operations management
MANDY17
Chapter8_GlobalOperationsManagement.pdf
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8 Global Operations Management
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Chapter Overview In the fundamental sense, global business involves the buying, selling,
and trading of goods and services across national borders. While many managerial aspects directly impact the profitability of a business, it is the
management of business operations that determines a company’s total growth
potential and earning capabilities. Management involves the process of developing decisions and taking actions to direct and control the activities of
employees toward the attainment of organizational goals.1 Operations management specifically involves the management of the process and production
activities that produce the goods or services. Operations managers are concerned with every aspect of the production process, including key areas such as
research and development, acquisition and distribution, inventory management,
technology, transportation, manufacturing, and customer service.2 The overall success of the business is dependent upon the efficiency and effectiveness of every
function within the production process.
The continuous and rapid expansion of world markets is a mitigating factor for the globalized perspective of operations management. Taking a business to the global
marketplace necessitates the development of a global operations strategy, which requires three strategic capabilities:
Based on the extent to which these capabilities exist within the firm, operations managers are involved in the ongoing processes of strategic issues, such as
planning, production, logistics, and supply chain management to maximize the business output potential. The key components in successful operations
management are efficiency and effectiveness. Global organizations differ from
Global-scale efficiency and competitiveness
National-level responsiveness and flexibility
Cross-market capacity to leverage on a worldwide basis3
domestic in that operations must not only efficiently move products from multiple
locations but also from multiple continents.
