Sixty more pages down and three
questions to go. During this reading I was asked to focus on offshoring, supply
chain and Google. Once again I learned a lot about the progression of
technology and business during this reading. I always thought that out sourcing
and offshoring went hand in hand. I learned that they kind of do, and they kind
of don’t. Outsourcing is when a company takes a specific function from in house,
like research, call centers, or accounts receivable, then have another company
perform the exact same function for you and then reintegrate their work back
into your overall operation.
Offshoring is when a company takes
one of its factories that in operating in Canton, Ohio, for instance and they
move the entire factory to Canton, China. There it produces the same product in
the same way only with cheaper labor, lower taxes, subsidized energy and lower
health care costs. In 2001, China joined the World Trade Organization, which meant
they would level the playing field and agree to play by the same rules everyone
else was playing by. By joining the WTO, China became the number 1 location for
offshoring. There are some who oppose offshoring in China, they say China will
start setting the standards for low wages and lax labor laws and workplace
standards.
Supply chaining wasn’t necessarily
created by Wal-Mart but it was certainly perfected by them. The supply chain goes
from manufacturers to vendors, to Wal-Mart trucks, to the distribution center,
on to conveyors at the distribution center, from there the products are
separated onto different conveyors, back onto trucks and out to numerous
Wal-Mart stores. Wal-Mart, which is considered to be the best retail store,
literally makes none of its own products. The reason they are able to sell
their products for 5-10% less than the next store is the fact they were the
first to buy products straight from the manufacturers. They broke the mold when
they did that. Up to that point everyone went through vendors to get their
product, and by cutting out that middleman they shave a lot off the price.
With a supply chain your company can
and must take advantage of the best producers at the lowest prices anywhere in
the world. The supply chain means a lower price for the consumer.
The third and final focal point of
reading was Google. How has Google affected businesses? Never before in the
history of the planet has anyone been able to find so much information about so
many things and about so many people all on their own. Thanks to Google and
other search based websites, everyone has the same basic access to overall
research information. Google also tracks your searches and gives you customized
advertisements, then charges those companies for every time you click that ad.
With Google, small companies in remote locations have the same possibilities
for success that large companies do. If you have a product that can be found on
Google, your market no longer has to be restricted to those that walk into a
store front. You can literally sell to anyone all over the world. I have a
friend that works for an auto parts company, all day everyday his job is to add
their parts inventory to the Google search. That way anytime anyone searches
that part, his will be the first to pop up. It seems like he has to input all
the inventory all over again because Google changed some of the guidelines. It’s
a great way to do business if you can stay ahead of the curve.
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