After a substantial devaluation in the value of the Mexican currency, a major automaker attempts to reduce the price it is paying to a Mexican based supplier. The supplier (Ventramex) is put in a difficult position because a large portion of its costs is based in US dollars. The company must decide how to respond to the automaker while considering options that would increase the proportion of its costs that are based in Mexican pesos.
This case demonstrates how forming strategic partnerships with suppliers and clients can lead to win-win-win situations in the supply chain. It can be used to discuss the importance of information sharing and the use of information technology to drive the direction of the individual relationships. It also shows how cultivating partnerships can result in a competitive advantage in a highly competitive service industry. Techniques for developing and maintaining such a relationship are also brought out in the case, and it provides an opportunity to focus on the key concepts of supply chain management as they apply to service industries.
The president and owner of a small sandal factory realizes that if his company is to survive in the long-run, the manufacturing operation would need to become more efficient. Relaxed tariff barriers had increased the level of foreign competition in the country, particularly in the footwear industry. He had recently attended a seminar on total quality control (TQC) sponsored by the local trade association. Despite the potential benefits of TQC and its record of past successes, John was uncertain whether the Mexican employees would be able to implement TQC, a system that appeared to be based on different norms and values than those of Mexican workers.
The president and owner of a small sandal factory decided to implement TQC in his company factory. This case outlines the steps he followed, the problems he encountered and the measures he took to correct them as he introduced his employees to TQC. This case is intended to be used in conjunction with Sandalias Finas de Cuernavaca, S.A.: Total Quality Management (A), case 9A95C018.
Techno Systems, an industry leader in providing electronic kit assemblies for customized commercial applications and government, is currently undergoing a transition from a heavy government orientation to a more commercial customer base. A director of sourcing has been asked to prepare a review of the sourcing function by using benchmarking. She is considering how to effectively implement a benchmarking effort that would contribute to the sourcing review. Based upon her presentation, the upper management will determine the need for strategy development in the sourcing department. In essence, she is determining the hierarchical placement of the sourcing department for the future. This case affords the student an opportunity to examine sourcing in relation to operations strategy and to investigate benchmarking practices. It includes information compiled from benchmark studies conducted by the Center for Advanced Purchasing Studies (CAPS) and provides an insight into gated benchmarking.
A medium-sized Canadian packaging firm is facing the potential recall of 90,000 individual products by one of its major pharmaceutical clients. The defects are packaging-related and were traced to a lot of customer-finished boxes that Jones, Box and Label had recently delivered. The immediate issue is to determine the problem causing defective packaging materials and how to solve it. Other business basics include: quality assurance, what type of relationship between buyer and supplier is most effective for problem-solving and whether the anticipated level of uncertainty dictates the nature of buyer-supplier relationships. The case introduces students to Kepner-Tregoe problem solving and offers an opportunity to compare and contrast this problem resolution methodology with Ishikawa (or fishbone) diagrams and other problem-solving techniques.