The magnitude 9.0 earthquake that struck Japan in March 2011, caused damage to the wafer fabrication facility Renesas Electronics, an essential link in the global supply chain of the car. Many builders awarded to a supplier of custom chips fab if the judgment forced the “Big Three” of Detroit and Japan to stop production also. Data from two customers in the automotive sector in particular, which allows the instructor to discuss issues of one vendor extension decision, and / or market position as a producer of components Renesas low volume customization in the context of Disaster Recovery in the supply chain. Both manufacturers had different strategies against the use of components across product lines. Therefore, a numerical assignment simply shows students the power of delayed differentiation of the components. OEM with subsequent cross-utilization (lower customization components among product lines) had greater flexibility in vehicles that have stopped producing by scarcity. Similarly, students can study the impact of delayed product differentiation by observing the production process within the worker. Here customizing Renesas causes premature differentiation. Again numbers are working examples. Finally, the broader questions about the viability of the market position of Renesas can be discussed. How should they respond to the disaster in the short term? How can assure customers that can handle future interruptions differently? And the point of view of the manufacturer, in case you change your product design to allow incorporation of spare parts? These rooms have their own drawbacks. The results on two numerical examples can be used to conduct this discussion, or a part of the overall strategy can be applied.
by
Willy Shih,
Margaret Pierson
Source: Harvard Business School
16 pages.
Release date: April 5, 2012. Prod #: 612071-PDF-ENG
Renesas Electronics microcontroller and automotive supply chain (A) of the solution of the case
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