1. why is automation such an important om decision in china?

Source: ​ Roberts, Dexter.​ “The March of Robots Into Chinese​
Factories,” Bloomberg​ Businessweek,
​http://www.businessweek.com/articles/2012-11-29/the-march-of-robots-into-chinese-factories,
posted​ 11/29/2012. Step into the factory of Chinese SUV and truck
maker Great Wall Motors and​ it’s easy to forget​ you’re in China.​
Swiss-made robots pivot and​ plunge, stamping metal door frames and
soldering them to the skeletal vehicle bodies of a​ mini-SUV.
Workers in hard hats are few and far between.​ “With automation, we
can reduce our head count and save​ money,” says Great​ Wall’s
manager, who has invested​ $161 million​ (about $50,000/robot) into
mechanizing 4 plants with​ 1,200 robots.​ “Within three​ years,
this cost will be completely paid for in savings from reduced
worker​ wages.” After the robots were​ added, the number of welders
dropped from​ 1,300 to around 400. Last year sales of industrial
robots in China reached​ 22,577 units, up​ 51% over 2011. That puts
China just behind Japan and S.​ Korea, but ahead of Germany and
the​ U.S., in the purchase of new robots. China is on track to
become the​ world’s largest robot market by 2014. One factor
driving the switch to robots is demographics. Next year​ China’s
labor force will peak at 1 billion before starting to shrink. Labor
shortages are already common and are driving wage inflationlong
dash—up around​ 20% annually recently. For the textile​ industry,
facing​ ever-narrower margins, automation may be the only
alternative to shutting down or moving. While some factories
relocated to​ lower-wage Cambodia and​ Vietnam, sweater maker​
Milo’s Knitwear upgraded. After spending​ $1.9 million for 29
Japanese stitching​ machines, its factory has reduced staff from
140 workers to 6. Worker protests have also sped up the automation
trend. Labor unrest at giant electronics​ manufacturer, Foxconn,
has forced shutdowns at several of its facilities. Last year the
company announced the ambitious goal of adding a million robots
within three years. Foxconn will have at least​ 30,000 robots in
China by​ year-end. Workers have one consolation. With
manufacturing wages still less than a 10th of those in the​ U.S.,
Chinese factories are unlikely to soon be as​ robot-dependent as
those in developed countries. As product cycles shorten and
customers put in smaller orders more​ often, people can still be
shifted more quickly to new production roles. In​ China, says one​
expert, “a fully​ automated, human-less factory will still be hard
to justify any time in the near​ future.” The bottom​ line: With
robot sales in China​ up, the switch from​ low-wage shops to​
high-end producers is under way.0 Critical Thinking​ Questions: 1. Why is automation such an important OM decision in​
China? A. There is increasing competition from​ lower-cost
countries. B. ​China’s “one-child” policy means the population is not
expanding. C. Robotics can save money. D. All of the above. 2. Why is Great Wall Motors investing so much in​ robots? A. Robots have dropped in price significantly since the​
2008-2010 recessions. B. The company wants to save money. C. Workers are too hard to train in the auto industry. D. Unions prevent some jobs from being completed
efficiently. 3. Why is​ China’s textile industry​ vulnerable? A. ​Myanmar’s (Burma) new leadership is driving customers to
produce there instead of China. B. ​Lower-wage countries are trying to take its business. C. ​China’s robots cannot make clothing efficiently. D. Foxconn has faced labor unrest. 4. How has automation impacted manufacturing jobs in the​
U.S.? A. It has an overall negative impact. B. It is bringing more manufacturing work back to the U.S. C. It has resulted in stronger unions. D. It has created millions of new jobs.

1. Why is
automation such an important OM decision in​
China?
A. There is increasing competition from​ lower-cost
countries.
B. ​China’s “one-child” policy means the population is not
expanding.
C. Robotics can save money.
D. All of the above.Ans.D. All of the above.
Because China is rapidly increasing its use of automation to
counteract the predicted decline in its labour force due to the
effects of its one child policy.”With automation, we can reduce our
head count and save​ money,” says Great​ Wall’s manager, who has
invested​ $161 million​ (about $50,000/robot) into mechanizing 4
plants with​ 1,200 robots.​2. Why is Great Wall
Motors investing so much in​ robots?
A. Robots have dropped in price significantly since the​ 2008-2010
recessions.
B. The company wants to save money.
C. Workers are too hard to train in the auto industry.
D. Unions prevent some jobs from being completed efficiently.Ans.B. The company wants to save money.
Because For Great Wall, a private sector Chinese car maker that
employs 50,000 workers, the Swiss robots and other machinery that
line its bright factory floor produce more than cost savings.3. Why is​ China’s
textile industry​ vulnerable?
A. ​Myanmar’s (Burma) new leadership is driving customers to
produce there instead of China.
B. ​Lower-wage countries are trying to take its business.
C. ​China’s robots cannot make clothing efficiently.
D. Foxconn has faced labor unrest.Ans.B. ​Lower-wage countries are trying to take its
business.
because China’s textile industry is facing various difficulties,
such as excessive resource reliance, low technology and value
added, indisposition in trade structure and highly concentrated
export markets. More and more trade sanctions against China’s
textile products are particularly noteworthy as they cast tight
restrictions on China’s competitive advantage in this
industry.4. How has automation
impacted manufacturing jobs in the​ U.S.?
A. It has an overall negative impact.
B. It is bringing more manufacturing work back to the U.S.
C. It has resulted in stronger unions.
D. It has created millions of new jobs.Ans.D. It has created millions of new jobs.
“Automation creates more jobs that are technical in nature instead
of a person loading parts all day,” responded Seth Warnke, a
controls technician at Nammo Talley Inc. “

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