University of California Supply Chain Management Case Study i uploaded two jpg format which contain the reading and four question, then also one additional

University of California Supply Chain Management Case Study i uploaded two jpg format which contain the reading and four question, then also one additional question the second file, totally two pages length need, 68
NETWORK AND SYSTEM DESIGN
Case Study
Boca Electronics, LLC
Boca Electronics, a manufacturer of semiconductor com- (customer accounts would be updated in the sales department,
ponents, was established in Houston, Texas, in 2002 after but not in accounting). Although this issue went largely
spinning off from its parent company. Originally a branch of unnoticed during thriving periods, the recent slowdown in
Vissay Inc., Boca Electronics had a solid customer base and the economy revealed potential repercussions of the current
strong sales with some major firms such as IBM, Compaq, and business operations, as Boca Electronics began to run short on
Motorola. Semiconductors included a wide array of products its cash flows.
that were broken down according to their application and In the last month, one of Boca Electronics’ largest cus-
material. Some of their main products include microprocessors, tomers began requiring all its suppliers to integrate their manu-
light-emitting diodes (LEDs), rectifiers, and suppressors. Boca facturing operations to improve the sharing of information and
Electronics operated on a mainframe system that it inherited further improve its supply chain. This company had recently
from its parent company and used additional stand-alone implemented an ERP system from a major provider and was
systems to perform many of its other business functions. For encouraging its suppliers to do the same. Suppliers had the
the last four years the company had performed well financially, option of implementing middleware software to integrate oper-
so little concern had been given to the business operations. ations. Whether suppliers chose to keep their current systems
However, recent slowdowns in the economy and an increase and implement middleware, or implement an ERP system that
in competition in the semiconductor industry had forced Boca would integrate with the company, they had one year to make
Electronics to take another look at the way it operated its the changes to continue doing business with this customer.
business.
Paul Andrews, the CIO at Boca Electronics, was well
Ron Butler, the purchasing manager at Boca Electronics, aware of the issues facing the company. He knew that some-
was responsible for ordering raw materials and ensuring that thing had to be done to improve communication and informa-
their delivery was on time and met production requirements. tion sharing within the company, and the current mainframe
Ron used his own forecasting software to determine purchas- system was outdated and inefficient. He was also aware of the
ing needs based on past sales. Although this worked most of constraints that Ron was facing in Purchasing and how much it
the time, Ron often found himself scrambling to meet large cus- was costing the company. With the new request from one of its
tomer orders at the last minute and was forced to expedite a lot largest customers for further integration, the idea of implement-
of orders to meet the production needs. Ron felt this was due ing an ERP system for Boca Electronics seemed like a viable
largely to the lack of communication between his department solution to Paul. However, recent economic downturns and a
and the sales force. Although he received production forecasts limited amount of capital made such a large capital outlay a
and projected sales from the sales department, it occurred on risky investment for the company.
an irregular basis, and the forecasts would often change by the
Case Questions
time he had placed orders to the suppliers. In addition, Ron had
a difficult time synchronizing with suppliers and determining 1. Determine the trade-offs of implementing an ERP system
factors such as lead times and product prices. He had previously in the company versus buying best-of-breed software and
recommended a new software system that would integrate with using middleware to integrate.
suppliers of key components but the proposal was turned down 2. What are the potential impacts of such an implementation
by senior management due to a “current lack of need for such
on the company’s suppliers and customers?
an investment.”
Boca Electronics also faced issues regarding its cash
3. If the company chose to stay with the system it currently
flows. It took several weeks for the accounting department
has, what are some potential consequences that can occur
in the future?
to process invoices and usually had to e-mail back and forth
with the sales manager to make multiple corrections. Because
4. Based on the business nature of the company, the industry,
both departments used different systems to manage customer
and the current environment, what would you recommend
accounts, some of the data was redundant and inaccurate doing?
PROBLEM
1. Green Go Monitors is ready to release their new intelligent
monitors. The variable cost for each product is $2,000. Fixed
cost per year is estimated to be $100,000. If the company sells
each product at a price of $2,500, how many products must be
sold to break even? If the company sells 1,000 products at the
price of $2,500, what will be the contribution to profit?
cost per year is estimated to be $20,000. James is planning to
sell each mini-mower at a price of $40. How many products
must be sold to break even? If James sells 5,000 products at the
price of $40, what will be the contribution to profit?
2. James Pens has designed a new lawn care product called the
mini-mower and is now considering its processing needs. The
variable cost for each mini-mower manufactured is $30. Fixed
3. A company’s break-even quantity for a product is 1,000. What
is the selling price for each product assuming $10,000 fixed
cost per year and $20 variable cost per product? If the com-
pany sells 2,000 products at the selling price, what will be the
contribution to profit?

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