2007-2008 Projects


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2007-2008 Projects

  1. 1. W. P. Carey School of Business MBA Supply Chain Management Specialization 2007-2008 Corporate Projects 1. Apple, Inc.: Apple Latin America Supply Chain Optimization 2. Boeing Company: SCOR/GreenSCOR Assessment of Boeing Mesa Integrated Defense Systems Component and Sub-Assembly Operation Supply Chain 3. Cisco Systems, Inc.: Beyond Landed Cost: How do Logistical Alternatives Stack Up? 4. Intel Corporation: Cost/benefit of Supply-chain Duration Reductions in Volatile Demand Markets 5. Honeywell Aviation Aftermarket Services: Honeywell Aerospace Spare Parts Delivery Improvement 6. Rockford Corporation: Rockford Fosgate Warehouse and Distribution Solution 7. Temple-Inland: Market Analysis & Risk Assessment for Direct Material (Wax) 1
  2. 2. Apple Latin America Supply Chain Optimization Company/Division Apple, Inc., Americas Sales and Operations Project Problem or Interest in improving the supply chain for Latin America has Opportunity increased with the recent opening of the online Apple store for Mexico. (http://store.apple.com/001-800-MY- APPLE/WebObjects/mexicostore). At this time we would like to ensure the successful low cost operation of the Latin America Supply Chain Operations for outbound product, and would better like to benchmark and understand the options for supplying Latin America. Project Objectives Develop a best-in-class outbound logistics model for Apple products sold in Latin America. 1. Determine optimal customer service objectives for Latin America. 2. Minimize total supply chain costs for the Latin American operations. Primary Project 1. Benchmark Apple's supply chain with other leading computer Activities/Tasks and electronics companies for Latin America. Identify best-in- class supply chains. Focus on the following countries in which product would be shipped: Mexico, Brazil, Puerto Rico, Argentina, Chile and Columbia. Consider all Latin American countries as potential hub sources of shipments, in addition to direct shipments from OEM supplier in China, US warehouses and Brazil warehouses. 2. Identify the optimal supply chain solutions for each of the countries listed. Be sure to include tax implications in your analysis. 3. Once optimal supply chains are identified, research requirements (import, export, customs paperwork, etc.) and leading transportation carriers for the movement of product into Latin America 4. Develop a reverse logistics model for each of the countries with product ultimately being returned into US. Anticipated 1. Presentation to Apple Supply Chain officers in Austin on results of Deliverables above tasks 2. Tool for evaluating Latin American supply chain. Special (For example, non-disclosure agreement, drug testing, U.S. Requirements for citizenship): Student Team Desire but don’t require Spanish and Portuguese language capabilities. 2
  3. 3. Boeing: SCOR/GreenSCOR Assessment of Boeing Mesa Integrated Defense Systems (IDS) Component and Sub-Assembly Operation Supply Chain. Company/Division The Boeing Company Integrated Defense Systems, Rotorcraft 5000 E. McDowell Rd Mesa, AZ 85215 Project Problem or The Boeing Company in Mesa, Arizona is home to the AH-64D Opportunity Apache Longbow, the premier multi-role combat helicopter, as well as a manufacturing center for high tech aviation electrical sub-assemblies, a developer of advanced rotorcraft systems and a leader in aviation simulation. A significant portion of the Mesa facility’s production base is short run, highly competitive products that depend on our ability to rapidly respond to new customer requirements. To maintain and grow this business in today’s environment of limited supplier capacity and lengthening lead times it is crucial that we have a clear understanding of our supply chain competitive strengths and weaknesses, and where we can best leverage improvement initiatives. Additionally, understanding the environmental impact of our supply chain processes, and being able to quantify reductions in our environmental footprint is necessary when considering new business acquisition under our current environmental requirements, and when looking at how we can continue to reduce our overall environmental impact. Project Objectives Reduce supply chain costs by providing a baseline supply chain assessment, from which targeted improvement initiatives can be identified and quantified, and booked into the long range business plan. Primary Project Identify where the supply chain is competitively advantaged and Activities/Tasks disadvantaged, and consequently where we can focus our marketing and business acquisition strategy to leverage the advantages, and where we need to develop and how we prioritize our improvement projects to increase our new business acquisition competitive advantage. Provide an initial view of the environmental footprint of our supply chain processes. Identify opportunities to reduce our footprint, and recommend a method by which we can evaluate 3
  4. 4. impact/changeability of supply chain environmental considerations. Validate the usefulness and practical application(s) of the SCOR and GreenSCOR models. Specific steps of the analysis include: 1. Select and propose the elements of a SCOR assessment that would be appropriate to meet the project objectives. 2. Research and propose a GreenSCOR assessment approach. 3. Develop the project plan for a SCOR/GreenSCOR analysis of a segment of the Boeing Mesa supply chain. Include data and resource (personnel and budget) requirements. Present to the sponsor and business unit director for approval to execute. 4. Perform the SCOR/GreenSCOR assessment as defined and approved in the project plan. Operate within budget and schedule. 5. Present the results of the assessment, and any associated recommendations, in both report and presentation format to the sponsor, business unit director, and site leadership team, and to an enterprise level materials management leadership team. 6. Submit the appropriate elements of the assessment to the APQC SCORMark database for additional benchmark evaluation. Anticipated • A baseline model from which Boeing Mesa can prioritize and Deliverables quantify supply chain improvement opportunities. • Recommendations for changes to our supply chain processes that can reduce our direct and overhead costs, increase our competitive advantage, and reduce our environmental footprint. Quantification of the potential cost, cycle time, and environmental impact credits improvement. This may include, but not be limited to, changes in: o Process/procedures o Infrastructure o Technology o Metrics o Policy • Recommendation as to continued use and/or expansion of the SCOR/GreenSCOR models as viable supply chain assessment, benchmark, and improvement tool. • Feedback as to the overall project experience, and the value to you as a team and as individuals in meeting your personal, professional, and career development expectations. Recommendations on how we at Boeing might improve our program for providing industry experience to the next year’s ASU students. 4
  5. 5. Special • US Persons status required Requirements for • Non-disclosure agreement (presentations outside of Boeing Student Team containing information relative to this project must be approved by the sponsor and Boeing Mesa communications) • Project members badged for access to Boeing – Mesa facility • Travel to selected sites. Tentatively Philadelphia and St Louis • Team presentation to site senior management • Team presentation to enterprise steering team, and associated process action teams and councils. 5
  6. 6. Cisco: Beyond Landed Cost: How do Logistical Alternatives Stack Up? Company/Division Cisco, World-Wide Manufacturing, EMS Supply Chain Management Project Problem or Cisco utilizes an internally developed landed cost tool that allows us Opportunity to make informed supply chain decisions. The tool’s primary purpose is to provide a relative cost and risk comparison across various supply chains that we could choose to build our products. Some of its key considerations include:  Transformation cost at the various EMS partners  Direct Fulfillment cost at the various EMS partners  Logistics costs between EMS partner sites  Logistics costs to various SLC sites, based on customer demand (theater distribution)  Taxes / Duties  Lead-time  Inventory carrying cost  Risk (index based on site, financial, geography, natural hazard, geo-political, etc.) The output of this tool shows a relative comparison of the costs and trade-offs between choosing one site over another. In supply chain management cost is king. However, there are many hidden costs that are less obvious or more difficult to quantify than ones listed in the key considerations above. Cisco aspires to supplement our future supply chain analysis capabilities with additional intelligence that exposes some of these “hidden costs”, so that we can integrate them into our overall analysis process. For the purpose of this project, the “hidden cost” that we want to expose is “carbon footprint”. The scope of this assessment should be limited to the logistics options associated with moving our products throughout our supply chain, as depicted below. Component Supplier #1 Printed Circuit Direct Fulfillment / Component Customers Board Assembly Final Assembly & Source SLC Destination SLC Supplier #2 (~500) (PCBA) Test (DF/FA&T) Project Scope Component Supplier #n 6
  7. 7. Project Objectives Optimize total supply chain costs for Cisco, including the costs of carbon output. The primary output of this project should be a model that allows Cisco to compare the carbon footprint of various supply chain alternatives. For example, Cisco often compares different supply chain combinations which might include PCBA in China, and DF in North America, vs. PCBA and DF in North America. We are currently unable to quantify the carbon impact of a product traveling across the ocean on a boat to the same product traveling domestically on a truck. Alternatively, the same route might include air transportation instead of boat, or air transportation as a percentage of total transportation between China and North America. Primary Project 1. Analyze the supply chain of a given product Activities/Tasks a. Choose between 1-3 products b. Map all supply chain nodes (current state and alternatives) 2. Apply different modes of transportation (plane, boat, truck, rail) between each node, then quantify: a. Transit time b. Carbon output c. “Cost of carbon output” for each alternative Anticipated 1. A report that compares Deliverables a. The carbon output of various modes of transportation, with stated assumptions b. Environmental “costs” of each transportation mode c. Environmental impact of JIT manufacturing; e.g., with JIT we would expect more frequent shipments and partial loads. How would this stack-up against fewer shipments and full loads? 2. List of additional sources of carbon output for consideration 3. A scalable model that quantifies the carbon output of various modes of transportation and associated costs. Special Non-disclosure agreement Requirements for Ownership rights to any model developed as part of this project Student Team 7
  8. 8. Intel: Cost/benefit of supply-chain duration reductions in volatile demand markets Company/Division Intel/TME Project Problem or Build a model that we could use to quickly understand the financial Opportunity impact – How much does it make sense to pay for cycle time reductions? • What is the value of a day saved in the capital equipment supply chain? • Does the value of this day change as we move through the supply chain? • Where is the sweet spot? • Should we accept equipment at the very last moment, resulting in a need for overtime and accelerated schedules? • Is an earlier acceptance better financially (assuming we know the tool is required)? • How should be make decisions on shipping alternatives – low cost, slow TPT vs. high cost, fast TPT? Project Objectives Define how to make effective trade-offs between cost and velocity which would result in supply chain velocity improvements. Primary Project • Define the current decision making methodology Activities/Tasks • Build a velocity ROI model • Apply the model to a particular toolset • Model several potential outcomes and decisions • Recommend application of model to additional situations Anticipated • Provide a tool/algorithm that can be used to make ROI Deliverables based decisions when confronted with choice that require trading $ vs. velocity. Special (For example, non-disclosure agreement, drug testing, U.S. Requirements for citizenship) Student Team Non-disclosure agreement would be required 8
  9. 9. Honeywell Aerospace Spare Parts Delivery Improvement Company/Division Honeywell Aviation Aftermarket Services Project Problem or Honeywell Aerospace Spares is a multi-billion dollar business global Opportunity distribution business. We have undergone many system wide changes in the last 6 months including a new planning system, and order management system, as well as the separation our European Distribution Business in a regionalization strategy. While each of the changes is directionally correct they have impacted On Time Delivery. Project Objectives Improve Customer Service by 5% globally by identifying barriers to historical performance levels and leveraging opportunities for improved service. The solution space should be on the Systemic level, versus specific material availability or Supplier Performance. Primary Project 1. Review and map current high level value chain including Activities/Tasks performance metrics. 2. Identify potential failure modes and severity. 3. Make recommendations for improved performance requirement based on feasibility, cost, and benefit. 4. Process map the recommended alternative and create the associated work instructions. 5. Develop an implementation plan for the high value activities including required tasks and resources. 6. Pilot selected “quick payoff ” actions to the value stream. Anticipated 1. Analysis of potential alternatives for daily replenishment, and a Deliverables defensible recommendation for a replenishment strategy. 2. A detailed process map and work instructions supporting the selected strategy/process. 3. A Spares on time delivery improvement strategy implementation plan, and control system. 4. Implementation plan for agreed quick payoff pilot activities. Special Due to the nature of this Spares distribution operation US citizenship Requirements for is required. Student Team 9
  10. 10. Rockford Fosgate Warehouse and Distribution Solution Company/Division Rockford Corporation Project Problem or Rockford Fosgate is a Tempe, AZ. based designer, and Opportunity manufacturer of consumer audio products, including auto and truck audio equipment. Rockford is currently shifting its US manufacturing to an outsourced importing model, primarily from Asia. Thus, we are currently transforming from a business model as the primary manufacturer of their equipment to a design & outsourcing business model, while maintaining some manufacturing capability. We are currently attempting to determine the optimal distribution model for our organization for the future, given this transformation in our business model. We would like to evaluate whether our current configuration is ideal given the changes in our business model. We would like the project team to evaluate our current distribution model and then determine the most cost effective approach to our multi warehouse system for the future. Determining the most advantageous approach could yield substantial savings in fixed costs to the company, and could yield saving of $.5 million or more. Project Objectives Evaluate the most cost effective approach to warehousing and product distribution resulting in improved financial performance and more efficient supply chain utilization. Primary Project Evaluate current multi-warehouse distribution systems and Activities/Tasks determining the most cost effective approach for the company. (i.e., continue with current warehousing structure, utilize one of our existing warehouses and close the other, eliminate both warehouses and establish a new facility more centralized in the United States, use third party warehousing, or any combination of the above). 1. Collect and evaluate current product demand and shipping data and determine the cost of the “as-is” system. 2. Using current forecast data develop cost and service level estimates of a number of alternative solutions for the future, and a tool for analyzing these solutions. 3. Determine the sensitivity of these solutions to changes in the business environment. 4. Present the preferred and alternative solutions along with the tool developed to analyze these solutions. Anticipated Cost and distribution analysis outlining the pros and cons of the Deliverables model(s) presented, and a recommendation from the group on the 10
  11. 11. preferred warehousing structure. In addition, provide a brief summary outlining reasons for not choosing the structures previously mentioned. Special (For example, non-disclosure agreement, drug testing, U.S. Requirements for citizenship) Student Team Rockford is a public company, and therefore we require non- disclosure agreements. 11
  12. 12. Temple-Inland: Market Analysis & Risk Assessment for Direct Material (Wax) Company/Division Temple-Inland / Strategic Sourcing Project Problem or Company Information: Opportunity Temple-Inland Inc. (NYSE:TIN) is headquartered in Austin, TX. We are working together as one company to create superior and sustainable value for shareholders, customers and employees. We have made significant progress implementing major initiatives to lower costs, improve operational efficiency, increase asset utilization and drive return on investment. We are performance- driven, and our goal is to have the highest ROI in our industry. As of January 2008 we will have two core operations at Temple- Inland; corrugated packaging and building products. Our Corrugated Packaging operation has six containerboard mills and can effectively serve our customers through our integrated - nationwide system of converting facilities. Corrugated Packaging is the largest segment of the paper market. The Building Products operation manufactures a diverse line of products for new home construction and for repair and remodeling markets. Our business philosophy is focused - we are a company on a journey to be the best by consistently exceeding customer expectations, maximizing assets, lowering operating costs and improving efficiency. Opportunity: Temple-Inland will spend approximately $40 million in 2007 on Wax for use in its Corrugated Packaging (Box Plants) and Building Products (Panel and Gypsum) operations. Refined Petroleum Wax (RPW) is a by-product of lubricants manufactured by crude oil refining. Of the 654 Refineries in the world, only 30 continue to produce RPW. The disappearance of heavy crudes along with technology changes in the manufacturing of lubricants has resulted in a reduction in the worldwide production of petroleum based waxes. Temple-Inland needs to develop and implement a strategic souring plan that ensures the uninterrupted supply of wax, at a fair and reasonable value, to its Corrugated Packaging and Building Products facilities. 12
  13. 13. Project Objectives Ensure the long term supply of wax over upcoming XXX years to all operations to meet all demand requirements at the lowest total cost. Primary Project Temple Inland has a clearly defined 5 Step Strategic Sourcing Activities/Tasks Process. Completion of a Market Analysis and Risk Assessment will satisfy the requirements for the first two steps in this process. • Meet with Temple-Inland stakeholder team to gain an understanding of volume requirements, locations, logistical issues, historical spend, current and former suppliers, and other issues pertinent to the sourcing of Wax. • Complete a Category Strategy Profile for Wax: a. External Analysis: 1. Industry Characteristics (Market Size, Market Segments, etc.) 2. Value Chain Process Map 3. Five Forces Analysis b. Internal Analysis: 1. Volume Analysis (By Supplier, By Business Unit, etc.) 2. Internal trend Analysis 3. SWOT Analysis c. Category Strategy 1. Risk / Opportunity Matrix 2. Strategy Project Plan • Interaction of team with key Temple-Inland personnel will include VP of Strategic Sourcing, Director of Sourcing , e- Sourcing Manager, and Sourcing Manager of Production Material. Anticipated • Category Strategy Profile for Wax Deliverables • Recommendation of how to purchase Wax (spot market or fixed pricing) • Risk Assessment – align our risk tolerance with the needs of the business Special Non-disclosure agreement. Approximately two trips to Austin, TX, Requirements for for information collection and management presentations. Student Team 13