Supply Chain Management

BBA 323 SUPPLY CHAIN MANAGEMENT Task brief & rubrics Final Assesment

The task is individual The deliverable has to be a report (of about 2,500 and 3,000 words) The weight is equivalent to 60 %of the whole course The report has to be delivered in Turnitin on 17th January 2020 at 23h 59 Harvard Referencing System has to be used.

Case: WE ARE THE BEST We are the Best & Co. is a Company located near to Barcelona. They manufacture and distribute computer screens. The are producing 5 different models (screen sizes). Sales volume of the different sizes during the last 3 years was as follows:

SIZE PERCENTAGE OF ANNUAL SALES

10 5% 12 7% 15 45% 18 33% 24 10%

In order to assembly any model, 10 different components are required. Six of these components are common two all models whereas the other four are specific for each size.

Profit and loss results of the last three years as well the forecasted one for 2018 are as follows:

MILLION EUROS 2016 2017 2018 2019 SALES 10 12 13,5 15 PURCHASING COMPONENTS 5 6,6 7,7 9 TRANSPORTATION COSTS 0,5 0,6 0,9 1,2 SALARIES 2 2,1 2,1 2,2 OTHER COSTS 0,4 0,4 0,5 0,6 GROSS PROFIT 2,1 2,3 2,3 2,0

The behavior of the available cash has been the following:

MIO. EUROS 2016 2017 2017 2018 CASH 1 0,8 0,7 0,5

“We are the Best” is selling the screens in Spain, France and Portugal . Customers are big distribution Companies as well as wholesalers. 30% of the total sales are concentrated during the Christmas period. Main customers in 2019 were (under brackets central warehouse)

• El Corte Inglés (Madrid): 5 Mio € • Carrefour (Paris): 3,5 Mio € • FNAC (Barcelona) : 3 Mio € • The rest are 9 wholesalers/distributors located in Bilbao (2), Valencia (2), Zaragoza, Sevilla, Oporto (Portugal), Vigo and Bordeaux

(France). All these customers bought less than 0,5 Mio € each.

There is also a huge potential customer (between 3 and 4 Mio € sales) located in Lisbon (Portugal). Big marketing and sales efforts have been made trying to catch this customer. “We are the best” has 4 warehouses: Barcelona (located in the factory), Madrid, Sevilla and Zaragoza. Inventory of all manufactured products (sizes) is available in all warehouses. Additionally, they always have safety stock of at least 20 days average sales of all products in the central warehouse. The delivery time agreed with customers are 4 labor days. Total time for assembly is 2 days. Factory works from Monday to Friday. Organization is as follows. Owner/Managing Director: Joan Soler Sales and Marketing Manager: Sonia González Manufacturing and Purchasing : Raúl López Logistics manager (Transportation and Warehousing): Rafael González Financial Manager: Pilar Gómez They have a Board of Directors meeting once a month. Everyone explains improvement and results in their area. Raul and Rafael are very good friends. They work very closely. They think they shouldn´t need any sales department because “with only 3 main customers, Mr. Soler could take care of them”. “Why do we need marketing if there are no new customers to discover.?” “We give a good service. There are no stockouts and customers are satisfied with our quality.” Although “We are the best” is the only computer screens manufacturer located in Spain, their market share in the Spanish market is 18%. Their competitors are foreign Companies. During last Board of Directors Sonia proposed she would like to work closely with Raúl and Rafael. She thought it would be a good idea to show to customers the assembly process as well the warehousing facilities.

Rafael and Raúl considered customers didn´t need to visit them. “You are responsible for customers. You take care of them and you deal prices with them. But this is not our business”. By the other side, Pilar is really concerned because their cash needs are increasing and, as the working capital has been growing the last 3 years (mainly final products inventories), she has problems to fulfill the financial and cash requirements for running the daily activity. Mr. Soler decided he should need a Managing Director with new ideas. Her older daughter, Marta, recently graduated at the EU Business School at Barcelona, took this position and joined the Company 2 weeks ago and during his first Board of Directors, he said: “We must build an efficient supply chain organization, to improve our customer service and to increase profits”. Sonia is really excited about this proposal but Raúl and Rafael consider things are running good enough. “The only thing we need to increase profits is to increase sales prices!!!! said Rafael”. Marta Sole has appointed you to provide a report assessing the company situation in the following areas/activities.

• Transportation strategy • Warehousing location • Supply range optimization • Manufactured components (possible optimization) • Overall marketing/sales strategy • Internal Organization • Any other strategical/functional issue you consider

She is requesting you to specifically evaluate the strengths and weaknesses of the supply chain, and determine the improvements to be applied. These are the main aspects she wants to have elucidated: 1. Critical evaluation of the current marketing/sales strategy. 2. Determine if manufactured components could be optimized, and, in such case, what actions would have to be taken, and what would

be the resulting optimization. 3. Analyze if the current supply range is optimal, and propose changes and/or improvements.

4. Assess warehousing location and its appropriateness. 5. Define pros and cons of the current transportation strategy and elaborate recommendations. 6. Is internal organization adapted to the main objective stated by M. Sole: “We must build an efficient supply chain organization, to

improve our customer service and to increase profits”. Critically discuss this point. 7. Provide a summary of the main actions to be undertaking to achieve M. Sole strategic objective.

Exceptional 90-100

Good 80-89

Fair 70-79

Fail <70

Knowledge & understanding

(20%)

Student demonstrates clear understanding of the Supply Chain Management concepts involved in the discussion questions; Provide relevant examples from Corporate world to establish a connection between practice and theory; Free of grammatical or stylistic errors

Student demonstrates fair understanding of the Supply Chain Management concepts involved in the discussion questions; Provide few examples from Corporate world to establish a connection between practice and theory; Few grammatical or stylistic errors.

Student demonstrates few, if any new ideas or connections; summarize other postings; Several grammatical or stylistic errors.

Student demonstrates little or no awareness of key concepts required in the discussion questions; Obvious grammatical or stylistic errors

Critical evaluation

(30%)

Student comments significantly add to the learning process; demonstrates higher level of critical thinking-analysis, synthesis& evaluation.

Student comments add to the learning process; demonstrates moderate level of critical thinking analysis, synthesis& evaluation.

Generally competent; information is average doesn’t add to the continuous learning process; grammatical or stylistic errors interfere with the content.

No new ideas are presented; Usually have “I agree with…” statement; makes understanding impossible.

Written Communication (20%)

Student communicates their ideas extremely clearly and concisely. Able to connect theory with the case study, comments are focused and concise.

Student communicates their ideas clearly and concisely. Able to connect with the case study but lack depth and/or detail.

Student communicates their ideas with some clarity and concision. Limited, if any connections with the case study; vague generalities

Student fails to communicate their ideas clearly and concisely. No connections are generated between theory and the case study; comments are off topic

Synthesis (30%)

Student synthesizes the content of their writing with exceptional clarity and concision

Student synthesizes the content of their writing with some clarity and concision

Student synthesizes the content of their writing, although work lacks clarity and/or concision

Student makes an insufficient attempt to synthesize, with a lack of clarity and concision.