary according to the local human imagination standards and their conformity to the international standards. Nevertheless companies must ensure a systematic training structure and course of study for their employees. This will provide organization's in maintaining balanced skills among employees multi-nationally.
8. Technology Development
Technology development is the process of research and development of technology. If companies fail to develop innovative technologies, the competitions take a lead. Technology development has become a endlessly evolving activity. These technological innovations provide organizations specialization in product central or process central areas that help them differentiate in the market place. Growing companies need to center on research and development on key processes that affect their business.
9. Leading Industry practices
Leading industry practices are methodologies and systems that have evolved over respite of continuous research and development. These industrial practices in technology, application, and service areas are growing in a tremendous pace. Organizations that failing to make efforts to move tandem with these developments are facing difficulties in moving ahead. On the other hand, practicing leading practices provides organizations greater industry recognition, professionalism, cost savings, and also improves employee morale.
10. Exploring market
Companies need to do a market analysis on the trends of the business in their target countries for operations, target market, competition analysis, government regulations, so forth. This kind of analysis help companies choose to make an knowledgeable decision on whether to serve the local market or be an Export only Unit.
Conclusion:
These 10 development areas are just part of the extensive list of areas that companies need to center on, yet these would be the most significant ones. The clause attempts to highlight some of the modern thoughts and approaches that would help manufacturing industries internationalize in a triple-crown manner.
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