Outsourcing Dilemma at National Electronics
This caselet enables an understanding of the application of factor rating to evaluate outsourcing providers. The caselet provides a brief about the dilemma of choosing a supplier at National Electronics, a Chennaibased electronic parts manufacturing company. With an aim to focus on core products, the company decided to outsource some of its production. Upon request for bids, four suppliers responded. Now, the company Founder Chris Xandu has to finalize the outsourcing supplier based on certain criteria. He enlisted the assistance of an expert, Gopal Verma for this assignment. Gopal Verma had to find a precise method to select the supplier for outsourcing.
Expected Learning Outcomes
- • The basics of outsourcing
- • Factor rating to evaluate outsource providers
Prerequisite Conceptual Understanding
The participants were asked to read the following chapter given as mandatory reading at the end of the caselet to participate effectively and to enrich the learning outcomes:
Jay Heizer, et al., “Supplement 10: Outsourcing as a Supply Chain Strategy”, Operations Management, 9th Edition, Pearson Education, 2008
Case Positioning and Setting
This caselet can be used in MBA/Executive MBA program for Operations Management course to illustrate the concept of Outsourcing.
- I. Using the un- weighted factor-rating method, which Supplier should CEO select based on risk avoidance?
- II. If the Supplier 2’s ratings for “Quality” and “Price” are each lowered by 50%, will your answer to the previous question (Assignment Question no. I) change? If yes, how? If no, why not?
- III. ..............
The classroom discussion and analysis for this caselet could be summarized and facilitated under two broad sections [Exhibit (TN)-I]....................