Hon Hai is now one of the biggest contract manufacturers of the electronics industry because it can make cheaper products than its competitors. The company is obsessed with keeping its costs low. Hon Hai achieves low costs by following some cost controlling steps.
Unlike its rivals it has no imposing headquarters. It operates from its own five-story concrete factory in a messy suburb of Taipei where it holds its annual meeting in the staff canteen thus keeping its costs land costs low. In addition, Hon Hai has moved much of its manufacturing to china when labor costs were low. It employs 100,000 people with wages that are one-fifth of those in Taiwan. Operating in china not only offers low labor costs but also offers a high level of production
…show more content…
However, remember that Hon Hai has the advantage of doing all these things before many of its competitors even thought about them. Competitors can copy Hon Hai by moving their manufacturing to china to achieve lower labor costs. Competitors might copy Hon Hai tangible resources such as technology, automation, and moving to low cost locations. However, it is the intangible asset which makes it very difficult for competitors to outcompete hon Hai, such as building strong relationship with customers that is not an easy thing to achieve. Moreover, Hon Hai sells its products and services at low margins and few of Hon Hai’s competitors have the minimum scale necessary or, indeed, the ambition to handle the large volume that it routinely handles.
To summarize, Even though competitors can copy some of Hon Hai’s ways, Hon Hai has been doing these things long before its competitors knew about it so it had gained a lot of experience which makes it hard for competitors to be as successful as Hon Hai because when any company tries something new, it will have to learn how to make its strategies work
…show more content…
Dependability is “doing things on time” and is established over time and in the end overlaps all other factors. In customer’s point of view it does not matter how cheap, fast, innovative a product/service is, if they cannot depend that it will be delivered in time, the customer will be lost. A company also measures dependability by the product’s ability to function as expected and to perform effectively over a reasonable amount of time. Dependability inside an organization is also very important as it saves time and money; by reducing the ineffective use of resources because dependability reduces the chance of repeating input resources or some resources left unused that would increase the cost of maintain, or labor cost. For example, every product comes with a guarantee/warranty claims which insures that customers can get their product exchanged with a new one which in turn gives a customer a feeling that he or she can depend on the
product that has the added value of being cost effective. However, in China, cost effectiveness
Time available: As we discuss some trainings has to be provided to all employees including the line supervisors and line workers they have to be divided into groups so that they don’t halt the continuous production for everyone.
manufacturing a competitive advantage. According to 2013 analysis done by consultant AlixPartners estimated that cost of manufacturing in China will equal cost of manufacturing in U.S. due to labor cost in China has been increasing in past 10 years. The low cost energy and labor equivalence recently is contributed to 500,000 jobs created in manufacturing sector since 2010 (Ludwig & Spiegel, 2014).
RL Wolfe is an engineering and productions company that deals with the production of plastic pipes. The company has its headquarters in Houston, Texas. It is worth 350 million dollars and has three branches that include Wolfe’s Austin based in Texas, Columbus based in Ohio and the most recent branch that the company acquired based in Corpus Christi, Texas. The company has been trying to adopt new human resource management (HRM) practices in a bid to increase the productivity. The new HRM strategy is the adoption of self-directed teams (SDTs). The strategy began as an experimental strategy on the workforce in Corpus Christi in a bid to raise the production of the company workforce to 95%.
Nosocomial or healthcare-associated infection (HAI) occurs when a patient receiving treatment in a health care setting develops an infection secondary to their original condition. These infections are serious and costly adverse outcomes of medical care that affect nearly two million people in the United States annually and lead to substantial morbidity and mortality. With increased days of hospitalization and direct medical costs, HAIs account for an estimated $20 billion per year in national health care expenditure every year. As such, they present one of the major threats to patient safety and remain a critical challenge to public health. On any given day, approximately [one in 25 patients] contracts at least one infection while receiving
Seung-Hui Cho was a mass murder from South Korea who in April 16, 2007 used a Glock 19 pistol to murder 32 people including himself wounding 17 people in Blacksburg, Virginia at Virginia Polytechnic Institute (Virginia Tech Review Panel, 2007). The motive of murdering these 32 people according to a note he left in his room criticized deceitful charlatans, debauchery, and rich kids, who he said attributed to his act of murder. Cho’s diagnosis of anxiety disorder called selective mutism and major depressive disorder led law enforcement to believe contributed to the murdering of these 32 people. However, reports from the media speculate that he became enraged after Emily Hilscher rejected his romance advances.
The cost advantages related to raw materials may be explained by better negotiated agreements with suppliers (perhaps due to the larger volumes of purchases – comp. Fig. 5) and possibly less shipping and distribution costs that stem from the fact that Samsung’s fab facilities are geographically collocated (while competitors’ facilities are spread world-wide). In terms of labour productivity only Chinese SMIC outperformed Samsung, but that came hardly unexpectedly: low labour costs in China had been and were to remain unbeatable for some time yet.
Reliability is doing what you say you are going to do, when you say you are going to do it. If someone is reliable, you are able to depend on him or her at work or school. Working with someone who is reliable is working with someone whom you trust versus working with someone who is not dependable.
A company’s value chain can be created through a number of avenues. Tangible and intangible resources including knowledge, capabilities, skilled human resources, information systems, and company infrastructure can each be a distinctive competency. However, the multi-faceted business environment and industry dynamics can effectively erase a company’s advantage over time. This is particularly true with tangible resources. It’s easy for competitors to imitate one another. For example, all players in the package courier industry have invested heavily in tracking technology, shipping labels, and scanners. When UPS decided to move into the retail industry and acquired Mail Box Etc. in 2001, FedEx followed suit and acquired Kinko’s in 2004 (Hill & Jones, 2011). Marketing strategies related to pricing and promotions are also highly coveted.
Hon Hai Precision Industry Co., Ltd which trades as Foxconn Technology group or as the media calls it Foxconn has been in media limelight recently due to labor problems that have surfaced from the organization. Foxconn is a major equipment manufacturer supplier to electronics giants like Blackberry, Apple, Microsoft Xbox, Sony PlayStation and the Nintendo Wii. The internet has several articles and controversies regarding the deplorable worker conditions and cases of suicides by the workers.
China also provided a labor force that is able to tackle both white-collar and blue-collar job positions. This made foreign companies rush both monetary and technological resources into China to utilize the manufacturing and development power. Both Microsoft and Sun have created research and development centers to implement and design software applications in China. Domestic companies are not far behind either, for example, China's own Evermore Software is on the rise to challenge Microsoft's office suite with its own.4
Pricing. Our product is priced lower than our competitors in our industry. Even though our competitors have a different kind of product compared to us.
The second component is reliability, it relates to products and services being available to customers any time they want to use it. This includes things such as on-time operation and opening hours, including public holidays. As well as bookings being free of errors and the level of service provided be consistent among staff and at all times of the day, every day. Being reliable is of significance to customers it accounts for a lot of their expectations when dealing with a company. Being unavailable to customers reads to them that their time is not
Lean production is an approach to production developed in Japan. Toyota, the Japanese car manufacturer was the company that invented lean production. The whole aim of lean production is to reduce the quantity of resources used up in production. By doing this, lean production uses less of - factory space, materials, stocks, suppliers, labour, capital and time. Lean production reduces costs, increases efficiency and output and improves motivation. Lean production involves using a range of practices designed to reduce waste and improve productivity and quality.