Based on the article illustrated below "HP in Singapore".
1) Compared to other countries, why did HP select Singapore?
2) What were 'key criteria'?
3) When did it establish its wholly-owned-subsidiary there?
4) What cases of ethnocentrism are identified in the mini-case?
5) How did HP Singapore become 'a strategic factory and development center for HP'?
6) On pure speculation, what do you think HP Singapore is currently involved with?
P.S. Please provide appropriate references for statements and/or quotations next to the statements and/or quotations itself, apart from the references that you would provide at the end of your response as well. If you're just going to respond with outside references only, then please DO NOT respond. Also please provide references that I can access.
Hewlett Packard in Singapore:
In the late 1960s, Hewlett Packard Company was looking around Asia for a low cost location to produce electronic components that were to be manufactured using labor intensive processes. The company looked at several Asian locations but eventually settled on Singapore, opening its first factory there in 1970. Although Singapore did not have the lowest labor costs in the region, costs were low relative to North America. Plus, the Singapore location had several important benefits that could not be found at many other locations in Asia. The education level of the local work force was high. English was widely spoken. The government of Singapore seemed stable and committed to economic development, and the city state had one of the better developed infrastructures in the region, including good communications and transportation networks and a rapidly developing industrial and commercial base.
HP also extracted favorable terms from the Singapore government with regard to taxes, tariffs, and subsidies. To begin with, the plant manufactured only basic components. The combination of low labor costs and a favorable tax regime helped to make this plant profitable early. In 1973, HP transferred the manufacture of one of its basic handheld calculators from the United States to Singapore. The objective was to reduce manufacturing costs, which the Singapore factory was quickly able to do. Increasingly confident in the capability of the Singapore factory to handle entire products, as opposed to just components, HP's management transferred other products to Singapore over the next few years including keyboards, solid state displays, and integrated circuits. However, all of these products were still designed, developed, and initially produced in the United States.
The plant's status shifted in the early 1980s when HP embarked on a worldwide campaign to boost product quality and reduce costs. HP transferred the production of its HP41C handheld calculator to Singapore. The managers at the Singapore plant were given the goal of substantially reducing manufacturing costs. They argued that this could be achieved only if they were allowed to redesign the product so it could be manufactured at a lower overall cost. HP's central management agreed, and 20 engineers from the Singapore facility were transferred to the United States for one year to learn how to design application specific integrated circuits. They then brought this expertise back to Singapore and set about redesigning the HP41C.
The results were a huge success. By redesigning the product, the Singapore engineers reduced manufacturing costs for the HP41C by 50 percent. Using this newly acquired capability for product design, the Singapore facility then set about redesigning other products it produced. HP's corporate managers were so impressed with the progress made at the factory, they transferred production of the entire calculator line to Singapore in 1983. This was followed by the partial transfer of inkjet production to Singapore in 1984 and keyboard production in 1986. In all cases, the facility redesigned the products and often reduced unit manufacturing costs by more than 30 percent.
The initial development and design of all these products, however, still occurred in the United States. In the late 1980s and early 1990s, the Singapore plant started to take on added responsibilities, particularly in the inkjet printer business. In 1990, the factory was given the job of redesigning an HP inkjet printer for the Japanese market. Although the initial product redesign was a market failure, the managers at Singapore pushed to be allowed to try again, and in 1991 they were given the job of redesigning HP's DeskJet 505 printer for the Japanese market. This time the redesigned product was a success, garnering significant sales in Japan. Emboldened by this success, the plant has continued to take on additional design responsibilities.
Today, it is viewed as a lead plant within HP's global network, with primary responsibility not just for manufacturing, but also for the development and design of a family of small inkjet printers targeted at the Asian market.