Assignment:
PLEASE READ THE BELOW ESSAY AND WRITE A SUBSTANTIVE 300 WORD REPLY Make sure that you are adding new and relevant information with each this reply.
The Hewlett-Packard Company (HP) case study is about a company established in 1939 by William Hewlett and David Packard who were Stanford University graduates. The company originally specialized in test equipment and analytical measurement instruments that catered to academic institutions. As the era shifted they became key innovators to competitive advantage and used it as a main strategy to increase their Return and D. By 1990, Hewlett-Packard Company had over 50 operations nationwide. They were bringing in revenue of $13.2 billion with net income of $739 million. They had created the technology of high end laser printing that had a feature of networking capabilities with a variety of special functions.
Problem:
The problem faced with Hewlett-Packard Company was experiencing a supply chain decision currently they were manufacturing their circuit board in Boise, Idaho. They held a contract with HP Japan to ship their circuit board where they would be integrated with the power supply and fuse unit. Network Printer division was outsourcing procurement and the assembly of their products to their main engineers which resided in Japan. This, nonetheless, added 14 weeks of lead time. Another problem faced was the difference between American and European volt power. This led the company through the demand uncertainty that increased their lead time. Which they were forced to order ahead of time that accrued a four and half month period. This increased their life cycles to 18 months, which lead to the inability to accurately forecast their printers. They also faced imbalance of their current inventory. Inventory cost rose due to excess holding and increasing their carrying cost. This ultimately led to decreased customer stratification. They were unable to meet the demand, supply and kept fluctuating on their inventory requirements. This led to accrued expenses both overhead and to the production line. Air freight and sea shipments were expensive and not able to deliver on time.
Focus:
The focus of the study was if HP should adopt the universal power supply for their innovation of the next generation laser printer. Each department was asked for their options. These included the marketing team, product development, finance, manufacturing, and distribution perspective. They had to decide what the best solution would be should they adopt universal power supply?
Solutions:
They would have to assess their current process which entailed the suppliers delivering to their Boise factory, followed to shipment to their assembly in Japan, shipped to their customization of European volt supplier, then back to the United States for their volt supplier. If they analyzed their risk pooling they would see a reduction in uncertainty. Better understanding of their forecasting. They would decrease cost in transshipment costs. If they could save money in these areas, they could put back revenues in innovation as well as delivering a satisfaction in less time to deliver to the customers.
Case Questions:
The universal power supply may be considered a postponement strategy by reducing the anticipated risks that may arise in a supply chain. It also may design generic parts that may be shared between warehoused with similar end products. It can lead to decreasing time and cost to firms, while obtaining the proper end quality. Quality is such an important factor for any vital company. As stated by Young (1985 p.7) "HP has learned that a focus on quality is actually one of the best ways to control costs."
The cost benefits of the universal power supply would lead to a new product such as a network laser printer. It would increase costs that will gain revenue of $30.00 per unit. They would be able to forecast effectively. Their profit would increase while time would decrease. The universal power would be universal, this would save money that could be allocated in a different area. This could decrease their lead time and decrease over stock.
The cost would benefit the different product life cycle by increasing their profits per unit. They can decrease their cost of supplying two different voltages. This could increase their forecasting and beat competitors. They can gain access in the life cycle and which may aid in increasing their volume. They can beat their end cycle and save from having to discount any left unwanted products and lose revenues.
Suggestions to HP Boise include adapting a software to improve their ability to forecast to aid in a more efficient operational standard. They can increase their innovation by investing in research. They can also investigate on other partners or vendors to supply inventory at a lower cost.
I believe that they should adopt the universal power supply. This would bring their printer to the next generation as they anticipated. This would improve overall function in their operational division. It will aid their printer in being universal which would draw attention to a wider market.
Conclusion:
For Hewlett-Packard Company to be successful, they should adopt the universal power supply. They may incorporate their shipping to only use air shipment when they detect a high demand or low inventory. This would be used in case of an emergency of over demand. HP should also invest in research operations, according to Tandon (2013) they entered the online customer sales business. This would lead them to enter their market globally. They already have the title of the innovators of their time with technology. This could lead them to remarkable sales and aid them to fund more towards innovation of their products to stay head of their competitors. With the movement of internet involving and consumers always wanting the latest technology they can continue being the pioneers of technology.
References
Tandon, R., Chakraborty, A., Srinivasan, G., Shroff, M., Abdullah, A., Shamasundar, B., ... & Dhore, P. (2013). Hewlett Packard: delivering profitable growth for HPDirect. com using operations research. Interfaces, 43(1), 48-61.
Young, J. A. (1985). The Quality Focus at Hewlett-Packard. Journal of Business Strategy, 5(3), 6-9.