Global Value Chain Considerations The Unit 4 Discussion is designed for you to p

Question

Global Value Chain Considerations

The Unit 4 Discussion is designed for you to practice the decision-making process when considering globalization of a value chain.

Directions

1- Choose and describe a company operating solely in the United States that might be ready to expand globally. Explain what type of global expansion is being considered (your choice).

2- Assume you are the CEO and the ultimate decision-maker of this local company. You are confident your current value chain is solid but you are concerned at what the impact on your value chain might be if you expand to another country/other countries. What might need to be changed or modified in your company’s value chain prior to the expansion?

3- Examine how globalization could impact the current value chain. In the examination, include the following:

• What are some of the challenges an organization faces when a value chain goes global?

• What are the differences between a domestic and global value chain?

• Why does a firm go global? • Analyze pros and cons of going global.

• Does culture matter in a value chain and the management of the business?

• Describe how your business can transition the current value chain to be a global value chain.

4-The response should use first person (“I”, “me”) perspective.

5- Compose a response of at least four paragraphs of 4–5 sentences per paragraph. Apply no more than one APA formatted reference and citation per paragraph.

Explanation / Answer

Ans 1=rue21, inc. operates in the specialty apparel retailing sector in the United States. It provides fashion apparel and accessories for girls and boys, including graphic T-shirts, denim, dresses, shirts, belts, jewelry, handbags, footwear, and other accessories.As on January 28, 2012, it operated 755 stores in 713 cities in 46 states.

Ans 2=In developing a glocal value chain the following points have to be considered-

1.) The complexity of transactions. More complex transactions need greater interaction among actors in GVCs and so stronger forms of governance than simple price-based markets. Hence, complex transactions would likely to be associated with one of the three network governance patterns (modular, relational, or captive) or integrated within a single firm (hierarchy).

2.) The codifiability of transactions. Schemes should be worked out to codify complex information in a manner in which data can be handed off between GVC partners with relative ease, using advanced information technologies.

3)The competence of suppliers. The ability to receive and act upon complex information or instructions from lead firms needs a good degree of competence on the part of suppliers. Only then can the transfer of complex but codified information be obtained or intense interaction be worthwhile . When competent suppliers do not exist, lead firms either must internalize the function (hierarchy) or outsource it to suppliers that they tightly monitor and control (captive suppliers)

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