WHEN COMPANIES MANUFACTURE IN DEVELOPING COUNTRIES

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WHAT HAPPENS WHEN COMPANIES MANUFACTURE IN DEVELOPING COUNTRIES?

 

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Manufacturing plants in developing countries have more potential competitive advantages over their industrialized counterparts than just lower costs. International companies sell their products worldwide, but many manufacture their goods in developing countries. In these countries, production costs, like land the factory is built on, electricity for the factory lights, and wages paid to workers are lower than in the United States and other developed countries. Also, governments in developing countries often give international companies incentives, such as lower taxes and fewer regulations, to persuade them to set up factories. China is the largest manufacturer in the world. Its government has been offering incentives to international businesses to encourage economic development since the 1980s, and the cost of Chinese labor and materials is low.

Motivation is again a product of good leadership. Motivation is highly personal, and it is the leaders responsibility to understand what motivates each individual and implement policies to obtain maximum performance from a group. The importance of the leaders role in motivating individuals is highlighted in Herzberg’s Two Factor theory. The theory highlights factors that must be in place to avoid dissatisfaction, hygiene factors, and factors that promote satisfaction, motivation factors, shown in Figure 4 (Pettinger, 2007). Herzberg’s theory helps to decipher what motivates individuals, but does not advise on how to implement this to produce maximum productivity from an individual, this is achieved by using the theory in conjunction with other motivational theories such as goal setting theory.
Figure 4: Hygiene and Motivating Factors (Pettinger,, 2006)
Goal setting is not just an important part of motivation, they are essential for both teamwork and successful leadership, they provide indication on what must be achieved, how much effort they must devoted to achieve it and they act as the primary source of job motivation for individuals, therefore setting them accurately is essential (Pettinger 2007). Specific and clear goals are the most effective motivators, and will lead to optimum performance, therefore it becomes essential for a leader to understand what motivates each individual within a group (Pettinger, 2007). Motivation is highly personal, and can differ massively across a group, so the leader must adapt how they motivate to suit each individual, this highlights the need for an organisation to implement policies that allow leaders to be flexible in how they reward individuals. Issues arise when goals are not set well, if the goals are ambiguous, unachievable or too easy then the individual will lose motivation (Pettinger, 2007). Once goals have been set it becomes essential for leaders to regularly assess how individuals are progressing towards them, if well then goals should be made more challenging, if the

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