MGOC20H3 Lecture Notes - Lecture 8: Keiretsu, Supply Chain, Vertical Integration
Document Summary
Quality programs like tqm lower costs of failures and increases sales. No one wants inventory (people just want sales); there are costs associated ie. holding, set up, labour and management costs, cost of rent, utilities, cost of obsolescence. Sell the just in time model to employees for transition. High inventory hides quality issues (you just ship them a new one) Evolution of supply chains: used to make their own stuff, rely on others to get components to make stuff, forming deep relationships with suppliers that evolve and innovate together, competition between supply chains, not firms. Differentiation strategy: clearly unique and superior by quality or brand. Vertical integration: how much of the supply chain do you own: backward integration: buying out a supplier or doing your own production. Joint ventures: collaboration (not necessarily in the same supply chain) to produce something. Keiretsu networks: supply chain vs supply chain; each is a partnership.
