Question

Technovation, Inc., is a major Tier 1 supplier of electrical and electronic parts, with operations in more than 80 countries around the globe. It supplies the parts to Original Equipment Manufacturers (OEMs) in a wide range of industries, including; automotive, aerospace, healthcare, and electronics manufacturing.

In the recent past, it has experienced significant growth due to several new contracts received. The company is in the process of identifying suppliers for a critical component that goes into the product it makes. Technovation’s buyer team has shortlisted 4 potential suppliers and requested that they provide a self-assessment of their performance in different areas. Based on this information and others that include the facilities’ site visits, the 4 suppliers were given scores as shown in the table below. Also, the team of evaluators went through a series of iterative processes to arrive at weights for each criterion. These values are also provided in the table (shown in brackets). The team’s intent is to use this information to determine the 2 suppliers to narrow down to so as to engage in negotiations with them. Depending on the post-negotiation result, the team would decide to either use 1 of the suppliers or split the production volume between these 2 suppliers.

(a) Help the team determine the 2 suppliers to which it should narrow down this list [Apply the Weighted Factor Analysis (WFA) method. Use Microsoft Excel for your calculations].

(b) Do you think the team should eventually use 1 supplier or split the volume between these 2 suppliers? Fully discuss why you are in favor of one over the other.

(c) What other factor(s) do you think the team omitted and which they should have included? Briefly explain.

(d) Mr. Ronald Hamburg, the team manager, has suggested that, given the types of parts under consideration here, “management experience” and “price” are not particularly relevant factors. He suggests that their combined weights should be added to the current weight for the “technical experience” factor. Explain, based on relevant calculations, whether this would affect your decision as to which suppliers to shortlist.

Factors (Weights (1) Technical (0.15) Robin, Inc. Powell, Inc. Tulane, Inc.Rider, In<c (a) Design (0.10) 90 70 85 80 85 75 80 70 Experience (0.05) (2) Management (0.15) (a) Experience (0.10) Expertise (0.05) 85 80 75 90 90 85 70 80 (3) Quality (0.45) (a) Defect rate (0.35) 90 65 70 85 85 90 75 70 Best practice (0.10 4) Delivery (0.20) (a) Lead time (0.05) 75 80 85 70 90 90 60 65 75 75 n-Time Performance (0.15 70 5) Price (0.05 80

Need answers to c and d only answers to a and b below from a previous post.

Previous answer for a and b

As per chegg guidelines A and B question is answered

A) open the excel and create a WFA as shown in the table below:

The two highest scorer are Robin Inc and the Powell Inc.

b)

Use ROBIN INC.: Using a single supplier creates long term relationships and colloborations. However, it increases the risk if the supply of the supplier stops due to some issue. However, still I prefer the have a single suppler as a single suppler values long-term relationships and helps it to understand the requirements of the company.

Answer 1

c) The following factors could have been included in the supplier analysis to facilitate the decision:

• Distribution network: This factor could have highlighted the extent to which the supplier has distribution network in the region. Densely available distribution network will facilitate the overall delivery of products
• Inventory control: The information of this factor will highlight how efficiently the supplier handles his inventory management. This will reduce the overall turn around time (TAT) of the procurement process, thus saving procurement costs of the company.

d) Both management experience and price are quite crucial factors for supplier selection.

• Management experience highlights the skills and expertise of the supplier and his establishment. With a high management experience, the supplier will be able to handle multiple profiles easily and will be able to solve any kind of issue quite easily
• Price: Price is a major factor as it serves as an expense for the company. The overall cost of the product will be dependent on this price

Hence it is not a wise decision to eliminate management experience and price factors from the supplier selection grid.