dc.description.abstract | Over the recent years, due to the dramatic reduction of product life cycles and the fierce competition, the prices of IT products have been experiencing rapid changes. International IT companies have been outsourcing to professional OEM manufactures for the assembly processes that are of low margins or easy to duplicate. The Taiwanese electronics OEM manufacturers have been thriving on this trend and growing in size and strength. The outsourcing trend has also extending into the PC, mobile phone, wireless communications equipment and other technology products. In addition, in an economic downturn, international brands will step up their outsourcing activities and focus on their core competence instead, in order to reduce production costs and enhance their own competitive edge.
The purpose of establishing an international procurement management system is to reduce cost and improve a company’s competitiveness. At present, multinational corporations have a network of factories throughout the world so some products can be produced close to their target markets. Considerable manufacturing costs may be saved via local or international procurements. Meanwhile, due to the large quantities of material procurements, the bargaining power of the international procurement staff, the reliability of transaction activities and the timeliness of cross-country operations become the keys to the reduction of procurement costs. In addition, it is possible to link the satellite factories around the globe into one supply chain via computer networks so that the company can keep track of the current capacities, product items and the sufficient level of component inventories of individual factories at any given time. The computer will directly transfer orders or place orders for additional components, depending on which the inventory level runs below or above the warning lines. In this way, the factory with excess inventory will transfer their excessive inventory to those in shortage. It is also possible to inform the suppliers to speed up their shipments to meet up with the demands from the production lines.
For any Taiwanese OEM manufacturer that has production lines in China, the management of multinational procurements is one of the most important issues at today’s environment. A successful plan and management of an international procurement system reduces the operational risks, control costs and increase profitability.
This research aims to study Company A, a computer OEM maker in Taiwan and uses Company A as a case study. The success of international procurements involves three dimensions, i.e. organization structure, management system and strategic
implementations. The ultimate purpose of international procurements is to provide products required at a timely manner with the right quantities and at the right prices. The operations of international procurements span far and wide. It is a daunting challenge. Regardless how big is the difference in nature, scale and complication, all the processes serve one common purpose: to procure the products necessary to meet with the demands from clients. What kind of the management system is required for a successful international system? How should we plan for the organization and human resources required to reach this goal? What are the strategic considerations that we must address in the process of international procurements?
This research paper intends to explore the key success factors in the construction of a complete international procurement management model. Such a model cannot only ensure the success of international procurement plans, but also create and enhance the overall value and competitiveness of a corporate. | en_US |