"Welch's March to the South"
Business Week, December 6th, 1999, pp. 74-78.
Synopsis:
There are three major functions that firms can globalize: input (where to get resources) - transformation (where to manufacture) - output (where to sell). Even though the three functions are equally important, their impacts on business, consumers and suppliers are significantly different.
This article explains how Welch, General Electric Co. (GE) CEO, globalizes all aspects of the company especially its suppliers. By demanding deep price cuts from GE's suppliers, Welch pressures them to move to low-cost Mexico. This article also explains the concerns of GE unions about the resulting loss of US jobs and the potential impact of Welch's supplier squeeze on other companies.
Full-text Article:http://www.businessweek.com/1999/99_49/b3658138.htm
Text connection:
Chapter 1 "Globalization" (pp.7-10) and Chapter 7 "The Political Economy of Foreign Direct Investment" (pp. 219-221).
