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Monsanto's March into Biotechnology (C)
Supplements the (A) and (B) cases. -
Prism Canada Inc.
A buyer for Prism Canada, Inc. wondered how to outsource the company's inefficient sheet metal operation. To satisfy current and potential customers' requests to lower costs for up-coming contract bids, Donna had to decide quickly to whom to outsource and what criteria to use for choosing a supplier. The primary teaching objective is to take students through the supplier selection process, framed in an outsourcing context. Selection criteria, such as price, quality, and reputation and their relative importance will be examined. Other objectives include exploring the issues of implementing an outsourcing decision, keeping in mind employee concerns and union reactions, as well as impact on production operations. The case can be used at the beginning of a principals of buying course as an introduction to source selection. -
Fast, Global, and Entrepreneurial: Supply Chain Management, Hong Kong Style: An Interview with Victor Fung
In this interview, Li & Fung Chairman Victor Fung explains both the philosophy behind supply-chain management and the specific practices that Li & Fung has developed to reduce costs and lead times, allowing its customers to buy "closer to the market." Li & Fung, Hong Kong's largest export trading company, has been an innovator in supply-chain management--a topic of increasing importance to many senior executives. Li & Fung has also been a pioneer in "dispersed manufacturing." It performs the higher-value-added tasks such as design and quality control in Hong Kong, and outsources the lower-value-added tasks to the best possible locations around the world. The result is something new: a truly global product. To produce a garment, for example, the company might purchase yarn from Korea that will be woven and dyed in Taiwan, then shipped to Thailand for final assembly, where it will be matched with zippers from a Japanese company. For every order, the goal is to customize the value chain to meet the customer's specific needs. To be run effectively, Victor Fung maintains, trading companies have to be small and entrepreneurial. He describes the organizational approaches that keep the company that way despite its growing size and geographic scope: its organization around small, customer-focused units; its incentives and compensation structure; and its use of venture capital as a vehicle for business development. As Asia's economic crisis continues, chairman Fung sees a new model of companies emerging--companies that are, like Li & Fung, narrowly focused and professionally managed. -
Innovation at 3M Corp. (A)
Describes how 3M Corp. introduces and learns a new and innovative methodology called Lead User research to understand future customer and market needs. A team from 3M's Medical-Surgical Markets Division applies the Lead User methodology to the field of surgical infection control and discovers not only new product concepts but also a very promising new business strategy. Focuses on: (1) 3M's approach to the management of innovation and understanding market needs, (2) an in-depth description of the Lead User method and its potential as applied to the medical business, and (3) the managerial challenges of introducing novel methods into a successful organization. -
Innovation at 3M Corp. (B)
Supplements the (A) case. -
Note on Lead User Research
Describes the Lead User concept and method (step-by-step) with brief examples from industrial practice. -
Innovation at 3M Corp. (A), Spreadsheet Supplement
Spreadsheet supplement for 699-012. -
An Introduction to Inventory Control and Independent Demand
Inventories exist in virtually every organization, and can serve any number of purposes. However, they can also represent a significant investment. Consequently, an important challenge facing managers is balancing the economic benefits of less frequent orders or setups versus the costs of holding inventory. This note provides an introduction to managing independent demand inventory items. It reviews the basic techniques associated with independent demand items, including fixed order quantity and fixed time period systems, and the ABC inventory classification system. The note is intended to address the questions of how much to order (the lot size issue) and when to order (the reorder point issue). -
Hudson's Seafood Corporation (A)
This case is appropriate for teaching courses in operations, leadrership, strategy, and managing a small business. A founder is faced with several issues concerning the service operations of his two restaurants. An immediate issue as to how to resolve an employee-relations problem has surfaced between the servers and their assistants. But the more comprehensive and perplexing problem is whether to change the service-operations package at one of the restaurants where personnel problems have adversely affected the quality of the food, and customers appear to be confused as to what kind of restaurant it is. These problems have forced the owner to examine the fundamental strategies used to deliver services at the restaurant, and to analyze its target markets. Another issue is future business investment. There is a teaching note (OM-0875TN) available. -
Product Development at Dell Computer Corp., Spreadsheet Supplement
Spreadsheet supplement for case 699010. -
Product Development at Dell Computer Corp.
Describes how Dell redesigned its new product development process after experiencing a major product setback and a significant decline in firm profits in 1993. Dell's new process is challenged during the development of a new line of portable computers when the incoming head of portables has to manage the risk of using a new technology. This case focuses on: (1) product development process design, (2) the costs and benefits of flexibility and structure in uncertain environments, and, (3) managing development risk during and after a financial and market setback. -
Display Technologies, Inc. (Abridged)
Display Technologies, Inc. (DTI) is a new joint venture between Toshiba and IBM Japan that is manufacturing the most advanced form of flat panel displays. With success in achieving significant production volumes, DTI has been asked to double its output as quickly as possible. Mr. Shima, DTI's president, must decide among three options, each of which has immediate and long-term strategic consequences. -
Operations-Based Strategy
Although most companies confine their operations organizations to restricted, tactical roles, in some of the most successful firms operations has served as the foundation for--indeed, the driver behind--successful strategic attacks and defenses. This is most clearly seen in cases where small companies--although lacking the advantages of size, market position, and proprietary technology--take on big companies and in a relatively short time push their way to industry dominance. In such cases, the key to success often is an operations-based advantage. The peculiar nature of this advantage provides insight into the reasons many former industry leaders did not react more promptly and vigorously to such attacks, and why others, in contrast, were able to defend themselves successfully. -
Planning for Product Platforms
This is an MIT Sloan Management Review article. By sharing components and production processes across a platform of products, companies can develop differentiated products efficiently, make their manufacturing processes more flexible, and take market share away from competitors that develop only one product at a time. The platform approach also enables companies to manufacture products in high volumes that are tailored to meet the needs of individual customers. A platform is a collection of assets--components, processes, knowledge, people, and relationships--that a set of products share. The platform planning effort involves two key tasks. First, product planning, where marketing managers determine which market segments to enter, what the customers in each segment want, and what product attributes will appeal to those customers. Second, system-level designers decide which product architecture to use to deliver the different products while sharing parts and production steps across the products. Three key ideas underlie the platform planning process. First, customers care about distinctiveness, how closely the product meets their needs. At the same time, the cost of a firm's internal operations is driven by the level of parts held in common among a group of products. Second, given a particular product architecture, there is a trade-off between distinctiveness and commonality. Third, product architecture dictates the nature of this trade-off. By developing and aligning three tools--a product plan, a differentiation plan, and a commonality plan--managers can balance the need for distinctiveness with the need for commonality. The process must involve all key functions and be guided by top management. -
GM Powertrain
Discusses a young MBA plant manager who is improving the operations of a small General Motors components plant in Fredericksburg, Virginia. At 29 years old, Joe Hinrichs is the youngest plant manager at GM, and in his new assignment, he is faced with the daunting challenge of designing and implementing significant manufacturing procedures that will dramatically improve the plant and remove it from its current unprofitable and inefficient state. Aided by the introduction of new carbon fiber technology that has revolutionized the plant's product (the torque converter clutch, a component of the automatic transmission of a car), Hinrichs hopes to keep the plant open by streamlining operations, reducing inventory, redesigning worker jobs, increasing worker commitment, and other improvements. During this process, he must deal with an unexpected union strike, equipment malfunctions, and other problems that threaten the success of the improvement process. He has, however, found unusual ways to overcome these barriers without eroding worker trust. At the end of the case, Hinrichs faces the serious dilemma of what to do about the broken 1,500-ton press, one of the most important machines in the production process. Three options are outlined, each with technical and managerial tradeoffs. -
COM DEV Xi'an: ISO 9000 Registration
Ken Zelazny, general manager of COM DEV's Chinese facility, which assembled satellite components, was trying to decide whether the plant should seek ISO 9000 certification. Not only did ISO 9000 registration have a number of advantages and disadvantages, but also the decision in the Chinese plant would have some implications for COM DEV's other facilities in Canada and Europe. In addition, if Zelazny decided to seek ISO 9000 certification for his plant, he would have to decide which level of certification to seek. The case is intended to expose students to the ISO 9000 series of quality standards. -
DuPont Kevlar: Commercializing a Miracle Fiber
Describes Dupont's efforts to build commercial markets for its miracle fiber, Kevlar. Initially, it sought to create a market for Kevlar tire cord, primarily because its existing tire cord business was languishing. This market never developed, even after Dupont spent several hundred million dollars. A rewritten version of an earlier case. -
Industrie Pininfarina: The New Customer Decision
A renowned manufacturer and designer of niche vehicles for major automobile companies has traditionally competed on flexibility using a highly skilled design and manufacturing workforce and low levels of automation. However, the European auto market is threatened with a shakeout. The director of operations must decide whether to accept an offer from Mitsubishi to become the exclusive European manufacturer of a sport utility vehicle. The order would more than double the company's manufacturing volume and relieve pressure to replace models currently in production. However, the fit of the order with existing manufacturing strategy is poor, and major changes in facilities and equipment as well as people and systems would be required. The case is suitable for use in an operations class to introduce or apply basic concepts in operations strategy or to discuss operations capability and strategy with executives. -
Merchandising at Nine West Retail Stores
Describes the merchandising decision process (organization, structure, and incentives) at Nine West retail stores, a large footwear retailer in the United States. Also describes changes currently occurring at Nine West and thus provides a context in which students can recommend changes to the merchandising process and the structure of the merchandising organization. To explain how merchandising decisions are made at a fashion retailer and to explore how changes in the environment will impact the merchandising organization. -
Off Broadway Photography
In early January 1998, the co-owners/photographers of Off Broadway Photography, were reviewing the company's year-end financial statements. Although profit levels were up from last year, sales were down. To improve both their sales and profit levels, the partners were considering three options; purchasing bulk film, outsourcing black and white film development, and changing the proof format. Students need to assess the company's current customer requirements and what is important to them, the company's current activities as to both efficiency and effectiveness and how the company could become more efficient, and therefore more profitable. The tradeoffs presented require both quantitative and qualitative analysis.