Table of Contents Introduction: 3 Problem identification: 3 Recommendations and solution 5 Strategies to be adapted: 5 A. Postponement or Delayed Customization: 5 B. R&D in Europe and Asia 5 C. Investing in information: 6 Strategies to be altered: 6 I. Quick response can be used, along with improved and more accurate forecasting: 6 II. Ordering quantity that would allow HP to provide a certain service level: 6
William Hewlett and David Packard with headquarters in Palo Alto, California founded Hewlett-Packard Company in 1939.
HP diversifies its production into electronic test, …show more content…
Apparently, HP operates in Europe and Asia as a DC solely; this might explain the in-accurate forecasts because a distributor – without any R&D and sales and marketing department is not expect to do a full marketing research to understand the needs and demands of customers. So having an R&D (at least visit) in Europe and Asia, to conduct a good marketing research will help improve forecasts and understand the market and its needs and preferences.
C. Investing in information:
It is clear that there is no coordination between the entities in the supply chain. HP should consider investing in IT and some inventory management software; in order to minimize the bull-whip effect, and reduce the pressure put on Vancouver plant once and the idle time it faces at other times.
Strategies to be altered: I. Quick response can be used, along with improved and more accurate forecasting:
The Vancouver plant can ship a set amount of printers to the DCs (those that will certainly sell) through the sea – just like they currently do. However, once the DCs start selling and thus actually observe the demand, air transportation can be used for lower lead times. This will affect the holding costs, over and under stocking in the DCs by lowering them. II.