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By Martin Kenney, Richard Florida, eds.

What are the forces which are riding companies and industries to globalize their operations? This quantity explores how particular industries have geared up their worldwide operations via case reviews of 7 production industries: clothing and textiles, cars and car elements, televisions, harddisk drives, flat panel screens, semiconductors, and private desktops. in keeping with long term learn subsidized by means of the Sloan beginning, the chapters supply readers with a nuanced realizing of the advanced matrix of issue expenses, entry to inimitable features, and time-based pressures that effect the place corporations choose to find specific segments of the worth chain.The publication examines globalization in the context of 5 elements affecting locational judgements: advances in transportation and conversation; the clustering of data resources; the force to minimize cycle occasions; the commodification of current items; and the relative benefits of proximity to clients. The case stories are framed via Paul Deguid’s Preface at the value of energy in worth chains and Bruce Kogut’s end at the significance of information in locational judgements. jointly, the chapters show a striking range of responses throughout industries to those forces, and recommend that any figuring out of globalization needs to have fun with this variety. This quantity is perfect for either MBA and undergraduate scholars learning the positioning of monetary actions by way of multinational corporations.

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Extra info for Locating Global Advantage: Industry Dynamics in the International Economy (Innovation and Technology in the World Economy)

Example text

For the literature on the MNE, classic citations include Dunning (1980), Hamel and Prahalad (1994), Porter (1985), and Vernon (1971). 2. An excellent cross-national comparative perspective is Dunning (1997). 3. For an excellent further discussion of the relative merits of these two terms for chains and their intellectual merger, see Gereffi (2001). 4. In the import-export databases, this is reported as Harmonized Tariff Schedule number 85415000. 5. For discussions of containerization and air freight, see Taggart (1999) and Lappin (1996).

Market from Asia to the Caribbean Basin and Mexico, while in Western Europe production is being relocated from Asia to North Africa and Eastern Europe. Firms must balance between production and transportation costs and speed, which, in rough measure, is a function of distance and transportation modality. They explore the trade-offs that garment firms must make when deciding where to source their production. This is illustrated by a provocative demonstration of how low labor costs can be offset by the inventory cost savings and risk reduction that can be achieved by producing in a higher cost environment in closer proximity to the customer.

Today, transport costs constitute only approximately 1 percent of the final price of consumer goods (Taggart 1999). From the rapid replenishment system described by Abernathy et al. for garments to Dell’s build-to-order PC production system described by Curry and 6 / martin kenney Kenney, the transportation and communications advances are providing firms with more efficient and transparent logistics systems. Logistics specialists such as UPS or Federal Express not only handle deliveries on a global scale but are also capable of undertaking some measure of final assembly: packaging, inventory management, and distribution.

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