Insights into the global factory

The conceptual structure of the global factory derives from internalization theory and incorporates the “make or buy” decision , the location decision , and the role of headquarters in orchestrating the focal firm’s global value chain. Global factories both shape and respond to globalization. The network aspect of modern global enterprises and the “fine-slicing” of activities are key aspects of global factories explaining their flexibility and resilience in the face of exogenous changes in the global economy. New management strategies are mandated by the transition of integrated multinational enterprises into global factories.