The strategy development process typically begins with the identification of customer needs, and how these needs can best be met by the company. In this case Bose has a strong emphasis on Research and Development. Bose is willing to explore new technologies that increase speaker performance, and this has been a central driver to the business strategy ever since the company was founded. Bose has a wide range of customers e. G.
Dolce, Honda, Ionians, Audio, as well as other demanding distributors who carry their products, these customers want up to date technology and deliveries made with short cycle time and high quality products at lower costs. This market analysis has profound implication for the company’s procurement and supply strategy. What should be the relationship between Oboe’s supply management strategy and the development of its performance measurement system Bose needs to attract suppliers who can bring with them technological inputs, and be able to respond to Oboe’s needs in a timely manner to bring new products to the market s quickly as possible.
This also means that suppliers have excellent quality, quick response and be high levels of service responsiveness. Why is purchased quality so important to Bose? Bose audio products received polarize opinions about quality. So they took quality as a primary concern and relied on improving it. Can a just-in-time purchase system operate without total quality from suppliers? Why can some components arrive at Hillsdale, Michigan, plant with no incoming inspection required? Discuss the reasons why Bose has a certificate of achievement program for identifying qualified suppliers.
There are several reasons for a certificate of achievement program for identifying qualified suppliers. Certified suppliers can deliver directly to the plant thereby eliminating costly inspection of incoming shipments, this in turn can reduce cycle time and further reduce costly inventories. Another important benefit of the supplier certification is that engineers can now design products and consult a purchasing database when they want to design a new part. If the part already exist in which its close enough to the requirements it can be used and may already have a certified supplier.
Bose is moving toward single sourcing many of its purchased part requirements. Discuss why the company might want to do this. Are there any risks to that approach? Companies are moving to single sourcing to reduce complexity in their supplier network, single sourcing can lead to strategic partnering which is a mutual ongoing relationship involving a commitment over and extended period and a sharing of information and the risk and rewards of the relationship has many advantages including; Leverage increased volume, obtain lower price, lower administrative cost, monopolize supplier technology and gain access to design or engineering.
Discuss some of the difficulties a company like Bose might experience when trying to implement just-in-time purchasing with international suppliers. There are several reasons BOSE would want to single source more than multi source. In the long run single sourcing saves time and money. It diminishes opportunities for errors in production and distribution. Also, the variation in production is very small verifying great quality. Some of the risks associated with single sourcing would be risk of a buyout on the suppliers end. Without the supplier you are forced to delay production and begin search for a new supplier.
Another equidistant that occurs is the loss of interest in your company from other suppliers and you could lose your competitive edge Why does Bose have to source so much of its purchase requirements from offshore suppliers? Bose is setting up international trading advantages by using offshore suppliers. The costs of the goods BOSE wants to buy are cheaper elsewhere. BOSE is also finding the quality of the products is a bit better. Bose is also getting low cost skilled labor, low cost raw materials, tax breaks, and low trade tariffs What makes a KIT II system at Bose unique? Why would a company pursue this type of system?
