Multinational Company Outsourcing

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Grand Canyon University *

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Sociology

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Jan 9, 2024

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Multinational Company Outsourcing Joshua P. Norholm Grand Canyon University SOC-100-0500 Professor Mitchell 01/23/2022 1

Multinational Company Outsourcing Global stratification in general, is when there is an unequal distribution of resources or services across various nations. Ford Motor Company has outsourced many resources for their vehicle production over the decades since their founder, Henry Ford. Henry Ford, the founder of the Ford Motor Company, is known as the pioneer of mass production and the inventor of the moving assembly line, which is considered the world's greatest contribution to manufacturing (Tomac, N., Radonja, R., & Bonato, J. (2019). As a company, this makes sense because they are able to get their materials and labor for lower cost by outsourcing to third world countries, however, this has also created some negative tension “at home” in the United States. The local cultures around Ford production plants suffer from this outsourcing because the local people are passed over for the possible jobs, which are offered to people in other countries. So, not only are the factories taking up space from potential housing, but they aren’t even benefitting the people around them. On the other hand, outsourcing to other countries helps to strengthen relations with those nations by offering jobs and thus pumping money into their economy. This encourages people to buy Ford vehicles, because they are happy to support a company that is supporting their economy. In the United States, there are countless companies that practice global stratification. The act of doing so boosts the economies of all who are involved, the United States gets their materials and labor cheaper, and the other countries get more money flowing into their economies. Ford is one of these companies, and although outsourcing might hurt those local to their facilities, it allows Ford to produce their vehicles at a lower cost, thus making them more affordable to the general population. The old-fashioned motto, “Afford a Ford” stands true, and the United States population appreciates them for it. One way that Ford Motor Company has practiced global stratification, is through their Ford Asia Pacific & Africa division. Although the company is headquartered in Michigan, Ford began in 2011 adding factories, dealers, and vehicles in the region “at a breakneck pace” expecting Asia Pacific to generate 60%–70% of its total growth in the coming decade (Juan Alcacer, & Nancy Hua Dai. (2014). This may seem like a problem for the United States economy, but by building all these assets in Asia Pacific, Ford strengthened the relationship between the U.S. and its Asian affiliates. Not only that, but the boost in Ford’s revenue, drastically increased the taxes owed to the United States Government. This added income helps the United States to grow and support its citizens, creating a better overall living experience here in the United States. All in all, the biggest winner here is the American people. On the surface, it may seem like global stratification hurts the United States economy, while in reality, practicing such strategies actually helps all those involved to grow and prosper. The United States helps other countries by providing jobs and income for the citizens through companies like Ford, the other nations provide lower cost parts and labor, which helps the companies to keep costs low and allows them to offer their products at more affordable rates, and the governments involved reap the benefits of more taxes being paid. 2

References Juan Alcacer, & Nancy Hua Dai. (2014). Ford Asia Pacific & Africa: The E-coating Facility Decision in Gujarat, India (A) . HBP Education Case Study Collection. Tomac, N., Radonja, R., & Bonato, J. (2019). Analysis of Henry Ford’s contribution to production and management. Scientific Journal of Maritime Research , 33 (1), 33–45. https://doi-org.lopes.idm.oclc.org/10.31217/p.33.1.4 3

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