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Case Study 1 Global Value Chain

case study of GVC for international business management

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21 views

Case Study 1 Global Value Chain

case study of GVC for international business management

Uploaded by

dhruvptel0549
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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24W_MGT1212_310 Global Value

Case Study:-1
Metrovox – Global Value Chain
Management and Strategic
Sourcing

BY:-
Dhruv Patel:- 041103641

TO Professor:-
JamesHuget
(1) Based on the risk factors associated with the Bugabyte and the Bugabyte Lite, which

product do you think Grunwald and Vogel will recommend as the best candidate for

assembly outsourcing?

The Bugabyte, as a relatively new product with increasing production delays due to its video

capability, presents challenges in meeting delivery schedules and has a 30 per cent late delivery

rate. In contrast, Bugabyte Lite has a stable sales history over the past two years, right

forecasting, and a well-established assembly process, making it a more suitable candidate for

outsourcing. This decision aligns with the goal of addressing Metrovox's late delivery rates and

ensuring a reliable supply chain. By outsourcing out the assembly of Bugabyte Lite, Metrovox

can better meet delivery deadlines and efficiently manage schedules. This choice keeps the

business competitive in the market and keeps a constant standard of product quality.

(2) Based on Grunwald and Vogel’s decision, what will be the benefits and disadvantages of

outsourcing the assembly function?

Advantages: -

The potential advantages of outsourcing the production of the Bugabyte product are significant

and warrant careful consideration.

Firstly, by focusing on the development of the new Bugabyte product, the company may be able

to minimize production error margins, ensuring a higher quality product is delivered to the

market.

Secondly, outsourcing allows for greater control over the cost and delivery time of the product,

enabling the company to keep a steady supply chain and avoid delays in product delivery.

By using the ability of external partners, the company can optimize


32 the production process and ensure that the Brugnatellite product is always available to

customers.

Disadvantages: -

One of the primary disadvantages is the potential loss of control over intellectual property, the

company may face the risk of intellectual property by competitor firms.

Additionally, there is a possibility of delays in manufacturing and transportation processes,

which might result in missed deadlines and lost revenue.

Furthermore, there is a risk of breaching inventory agreements with suppliers, leading to

potential penalties and loss of reputation.

(3) If Metrovox can outsource the assembly of the circuit boards to an existing supplier,

discuss the key contract issues Metrovox will need to consider with its supplier.

Delivery schedules: - To ensure compliance with existing agreements with European

merchants and USA distributors, the manufacturer and the new supplier must coordinate on

delivery schedules for Metrovox products. Under these contracts, it is stipulated that Bugabyte

and Bugabyte Lite must be shipped together in a single consignment.

Intellectual property right: - The contract must include strong intellectual property protection

measures since Metrovox uses confidential information for circuit board testing. This guarantees

that Metrovox's technological advantage is not damaged by a third-party manufacturer.

Payment Method: - They must review their current payment and documentation processes and

establish what will change when the supplier assumes responsibility for the assembly process.

Informing the banks involved in the change of service will be necessary.


Exit Strategy: - It is important to include specific termination conditions and an

escape plan in the outsourcing agreement in case of unexpected events or

dissatisfaction with the arrangement. This will ease a seamless shift and

reduce any possible hiccups or conflicts.

(4) Which inventory management strategy should Grunwald and Vogel recommend

Metrovox adopt to ensure efficiencies throughout its entire supply chain? Why?

Metrovox will oversee and coordinate the inventory of completed circuit boards on behalf of the

supplier, considering both customer demand and predefined minimum and maximum levels.

Metrovox can accurately predict demand for this product due to Bugabyte Lite's consistent sales

over the past two years, making it an ideal candidate for a vendor-managed inventory (VMI)

system. In addition, the reason to use this strategy is that Metrovox created the

Bugabyte product that is presently on the market, which has 300% greater

demand than predicted according to forecasts. Thus, this approach will

support maintaining a consistent inventory level and a line of inventory

by market demand. (Metrovox - Bugabyte and Bugabyte Lite Products , 2018)

As a result of the successful Virtual Manufacturing Initiative (VMI), Metrovox

and its supplier/assembler will require a unified electronic data interchange

(EDI) system for the exchange of quality testing information, which will

enable efficient scheduling of deliveries and align with Metrovox's delivery

standards. (Management and Strategic Sourcing , n.d.)


References
(n.d.). Retrieved from www.coursehero.com:
https://www.coursehero.com/file/38945489/Case-Studypdf/

Casestudyfitcostandriskmodulesgvcdocumentmanagementanswersheet0.
(n.d.). Retrieved from www.coursesidekick.com/:
https://www.coursesidekick.com/management/451175

Management and Strategic Sourcing . (n.d.). Retrieved from


www.coursesidekick.com:
https://www.coursesidekick.com/business/888137

Metrovox - Bugabyte and Bugabyte Lite Products . (2018, 05). Retrieved from
www.essaysforstudent.com :
https://www.essaysforstudent.com/Business/Metrovox-Bugabyte-and-
Bugabyte-Lite-Products/109503.html

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