IDS 454 HW 1

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Industrial Engineering

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Feb 20, 2024

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Supply Chain 1. The product I chose is the PlayStation 5 which is manufactured by Sony Interactive Entertainment and is retailed by stores like GameStop, Best Buy, Target, etc. 2. a. In component sourcing, the push boundary would be that the company forecasts the demand for the components based on expected production volumes of the PS5 to ensure security in the necessary raw materials in advance of manufacturing. The pull would emerge as the raw materials are sourced as the demand for the product becomes clearer (“Case Study - Sony Playstation Network”). b. In manufacturing, the push strategy would be Sony forecasting the demand for the product and producing a specified quantity based on the prediction. The pull would emerge as manufacturing progresses because the production process can be adjusted based on real-time demand info, allowing for flexibility in volume (Tripathi). c. In distribution, the push is the initial distribution of finished PS5 units to various regions is likely planned. The pull would be seen as they respond to actual sales data and adjust the distribution of PS5 units to meet regional demand variations. d. In retail, the push would be the retailers receiving shipments of PS5 units based on forecasts and initial allocation plans. They may promote and market the product to drive sales. The pull may occur as they observe actual sales, adjusting restocking orders and promotional efforts based on real-time demand. e. For customers, the push is Sony initially pushing the product into the market based on marketing strategies and anticipated demand. The pull would be as customers purchase the PS5, their actions create a pull on the supply chain. Retailers and Sony respond to this demand by restocking inventory and adjusting production plans. 3. Implied demand uncertainty shapes the design of the PS5 supply chain especially in the component sourcing stage. One of Sony’s biggest issues with the PS5 distribution is that there is not enough supply to meet demand. With the shortage of GPUs in the past few years, it makes it difficult for them to keep up with demand. One article stated that 100,000 units sold out in 17.5 hours (McLoughlin). 4. During COVID, Sony faced challenges in the manufacturing side of the supply chain as the required at-home/hybrid work life prevented employees from international travel that was necessary for testing and production lines (“Sony PS5 Production Getting Hit by Covid-19 Lockdown, Talks about the Launch Time Frame”). They also faced financial difficulties in regards to a decrease in sales for the PS4 in the beginning of the pandemic (2020).

5. Sony quickly rebounded from their initial struggle with delays on the production of the PS5 at the end of 2020 when it finally released. The pandemic eventually led to an increase in profits for Sony as the demand for the console exceeded expectations at the release. The only issue they still struggle with is the shortage of semiconductors which makes their production limited, but the price increased (Ambrose). Works Cited Ambrose, Jillian. “Sony Profits Soar as It Benefits from Home Entertainment Boom.” The Guardian , Guardian News and Media, 4 Aug. 2021, www.theguardian.com/technology/2021/aug/04/sony-profits-soar-benefits-from-home-entertainm ent-boom-playstation-5. “Case Study - Sony Playstation Network.” Scaled Agile Framework , 13 July 2017, v5.scaledagileframework.com/sony-playstation-network-case-study/. McLoughlin, Aleksha. “Sony’s Selling so Many Ps5s It’s Become AMD’s Biggest GPU Buyer.” TechRadar , TechRadar, 2 Mar. 2023, www.techradar.com/news/sonys-selling-so-many-ps5s-its-become-amds-biggest-gpu-buyer. “Sony PS5 Production Getting Hit by Covid-19 Lockdown, Talks about the Launch Time Frame.” HT Tech , 14 May 2020, tech.hindustantimes.com/gaming/news/sony-ps5-production-getting-hit-by-covid-19-lockdown-ta lks-about-the-launch-time-frame-71589435707184.html. Tripathi, Pragyik. “Sony’s Multi-Pronged Approach to PlayStation Distribution: Leveraging Online and Offline Channels through Strategic Partnerships and a Worldwide Retail Presence.” Scribd , Scribd, www.scribd.com/document/471904538/MM-distribution#:~:text=Sony%20utilizes%20both%20o nline%20and,Terra%20Soft%20Solutions%2C%20and%20IBM. Accessed 28 Jan. 2024. Writer, Staff. “Sony Eyes Record PS5 Production and Chip Output Boost.” Nikkei Asia , Nikkei Asia, 27 May 2022,

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