Ivey Publishing

Supply Chain Logistics Management

Bowersox, D.J.; Closs, D.J.; Cooper, M.B.; Bowersox, J.C.,4/e (United States, McGraw-Hill Irwin, 2013)
Prepared By Jill Pillon, CaseMate Editor
Chapter and Title Chapter Matches: Case Information
Chapter 1:
21st-Century Supply Chains

ADANI AGRI LOGISTICS LIMITED: BLOCKING THE GRAIN DRAIN
Mohita Gangwar Sharma, K.N. Singh, Sachinder Mohan Sharma, Puneet Mehndiratta

Product Number: 9B14D001
Publication Date: 4/2/2014
Revision Date: 4/1/2014
Length: 11 pages

Adani Agri Logistics Limited (AALL) was established to execute a national project for the bulk handling of food grains through a public-private partnership with the Food Corporation of India. This project involved financing, planning, designing, constructing, operating and maintaining modern infrastructure for the bulk handling, storage and transportation of grains required for the public distribution system. Although a technology-driven supply chain solution was implemented, the benefits of this innovative supply system did not come into full fruition even after four years of operation. AALL soon realized that farmers were reluctant to accept the new storage system because it was a departure from the relationship-based transactions they were used to undertaking with traditional intermediaries. In this way, the company learned that there are cultural subtleties and traditions that must be appreciated and given consideration, along with the economic justifications. How could these traditions be respected and upheld while making way for improvement and progress?

Teaching Note: 8B14D001 (9 pages)
Industry: Transportation and Warehousing
Issues: Supply chain strategy; collaboration; national culture; trust; India
Difficulty: 5 - MBA/Postgraduate



RED BRAND CANNERS AND ITS SUPPLY CHAIN
Christoph Haehling von Lanzenauer, Olaf Pohl

Product Number: 9B12E007
Publication Date: 8/10/2012
Revision Date: 10/6/2016
Length: 5 pages

Developed as a companion to the Red Brand Canners (RBC) case, the starting point in this case is the improvement in performance resulting from the optimization approach in the original case. However, RBC’s vice president of operations is concerned about the quality and quantity mix of the most recent tomato crop received from Greenfield Farms (GF). RBC’s preferred quality and quantity mixes differ significantly from the current harvest. To RBC, the issue is how to motivate the supplier to produce a crop more in line with RBC’s needs. Initially, both firms in the B2B section of the supply chain try to find a combination that would be mutually beneficial — an attempt that fails because of conflicts of interest. RBC’s objective might be accomplished by taking a supply chain approach and modifying the delivery contract by an appropriate pricing scheme. The task is to identify and calibrate a pricing scheme that will realize the supply chain’s maximum performance and lead to a stable win-win solution. The derivation of the supply chain optimal prices is carried out by developing and solving a linear optimization model.

Teaching Note: 8B12E007 (17 pages)
Industry: Manufacturing
Issues: Supply Chain Management; Pricing; Linear Programming; Quantitative Analysis;Food Processing Industry
Difficulty: 4 - Undergraduate/MBA



HALF A CENTURY OF SUPPLY CHAIN MANAGEMENT AT WAL-MART
P. Fraser Johnson, Ken Mark

Product Number: 9B12D010
Publication Date: 4/19/2012
Revision Date: 11/12/2013
Length: 23 pages

In 2012, a stock analyst was preparing a recommendation on what his firm, a large U.S. investment house, should do with its stake in Wal-Mart Stores, Inc. Wal-Mart, the world’s largest retailer, was trying to recover from a series of missteps that had seen competitors such as dollar stores and Amazon.com close the performance gap. Competitors had copied many aspects of Wal-Mart’s distribution system, including cross-docking products, eliminating storage time in warehouses, positioning stores around distribution centres, and widespread adoption of electronic data interchange (EDI), as well as ordering and shipping from suppliers.

Teaching Note: 8B12D010 (9 pages)
Industry: Retail Trade
Issues: Operations Analysis; Supply Chain Management; Supplier Relations; Competitive Advantage; Scheduling; United States
Difficulty: 4 - Undergraduate/MBA


Chapter 2:
Logistics

DHL SUPPLY CHAIN
Singfat Chu, David Ringrose

Product Number: 9B12E003
Publication Date: 4/19/2012
Revision Date: 4/24/2015
Length: 3 pages

The degradation of the environment has led many governments and customers to pressure businesses to make their operations more environmentally friendly. The case illustrates an effective example of corporate social responsibility. Specifically, it demonstrates how a small increase in a supply chain budget can drastically reduce carbon dioxide emissions in the transportation of LCD TVs from their manufacturing bases to a distribution centre.

Teaching Note: 8B12E003 (7 pages)
Industry: Transportation and Warehousing
Issues: Environmental Sustainability; Linear Programming; Logistics; Optimization Analysis; Spreadsheet Modeling; Corporate Social Responsibility; China
Difficulty: 4 - Undergraduate/MBA



NOKIA INDIA: BATTERY RECALL LOGISTICS
Charles Dhanaraj, Narendar Sumukadas, P. Fraser Johnson, Monali Malvankar

Product Number: 9B11D003
Publication Date: 6/22/2011
Length: 13 pages

This case presents the challenge faced by Nokia India in 2007. Nokia had built a strong brand reputation over a ten-year period and was a market leader in Indian mobile devices. India, incidentally, was also Nokia’s second-largest market, next only to China. Suddenly, what corporate headquarters considered a routine product advisory for a defective battery resulted in panic in customers after the Indian media widely publicized the potential dangers that defective batteries could pose. Over a three-month period, Nokia India had to recall a few million batteries and replace them with new ones.



The case provides an opportunity for students to develop practical knowledge of the role of operations management in a product recall situation, particularly in an emerging market context. Product recalls are an integral part of supply chain management (SCM). Companies inevitably face a question of when, not if, a recall will be necessary. These recall situations combine the complexity of operations with the time-urgency of a mission-critical task. The case also provides a rich context to learn about the interaction of SCM, information systems and reverse logistics, and to understand the marketing, logistics, and communication challenges faced by a multinational company operating in an emerging market such as India.


Teaching Note: 8B11D003 (11 pages)
Industry: Information, Media & Telecommunications
Issues: Supply Chain Management; Logistics; Communications; Crisis Leadership; Product Recall; India; Ivey/ISB
Difficulty: 5 - MBA/Postgraduate



3M HEALTH CARE
P. Fraser Johnson, Viola Hoo

Product Number: 9B04D008
Publication Date: 1/4/2011
Length: 12 pages

A summer intern student at 3M Health Care must analyze the health care division’s logistics systems and report her findings to the vice president of 3M Health Care Markets. The vice president is most interested in the recommendations for the proposed changes to the existing method of distributing products to Canadian hospitals. This case provides sufficient information for students to assess the quantitative and qualitative issues relating to direct distribution versus maintaining a current supply chain structure of using value-added resellers.

Teaching Note: 8B04D08 (7 pages)
Industry: Health Care Services
Issues: Hospitals; Sales Strategy; Logistics; Distribution
Difficulty: 4 - Undergraduate/MBA


Chapter 3:
Customer Relationship Management

AMERICAN EXPRESS CANADA
Larry Menor, Ramasastry Chandrasekhar

Product Number: 9B12D022
Publication Date: 10/17/2012
Revision Date: 7/5/2018
Length: 23 pages

This case examines how a premium credit card company, American Express Canada (Amex Canada), is attempting to differentiate itself from its competition and to realize value for—and from—its cardholder members through a focus on providing apt quality services and servicing. In April 2011, the president and chief executive officer of Amex Canada is considering his options in sustaining the company's stance in the ultra-rich end of the premium payment cards segment in the face of competition from credit card companies that previously targeted the Canadian mass market. The situation is compounded by the after-effects of the economic downturn that began in the United States in 2008. Amex Canada has to develop a viable strategic and operational plan to realize its vision of becoming the most respected service brand, an ambition that is founded upon what it calls the Total Service Experience it provides to its card members. The case looks at the history of the company, provides an overview of the Canadian payment card industry, and explores core service and servicing issues salient to the design and provision of the Total Service Experience that Amex Canada hopes will not only satisfy existing cardholders but will attract new card members across its array of payment card options.

Teaching Note: 8B12D022 (23 pages)
Industry: Finance and Insurance
Issues: Service Design and Delivery; Quality; Customer Experience; Canada
Difficulty: 5 - MBA/Postgraduate



IBM CANADA LTD.: IMPLEMENTING GLOBAL STRATEGY
Deborah Compeau, Ken Mark

Product Number: 9B10E008
Publication Date: 10/13/2010
Revision Date: 11/9/2010
Length: 10 pages

A senior manager at IBM Canada Ltd. is trying to determine how best to implement strategy developed at the global level. The Business Transformation Executive, Sales & Distribution, IBM Canada Ltd., is responsible for introducing, maintaining and retiring software programs to support IBM Canada's business needs. In October 2009, the senior manager is trying to assess if the customer relationship management (CRM) developed locally should continue to be supported or if the planned switchover to a global standard CRM should continue as scheduled. The case is intended for students to discuss the challenges of implementing global IT strategy at the local or country unit level.

Teaching Note: 8B10E008 (6 pages)
Industry: Administrative, Support, Waste Management and Remediation Services
Issues: Information System Design; Change Management; Information Technology; Strategic Change
Difficulty: 4 - Undergraduate/MBA



A-CAT CORP. - BANG FOR THE BUCKS
Jitendra R. Sharma

Product Number: 9B09D006
Publication Date: 7/13/2009
Length: 7 pages

The case describes the situation facing the vice-president of A-CAT Corp. (A-CAT), Vidarbha Region, Maharashtra. A-CAT manufactured a wide range of electrical appliances for household use. Typical products included TV signal boosters, transformers, FM radio kits, electronic ballasts, battery chargers and voltage regulators. The voltage regulators manufactured by A-CAT were used for many different purposes; however, the focus was on its flag-ship product, VR500 - a voltage regulator. Over the last few months, this model had faced stiff competition and was not able to meet the rising expectations of the market. Management was concerned that a significant number of A-CAT's customers were opting for competitors' products. The case intends to 1) make students aware of the relationship between customer requirements and the technical characteristics of a product 2 ) help students grasp the basics of value analysis 3) teach students to use value analysis in assessing the scope for cost reduction.

Teaching Note: 8B09D06 (7 pages)
Industry: Manufacturing
Issues: Cost Control; Value Analysis; Product Design/Development; Cost/Benefit Analysis; Consumer Satisfaction
Difficulty: 5 - MBA/Postgraduate


Chapter 4:
Procurement

PURCHASING CONSORTIUM FOR THE BMS INDUSTRY IN SINGAPORE
Mei Qi, Siew Hwa Ong

Product Number: 9B12D014
Publication Date: 7/17/2012
Revision Date: 7/9/2012
Length: 6 pages

Since November 2011, the director and chief scientist for Acumen Research Laboratories (ARL) had been conferring with Spring Singapore — a government agency devoted to the city-state’s economic growth — on ways to improve the current procurement practices of the biomedical science (BMS) industry in Singapore. As a senior chief scientist and the founder of ARL, she saw and experienced tremendous purchasing inefficiency and quality problems in the existing procurement practice in sourcing supplies and equipment. She believed that a centralized procurement structure and process among all members of the BMS industry in Singapore would be more efficient and was in April 2012 finalizing a proposal to Spring Singapore for initial funding to set up such a purchasing consortium. This consortium would be a new line of business for ARL.

Teaching Note: 8B12D014 (7 pages)
Industry: Health Care Services
Issues: Purchasing Consortium; Entrepreneurship; Purchasing Process; Supply Distribution
Difficulty: 4 - Undergraduate/MBA



STRATEGIC SOURCING AT WHIRLPOOL CHINA: FINDING THE IDEAL SUPPLIER
Martin Lockstrom, Thomas E. Callarman, Shengrong (Linda) Zhang

Product Number: 9B12D012
Publication Date: 6/21/2012
Revision Date: 6/19/2012
Length: 8 pages

It was April 10, 2011, when the head of Whirlpool’s Asia International Procurement Office in Shanghai was informed by his colleagues that the company was about to launch a new energy-efficient refrigerator model in just six months. For the new refrigerator model, the basic difference was in the motor; the current AC motor would need to be replaced with a DC motor, which was more efficient but also more expensive. He would have to find a suitable supplier of DC motors in a very short time. Delayed sourcing of components would cause delays in the production of a new refrigerator and result in a later launch of new products. Within the home-appliance industry, the fierce level of competition meant that any delays in launching new products would result in a loss of sales. How should Whirlpool go about the process of finding a suitable supplier for the required DC motor parts? Should the company explore the possibility of developing its current supplier, or should it quickly engage an existing supplier of DC motors?

Teaching Note: 8B12D012 (7 pages)
Industry: Other Services
Issues: Suitable Supplier; IPO; Global Sourcing; Supplier Quality; Strategic Sourcing; Supplier Selection Criteria; China
Difficulty: 5 - MBA/Postgraduate



HIGH-TECH METAL COMPONENTS: FINDING LOCAL SUPPLIERS
Martin Lockstrom, Shen Li

Product Number: 9B12D004
Publication Date: 3/22/2012
Revision Date: 10/26/2015
Length: 10 pages

In May 2009, High-Tech Metal Components (HTMC) inaugurated its brand new production plant of forgings and castings for automotive supplies in Suzhou, a city of 13 million close to Shanghai, China. After the successful installation of machinery and placement of workers, the company was prepared to begin production. A month later, the general manager of the Chinese division of HTMC received a phone call from the chief operating officer of its German headquarters; it was decided that it was necessary to cut costs for 2009 by more than five per cent. The cost structure was way too high, with many components imported from Europe. How could cost-cutting be done with the existing supply chain design in China? What long-term measures could be taken to realize the goal?

Teaching Note: 8B12D004 (5 pages)
Industry: Manufacturing
Issues: Supplier Management; Low-cost Country Sourcing; Technology; Germany; China; CEIBS
Difficulty: 5 - MBA/Postgraduate


Chapter 5:
Manufacturing

MEAGAL STELPLAST: STEERING A NEW PATH
Rajiv Misra, Achin Kishore

Product Number: 9B13D013
Publication Date: 7/12/2013
Revision Date: 7/5/2013
Length: 12 pages

A family-owned business that manufactures automobile horns for the replacement market in Delhi, India is considering options to improve current operations and expand the business. The company is faced with numerous challenges: erratic demand, lack of brand, high warranty returns, lack of information, availability of skilled manpower and implementing modern methods of manufacturing. The company is also considering expanding beyond Delhi and manufacturing products for automobile manufacturers, which requires adherence to regulatory certification.

Teaching Note: 8B13D013 (15 pages)
Industry: Manufacturing
Issues: Process analysis; line balancing; plant expansion; production planning; India
Difficulty: 5 - MBA/Postgraduate



LEAN IMPLEMENTATION AT SIEMENS' KALWA PLANT
Jamie Anderson, Subramanian Chidambaran, Vaibhav Khandekar

Product Number: 9B12M026
Publication Date: 5/9/2012
Revision Date: 6/25/2012
Length: 20 pages

The Siemens Kalwa factory in Mumbai, also referred to as Kalwa Works (KW), started in 1973 with the production of motors and later diversified to produce switchgears and switchboards. By 2009, 40 per cent of all Siemens India employees were working in Kalwa and contributing 45 per cent of the total Siemens India production. Kalwa had become the most important business centre for Siemens India.

In October 2006, Siemens AG decided to implement lean manufacturing in the Kalwa factory as part of a worldwide rollout of the Siemens Production System in all its medium-voltage facilities. The implementations were expected to bring drastic improvements in labour productivity, lower inventory levels, and higher throughput to improve the factories’ financial performance. The lean program promised that the factory’s current realized capacity of 4,000 panels per year could be increased by approximately 50 per cent to 6,000 panels per year in the medium term within two years, and to about 12,000 panels within the next four to five years.

While the benefits of successful implementation were attractive, the company faced several challenges, including restructuring the organization, getting staff on board to accept and facilitate the change, and handling resistance from internal and external stakeholders. This case provides an opportunity to analyze and discuss lean implementation issues for a global multinational firm in the Indian context.


Teaching Note: 8B12M026 (9 pages)
Industry: Manufacturing
Issues: Lean Manufacturing Implementation; Organizational Change; Change Management; Factory; India
Difficulty: 4 - Undergraduate/MBA



PROCESS MANAGEMENT STRATEGY FOR XYZ LIMITED - KLTD DIVISION
Srinivasan Maheswaran

Product Number: 9B09D007
Publication Date: 10/14/2009
Length: 4 pages

The case describes the situation faced by the vice-president of operations at Konkan Leaf Tobacco Development, the tobacco processing unit of XYZ Limited. This unit is in charge of procurement and processing of different varieties and grades of tobacco grown in southern India. The tobacco leaves are categorized into different varieties on the basis of quality and location of the crop. The company has two processing plants with varying processing capacities. Due to the seasonal and agricultural nature of the commodity, the company is finding it difficult to maintain efficiencies between the inflow of the tobacco and the requirement of the processing line capacity, resulting in frequent start-stop situations for the processing lines. This case enables students to develop strategies for the process management to achieve the optimum process schedule, which will result in the fewest stoppages of the process lines and optimization of both the utilization of the processing lines and the inflow patterns among the processing units.

Teaching Note: 8B09D07 (8 pages)
Issues: Mapping Inflow and Processing Line Capacity; Process Management; Capacity Utilization; Forecasting
Difficulty: 4 - Undergraduate/MBA


Chapter 6:
Integrated Operations Planning

ATHLETIC KNIT
David Wood, Dina Ribbink

Product Number: 9B12D020
Publication Date: 8/31/2012
Revision Date: 7/17/2017
Length: 7 pages

This case investigates issues of obsolescence and inventory control in a local sportswear company that is competing on the global stage with both multinational corporations and foreign, low-cost distributors. Athletic Knit, a family-owned company in Toronto, faces the need to balance peak-season demand during the third quarter of the year with the available knitting production capacity. Inventory, if it serves a purpose, can be an asset to a company, but too much inventory can be a liability. Trade-offs between capacity, inventory, and flexibility to meet custom orders must be met to support corporate strategy. Given the competitive nature of the industry, tighter inventory controls are essential, but the company must weigh endangering its reputation for fast responses to custom orders with managing inventory to prevent stock-outs and/or overruns of stock that cannot be sold.

Teaching Note: 8B12D020 (9 pages)
Industry: Arts, Entertainment, Sports and Recreation
Issues: Inventory Analysis; Economic Order Quantity; Aggregate Planning; Cost; Canada
Difficulty: 4 - Undergraduate/MBA



CRP PRODUCTS
David Wood, Robert Klassen

Product Number: 9B11D015
Publication Date: 11/10/2011
Revision Date: 6/29/2012
Length: 7 pages

Bruce Ballantyne had recently joined C.R.P. Products (CRP), a furniture manufacturer in Stratford, Ontario, to help review the company’s operations and assess what changes were necessary to keep up with demand. Although it was early 2011 and the peak season was still four months away, Ballantyne knew that he would have to determine what equipment was needed over the next three weeks to ensure it was delivered and installed before the peak season. Jamie Bailey, the owner of CRP, had also concluded that CRP did not have the financing available for both the new equipment needed to make its unique design of outdoor furniture and the seasonal working capital required to support inventory and accounts receivable. He had turned to Ballantyne to develop a solution that would keep up with demand, keep inventory low, and work within the available financing.

Teaching Note: 8B11D015 (13 pages)
Industry: Manufacturing
Issues: Capacity Management; Inventory, Batch Size and Free Capacity; Economic Order Quantity; Process Design; Plant Layout; Furniture; Ontario, Canada
Difficulty: 4 - Undergraduate/MBA



THE NORTH WEST COMPANY (B): SUPPLY CHAIN MANAGEMENT
P. Fraser Johnson, Stephen R. Foerster, Ken Mark

Product Number: 9B07D008
Publication Date: 2/5/2010
Length: 7 pages

The North West Company cases allow students to take a cross-enterprise leadership approach in looking at the dilemma facing the president and chief executive officer of The North West Company (North West), a food and general merchandise retailer operating primarily in Northern Canada. In early 2003, North West had negotiated a master franchisor agreement with Giant Tiger Stores Limited (Giant Tiger) with the objective of opening stores west of Winnipeg. In contrast with North West's push system of product replenishment, Giant Tiger had developed a successful pull system that gave individual store managers tremendous leeway in ordering decisions. The president and CEO wonders whether there is an opportunity to drive better results by adopting Giant Tiger's pull system within its Northern stores. The upside potential may include higher sales and reduced inventory levels as merchandise is tailored for each community. On the other hand, North West may face logistics and human resources issues in attempting to adopt this new system. This supplement to The North West Company (A): Cross-enterprise Strategy, product 9B07M047, discusses the supply chain issues.

Teaching Note: 8B07D08 (4 pages)
Industry: Retail Trade
Issues: Supply Chain Management
Difficulty: 4 - Undergraduate/MBA


Chapter 7:
Inventory

AGGREGATE PLANNING AT GREEN MILLS
Owen Hall, Jr., Kenneth Ko

Product Number: 9B13D002
Publication Date: 3/14/2013
Revision Date: 3/12/2013
Length: 3 pages

Green Mills Inc. operates several lumber mills throughout the Northwestern United States that produce a variety of wood products. The company is currently considering expanding operations to Chile as a vehicle for reducing the costs of raw materials. In that regard, the management team is interested in analyzing the cost implications as a vehicle to properly assess this backward integration strategy. More specifically, management wishes to evaluate several different aggregate planning policies including level, chase and mixed policies.

Teaching Note: 8B13D002 (8 pages)
Industry: Manufacturing
Issues: Aggregate planning; sensitivity analysis; United States
Difficulty: 5 - MBA/Postgraduate



MATERIAL REQUIREMENTS PLANNING AT A-CAT CORP.
Jitendra R. Sharma, Tinu Agrawal

Product Number: 9B12D003
Publication Date: 4/12/2012
Revision Date: 4/11/2012
Length: 5 pages

Material requirements planning (MRP) systems have been widely used by manufacturing firms to maintain an optimum flow of inputs for the best production results. By using an MRP system, a firm can prepare a production plan that specifies the number of sub-assemblies that go into a final product along with the exact timeline of an order, from placement to completion.

In the case, an A-CAT employee is assigned the task of preparing an operating plan for the next eight weeks for a product. She has to decide how much to produce to be able to meet the requirements economically, taking into account the forecasted demand. The case examines the intricacies of procurement, warehousing, and processing costs of various material components by critically evaluating different techniques in practice. Using situational scenarios, the case presents lot-sizing techniques — including lot for lot, economic order quantity, least total cost and least unit cost — for balancing costs such as set-up costs, ordering costs, and inventory-holding costs.


Teaching Note: 8B12D003 (8 pages)
Industry: Manufacturing
Issues: Material Requirements Planning; Inventory Management; Lot-sizing Techniques; Bill of Materials; Electrical Appliances; India
Difficulty: 4 - Undergraduate/MBA



KEDA’S SAP IMPLEMENTATION
Derrick Neufeld, Yulin Fang, Huaiqing Wang, Terrance Fung

Product Number: 9B11E001
Publication Date: 2/18/2011
Revision Date: 5/4/2017
Length: 13 pages

Keda, a manufacturer of large-scale machinery in China, had successfully deployed an enterprise resource planning (ERP) solution that was paying for itself through more efficient inventory management. This was significant because despite China’s increasing demand for ERP systems, an estimated 80 per cent of ERP implementation efforts failed in the country. The vice general manager of Keda had a large backlog of other information technology projects, and he wanted to carefully evaluate the ERP project to determine what had gone right, what had gone wrong, and what Keda had achieved through simple luck.

Teaching Note: 8B11E001 (9 pages)
Issues: System Implementation; Enterprise Resource Planning; Information Technology; Project Management; China
Difficulty: 4 - Undergraduate/MBA


Chapter 8:
Transportation

YAMATO TRANSPORT CO. LTD.: TA-Q-BIN
H. Brian Hwarng, Motoka Mouri

Product Number: 9B13D021
Publication Date: 2/28/2014
Revision Date: 2/28/2014
Length: 18 pages

Since 1976, Yamato had enjoyed steady growth in the Japanese domestic parcel delivery market. Yamato had maintained its leading position in Japan through its highly acclaimed TA-Q-BIN service. However, with changing demographics and market conditions, the business landscape had been changing. Overdependence on the domestic delivery business limited the overall growth of Yamato. Furthermore, the growth of the TA-Q-BIN business in Japan was limited by the stagnant growth of Japan’s economy. Makoto Kigawa, president and then chairman of Yamato Transport, had been relentlessly pursuing business restructuring as well as promoting productivity improvements. His goal was to increase the share of the delivery business related to overseas markets from four to twenty per cent of total revenue by the time of Yamato’s centennial celebrations in 2019. How could he successfully implement the TA-Q-BIN service system in overseas markets such as Taiwan, Singapore, Shanghai, Hong Kong and Malaysia?

Teaching Note: 8B13D021 (12 pages)
Industry: Other Services
Issues: Express delivery; door-to-door services; global operations; Japan
Difficulty: 5 - MBA/Postgraduate



DALIAN AIRPORT'S ALLIANCE MANAGEMENT DILEMMA
Miao Cui, Jun Wang, Jacqueline Tuck, Jingqin Su, Shujuan Wang

Product Number: 9B13M120
Publication Date: 1/10/2014
Revision Date: 1/10/2014
Length: 10 pages

The general manager of market development for the Dalian International Airport in China was worried. Two years after he had successfully launched the Northeastern Hinterland and Bohai Rim Region Airport Aviation Market Strategic Alliance in 2009, it was facing serious external and internal challenges. Competitors had begun to impact on the alliance by intensively adding flights to regional airports with the support of subsidies from provincial and local governments. And as alliance members gained more air traffic, they began to compete for transport resources, which challenged the organization’s sustainable development. From the beginning, Dalian International Airport, as the core of the organization, had shared its routes and ticket fares with other alliance member airports, had removed landing fees for stopover flights and had organized a trade fair to encourage interactions between small regional airports and the airlines that had ignored them in the past, not recognizing how China’s booming economy was making even remote routes potentially profitable. The general manager had three possible options: utilizing outside help, increasing his airport’s market position and strengthening internal ties to resist external forces. All three options had their pros and cons. What should he do?

Teaching Note: 8B13M120 (10 pages)
Industry: Transportation and Warehousing
Issues: Alliance management; competitive advantage; China
Difficulty: 5 - MBA/Postgraduate



SINOFERT HOLDINGS LIMITED: UREA DISTRIBUTION PLANNING
Peter C. Bell, Mehmet A. Begen, Duan Changshan, Fiona Yiu, Jeremy Cheng

Product Number: 9B13E027
Publication Date: 9/19/2013
Revision Date: 9/19/2013
Length: 6 pages

Sinofert Holdings Limited, the largest comprehensive fertilizer enterprise in China, is trying to improve the profitability of its urea business. The company has invested a great deal of time and money but still reported losses in 2007 and 2009 and only a small profit in 2008. Sinofert both manufactures urea and purchases it from external suppliers, as well as distributing it to the provinces. Manufacturing costs, transportation costs, market prices, demand forecasts and manufacturing constraints are all known. An optimal distribution plan using linear programming can be compared to the plan derived by Sinofert management. Substantial profitability increases are shown to be possible, although the optimization reveals some issues with contract constraints. If the company is to make its urea business profitable, it needs a fresh look and a change in the way of doing business. The company’s chief analytics officer has been asked to look at the urea business and to provide recommendations to increase profitability.

Teaching Note: 8B13E027 (3 pages)
Industry: Agriculture, Forestry, Fishing and Hunting
Issues: Optimization; transportation problem; supply chain; distribution planning; China
Difficulty: 4 - Undergraduate/MBA


Chapter 9:
Warehousing

BUILDING SUSTAINABLE DISTRIBUTION AT WALMART CANADA
Robert Klassen, P. Fraser Johnson, Asad Shafiq

Product Number: 9B13D010
Publication Date: 4/5/2013
Revision Date: 11/12/2013
Length: 9 pages

The director of logistics at Walmart Canada, was developing plans for a new distribution centre in Alberta. Senior management had presented her with a challenge: why not build the most sustainable distribution centre in the world? Yet, much remained unclear about how to translate this challenge into specific actions, while keeping in mind corporate goals for sustainability. Her team now was exploring three options that promised to be significantly greener: hydrogen fuel cells for forklift trucks, LED lighting and renewable energy generation from on-site wind turbines. Any investment in these sustainable technologies had to make business sense, and any decision could dramatically affect the distribution centre’s operating performance.

Teaching Note: 8B13D010 (12 pages)
Industry: Retail Trade
Issues: Environmental Management; Supply Chain; Renewable Energy; Distribution; Canada
Difficulty: 4 - Undergraduate/MBA



WAREHOUSING STRATEGY AT VOLKSWAGEN GROUP CANADA INC. (VGCA)
P. Fraser Johnson, Adam Bortolussi

Product Number: 9B12D002
Publication Date: 3/5/2012
Revision Date: 11/15/2012
Length: 8 pages

The director of warehousing and logistics at Volkswagen Group Canada (VGCA) had been tasked with analyzing the capacity of the Toronto parts distribution centre to support an aggressive growth plan that involved a series of new product launches and product facelifts. Expecting that expansion of the facility would be necessary, the director needed to determine the additional warehouse capacity required, when it would be needed by, and which expansion option made the most sense.

Teaching Note: 8B12D002 (9 pages)
Industry: Transportation and Warehousing
Issues: Supply Chain Management; Warehousing; Distribution; Capacity Analysis; Logistics; Automotive Industry
Difficulty: 4 - Undergraduate/MBA



LOCATION PLANNING AT A.B. CORP.
Jitendra R. Sharma

Product Number: 9B12D008
Publication Date: 4/30/2012
Revision Date: 4/12/2012
Length: 3 pages

In March 2010, the management of A.B. Corp. announced its plan to select a definite location for its central warehouse. The company, a major producer of agriculture and farm equipment, had gone through three consecutive years of financial loss as a result of increasing production costs. Management had to select a central warehouse between four candidates, based on the location of five distribution centres, the loads to be transferred, and other factors such as land costs and tax.

Teaching Note: 8B12D008 (8 pages)
Issues: Location Analysis; Centre of Gravity; Load Distance Factors; Factor Rating Method; Decision Making; Agriculture; India
Difficulty: 4 - Undergraduate/MBA


Chapter 10:
Packaging and Handling

COLD CHAIN DISTRIBUTION ISSUES AT INDO-EURO PHARMA
Mohit Srivastava, Helen Rogers, Kulwant Pawar, Janat Shah

Product Number: 9B13D018
Publication Date: 12/16/2013
Revision Date: 11/19/2013
Length: 12 pages

The supply chain director of Indo-Euro Pharma summoned an urgent meeting in response to significant losses incurred by the company in the last fiscal year. This was primarily due to the return of yet another international consignment of temperature-sensitive drugs (TSDs) — this time worth millions of dollars. The meeting focused on the inability of Indo-Euro Pharma to appropriately distribute and monitor TSDs cost effectively across the various stages and locations of the supply chain — especially at the pharmacist level. Deviations from drugs’ required temperature ranges could happen during packaging, storage, transport, loading and unloading in aircraft, sea containers, trucks, etc. It was extremely difficult to monitor whether pharmacists were following proper procedures for storing TSDs. Most medical stores in India had domestic refrigerators that required frequent calibration. The problems indicated the need for Indo-Euro Pharma to adopt an alternative distribution system that was specifically tailored for TSDs.

Teaching Note: 8B13D018 (7 pages)
Industry: Health Care Services
Issues: Cold chain; pharmaceutical; temperature sensitive drugs; distribution; India
Difficulty: 5 - MBA/Postgraduate



BELLA SPRINGS
Nicole R.D. Haggerty, Francis Ayensu, Jesse Brame, Chris Lau, Gerry Li

Product Number: 9B13D009
Publication Date: 4/16/2013
Revision Date: 8/3/2018
Length: 6 pages

The founder of a water purification, packaging and distribution company in Ghana, Africa, faced some operational issues. Demand has increased for the company’s water sachets, but the founder needed to develop strategies to increase the firm’s current operational capacities to meet this demand. He and the operations manager needed to determine how the company can position itself as a successful high-growth company in a developing and sometimes uncertain Ghanaian economy.

Teaching Note: 8B13D009 (5 pages)
Industry: Accommodation & Food Services
Issues: capacity planning; distribution; emerging markets
Difficulty: 4 - Undergraduate/MBA


Chapter 11:
Global Supply Chains

ELIZABETH ARDEN: EXECUTING GLOBAL SUPPLY CHAIN RE-ENGINEERING
David Wood, Norman Gao

Product Number: 9B13D017
Publication Date: 11/8/2013
Revision Date: 1/14/2019
Length: 11 pages

In mid-2008, the senior vice-president of Global Supply Chain at Elizabeth Arden in New York City was troubled with the challenges that lay before him. He had been hired to make sweeping changes to the company’s management of its supply chain, and he had already made a significant impact in forecasting, inventory control and service performance. His next move would require a radical consolidation of suppliers, make dramatic changes to inventory management, have a far-reaching impact on product development and require major lead time reductions. Given such a disruptive move, would current suppliers be able to meet expectations? Could the company’s current employees keep up with the pace of change expected? How many would have to be let go, and what would this do the morale of the workforce? Were significant results to shareholders really achievable? How much money would be saved, where would the savings come from and when would they be realized? The senior vice-president was determined to execute the re-engineering in a manner that would best address all these concerns.

Teaching Note: 8B13D017 (15 pages)
Industry: Retail Trade
Issues: Strategy; design; restructuring; impact of supply chain innovation; United States
Difficulty: 4 - Undergraduate/MBA



GLOBAL SOURCING AT ANHEUSER-BUSCH INBEV: TAPPING (BEER) INTO THE CHINESE SUPPLIER MARKET
Martin Lockstrom, Thomas E. Callarman, Shengrong (Linda) Zhang

Product Number: 9B12D015
Publication Date: 7/25/2012
Revision Date: 7/25/2012
Length: 5 pages

This case concerns the difficulties of global sourcing for InBev, an international brewery with branches in six geographical zones. In 2006, Pascal Baltussen came to China to set up the company's international procurement office and had it up and running by the end of the year. Not only were risks such as delivery delays and rising costs constantly lurking, but in 2010 his company, Brazilian-Belgian brewer InBev, acquired the almost equally large U.S. brewer Anheuser-Busch to form the world's largest brewer, AB InBev. This posed further complications. How could Baltussen now successfully roll out his sourcing vision for China and manage internal and external challenges?

Teaching Note: 8B12D015 (6 pages)
Industry: Accommodation & Food Services
Issues: Global Sourcing; Supplier Selection; Procurement Organization; Sourcing Strategy; China
Difficulty: 5 - MBA/Postgraduate



LEGO GROUP: AN OUTSOURCING JOURNEY
Marcus Moller Larsen, Torben Pedersen, Dmitrij Slepniov

Product Number: 9B10M094
Publication Date: 12/1/2010
Revision Date: 5/10/2017
Length: 16 pages

The last year's rather adventurous journey from 2004 to 2009 had taught the fifth-largest toy-maker in the world - the LEGO Group - the importance of managing the global supply chain effectively. In order to survive the largest internal financial crisis in its roughly 70 years of existence, the management had, among many initiatives, decided to offshore and outsource a major chunk of its production to Flextronics. In this pursuit of rapid cost-cutting sourcing advantages, the LEGO Group planned to license out as much as 80 per cent of its production besides closing down major parts of the production in high cost countries. Confident with the prospects of the new partnership, the company signed a long-term contract with Flextronics. This decision eventually proved itself to have been too hasty, however. Merely three years after the contracts were signed, LEGO management announced that it would phase out the entire sourcing collaboration with Flextronics. This sudden change in its sourcing strategy posed LEGO management with a number of caveats. Despite the bright forecasts, the collaboration did not fulfill the initial expectations, and the company needed to understand why this had happened. Secondly, what could LEGO management have done differently?

Teaching Note: 8B10M94 (13 pages)
Industry: Manufacturing
Issues: Outsourcing; Management Control; Global Strategy; Supply Chain Management
Difficulty: 4 - Undergraduate/MBA


Chapter 12:
Network Design

UPGRADING THE SUPPLY CHAIN MANAGEMENT STRATEGY AT SICHUAN TELECOM
Xu Chen, Zhang Du, Li Zheng, Ding Yichao, Liu Ying

Product Number: 9B12D013
Publication Date: 8/21/2012
Revision Date: 8/20/2012
Length: 7 pages

In the process of business development, many enterprises have to deal with issues from all dimensions of operations management including inventory management, distribution management, and network design. Sichuan Telecom, a branch of China Telecom Co. Ltd, which was a Fortune Global 500 company, had achieved its highest market share in its broadband business and maintained strong growth momentum in this segment. However, there was a serious inventory management problem concerning ADSL modems, a component that most broadband users required. The problem was that Sichuan Telecom's ADSL modem inventory was either too high or insufficient. To reduce inventory costs and improve the service level, the procurement manager conducted a comprehensive analysis of the company's sales and demand forecasting, procurement and suppliers, distribution management, warehouse management, and inventory management. This case follows the procurement manager in analyzing the company's existing operational management system for ADSL modems in order to discover the cause of the inventory problem and develop an effective plan to improve operations management.

Teaching Note: 8B12D013 (7 pages)
Industry: Information, Media & Telecommunications
Issues: Supply Chain Management; Inventory Planning Control; Distribution Design; Telecommunications; Service Industry; China; Ivey/CMCC
Difficulty: 5 - MBA/Postgraduate



DANFOSS — GLOBAL MANUFACTURING FOOTPRINT
Torben Pedersen, Jacob Pyndt

Product Number: 9B11M049
Publication Date: 6/22/2011
Length: 19 pages

AWARD WINNING CASE - Supply Chain Management Award, 2012 European Foundation for Management Development (EFMD) Case Writing Competition. The case examines the supply chain, managerial, and organizational challenges facing a large European industrial company competing in a mature industry with strong price pressure. Established in the 1930s in Denmark, Danfoss initially produced automatic valves for refrigeration plants. The company has since grown into a major industrial group. Until the mid-1990s, Danfoss had the majority of its sales and production in Europe. This changed, however, with the arrival of a new CEO, who initiated a process to change the company into a global player within all of its main business areas.

Following this process of internationalization, the company was facing three main issues which top management was concerned about: Danfoss’s manufacturing network; its continued global growth; and its highly engineering-based culture. The first issue stemmed from the fact that Danfoss had followed a strategy of one product, one plant. This had created a situation with a lot of highly specialized product lines and very few common features between them. On the other hand, the internationalization strategy had so far been quite successful in Eastern Europe and China. In the United States, however, the company was still experiencing difficulties despite heavy investments in its manufacturing capacity in Mexico. In China, the company had experienced success and wanted to secure long-term growth in the market. The third issue was the very engineering-based culture of the company, which among other things was manifested in the fact that Danfoss previously developed products at the expense of consumer demand and preferences.


Teaching Note: 8B11M049 (12 pages)
Issues: Family Business; Supply Chain Management; Organizational Design; Manufacturing Strategy; Internationalization; Denmark; China
Difficulty: 4 - Undergraduate/MBA



WAWA: SUPPLY CHANGE MANAGEMENT
Robert W. Keidel

Product Number: 9B11M042
Publication Date: 6/8/2011
Length: 14 pages

By mid-2007, Wawa, headquartered outside Philadelphia, had grown into a chain of 564 convenience stores (200 of which sold gasoline) within a 250-mile radius. A privately owned firm, Wawa employed over 16,000 people and had $4.67 billion of sales in 2006, an increase of 19.6 per cent over the prior year. It was widely admired as a highly effective and humane organization with a loyal and expanding body of customers.



This case addresses Wawa’s supply chain management (SCM) in the context of strategic direction, organizational design, and future growth opportunities. Over an eight-year period, Wawa had transformed its supply chain from a disjointed array of parts into a coherent, high-functioning system. Issues before the company now included (1) the relation between SCM and competitiveness; (2) the nature of the typical store and store manager; and (3) possible expansion beyond Wawa’s current area of operations. Another question concerned Wawa’s stores. Historically, these had featured a friendly ambience where “everybody knows your name,” but the company was moving towards larger, more standardized units with fewer offerings, with the goal of minimizing customer throughput time. What would this shift mean for the role of the store manager, and for the overall customer experience? Finally, to what extent was Wawa “landlocked” in its concentrated, middle-Atlantic market? Could — and should — the company attempt to export its distinctive value proposition, culture, and methods to other geographic areas?


Teaching Note: 8B11M042 (14 pages)
Industry: Retail Trade
Issues: Supply Chain Management; Geographic Expansion; Convenience Stores; United States
Difficulty: 5 - MBA/Postgraduate


Chapter 13:
Operations Analysis

LANDHILLS WINERY: DEVELOPING AN OPTIMAL BLENDING PLAN
Owen Hall, Jr., Kenneth Ko

Product Number: 9B14E006
Publication Date: 5/21/2014
Revision Date: 5/12/2014
Length: 3 pages

A senior vintner at Landhills Winery (Landhills) has been put in charge of developing an optimal blending plan for the upcoming season. This assignment is the result of a recent Landhills board meeting where the chief executive officer presented her ideas regarding the use of analytics for enhancing profits while at the same time not affecting quality. Specifically, the use of resource optimization could significantly improve Landhills’s profitability. Industry reports have indicated that a growing number of major wineries are using analytics to assist in the wine-blending process. The board meeting concluded with the CEO tasking the senior vintner with developing an analysis and reporting back his findings to the board at next month’s meeting.

Teaching Note: 8B14E006 (5 pages)
Industry: Accommodation & Food Services
Issues: Analytics; wine blending; United States
Difficulty: 4 - Undergraduate/MBA



SHANGHAI BAOLONG AUTOMOTIVE CORPORATION
H. Brian Hwarng, Xuchuan Yuan

Product Number: 9B12D021
Publication Date: 10/25/2012
Revision Date: 10/23/2012
Length: 18 pages

The president of a Chinese auto parts manufacturer is facing a crisis. For nearly 10 years the company's production lines have not been able to keep up with the orders. Deliveries are due, but the in-house stock is in short supply despite the production lines operating under extended hours. Quality issues have resulted in recent recalls in the United States, making the company's prospects worrisome. Faced with worsening international trade conditions and mounting problems, the chair and president decide to expedite the initiative of transforming their company into a lean manufacturer based on the Toyota Production System. However, the company has no in-house expertise or experience in lean production. The case presents a challenging situation faced by many companies as they move up the ladder of production competence and operational excellence. The major learning focuses on the adoption of Japanese production practices in an emerging Chinese company as it implements lean production.

Teaching Note: 8B12D021 (17 pages)
Industry: Manufacturing
Issues: Lean production; Toyota production system; lean implementation; corporate/social culture; China
Difficulty: 5 - MBA/Postgraduate



UPPER CANADA INSURANCE
David Wood

Product Number: 9B10D012
Publication Date: 12/13/2010
Revision Date: 6/2/2014
Length: 5 pages

Deborah McDonald of Upper Canada Insurance (Upper Canada) was reviewing several pieces of data she and her team had spent the last month collecting. McDonald and her team had been asked to address the inefficiencies in the life insurance application process, largely due to the high numbers of applicants withdrawing from the system (known as wastage) in the midst of the process. Upper Canada had determined that the most common reason for clients abandoning the application process was the long time required to get a response, followed by lack of communication and poor customer service. It was thought that by solving these problems, Upper Canada could meet or exceed industry wastage levels and improve the efficiency of the sales team. McDonald was assigned the task of analyzing the data and making recommendations to resolve the issues of the application process, but was not certain where to begin.

Teaching Note: 8B10D012 (8 pages)
Industry: Finance and Insurance
Issues: Capacity Utilization; Customer Service; Inventory; Process Flow Development; Create Value
Difficulty: 4 - Undergraduate/MBA


Chapter 14:
Collaboration

ISS & NORDEA: FACILITY MANAGEMENT IN THE NORDIC REGION
Torben Pedersen, Bent Petersen

Product Number: 9B12D005
Publication Date: 4/19/2012
Revision Date: 3/28/2012
Length: 20 pages

Nordea Bank had emerged as the largest financial group in the Nordic region. As part of its consolidated approach, Nordea’s top management had made the strategic decision to outsource a number of the company’s peripheral activities, such as catering, security, and cleaning, in order to focus on the core business of banking. In Denmark, Finland, and Sweden, some services had been outsourced to one of the leaders in the facility management (FM) market, the global service provider ISS. The relationship between Nordea and ISS on the delivery of facility services had a long history, but a new contract was successfully concluded by the end of 2010. Consequently, ISS was chosen as Nordea’s FM partner and would continually be providing Nordea with a scope of supportive services across 20 locations in the Nordic region. From 2010 and onwards, a significant switch was made to an output-based focus in the contract, where it was the quality of the delivered services that was specified rather than how to achieve this level of quality, i.e. the input. The change to an output-based contract was seen as a new beginning of a relationship that required significant changes on both sides in terms of mentality, organization, governance structures, and adjustments of expectations. Both the view of the customer (Nordea) and the supplier (ISS) are presented and contrasted in the case.

Teaching Note: 8B12D005 (15 pages)
Industry: Finance and Insurance
Issues: Outsourcing; Facility Management; Service Operations; Contract Governance; Supply Chain Management; Nordic Countries
Difficulty: 5 - MBA/Postgraduate



COMPFED: THE DAIRY COOPERATIVE DISTRIBUTION SYSTEM
Subhash Jha, Atanu Adhikari

Product Number: 9B11A047
Publication Date: 3/16/2012
Length: 19 pages

Bihar State Milk Cooperative Federation (COMPFED) had been marketing its milk and milk-related products under the Sudha brand name in the Bihar and Jharkhand regions of India for three decades. It operated through six unions and two dairies to process the milk collected from nearly 4,000 village-level cooperatives. COMPFED appeared to have a competitive advantage for its supply of milk, since it maintained the largest network for milk procurement, which spanned a large area and was unmatched by its competitors. However, due to various environmental forces, the ability to procure an adequate supply had declined in the last two years, which negatively affected the profitability of the organization.



The marketing manager of COMPFED had been facing difficulty in serving the growing demand and maintaining profitability. Since he operated in an industry with high fixed costs, the declining supply of milk procurement meant lower sales. As a result, there was no opportunity to significantly lower operating costs to match the limited supply.



The marketing manager thought of two reasons in the external environment that contributed to this situation. First, a series of floods had caused damage to grazing land and livestock operations. Additionally, private players were disrupting the supply chain by offering short-term higher payments to some suppliers/farmers. These players did not face the same regulatory and hygiene guidelines that COMPFED did. The marketing manager’s options included two very different alternatives: trying to work with these agents or securing a process to minimize or eradicate their activities.


Teaching Note: 8B11A047 (8 pages)
Industry: Agriculture, Forestry, Fishing and Hunting
Issues: Agribusiness; Distribution System; Cooperatives; Distribution Channel; Dairy Farming; India
Difficulty: 5 - MBA/Postgraduate



ALLIANCE MANAGEMENT AT FORBES MARSHALL
Naga Lakshmi Damaraju, Harshdeep Singh Chowdhary, Dhruv Khanna, Dhruv Ahuja

Product Number: 9B11M108
Publication Date: 1/24/2012
Length: 20 pages

This case traces the history and growth of Forbes Marshall (FM), a family-owned company in India. FM provides steam engineering and control instrumentation solutions for the process industry. The company has evolved into a leader in process efficiency and energy conservation through technology tie-ups and focused investments in manufacturing and research. Its joint ventures with the world's leading firms enable it to deliver quality solutions in 14 countries. Forbes Marshall's business practices and processes have combined into a unified philosophy of being trusted partners who provide innovative solutions.

Teaching Note: 8B11M108 (10 pages)
Industry: Manufacturing
Issues: Alliance Management; Corporate Strategy; Transaction Cost Economics; Real Options; Value Chain; India; Ivey/ISB
Difficulty: 5 - MBA/Postgraduate


Chapter 15:
Performance Measurement

ASTERAND: LEARNING FROM FAILURE
Anne Snowdon, Hannah Standing Rasmussen, David Maslach

Product Number: 9B12D018
Publication Date: 10/29/2012
Revision Date: 10/26/2012
Length: 11 pages

This case chronicles the challenges of establishing an innovative tissue bank service to accelerate the research and development processes of biotechnology and pharmaceutical companies worldwide. Asterand’s two major challenges involved achieving a standardized approach to collecting tissue samples in hospitals all over the world and achieving the highest possible quality of tissue samples shipped to their primary customer, Amgen. Despite the identified need for high-quality tissue samples, Asterand was experiencing multiple quality control problems in their processes and procedures. Tissue samples were being packaged poorly, labeled incorrectly or delivered at the wrong time or to the wrong place. Additionally, there were quality issues with the RNA analysis of the samples, which was a critical factor in the usability of the tissue sample for research and development of new therapies and drugs.



The head of pathology at Amgen’s California facility was threatening to terminate their existing order and communicate the failure of Asterand to all company employees, which would have a devastating ripple effect across the industry and likely destroy opportunities for any future orders with Asterand. If this happened, Asterand would not be able to secure contracts with customers and was at risk of losing investors and going bankrupt.


Teaching Note: 8B12D018 (11 pages)
Industry: Health Care Services
Issues: Health sector; medical products; product quality; customer relationship; United States
Difficulty: 4 - Undergraduate/MBA



AGILE ELECTRIC: QUALITY ISSUES IN A GLOBAL SUPPLY CHAIN
Dhruv Dar, Sanjay Kumar, Vijay Aggarwal

Product Number: 9B12D011
Publication Date: 7/18/2012
Revision Date: 8/16/2012
Length: 16 pages

The case describes the evolution of a global multi-tiered supply chain involving one of the world’s largest automotive original equipment manufacturers (OEMs), its tier 1 supplier — Automek, a U.S.-based global corporation — and the tier 2, tier 3, and tier 4 suppliers based in India.

With Automek’s engineering support, India-based Agile Electric had successfully developed many parts for the OEM in the past. Based on this experience, Automek buyers placed an order with Agile for a new product — an actuator assembly. In developing this product with little support from Automek, Agile was concerned due to its lack of knowledge concerning the suppliers for the actuator assembly components and the critical requirements. To allay its concerns, Automek promised to locate suppliers and assess and validate the suppliers based in India. Agile then invested in the assembly line and developed the actuator assembly. When supplies started, the OEM reported many quality problems, traceable to the tiered suppliers.

Along with quality and parts supply issues, the issues of subsequent liability in the case of a recall by the OEM were faced by members of the supply chain. Agile felt that since Automek had selected or approved the suppliers, and since Agile had had no original product expertise, that Automek should take responsibility for resolving the quality problems.


Teaching Note: 8B12D011 (8 pages)
Industry: Manufacturing
Issues: Global Sourcing; Supply Chain Management; Quality Management; Cross-cultural Differences; Developing Countries; India
Difficulty: 4 - Undergraduate/MBA



SUPPLY CHAIN MANAGEMENT AT INTERNATIONAL AUTOMOTIVE
Katrin Haarer, Nahide Hannane, Leonardo Zapata-Flores, Joo Y. Jung

Product Number: 9B11D013
Publication Date: 10/31/2011
Length: 9 pages

In 2008, International Automotive Company (IAC), a German manufacturer of automotive parts, acquired a plant in Reynosa, Mexico. This plant produced various types of motors for power windows, heating, ventilating, air conditioning, and wipers. At the time of acquisition, the plant was showing record losses. Because the acquisition was internally financed, it was crucial to make the plant profitable quickly. After conducting a deep analysis, the company discovered that a lack of proper management in the supply chain system was leading to a large amount of wasted resources. As a result, managers looked for opportunities to save money and facilitate improvements mainly in areas such as packaging, warehousing, and transportation. One of the greatest obstacles involved IAC’s employees, who were falling short in terms of knowledge and motivation.

Teaching Note: 8B11D013 (5 pages)
Industry: Manufacturing
Issues: Supply Chain Management; Operations Management; Lean Management; Mexico
Difficulty: 4 - Undergraduate/MBA


Chapter 16:
Risk and Sustainability

NAMO ALLOYS PVT. LTD. - A DRIVE TO SUSTAINABLE INVESTMENT DECISION
Jitendar Khatri Bittoo, Ashutosh Dash

Product Number: 9B13D022
Publication Date: 2/28/2014
Revision Date: 2/28/2014
Length: 14 pages

Namo Alloys, a medium-size, secondary-metal manufacturing firm, is seeking to expand by investing in new technology. The co-founder’s challenge is to select a technology that aligns with the company’s sustainable manufacturing philosophy by creating not only economic value but also sustainable societal and environmental values that will ensure triple bottom line value creation for all company stakeholders.

Teaching Note: 8B13D022 (18 pages)
Industry: Manufacturing
Issues: Sustainable investment; sustainable development; triple bottom line; multi-criteria decision making; India
Difficulty: 5 - MBA/Postgraduate



QUALITY MANAGEMENT IN THE OIL INDUSTRY: HOW BP GREASES ITS MACHINERY FOR FRICTIONLESS SOURCING
Martin Lockstrom, Shen Li, Shengrong (Linda) Zhang

Product Number: 9B12D006
Publication Date: 3/28/2012
Revision Date: 3/28/2012
Length: 9 pages

In the winter of 2010 in Shanghai, Dr. Zeb Feng, procurement director for Asia at British Petroleum (BP), was acutely aware of the growing burden that quality control imposed over his company’s global operations. Chinese suppliers were masters of cost-cutting, but quality often suffered as a result, which led in turn to an increased need for inspection and development efforts. Almost five years ago, Feng’s company had established an international procurement office (IPO) in Shanghai, which served as a shared service centre for internal customers throughout BP worldwide. Since that time, the IPO had been mainly sourcing non-hydrocarbon goods and services.



After a corporate board meeting with Christina De Luca, the vice president of procurement and supply chain management for BP’s downstream operations, it had been decided that the company would start to enhance its global competitive sourcing. As the number-one supplier market in the world, China was a high priority for further oil exploration. The pressing point that concerned Feng was whether Chinese suppliers were sufficiently ready to supply mission-critical supplies for oil drilling, extraction, and refining. During a recent conference call, De Luca had reiterated, “Zeb, our competitors are way ahead of us in their sourcing operations, and they have achieved much lower costs. We’ve got to do something!” Feng had to gather his team for a planning meeting. He knew that supply quality was the key issue, but how could it be resolved?


Teaching Note: 8B12D006 (6 pages)
Industry: Other Services
Issues: International Procurement Office (IPO); Quality Management; China; CEIBS
Difficulty: 5 - MBA/Postgraduate



WAL-MART CHINA: SUSTAINABLE OPERATIONS STRATEGY
David J. Robb, Ben Hopwood, Lei Wang, Jun Cheng

Product Number: 9B08D009
Publication Date: 5/5/2009
Length: 20 pages

A German expatriate had moved to China in 2005 to take up a merchandizing position at the Wal-Mart China headquarters in Shenzen. By 2008 he had been promoted to the new position of senior director for sustainability for Wal-Mart China (retail) and Global Procurement. His new position required that he lead the rapidly-approaching inaugural Wal-Mart Sustainability Summit. The senior director must ensure that Wal-Mart China's five Strategic Value Networks (SVNs), which were tasked with leading sustainability change within the organization, continued to engage stakeholders by implementing innovative solutions that not only cut costs but also lead to more sustainable operations. The case describes Wal-Mart China's operations (including purchasing, distribution and retail) in the context of the company's desire to improve sustainability in a manner appropriate to China. The immediate issue is to identify opportunities to improve the sustainability of Wal-Mart China's distribution systems and retail operations.

Teaching Note: 8B08D09 (14 pages)
Industry: Retail Trade
Issues: China; Distribution; Purchasing; Logistics; Supply Chain Management; Sustainability; Tsinghua/Ivey
Difficulty: 4 - Undergraduate/MBA