Prof. Lynn Barnsback
CASE STUDY- GLOBALIZATION
Research and Answer the following;
Do you think the acquisition would allow them to cut costs? Why? Whirlpool has planned to acquire Philips' Major Domestic Appliance Division which is a way to promote or market the electronic refrigerators and whirlpool appliances. Although, this acquisition is not related directly to the cost cutting but it will assist in the development of the outer structure of appliances. Actually, the major purpose of this acquisition is to enhance the dialogue with industry so as to gain knowledge regarding the structures, processes, procedures and way of handing business issues. Besides that, according to my opinion, some of the choices with respect to cost cutting can inadvertently contribute to rising costs, the stifling of innovation and slow processes due to segmented distribution of work tasks. Would it increase organizational costs? Why?
Initially, it can lead to increase in organizational cost because of acquiring of structure in a fragmented manner. They will face issues in manufacturing and distribution department because of different preferences of customers. Individuals from Europe demands small size refrigerator with one door opening whereas people from Asian states demands refrigerator with several door openings because of big family size. It will lead to an augmentation in the competition among traditional and non-traditional industry partners to drive down costs and to increase modernization. Besides that, research and development in a massive scale would lead to high cost. Could a purely global strategy be used with the product? Why? What might this do to the bottom line? Global strategy is basically a strategically guide for the organization to complete it globalized activities effectively. Considering refrigerators and other home appliances for the acquisition than global strategy may be appropriate...
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