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This case discusses the astounding growth of Crocs, Inc., a manufacturer of plastic shoes, from 2003 through early 2007. Much of the company's growth was made possible by a highly flexible supply chain that enabled Crocs to build additional product within the selling season. The normal model used within the fashion industry was to take orders well in advance of each selling season, and produce to those orders, with relatively little additional production. If demand was far in excess of this production, there would be stockouts and the company would lose the ability to capture revenue for that season. The product might or might not be in fashion the following year, when production would again be based on preseason orders. Crocs' ability to build additional shoes within the season enabled it to take advantage of strong customer demand, resulting in the company filling in-season orders totaling many times that of the initial prebooked orders. The case describes the Crocs supply chain. It asks students to assess the company's core competencies and how those can be exploited in the future. The case was revised in March 2011 to present information on the company's results in 2007 and prepare students for discussions of problems that would be faced in 2008 (covered in the B and C cases).

Starbucks Corporation was the world's largest specialty coffee retailer, with 2005 annual revenue of $6.4 billion. Despite gigantic growth in specialty coffee in the 1990s, a worldwide oversupply of lower-grade coffee had depressed market prices in the previous few years, making it difficult for coffee farmers to earn enough revenue to cover the cost of production. By the end of 2005, Starbucks was at a challenging point in its history. It boasted more than 10,000 stores--up from 676 a decade before--and roasted 2.3% of the world's coffee. Each day it opened an average of four stores and hired 200 employees. To support such a high growth rate, the company's future success depended on a secure supply of high-quality coffee beans to meet increased demand--Starbucks had to ensure a sustainable supply of this key commodity. The company decided to partner with Conservation International, an environmental nonprofit organization, to develop C.A.F.E. Practices (Coffee and Farmer Equity Practices). The goal was to contribute to the livelihood of coffee farmers and to ensure high-quality coffee for the long term. If Starbucks were able to overcome the issues it faced with a widespread implementation of C.A.F.E., the initiative could go a long way towards improving the sustainability of its coffee supply chain while at the same time improving Starbucks' image as a socially responsible corporation.

Covers inter-firm, IT-enabled supply chain collaboration and focuses on supplier-manufacturer collaboration. To assess collaboration from a holistic point of view, the case describes the distinct role played by the various parties involved in the collaborative effort: the manufacturer and its supply base, as well as a consulting firm, a supply chain process outsourcing company, and a software provider. Centers on the two latter companies--World Wide Technology (WWT), a $2 billion supply chain process outsourcing company based in St. Louis, and ClearOrbit, a rapidly growing software company based in Austin, Texas. Presents the story of a world-class automotive original equipment manufacturer (OEM) whose purchasing operations for maintenance, repair, and operations material had grown complex, costly, and error prone. In mid-2004, WWT, along with a consulting firm, proposed an outsourcing program to the OEM: the consulting firm would perform strategic sourcing and WWT would manage the entire fulfillment cycle. A critical feature of this program was that it would be collaborative. Early on in the program, however, it became apparent to WWT that delivering on the collaborative requirements of the program demanded the aid of specialized technological capabilities. WWT decided to partner with ClearOrbit, a company that had recently developed an Internet-based solution for companies to manage POs, deliveries, and invoices with a supply base regardless of size and technological resources available at each supplier. Describes the challenges of design, implementation, and growth of the program.

With 26 casinos in 13 U.S. states and $4.5 billion in revenue in 2003, Harrah's Entertainment Inc. was one of the leading brand names in the casino entertainment industry. Bill Harrah, the founder of Harrah's, was passionate about getting to know his customers and had instilled a deeply rooted commitment to customer satisfaction into Harrah's corporate philosophy. In 2003, Harrah's was focused on building loyalty and value with its target customers through a unique combination of great service, excellent products, unsurpassed distribution, operational excellence, and technology leadership. Through innovative customer relationship management strategies, effective management of its service supply chain, and sizable investments in enabling information technology, the company was at the forefront in attracting, serving, and retaining its customers.

Founded in 1987, Taiwan Semiconductor Manufacturing Co. (TSMC) was the world's first pure foundry, focused solely on the manufacturing of semiconductors. Operating in the cyclical semiconductor market, the company managed to grow rapidly and to become the world's 8th largest semiconductor manufacturer with more than a 50% market share in the foundry business. In the company's early days, TSMC management focused on manufacturing excellence and technology leadership. As competition in the sector intensified in the late 1990s, the company began to focus on customer service to differentiate itself further from companies like UMC, its next-door neighbor and closest competitor, and the rapidly growing Chinese foundries. The company invested heavily in the development of innovative, value-added services and proprietary information systems that would facilitate better communication and improve customer service, putting in place eCommerce applications such as eFoundry and Enterprise Supply Chain Management suites. TSMC management believed that customers, typically U.S.-based integrated circuit design houses facing high financial stakes, rapid technological innovations, short product life cycles, and intensive competition, would choose a foundry business partner based on quality, trustworthiness, and reputation, as opposed to price only. Could superior customer service make an impact in a capital-intensive, process- and quality- oriented industry such as the semiconductor industry, or would TSMC have to compete on price? Explores these issues, as well as other factors affecting TSMC's strategic path as it moves forward in the mid-2000s.

In November 2005, Microsoft prepared for a global launch of its next-generation game console, the Xbox 360. Microsoft's original Xbox had been introduced a year after Sony's Playstation, but would beat Sony's next-generation system to market by a substantial amount. It would also play an important part in Microsoft's future strategy, where the home entertainment system was seen as a major growth opportunity. Describes the evolution of the video game console business and the evolution of the Xbox, both from a design and manufacturing perspective. Microsoft's decisions for the original Xbox supply chain are described, together with the changes in the supply chain that were made for the Xbox 360. Asks questions about the motivation for changes to the supply chain, the risks and benefits of global rather than regional launch, and the use of contract manufacturers. Prepares students for discussion of how supply chains must evolve to support changing business strategy.

In 2005, Erez Meltzer, the president and CEO of Netafim (the world's leading manufacturer of drip irrigation equipment), was wondering whether Netafim's supply chain was strong enough to support the change in strategy he was planning for the company: migrating from selling products to selling solutions. When Meltzer stepped into office three years earlier, the company was struggling with flat sales, an out-of-date supply chain, and no global synergies. In just three years, Meltzer turned around the company, restructured its supply chain, and reinvigorated its growth. The question was whether the newly restructured supply chain would support the new strategy--one that would require new supply chain-related competencies from the organization.

In early 2005, the market for cement in Mexico was changing. The market, particularly in northern Mexico, had traditionally consisted primarily of sales of bagged cement, which was common in developing economies. There appeared to be a shift to bulk cement, more typical of developed economies. CEMEX, the third largest cement company in the world, and the dominant company in Mexico, had developed a strong brand identity for its bagged cement. Bulk cement, however, was harder to differentiate. Describes the Mexican cement industry and dramatic changes that CEMEX had made in 2000-2005 to focus on customer needs, particularly the needs of its distributors. These changes involved a wide range of activities, including dramatic improvements in logistics, creating a retail network among its distributors, and developing a suite of software applications to ensure that the right product was delivered to the right place at the right time. What lessons could the company adopt from its branded business and its success with building its distributor network, if the market turned more toward commodity bulk cement?

The Toyota demand chain is efficient, flexible, customer oriented, and product specific. Studies how Toyota uses its advanced distribution channels, inventory management, planning methodologies, and production capabilities to create and manage its demand chain, with a particular focus on the Japanese and the North American markets. Uses the Toyota Prius and the Scion product lines to illustrate how Toyota adjusts its demand chain to fit a particular product and its target customers, utilizing as much as possible from its existing manufacturing and distribution infrastructure.

In addition to its world-class supply and demand chain management practices, Toyota Motor Co. Ltd excels in managing its service chain. The service chain, which the company views as key to its long-term success, is responsible for providing products in the form of service parts for maintenance and repair, and services in the form of improving the value that a customer derives from a vehicle. Service chain management is based on establishing strong links with customers, both through the dealer channel and directly. Describes the network that Toyota has created to provide reliable supply of service parts to dealers in an efficient manner and how the company proactively helps dealers improve their service offerings to customers. Also discusses how Toyota uses advanced technologies, such as e-commerce and telematics, to build strong relationships directly with the vehicle owners. Focuses on Toyota's operations in Japan and the United States.

In July 2001, eight months after the release of Intel's Pentium 4 processor, sales of the new product had not met expectations. This was due in large part to significant downturns in world markets following record microprocessor demand in 1999 and early 2000. At the same time, Pentium III processor sales had not declined as rapidly as expected; in fact, production of desktop Pentium III processors was accelerated in the second quarter of 2001 to meet demand. Intel was faced with critical decisions about how to turn the tide to make the continuing transition to the Pentium 4 processor a success.

OnStar, a provider of in-vehicle safety, security, and information services called "telematics," was founded in 1995 as a collaborative venture among General Motors (GM), EDS, and Hughes Electronics Corp. Safety and security services, including roadside assistance, emergency help after a crash, remote diagnostics, and stolen vehicle tracking, were the cornerstones of OnStar's offering. In addition, OnStar provided its customers with a 24-hour connection to convenience services such as navigation and route guidance, vehicle location assistance, and personal concierge services. To generate more revenues, OnStar expanded its offering to luxury vehicles of other auto manufacturers. Looking back, Chet Huber, OnStar president, was quite satisfied with the company's achievements since it was founded: OnStar's subscriber base had grown to more than 2 million and the company was routinely recognized as the leading telematics provider in the world. OnStar was also delivering benefits to its parent company, GM. By maintaining one-to-one relationships with customers, OnStar helped GM sell more cars and trucks, strengthen customer loyalty, and improve operational efficiency. Although revenues for the world market of in-car telematics terminals were expected to reach $20 billion by 2010, competition in the market was intensifying. Richard Wagoner, GM's CEO, and Huber needed to explore a number of strategic and operational questions around the future of OnStar: How would OnStar create ongoing value to GM? How should OnStar position itself to gain high acceptance and subscription renewal rates? What further strategic partnerships should OnStar form to maintain its leadership? How should GM leverage the continuous stream of vehicle and customer data it received from OnStar?

Building a strong supply chain is essential for business success. But when it comes to improving their supply chains, few companies take the right approach. Many businesses work to make their chains faster or more cost effective, assuming that those steps are the keys to competitive advantage. To the contrary: Supply chains that focus on speed and costs tend to deteriorate over time. The author has spent 15 years studying more than 60 companies to gain insight into this and other supply chain dilemmas. His conclusion: Only companies that build supply chains that are agile, adaptable, and aligned get ahead of their rivals. All three components are essential; without any one of them, supply chains break down. Great companies create supply chains that respond to abrupt changes in markets. Agility is critical because in most industries, both demand and supply fluctuate rapidly and widely. Supply chains typically cope by playing speed against costs, but agile ones respond both quickly and cost efficiently. Great companies also adapt their supply networks when markets or strategies change. The best supply chains allow managers to identify structural shifts early by recording the latest data, filtering out noise, and tracking key patterns. Finally, great companies align the interests of the partners in their supply chains with their own. That's important because every firm is concerned solely with its own interests. If its goals are out of alignment with those of other partners in the supply chain, performance will suffer. When companies hear about the triple-A supply chain, they assume that building one will require increased technology and investment. But most firms already have the infrastructure in place to create one. A fresh attitude alone can go a long way toward making it happen.

In January 2003, West Marine (the nation's largest boating supply retailer) was on the verge of acquiring its biggest competitor, BoatU.S. Several years earlier, the company had acquired E&B Marine, another boating supply company of a similar size. However, that transaction proved to be too much for the organization to bear. Having nearly doubled its number of stores overnight, West Marine's systems and processes, as well as the experience level of its management team, could not withstand the rapid growth. West Marine's supply chain was especially hard-hit: The company was unable to keep all 72 West Marine and 63 E&B Marine stores amply stocked during the critical peak season. Following the E&B Marine transaction, the company charted a new course, bringing in a deeply experienced management team, initiating a significant cultural change, and repairing systems and processes across the company. On the eve of another major acquisition, West Marine was proud of all that the company had accomplished through its collaborative planning, forecasting, and replenishment program, particularly in the supply chain arena. As the company prepared to ramp up its growth engine again on its way to becoming a $1 billion business, West Marine's executive team wondered what "soft spots" might be discovered within its new and improved infrastructure.

With increasing pollution and congestion, European car manufacturers were concerned that governments might eventually ban conventional cars from city centers. A smaller car had the possibility of escaping such a ban. The producer of Swatch watches, SMH AG (Swiss Corp. for Microelectronics and Watchmaking Industries, Ltd.), came up with the novel idea of an environmentally friendly but stylish supercompact car. The smarta would embody a whole new notion of mobility, where owning a smart car would mean purchasing an uninterrupted mobility solution, referred to as smartmove. The program would offer the smart customer attractive, favorably priced parking spaces, access to other vehicles from AVIS and car-sharers, access to other means of transport, and reduced prices for transporting the smart on ferries and trains.

Supply chain management is all about software and systems, right? Put in the best technology, sit back, and watch as your processes run smoothly and the savings roll in? Apparently not. When HBR convened a panel of leading thinkers in the field of supply chain management, technology was not top of mind. People and relationships were the dominant issues of the day. The opportunities and problems created by globalization, for example, are requiring companies to establish relationships with new types of suppliers. The ever-present pressure for speed and cost containment is making it even more important to break down stubbornly high internal barriers and establish more effective cross-functional relationships. The costs of failure have never been higher. The leading supply chain performers are applying new technology, new innovations, and process thinking to far greater advantage than the laggards, reaping tremendous gains in all the variables that affect shareholder value: cost, customer service, asset productivity, and revenue generation. And the gap between the leaders and the losers is growing in almost every industry. This roundtable gathered many of the leading thinkers and doers in the field of supply chain management, including practitioners Scott Beth of Intuit, Sandra Morris of Intel, and Chris Gopal of Unisys. David Burt of the University of San Diego and Stanford's Hau Lee bring the latest research from academia. Accenture's William Copacino and the Warren Co.'s Robert Porter Lynch offer the consultant's perspectives.

Zaplet faces internal challenges following the dramatic change in the economy and the resulting market demand for its product.

It's the end of the quarter, and the sales staff at Exceso Corp. is scrambling to meet CEO R. Foley Vinton's overheated 9% sales target. Sure, the sales team has always hit its target in the past, and yes, that number was based on its forecast data. But the fact is, the projection was based on raw data. And as Martin Wu, the company's head of sales, warns Vinton, sales will do well to hit 3%. Vinton remains unconvinced. He has already given that number to the analyst community, and, he thinks, if he keeps up the pressure, Wu will find a way to make it, just like he always does. So Wu and his sales team do what they have done in the past--discount the heck out of their product and load up the distribution channel. That's great news for Alice Dias over at Flemings ValuMart. She just stocked up on 3,000 cases of ClickZipPlus at a 6% discount to the standing price, with the idea of shipping most of it to diverters and to other ValuMarts in regions that haven't been offered such a good deal. But it's bewildering to analyst Andrea Valdini who, after Vinton has just shepherded her through a plant cranking at full production, can't find any eight-packs at a store near the very offices where she and her colleagues are pondering the health of Exceso's stock. "They can't keep this up much longer," suggests a ValuMart manager, pointing to the empty shelves that are the ClickZipPlus display. As he falls asleep that night, Vinton thinks they'll be able to kick the loading habit--someday, when the timing's better. But should they? In R0205A and R0205Z, four commentators offer advice on this fictional case study.

Today's supply chain managers have been bombarded with a wide variety of the so-called leading-edge supply chain strategies. New terminologies and initiatives are being developed constantly. However, not all of these initiatives or strategies are appropriate for all firms. Companies need first to understand the uncertainties facing the demand and supply of its products and then try to match these uncertainties with the right supply chain strategies. Based on an analysis of the uncertainties of supply and demand facing the firm, this article develops a framework that can assist managers in developing the right supply chain strategy for their products.

Solectron Corp. grew rapidly from a small contract manufacturer in the early 1980s to the dominant company in the electronics manufacturing services industry by the late 1990s. In doing so, it evolved from providing peak capacity for its clients to providing services that clients could not provide on their own (low-cost materials and access to expensive capital equipment). Its next phase was to provide its clients with new ways of operating--such as outsourcing all operations except research, product conceptualization, marketing, and sales--allowing clients to outsource those activities that were not part of their core competencies. Describes this evolution and the rapid growth of the company. In 2001, the company's clients suffered severe business downturns, which in turn caused the first contraction in Solectron's history. Describes the company's initial response and raises questions about how the company should proceed.