FuYao is a Chinese manufacturing company that products glass for automobiles companies:
The company setup a factory in Dayton Ohio in 2013 to take advantage of the abundant supply of cheap skilled labor in the region resultant of the 2008 recession.
- globalization continues to apply downward pressure of wage growth around the world for commoditized labor
- automation continues to eliminate entire categories of jobs around the world
In depth analysis of FuYao Glass America
The opening of a plant in the new country can be seen as a acquisition of sorts. Acquisition activities is considered a merge of the following components:
In this case, it could be seen as a merging of FuYao’s culture and process with Dayton Ohio’s asset which is cheap skilled labor.
Below are the key conflicts with the merger
- highly structured and propagandized environment (Chinese) versus loosely structured and casual environment (USA)
- processes built around social norms in a weak union environment (China) versus social norms from a strong union environment (USA)
- productivity and throughput focused paradigm (Chinese) versus safety and family focused paradigm (USA)
- workers paid USD29/hr when working for GM before it shuttered are now paid USD17/hr under FuYao
- governor and grassroots were encouraging unionization to encourage more say American say in the running of the plan
- removal of locally hired senior management (USA) with Chinese senior management (USA) for effective implanting of culture within company
- battling against worker unionization