GLOBAL LOGISTICS AND RISK MANAGEMENT
In the contemporary global economy, manufacturing companies should recognize the power that comes from superior manufacturing and initiate various activities to improve their competitiveness. In this manner, this paper identifies and describes the global market forces, risks, development chain, supply chain, and strategies from a manufacturer’s perspective.
a. Global market forces
Global market forces are significantly defined by various cultural and religious ideologies. These different ideologies are forces that define how various manufacturers conduct their affairs.
Globally, these ideologies compete for people’s time, attention, and resources. Whether cultural, religious, or political, people hold strong convictions and are strongly committed to defending and maintaining them, in some cases by intimidation and force (Dicken, 2007). For instance, manufacturers transacting outside the United States, these ideologies often define where, when, and how they conduct their businesses. For this reason, the manufacturing companies should come up with strategies for operating within a global setting. Some products may be disapproved in some countries due to cultural or religious reasons, despite having clear potential for the market (Dicken, 2007). As such, manufacturers have to design their productions to meet different ideologies held by customers from various parts of the world. Other than the various ideologies, technology is another global market force that significantly influences manufacturers. The current global grid defined by information is greatly attributed to advancements in technologies. Information technology is a strong force that enhances effective communications in various industries. Manufacturers should take advantage of the various marketing platforms driven by the Internet, including email, smartphone apps, social networks, and dedicated websites (Abdul, et al., 2008). Manufacturers are at a position to leverage the power of the technological advancement to expand their market bases through affordable advertising these marketing platforms and reach a considerable number of potential customers.
As manufacturing companies are committed at gaining a substantial market force and maximizing their revenues while minimizing costs, they have to have to contend with various risks and challenges. One of the greatest risks that manufacturers face is establishing a secure and effective supply chain. Most manufacturers experience issues of quality raw materials from suppliers as well as errors in the supply chain, which may lead to shortages or backlogs (Chopra, & Sodhi, 2012). Furthermore, manufacturers are also exposed to risks related to natural disasters, which could result in transportation breakdowns and the subsequent delays in delivery (Chopra, & Sodhi, 2012). The growth of manufacturing industry also leads to stiff competition for workers, resources, and speed to the market. Furthermore, acquisitions and mergers in the industry increase competition for these elements. As some of the manufacturing companies merge, most of them gain a monopoly of the various elements of production. As such, this poses an unfair competition to individual competitions. Hence, competition is a crucial risk for manufacturing companies. In attempts to counter this risk of competition, most manufacturers focus outside their companies to gain access to new intellectual properties, technologies, products, and distribution channels to enhance their market positions (Chopra, & Sodhi, …