Fill Rate Order Entry Avg. Large number of raw material vendors 2. This means that any given reduction that Spartan can obtain on the procurement price of aluminum will translate in an even higher increase in the return on assets.
The new business strategy being formulated for 5 years will give more negotiation power in view of a commitment of a long term relationship.
An indirect distribution channel relies on middle This structure was functional to the previous strategy because there was a strong focus on the purchasing function. This change can be best illustrated by comparison of figures 1.
Raw materials procurement The customization strategy required the presence of many vendors and a high level of inventory in the warehouse. The purpose of a distribution channel is to supply a link between production and consumption. Spartan should keep always in mind that many of their customers including some of the key ones decided to opt for standard product design because it brings them more advantages like lower cost and faster delivery.
Sanzharevsky defines this term as a set of elements of ideological, institutional and sociological order that contribute to the formation of political management of a given country for a Get Full Essay Get access to this section to get all help you need with your essay and educational issues.
Moreover, reducing the purchasing price on raw materials will produce a leverage effect on the return on assets. Review the vendor list and based on the new product category, maintain only those who will be able to deliver the objective ii.
The general modern conception regarding procurement is recognizing the importance that, in addition to price, other elements may have in this relation. However, a very high turnover may result in loss of sales due to inventory shortage. Inventory turnover is different for different industries.
Such a large base of vendor proves that Spartan has a good market reputation. The new corporate strategy implies re-engineering from a job shop method of production which involved manufacturing operations with several departments, each of which produced particular components, Ref Case to a hybrid method of production which is a flow operation, where multiple work stations can be working simultaneously, which will mainly allow Spartan to increase volume of production, reduce lead time, it will further lead in cutting down the carrying cost of inventory, even though the inventory will be high.
There company could benefit from having one person responsible for forecasting demand. Actions to be Taken 2 I. The fact that we are reducing the number of vendors required will allow us to be more selective and procure only from the vendors that provide a service in accordance consistently delivered in few days lead time or those who can commit to do so in the future.
Problem Statement The Materials Department headed by Rick Coyne has to take a lot of initiatives internally to incorporate various implications of the new strategy, and submit his report to his boss Max Brisco of the changes suggested by him within a week. There company could benefit from having one person responsible for forecasting demand.
There is also an option of keeping a buffer stock in case of an inconsistent demand. We believe that in order to maximize the SC Department resources in accordance with the new structure the positions and functions of the people in the SC Department will have to be adapted to strengthen the inventory management function of the company.
As we previously mentioned, the new strategy of Spartan will enable the Supply Chain Department to restructure the procurement scenario.
Customization is what gives Spartan the competitive edge over their competitors. The change in corporate strategy will require the employees to get training in accordance with the new product line.
We know that reducing the costs will drive profitability up. Additionally, Rick will also have an option of keeping a buffer stock in case of an inconsistent demand. For that the company will have to get in touch with their suppliers more often in order to fulfill production requirement.
Moreover, working with this strategy will help Rick in another way as he will be able to solve the problem of stock out, specially for the basic raw material i. Raw materials procurement The customization strategy required the presence of many vendors and a high level of inventory in the warehouse.
From SC this may be discussed with the vendors at the time of negotiation and should also be a clause in the PO. On the contrast, the new corporate strategy reduces variety to basic lines for each product category will require less variety of raw material but in higher quantity.
Supply Strategy Case Spartan Heat Exchangers Inc. Case Sabor Inc. Case Ford Motor Company: Aligned Business Framework 3. Supply Organization Case Iowa Elevators Case Roger Haskett 4. Spartan Heat Exchangers, Inc. is facing increased competition from Korean and European Companies.
Korean Companies, with its low cost base competed primarily on price while the European Firms focused on standardizing their product lines to a few high-volume products and competed on delivery lead time and price.
Purchasing and Supply Management Case Denniston Spices Case Erica Carson 2. Supply Strategy Case Spartan Heat Exchangers Inc. Case Sabor Inc. Case Ford Motor Company: Aligned Business Framework 3. Supply Organization Supply Strategy Case Spartan Heat Exchangers Inc. SPARTAN HEAT EXCHANGERS IS FACING INCREASED COMPETITION FROM EUROPEAN & KOREAN COMPANIES.
KOREAN COMPANIES OFFERED LOW COST AND EUROPEAN COMPANIES HAD LESS LEAD TIME & COST. 2. Spartan Heat Exchangers have formulated new business strategy to reduce customization of products, reduce lead time from 14 weeks to 6 weeks. Spartan Heat Exchangers Inc. Overview Leader in design and manufacturing of industrial heat transfer equipment Shift in consumer demand Old business strategy.
SearchWorks Catalog Stanford Libraries. Catalog start Author/Contributor "Johnson, Supply Strategy Case Spartan Heat Exchangers Inc. Case Sabor Inc. Case Ford Motor Company: Aligned Business Framework 3. Cases cover purchasing and supply chain issues in a variety of settings, from process industries to high tech.Supply chain case of spartan heat excahngers inc