Risk Management, HR Management, Outsourcing and Industry 4.0 in International Companies

Answer 1: International Company Risk Management Techniques

1. You Can Choose Any International Company, Who Has Faced Any One Of The Country Risks: Political, Economic, Operational Or Competitive, In The Last 12 Months In One Of The Following Regions: 1) South America, 2) Africa, 3) Central Asia, And 4) Middle East. Identify, Analyse And Manage The Risk As If You Were Employed As a Consultant By Your Chosen Company. Any Risk Management Technique Which Has Already Been Adopted And Utilised By The Chosen Company Will Not Be Accepted In Your Answer

2. You Have Been Promoted To Hr Director In The Swedish Company Which Manufactures And Sells The Medical Equipment (Mri Scanner). Being Very Hi-Tech, The Equipment Have Until Now Been Made In Sweden By The Company’s Skilled Team. Your Employer Has Just Purchased a Factory In Mexico For The Manufacture Of Medical Equipment That Have Been Selling Well In The Usa. There Is a Budget For Three Expatriate Managers To Be Sent To Manage Its Operation In Mexico For Four Years. The Ceo Has Asked You To Recommend The Job Title For Three Expatriates With Your Justification For Each Job Title And Prepare a Plan To Help These Expatriates’ Early Settlement In Mexico.

3. Choose Any International Company Who Has Outsourced One Of Its Business Functions To a Local Company In Their International Operation And Critically Discuss The Benefits And Drawbacks Of Its Outsourcing Arrangement With The Local Company. An Outsourcing Arrangement Between The Two Companies Should Be Post 2010. 

4. Recently, a Notion Of ‘Industry 4.0’ Or ‘Fourth Industrial Revolution’ Has Become Of a Centre Of Attention In The Business World. Some Associated Technologies, Such As Additive Manufacturing, Advanced Robotics, Drones, Iot, Blockchain, And Ai, Have Been Rapidly Developing And Many Firms Are Contemplating Different Ways To Exploit These Technologies. Choose Any International Company Utilising One Of These Technologies And Discuss Their Journey In Moving Away From Its Traditional Business To More Sustainable Business

As stated by Malinga (2020), coronavirus or Covid-19 is an important threat which the different nations of the world are presently facing and this had taken a toll on the life of numerous people. Yu and Aviso (2020) are of the viewpoint that Covid-19 while adversely affecting the lives of numerous people had also affected the different business corporations of the world. As a matter of fact, this had increased the risks faced by the corporations and because of this the corporations had been forced to substantially change or modify the business processes used by them as well. For instance, in the wake of the threat posed by Covid-19, it had been seen that the corporation Samsung in South Africa is facing various kinds of economic and operations risks like the potential loss of skilled laborers, loss of customers, possible disruption of supply chain used by the corporation, increase in operations costs and others (Ft.com 2020). As per the statistics offered by Enca.com (2020), till now more than 159 people of South Africa had been affected by Covid-19 and this number is likely to increase even further.

Answer 2: HR Management Strategy for a Swedish Company in Mexico

There are various reasons for the unprecedented success attained by Samsung within the nation of South Africa like the availability of cheap labor, large customer base, low operations cost, effective relationship with the different suppliers and others (Malinga 2020). However, in the face of the threat posed by Covid-19, it is seen that the laborers are not willing to go to the workplace of the corporation in the fear of contracting the virus, the consumers are not purchasing the products offered by it, the relationship of the corporation with its suppliers is deteriorating and others. More importantly, the corporation in order to mitigate the threats posed by these risks had shifted its manufacturing department to Vietnam for the time being and intends to transfer the same to South Africa once the situation gets resolved (Ft.com 2020). However, at the same time it needs to be said that this in turn had substantially enhanced the operations cost of the concerned corporation which in turn had adversely affected the profitability of the corporation as well. Thus, it becomes important for the corporation under discussion here to take the help of effective risk management techniques for the identification as well as the mitigation of the risks that it is presently facing on the score of the threat posed by Covid-19.

Glendon, Clarke and McKenna (2016) are of the viewpoint that five of the most important risk management techniques which are commonly used by the business corporations are avoiding risk, transferring risk, preventing and reducing loss, spreading risk and retaining risk. In the particular context of Samsung, it can be said that the best said that the best possible risk management technique which the corporation can use is preventing and reducing loss. This can be done by the corporation through the adequate identification of different risks (the risk presented by Covid-19 is a preventable one), analysis of their causes and impact and thereby formulating effective strategies for the mitigation of the same. The corporation has the opportunity to take the different occupational health and safety measures, use cost-cutting measures, insurance and others for reducing the impact of the risks presently faced by it in the wake of the threats posed by Covid-19 and also for its prevention as well.

The three important job titles which are going to be important for the new manufacturing unit of the Swedish corporation in the nation of Mexico are operations manager, quality assurance manager and supply chain manager. Ivanov, Tsipoulanidis and Schönberger (2017) are of the viewpoint that the operations managers within the corporations are required to oversee the different high-level HR activities like recruitment and selection, analyzing the labor needs of the corporations, offering the required training to them and others. More importantly, they are also required to manage the different operations processes, manage quality, productivity and other important aspects which directly influence the growth of the organizations (Meredith and Shafer 2019). These activities are going to be of great important for the new manufacturing unit in Mexico and would also determine the success of the same. Thus this particular job title had been selected for the new manufacturing unit in Mexico.

Answer 3: Benefits and Drawbacks of Outsourcing Business Functions

On the other hand, Fernandes et al. (2017) have noted that the customers more than ever are effectively focusing on the attribute of quality because of the large number of service or product related options that are available to them presently and thus it had become important for the corporations to focus adequately on the aspect of quality. Furthermore, the quality assurance managers are also required to ensure the fact that the products or the services manufactured by the corporations are in compliance with the government and the industry quality standards, the quality standards followed by the corporations and also in synchronicity with the quality needs of the consumers as well (Chukwulozie, Nnaemeka and Chigoziri 2018). The job title of quality assurance manager had been seen that these activities are likely to be of great importance from the perspective of the new manufacturing unit which the corporation intends to establish in Mexico. Lastly, the supply chain manager had been selected since this particular manager will help the manufacture unit to procure the required raw materials which are being needed by it for the manufacture of the high-tech medical equipment. However, at the same time it needs to be said that since all of these expatriates are from Sweden thus they would have to familiarize themselves with the national culture of Mexico, the business style of the concerned nation, its etiquettes, greeting styles and others. These measures are likely to help the expatriates to overcome the initial cultural shock and ensure that the same would not affect the quality of work which would be performed by them within the manufacturing unit of the corporation in Mexico. Language training is another important aspect that needs to be taken care of since the languages which are being spoken in the two nations under discussion here are very different from each other. Furthermore, the corporation also needs to offer these expatriates adequate amount of compensation, incentives, perks and others for working in the nation of Mexico. These are likely to offer the required extrinsic motivation to the expatriates to work in the new manufacturing unit of the corporation in the nation of Mexico.       

Wahby et al. (2017) are of the viewpoint that the majority of the business corporations which are presently operating globally take the help of the process of outsourcing for the effective completion of their work, for enhancing the effectiveness of their corporations and other similar purposes. In this relation, General Motors (USA) is an important corporation which in the year 2019 finalized an outsourcing deal with Tata Consultancy Services (India) through which it transferred its production of vehicles in India to Tata Consultancy Services (Tcs.com 2020). There are various benefits that this deal offers to the corporation General Motors which in turn had propelled the corporation to maintain its outsourcing relationship with the above mentioned corporation. For instance, this particular outsourcing deal that had helped General Motors to resolve the manufacturing issues that it had been facing within the nation of India particularly in Bengaluru. General Motors earlier used to export the manufactured vehicles to India which in turn substantially increased its operations cost and also the cost that the customers needed to pay for the vehicles (Chandrashekhar and Mendonca 2020). However, through this particular deal it is now being able to manufacture low-cost vehicles in India itself and the customers also do not have to pay a higher price for the purchase of the same. This in turn had positively affected the sales volume of the vehicles offered by the concerned corporation in India which had enhanced its profitability as well (Tcs.com 2020). More importantly, this had also helped the corporation to utilize the technological resources of India, cheap labor offered by the nation and others which in turn had significantly improved the quality of the vehicles manufactured by it and also its profitability as well (Chandrashekhar and Mendonca 2020).

Answer 4: The Impact of Industry 4.0 Technologies on International Companies

As discussed by Globerman and Vining (2017), despite the different benefits offered by the process of outsourcing to the corporations it is seen that there are various negative aspects or negative connotations associated with the same as well. For instance, in the particular context of General Motors it is seen that because of this deal, the corporation had to part with more than 1,300 workers who had shifted to Tata Consultancy Services and this in turn is likely to adversely affect the human resources along with the other departments of the concerned corporation as well (Tcs.com 2020). More importantly, Tata Consultancy Services had also modified the vehicle designs, the features of the vehicles and other attributes of the vehicles offered by General Motors as per its convenience which in turn had significantly affected the quality of the vehicles (Chandrashekhar and Mendonca 2020). Another important negative aspect of this outsourcing which is being undertaken by General Motors is the fact that this had substantially enhanced the financial risks along with the operations risks and other risks faced by the concerned corporation. Furthermore, the delivery timing of the vehicles manufactured through this particular outsourcing also had been adversely affected which in turn had taken a negative toll on the brand reputation of General Motors. These in short are some of the most important negative aspects of the process of outsourcing which is presently being undertaken by General Motors.

Li, Hou and Wu (2017) are of the viewpoint that the Fourth Industrial Revolution or “Industry 4.0” had substantially changed the manner in which the different business corporations are managing their different business processes like manufacturing, sales, marketing and others. Adding to this, Xu, David and Kim (2018) have noted that the usage of the different disruptive technologies like artificial intelligence, advanced robotics, automation and others had become the trademark of the Fourth Industrial Revolution and this in turn had substantially reduced the dependence of corporations on human labor. For instance, it is seen that the majority of the work within the corporations which in the earlier times was completed by the human laborers are now being completed through the extensive usage of different disruptive technologies and this in turn had helped the corporations to substantially overcome their labor issues (Schwab 2017). More importantly, this particular approach used by the corporations had also helped them to move towards a more sustainable business model which in turn had also helped to attain sustainability as well as long-term growth (Peters 2017).

Tesla is an important automobile manufacturing corporation which since the year 2008 had been taking the help of advanced robots for the manufacture of the different electric cars offered by it (Schmid 2016). In this relation, it needs to be said that the concerned corporation because of its labor and other issues experienced a manufacturing disaster at the beginning of this century which in turn substantially narrowed the scope of its business (Munson 2018). Thus, for overcoming this particular manufacturing disaster, Elon Musk started to use robots for the manufacture of electric cars. This as a matter of fact not only helped the concerned corporation to overcome the manufacturing disaster which it experienced but also helped it substantially enhance the quantity of vehicles manufactured by it as well. For instance, presently the corporation through the usage of robots manufactures more than 30,000 units of electric cars per week and along with increase in the quantity of cars manufactured by it, the quality of the cars have also improved substantially (Valentin 2019). The usage of robots had removed the manufacturing defects in the cars offered by the corporation on account of human errors while helping to use latest technologies to improve both the quality and the quantity of cars manufactured by it as well (Schmid 2016). Moreover, by reducing its human workforce the corporation had also been able to enhance its profitability as well while helping it to achieve both the long-term and the short-term goals created by it as well. In addition to these, it had also been seen that the adequate usage of robots for the manufacture had also helped the corporation under discussion to outrival its major competitors within the automobile manufacturing industry which in turn had enabled the corporation to regain the competitive advantage that it lost during the manufacturing disaster experienced by it (Munson 2018). The below given table offers a rough overview of the history of the usage of robots by Tesla for the manufacture of cars-

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