Developing supply chain tactical flexibility


1 – How does lengthening or shortening lead time commitments lead to opportunities to improve capacity utilization and throughput?

  Operations Management Readings: Strategic Sourcing

  Section 1 – Introduction

  2 – What is the difference between ‘out-sourcing’ and ‘off-shoring’? Why do firms ‘out-source’? What are some of the specific issues this raises? Pick one and describe more fully why this is a challenge?

  3 – Review the section, ‘An Overview of Strategic Sourcing Decisions’. What are the challenges in determining whether to ‘make’ or ‘buy’? Provide an example to demonstrate pros and cons of each approach.

   Section 2 – Essential Reading

 4 – Use either the Apple or Crocs case study. Pick one purchased input, that is something that is currently ‘bought’. Assign it to one of the quadrants in the Kraljic Matrix. Justify why it is there. Recommend either keeping it there or moving it to a different quadrant. Justify your recommendation. 

  Section 3 – A Primer on Make-or-Buy Research

  5 – Review the section, ‘Competing on Core Competencies’. How do core competencies influence the ‘make-or-buy’ decision?

  6- Review the section, ‘Transaction Cost Economics’. What are transaction costs? How does ‘asset specificity’ relate to an organization’s core competencies? How do ‘bounded rationality’ and ‘opportunism’ influence the decision of whether to make or buy?

  7 – Read the article, ‘Aligning Incentives in Supply Chains’. What are some of the incentive problems that firms face? How can they address or prevent incentive problems? Provide a specific example that illustrates the incentive problem and how your recommendation would address it.

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