Gpv Outsourcing To China

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Question 1 To analyze how Global Sourcing Division - GSD can generate added value to their customers and to the rest of GPV's organization, we suggest to make an internal audit of GSD’s production and delivery process in terms of “Seven wastes of lean management”: 1. Overproduction, which leads to higher inventory costs; 2. Waiting time within the product process; 3. Transport, optimizing logistic can decrease the time-to-market rapidly; 4. Inappropriate processing; 5. Unnecessary inventory increases costs and waists working hours; 6. Unnecessary/excess motion; 7. Defects. To avoid these “seven wastes” Six sigma business management strategy could be used in order to optimize the production process, avoid defects and waiting times. Just-In-Time (JIT) saves unnecessary inventory and waiting time due to delivery optimizing. Outsourcing production facilities or establishing factories in the Asian area is an option too since our costumers moved there. It also gives the opportunity to expand the market share within Asia. Furthermore decreasing the production time by updating production facilities and investing into train employees shoud be considered. In logistics hard and soft objectives are defined. When looking at the hard objectives such as time and costs, it is more productive for GPV to outsource production to China. The time Spent on transporting decreases because most of the customers are having their production already in China, therefore it would be a good idea for GPV to outsource it there – cost advantage. The third hard objective – quality – would decrease. We assume that the company might not keep up with the Denmark’s high standarts and communication between departments in Denmark and China. These issues are discussed further in this report. Regarding the soft objectives such as confidence and security, they shouldn’t be affected by
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