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Meeting quality and cost imperatives in a global market
Abstract
The research report indicates that the complexity, uncertainty, and diminished control found in global operations hinder the development of world-class competencies. For example, as a firm rationalizes manufacturing, logistical challenges increase. As a result, cost advantages achieved through production sharing are often offset by higher logistics costs. This multi-method explores the cross-functional development of quality and cost competencies in an international production sharing setting. Overall, the study found that information and planning capabilities are vital antecedents to cost and quality competencies. The impact of cost on a firm's performance is direct, while the impact of quality is indirect, through productivity enhancements.
Keywords
Logistics, Global marketing, Customer satisfaction, Cost management, Quality management
Introduction
A major challenge confronting manufacturing companies today is that modern consumers are more demanding than ever and have come to expect to pay the lowest possible cost for the highest possible quality (Avery, 1998; Cole, 1998; Reed et al, 1996; Scully and Fawcett, 1994). One reason that consumer expectations have risen is that a host of companies from around the world vie for their attention and a larger share of their purchase dollar. This intense global competition has raised the competitive bar in almost all manufacturing industries. Indeed, today's manufacturers face the dual challenge of fending off tough global competition while striving to satisfy demanding world consumers.
In their quest to meet this dual challenge head-on, many leading ma ...