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You work for a company that makes vehicle safety systems, such as radar, on-board cameras, and the ever-present back-up beeper. To reduce costs on your most mature product, the back-up beeper, you are considering moving production out of the United States. You are considering Mexico, Philippines, and Singapore. You are interested in road infrastructure, port infrastructure, technological readiness, and wages. 1. Compare the four countries on these dimensions. Include the United States in your analysis as well as a baseline. For wages, use the Bureau of Labor Statistics’ Foreign Labor Statistics website bls.gov/fls. In particular, use the Index of Hourly Compensation Costs for Production Workers http://www.bls.gov/news.release/ichcc.t01.htm (Links to an external site.) . For the other data, use the World Economic Forum’s Global Competitiveness Report http://gcr.weforum.org/gcr/ (Links to an external site.) The bar chart comparison feature is an efficient way to get the information you need.
2. You are also interested in the overall business climate, which you consider to consist of factors like corruption, accounting standards, and a solid legal system. Use the Opacity Index Operations and Supply Chain Management for the 21st Century 121
to compare the overall level of opacity of each of the four countries: http://www.kurtzmangroup.com/reports/opacity_index_2.pdf (Links to an external site.)
3. What other factors should be considered?
4. What is your recommendation?
(You also can locate the reports by doing a web search on “opacity index” or/and on “BLS FLS Production Workers: Indexes of hourly compensation costs”)
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