Bad Business On Steam
In their rush to save money, managers often lose sight of the high penalties of moving abroad. And by continually shifting manufacturing to the areas with the lowest labor costs, they are merely postponing the inevitable day of reckoning when they must confront the parts of the business that really need reform. To be sure, the Japanese in the United States enjoy some advantages over existing U.S. plants.
100 million to automate manufacturing and materials handling, and Fairchild Semiconductor moved its assembly operations back to the United States after automating the welding of semiconductor chips and the inventory tracking system. Whatever those guys are up to in the parking lot, it’s got to be bad business. I think Bill got into some bad business with Wendy and her man last night. Just in case you need a helping hand, follow our simple instructions below. Bad Business codes are released by the game’s developer, Team Rudimentality.
Moving engineering offshore along with manufacturing is not a solution; it just accelerates the process. When companies do that, they give potential competitors not only finances and managerial expertise but also engineering skills. Offshore manufacturing is not, then, the only option available to companies under competitive siege.
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But managers should question the assumption that it is always right. Chances are, in their eagerness to save money on labor, many companies are giving up more than they bargained for, not the least of which is their future competitive position. Granted, companies can often save money on labor and materials by purchasing or manufacturing overseas, but other costs—some not so obvious—may well offset the gains. Offshore sourcing usually involves larger inventories, for example, and higher administrative costs. Parts made overseas are less likely to meet specifications, so quality costs may be higher. Factor in higher transportation expenses and tariffs, and don’t forget the cost of training foreign workers.