You are the production manager for a global business with assembly facilities around the world. The business...

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General Management

You are the production manager for aglobal business with assembly facilities around the world. Thebusiness has tended to manufacture in the home country, a developedone, with the assembly of the products taking place in astrategically located country in each of the major groupings ofmarkets. You have been asked to look at relocating some of theproduction of the older product lines in some of these assemblyfacilities and using them as production plants. Traditionallyproduction has worked closely with research and development in thehome country. Your changes need to reflect the fact that sales havefallen in the home market with increased competition. At the sametime, key markets around the world are booming. “Home or abroad?”is the question and the potential future of the business is in yourhands.
•      Withdemand low in the home country, why might it make sense to relocateproduction to a developing nation?
•      Howwould you consider the manufacture of maturing products? Would youconsider moving production elsewhere?
•      Whatare the advantages and disadvantages for the domestic productionfacilities of moving production abroad?

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Answer With demand low in the home country why might it make sense to relocate production to a developing nation The demand for the older product lines have been diminishing in the home country and since the manufacturing plant of the company is located in the developed country where the competition is high the company has to come up with a new product line or the modification in the existing product line Sometimes customer in the developed nation wants a new product with the more technological features rather than the older products offered with the few or limited modification since competitors introduce new and more developed products Under such circumstances it is a strategically wise decision to move the production process of the older product line to the developing country where the competition is low and customers are still using the older products and are not aware about the high technological developments Relocating the production to the developing nation makes sense as See Answer

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