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Further information is provided to the situation described in Kapco Limited (A), case 9A93D015, which leads to a request for Matt Gruber's resignation.

In the final case of the Kapco series, Matt's firing, and how he handled it, are presented. See Kapco Limited (A), case 9A93D015, for the origins of the story.

This is an MIT Sloan Management Review article. In a time of shortening product life cycles, complex corporate joint ventures, and stiffening requirements for customer service, it is necessary to consider the complete scope of supply chain management, from supplier of raw materials, through factories and warehouses, to demand in a store for a finished product. Hewlett-Packard has developed a framework for addressing the uncertainty that plagues the performance of suppliers, the reliability of manufacturing and transportation processes, and changing customer desires. Describes several cases in which entire product families are reevaluated in a supply chain context. The methodology presented should help others to manage their own supply chains more successfully.

Cummins Engine Co. is starting up production of diesel engine crankshafts in its plant in central Mexico. This operation requires much tighter tolerances than any product previously produced at the plant, and the young (recent MBA) manager who is in charge of the start-up is faced with several difficult decisions regarding the equipment to be used for crankshaft machining in Mexico. On the one hand, some of the equipment used for this purpose in Cummins' U.S. plant is inappropriate in the Mexican context. On the other, he has to operate under severe budgetary and supplier constraints. A subsidiary issue has to do with the long-term strategy for the Mexican plant, which has developed into one of the best in Cummins' worldwide network but risks being fragmented by the many opportunities for adding products that are available to it.

Logistics have the potential to become the next governing element of strategy. Customer needs vary, and companies can tailor their logistics systems to serve them better and more profitably. The goal of logistics strategy is building distinct approaches to distinct groups of customers. The first step is organizing a cross-functional team to proceed through the following steps: segmenting customers according to purchase criteria, establishing different standards of service for different customer segments, tailoring logistics pipelines to support each segment, and creating economies of scale to determine which assets can be shared among various pipelines.

This is an MIT Sloan Management Review article. Vertical integration is a risky strategy--complex, expensive, and hard to reverse. Yet, some companies jump into it without an adequate analysis of the risks. The authors developed a framework to help managers decide when it's useful to vertically integrate and when it's not. They examine four common reasons to integrate and warn managers against a number of other, spurious reasons. Their primary advice: Don't vertically integrate unless it is absolutely necessary to create or protect value.

Describes the history, theory, and practice of high-commitment work systems. The history reviews classical approaches (i.e. Frederick Taylor), the human relations movement, the human resources approach, quality of work life, and empowerment. The theory examines the underlying principles of design. The practice section reviews the experiences to date with these systems, including such innovations as gainsharing and such problems as defining the role of supervisor.

Prior to the 1980s, automakers purchased individual seat components and built the seats alongside their auto assembly lines. This case describes how Johnson Controls, Automotive Systems Group, blossomed when automakers turned to outsourcing the complete seat set. The case closely examines one plant, in Georgetown, Kentucky, that switched from just-in-time (JIT) delivery of seat sets to JIT assembly to serve a nearby Toyota Camry assembly operation. Exposes the challenge of dealing with growing seat variation and an opportunity of doubling the plant floor space at a separate site. The specific case question is how the plant should use this new space.

Details the evolution of a value-creating supplier-buyer partnership. Describes the buyer's (Liz Claiborne) manufacturing and marketing strategy, and details the workings of the firm's relationship with an important Taiwanese supplier of piece goods (Ruentex Industries Ltd.).

IBM has established a service delivery system to provide service and maintenance parts for its installed base of computers. The case outlines the competitive pressures IBM faces from alternative providers of maintenance services (e.g. other OEMs, third-party maintainers, and independent retailers) and describes the shifting service requirements of computer users. Describes a variety of programs that IBM has undertaken to improve its after-sales service operations, and proposes a variety of alternatives that IBM is considering implementing. Illustrates the value of communication and coordination between different functions within IBM (e.g., between maintenance, manufacturing, distribution, and marketing) to allow services to be provided in a competitive manner and to provide appropriate feedback from the field.

This case requires a decision on the possible consolidation of three Midwest business-travel centers. Significant cost savings in service representatives can be achieved by combining the front-end (booking) operations. The sensitivity of cost to service-productivity levels and customer waiting time is also explored. This case and related materials can be used as part of the Workforce Planning Module.

Linda Metzler, newly-appointed production planning manager, is drafting an aggregate production plan for the company's refrigerators, freezers and air conditioners for the next year. She has considered three plans. Students are asked to devise better plans and to evaluate the quantitative and qualitative factors favouring them. Ultimately, the use of linear programming to construct aggregate plans will be introduced.

The University of Western Ontario's fitness unit coordinator was wondering how to improve the aerobics program. With financial and time constraints, a very seasonal demand pattern, and an entirely part-time staff with relatively short tenure, she wondered how to improve the quality of service, the suitability of classes, the number of classes, and the productivity of program administration. Students have to analyze market survey data and develop a plan of action.

Richard Romano, a principal of a small real estate appraisal firm, faced an interesting ethical dilemma. A client had just stated that if the firm did not increase its appraised value of the client's commercial property by $4.5 million (15%), he would take his business elsewhere. Potentially, the client had a large volume of business which the young appraisal firm could certainly use. Richard must consider the firm's economic health in both the short and long terms, his personal values, and the ethical guidelines of the Appraisal Institute of Canada in making this decision.

In the late 1980s, the way New York City cared for thousands of its abused and neglected children underwent an unplanned shift. The impetus for the change came from a crisis: an explosive growth in the number of children in need of foster care. Between 1986 and 1990, the number of children in the city's foster care system nearly tripled, a tragic consequence of the crack epidemic plaguing the city. The sudden increase in demand for foster care overwhelmed the city's traditional source of foster care placements. Under pressure to find homes quickly, officials turned to a recently launched, city-run program--known as kinship foster care--to help meet the need. Kinship foster care was originally intended to be a relatively modest program. But in the wake of the crisis, the program rapidly ballooned, transforming the city agency responsible for foster care from a purchased and overseer of services into the nation's largest direct provider of foster care. This case chronicles this period of change and expansion for Kinship Foster Care and focuses on the leadership of then commissioner of the Child Welfare Administration Robert Little. It should be paired with HKS82 (Epilogue). HKS Case Number 1203.0.

Faced with the need for draconian budget cuts, Robert Little was determined to do all that he could to save his agency's struggling Kinship Foster Care Program. Preserving the core of the program would demand two major steps: reducing and restructuring other areas of his agency and shaving the reimbursement rate the city paid to the voluntary foster care agencies. Under his own roof, Little slashed his administrative budget by 20 percent, stripped away all programs not legally mandated, and pared his agency's mandated programs in protective and preventive services to the bone. The mayor's budget office still insisted on cuts within the kinship program, imposing reductions on the program's periphery by stripping down the level of supervisory staff and staff in the unit charged with approving relatives' homes. But Little was able to maintain the core of the program-its caseworkers-almost as he had hoped; although he did have to sacrifice 200 of the most recently hired workers, he did receive a commitment from OMB to rehire that number and more once the current crisis passed. HKS Case Number 1203.1

Novo Nordisk, a Danish company, is the largest supplier of insulin in the world. Using both in-house and outside design services, it has integrated medical research, user-information, and new technologies in team-based projects that have resulted in user-friendly insulin delivery systems, such as insulin pens. These pens have been very successful in Europe and have met varying success elsewhere. The company needs to determine whether its products represent "global design." If not, then how could they? Should they? This case focuses on the use of design in positioning and marketing in the United States an innovative, prefilled, disposable, easy-to-use, pen-like syringe to replace the "drugstore" diabetics conventionally carry. Students are asked to develop a marketing strategy and launch plan to suit local conditions.

PPG has built a state-of-the-art glass plant in Berea, Kentucky. The plant is pursuing the goal of a "self-directed workforce." The case describes the progress to date and the unresolved issues faced by management. These include questions about shift rotation, promotion opportunities, employee evaluation and supervision, the role of employees in policy setting, and whether or not to introduce a system of peer review. Explores the process of creating a self-directed workforce, the underlying theoretical model, and the difficulties and tensions inherent in that approach.

Supplements the (A) case.

Supplements the (A) case.