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Supply Chain Management Meditech Case Study

Supply Chain Management Meditech Case Study

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Published by Ravi Jain
Solution to MEDITECH SURGICALS case study in Supply Chain Management course.

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Solution to MEDITECH SURGICALS case study in Supply Chain Management course.

visit http://www.bookgeeks.in for more

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Categories:Types, School Work
Published by: Ravi Jain on Sep 07, 2010
Copyright:Attribution Non-commercial

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06/07/2013

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 SOLUTIONS TOMEDITECH SURGICAL CASESUBMITTED BYRAVI JAIN1226109240TOProf. Dr. P.R.S.SarmaIN PARTIAL FULFILLMENT OF THE COURSESUPPLY CHAIN MANAGEMENT13
th
February, 2010 GIIB, Visakhapatnam
 
Q1)
Meditech’s prob
lem in introducing new products. In manufacturing ALL products.Meditech introduces 1 new product per month on an average. Most of the new productsare only upgrades of old products. This considerably reduces the life-cycle of the products.Majority of Meditech customers are Material Managers whose primary focus is on cost anddelivery schedules but not on innovative product features.Though no major problems arise from assembly line perspective, signs of cognitivedissonance may arise in customers. No attempt is made by Meditech to understand the
Demand Dynamics
along the product life-cycle. Qualitative factors that have been identifiedas critical success drivers for a new product launch are
time-to-market relative tocompetition (Porter 1985, Kailash and Lilien 1986) or product diffusion (Bass 1969, Krishnan2000)
. But Meditech does not launch new products relative to competition and byconstantly pushing new innovations into the market it does not allow its products to diffuseeffectively into the market.Every new product launch requires a lead time of around 5-19 weeks (excluding designphase lead time) which is very high. With every product launch, pushing the product intothe market becomes the primary consideration of the sales force thereby neglectingcustomer service for older products.These constant launches have led to:
 
Supply side shortages (Fig. 1-10)
 
Delayed deliveries (6 weeks)
 
Low customer service
 
Low customer satisfaction
 
Inaccurate forecasts
 
High FG inventory levels (Fig. 1-8 & Fig. 1-10)The product portfolio of Meditech comprises about 200 separate end-products and thenumber is increasing. These wide ranges of products make Meditech rely heavily onsuppliers wherein the lead time is 2-16 weeks. So practising JIT, which would be veryeffective for Meditech, becomes impossible in this case. Meditech organizational structurehas a long scalar chain. Information dissemination becomes difficult here if there are toomany products in the portfolio.
 
Q2) Cause of the problems, systematically and organizationally
ISHIKAWA FISH-BONE DIAGRAM WAS USED TO DISSECT THE CAUSE AND EFFECT 
Problemsdiscussedin Q1
ManagementMachinery ManpowerMaterials Methods
 
Very long scalar chain
 
Slow information Flow
 
Weak Strategies
 
Frequent changesin process flow
 
High lead time of 2weeks
 
Focussed on Sales
 
Weak Service Levels
 
Too dependent on Suppliers
 
High lead times of 2-16 weeks
 
High FG Inventory levels
 
High Safety Stock levels
 
No data collection
 
Incorrect Forecasting
 
Very long forecasting horizonof 1year
 
Short Product Life Cycle
 
Panic Ordering
 
Ineffective delivery schedules
 
No Risk pooling

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