3J global consideration

Question 1

Global sourcing of inputs

Answer 1

involves a business
acquiring raw materials
and resources from
overseas suppliers.

Question 2

When choosing to source its inputs globally, a business should consider several factors that
may affect its expenses and reputation, including:

Answer 2

• how the price of materials and resources differs in each country.
• how the delivery costs vary when supplies are travelling different distances between countries.
• how suppliers treat and pay their workers and whether they operate in an ethical and
  socially-responsible manner.

Question 3

Global sourcing of inputs advantages

Answer 3

• A business is able to source
  materials that may not be
  readily available in its country of
  operation.
• Higher quality materials can be
  sourced by a business, allowing a
  product to better meet customer
  expectations.

Question 4

Global sourcing of inputs disadvantages

Answer 4

• Delivery may be time-consuming
  depending on where the supplies
  are being sent from.
• Materials may be damaged during
  transport.

Question 5

Overseas manufacture

Answer 5

involves a business
producing goods outside
of the country where its
headquarters are located.

Question 6

Overseas manufacture advantages

Answer 6

• There is greater access to highly
  skilled employees who have
  expertise in production.
• Production speeds can be improved
  through the use of highly skilled
  and experienced overseas
  employees.

Question 7

Overseas manufacture disadvantages

Answer 7

• Poor corporate social responsibility
  practices in the country may reflect
  badly on the business.
• Delivery is time-consuming
  compared to manufacturing goods
  in a domestic location.

Question 8

Global outsourcing

Answer 8

involves transferring
specific business activities
to an external business in
an overseas country.

Question 9

Global outsourcing advantage

Answer 9

• A business can allocate more
  resources and focus on its own
  areas of expertise.
• The business has more time
  available to focus on its own areas of
  expertise, increasing its productivity.

Question 10

Global outsourcing disadvantage

Answer 10

• Poor communication and language
  barriers with the external business
  may lead to delays.
• It may be difficult to communicate
  with external, overseas businesses
  due to language barriers.