Printed Circuits Components for a JIT Factory Essay Example

a willingness to conform to JIT specifications, being eager enough for the new business that Acacia would be a preferred customer, and being a U. S. based firm, no currency or communication problems. United's weaknesses include having no history as a JIT supplier with Acacia, having no experience with JIT requirements, and charging a price 10 percent higher than Monitor's. Taguchi's strengths are a familiarity with JIT and the automatic equipment used at Acacia.

Its weaknesses include being an international supplier, potential currency or communication problems, having no history as a JIT supplier with Acacia, and charging a price 10 percent higher than Monitor's. Other considerations the students should explore include how quickly the new suppliers would come up to speed, whether it would be useful to continue with Monitor in the short-run while additional qualified suppliers are located, and how seriously supplier goodwill would be jeopardized by pulling the JIT parts away from Monitor. Question 2: What should Carl do now?

There is, of course, no single correct answer to this question. In the class discussion there should be mention of how critical quality, service, timeliness, and cost are for the parts. The quality of Monitor's parts was so poor that production was repeatedly halted as a result. This is an extremely important factor for a high-volume, mostly automatic process. The service provided by the supplier is also of key importance in this case because of unusual specifications arising from the JIT environment, and probable engineering changes due to lack of experience Acacia has with the product and production process.

The timeliness of delivery is also an issue, since JIT hinges on virtually no inventories and assumes

weekly or more frequent deliveries. The higher cost of the new supplier's parts is probably not a critical issue; although 10 percent is a relatively big percentage increase, it is not very significant since the parts being re-sourced are relatively inexpensive. The actual way Carl settled the issue was to transfer all but the five monitor-unique parts to United and Taguchi over a period of a few weeks.

This has not resulted in any known damage to supplier relations, since the 440A parts were a tiny fraction of Monitor's total production. Both new suppliers have been able to meet the JIT packaging and delivery requirements without incident. Question 3: How could Carl have avoided the problems he experienced with Monitor? The most serious error Carl made in choosing Monitor as the initial supplier was the assumption that since Monitor was a competent supplier for ordinary parts, it would be competent for special-order parts as well.

Carl should have considered Monitor's management orientation toward high volumes, and the size of the supplier relative to the size of the order he was placing. Finally, he should have balanced the slight cost premium for better parts against the notional costs of repeated line shut-downs and inventory stocking problems. By choosing the correct suppliers initially, additional costs associated with researching the parts could have been avoided.