1. Explain Bull-whip effect. Comment on how to minimize, providing examples. 2. Take any case covered in class. Comment what you have learnt from it and how this learning could be applied to real life (organizations you have worked with or know of). 3. The Spanish Institute for Small Retailers (known in Spain as the INEPT: Instituto Nacional Español de Pequeños Tenderos) is promoting a plan to improve the competitiveness of its associates in the area of Madrid. Reported issues are high cost of inventory, waste due to low rotation, inefficient use of space and high purchasing costs. Propose such a plan, commenting the SCM and logistic principles behind your proposals. Make and state all assumptions as needed. 4. Case Micron (circa 2000): Micron Electronics manufactured PCs and sold them directly to customers that placed their orders through the internet or telephone. Micron owned a factory, located in Idaho (USA), and worked with one subcontractor who assembled the most popular models. Depending on the order (individual, corporate, high or low volume), the order was assigned to one of these two facilities. Large corporate orders, for example, went to Idaho (45% of sales were for the government). Micron had almost no stock of finished goods and assembled the PCs in response to customer’s orders. A typical order could also include a monitor and a printer. Micron did not make these items, stocked in Memphis at a logistics platform that Federal Express (FedEx) operated for them. Some of these accessories could also be in stock at Idaho. For individual orders, FedEx transported the assembled PC (from Idaho or from the subcontractor) to Memphis, where they were merged with the accessories waiting at the platform. Another possibility was that FedEx combined the PC and the accessories in one of its platforms closer to the customer. For instance, an order from Chicago could be completed at Chicago itself. To facilitate this on-transit assembly of the order, Micron shared detailed electronic information with FedEx as the PCs went out of Idaho. This also allowed the customers to trace the order on the Internet. For large corporate orders in USA, Micron did not use FedEx, instead used small transportation companies (less-than-truckload) that took the product to the customer. These orders were typically completed with accessories warehoused in Idaho. Micron sourced parts and components for the PC all over the world, using both air and sea transportation, and for the final USA’ portion a combination of rail/truck. Analyze this configuration of the production/delivery system, and propose possible improvements. Although you do not have to answer them explicitly, these questions can orient your analysis: 1. Why this particular network configuration? (Hint: identify reasons of the single plant and subcontractor, for the utilization of FedEx & for the global sourcing) 2. How do you think a company that sales direct and through resellers (HP, Compaq) should design and handle their production and delivery system?
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