GB511C Strategic Resources Management: Final Exam
Adam J. Franco
Professor Laurette Brady
November 16, 2013
Manufacturing today includes all facets of research, development, production, sales, distribution, logistics, customer service, marketing, and support. It extends from the making of physical products to the delivery of services (Deloitte, 2013). Manufacturing companies now compete on a global scale and utilize specific locations around the world to their advantage. For instance, basic, simple to make products will be produced in an area with cheap, low education labor. While products that use high tech machinery that require a skilled labor force would need to be produced elsewhere. Likewise, there are many unique challenges to managing the intangible assets of organization. This paper will examine those unique challenges a manufacturing company, with operations in the US, Mexico, France and Turkey, would face with aligning their human, information, and organization capital to their global strategy. USA
Manufacturers will open factories in the places they expect to be the most profitable and productive. That decision will certainly take into account factors like infrastructure, trade and tax policies, and the regulatory environment (Pianalto, 2011). One of the most important factors that will determine where firms locate is the quality of human capital. For a manufacturing company, the US is a good source of a well educated and competent labor force. In the US in the last 20 years, technological innovation has transformed the manufacturing work force, increasingly favoring higher-skilled individuals, many with post-secondary education. The traditional blue-collar and middle-skill manufacturing jobs, that are the traditional norm in the US, are accounting for a smaller share of employed labor force. Conversely, the number of college-educated manufacturing workers is increasing (Pianalto, 2011). A manufacturing company faces a unique challenge with this type of workforce. The initial investment in human capital is high. Human capital is developed through investments in education and training. Workers need higher levels of human capital to handle today's high-tech machinery. A manufacturing company is more likely to open and maintain high-tech factories, the kind that are likely to survive and thrive in the United States amid global competition, in regions with large populations of highly skilled workers (Pianalto, 2011). One of the biggest advantages for a manufacturing company operating in the United States is the strength in its Information Capital. Kaplan & Norton (2004), describe information capital as the “company's databases, information systems, networks, and technology infrastructure.” In the US, building an effective IT infrastructure that enables communication and analysis across all functions is rather simple when compared to an underdeveloped nation. For instance, a company has just developed a new smart pad to compete with the iPad. If they choose to manufacture their product in the US, they inherit some information capital advantages; confidence that their network will be secure and their products technology will not be copied and reproduced, ability to outsource portions or all of their IT, and overall lower IT costs. Baron and Armstrong (2007), define organizational capital as embedded or institutionalized knowledge that may be retained with the help of information technology on readily accessible and easily extended databases. It can include explicit knowledge that has been recorded on a database or in manuals and standard operating procedures, or unspoken knowledge that has been captured, exchanged and, as far as possible, codified. For a manufacturer, it would be difficult to assess the competitive advantages of organizational capital in the US. There are great examples like Google, Apple, and GE that still embody the culture of the...
References: Baron, A. & Armstrong, M. (2007). Human capital management: achieving added value through people. London: Kogan Page.
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