Please see attachments.
Supply chain Evolution at HP – Project Part 2
Project Introduction: This course project involves an investigation into the evolution of a supply chain at Hewlett Packard.
The first part of the case describes the evolution of HP supply chain for its PC business in Europe between the years 1992 and 1994 and the different initiatives: build-to-order, vendor-managed inventory, supply hubs, top value, channel assembly program, etc. (See M6A2SC attachment)
The last part deals with HP strategy of outsourcing production to SCI, a contract manufacturer.
You will be asked to analyze the decisions made by Hewlett Packard and to propose a supply chain strategy that answers the question, “ what should be the next step in this highly competitive environment?”
You will work on your course project throughout our term. You need to submit project reports based on the following schedule.
Project Submission Plan:
Description/Requirements of Project Part 2
Tasks:
· Complete your analysis of this case as follows:
· Complete your analysis of the HP supply chain by answering the following questions:
· What supply chain models will help us grow faster?
· How do we match our channel structure to customer requirements?
· What supply chain structures would help us reduce costs further and at the same time help we offer greater product variety to our customers.
· Use your answers in the above to guide your development of a new supply chain for HP, going forward.
· Diagram and describe your new supply chain in detail.
· Indicate how it meets the objectives posed by the questions above.
· Indicate how it supports the strategic goals of HP.
· Identify the strengths and weaknesses of each component of your supply chain.
· Provide appropriate data that is self developed, or from other sources, such as the library or the internet, to support your conclusions.
5-6 pages. APA citations.
Supply chain Evolution at HP
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Supply chain Evolution at HP
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Module 6, Assignment 2:
Supply chain Evolution at HP
Scott Jackson
Supply Chain Optimization and Outsourcing B6110
August 4th, 2012
For the 1992 – 1994 periods, describe and identify the supply chain that HP developed and used.
Between 1992 and 1994, HP employed a different technique of analysis that involved studying the effect that improbabilities have on the functionality of the supply chain. This involved carrying out analysis for the different divisions of the company. For example, carrying out analysis for inkjet product which is situated in Corvallis; the computer manufacturing department of the company which is at Cupertino, and the LaserJet printer department which is at Boise. Through these analyses, HP achieved its objective of studying the supply chain, the various factors that affect it, and how to improve it. For instance, this analysis helped HP to realize that carrying out regular reviews is very crucial for the supply chain. It also realized that, one of the divisions, the distribution division, which is responsible for transportation of the products to the customers, needs to be boosted as a means of improving this chain (Lee & Billington, 1995).
How does this supply chain support the HP strategic goals during this period?
The main goals of this supply chain is to minimize the overall costs of production, to reduce the inconveniences caused by the distribution division of the supply chain through delays, and to introduce better transportation means that improve the delivery of products. With the above adopted supply chain, these strategic goals of the firm can be achieved with much ease as the processes will be more suited to achieving these goals. This is because several techniques will be applied to cause these positive changes in the supply chain. These techniques include; regularly assessing the inventory, diversifying on the transportation means to ensure efficiency in the process, and cutting down on the frequency of manufacturing (Lee & Billington, 1995).
What are the strengths of this supply chain?
Among the main strengths of this supply chain is that by utilizing more advanced approaches, it can lead the firm into making several improvements in its processes such as relocation or changes in its distribution strategies, product design, manufacturing strategies and prediction of its markets; something that is in line with the firm’s goals and objectives. The flexibility of the supply chain is also strength. Generally, the ability of the supply chain to accommodate the changes that are needed to improve processes in HP is a great advantage (Lee & Billington, 1995).
What are the weaknesses of this supply chain?
Some of the weaknesses of this supply chain include; increase in the operational costs and expenses. Due to this, the cost is passed on to the consumer through charging high prices for the final product and therefore, it discourages the consumers. Additionally, this supply chain is time consuming, and needs a lot of additional resources to operate efficiently. Finally, as the supply chain is new, there is some level of uncertainty as the firm is not sure about its efficiency and whether it will work well for the firm (Lee & Billington, 1995).
To conclude; HP’s new supply chain (1992-1994) showed some level of success. This is explained by the increase in the distribution centers, and the increase in its products. For example, the eight hundred percent increase in the number of DeskJet printers produced in 1990, and the increase in inkjet department from two hundred million dollars to more than 1.2 billion dollars over a short period of time.
References
Lee, H. L., & Billington, C. (1995). The Evolution of Supply-Chain-Management Models and Practice at Hewlett-Packard. Interfaces, 25(5), 42-63.