Case Analysis Meditech Surgical Essay

2625 WordsOct 9, 201111 Pages
SUPPLY CHAIN MANAGEMENT Final Examination QUESTION 1: Case Analysis: MEDITECH SURGICAL. 1. What are Meditech’s problems in introducing new products? In manufacturing ALL products? When Meditech introduces new products, the company’s output is exceeded by a higher demand, consequence of a great amount of initial orders from customers. As a result of this situation, the company faces shortage at the beginning of introduction, product cannot be delivered at the agreed time, back orders accumulate and lead times increases. This company is not matching supply and demand adequately. Next figures (1 and 2) extracted from Simchi, L. & Kaminsky, P. (2008). Designing and Managing the Supply Chain show this situation in a clear way.…show more content…
& Kaminsky, P. (2008). “Designing and Managing the Supply Chain”. Figure 3. Level of inventory vs. demand pattern. High inventory levels are a consequence of incorrect forecasting, push-pull boundary decision and “panic ordering” from customers. Krajewski & Ritzman (2006) suggest that in manufacturing, high inventory levels are like water surface, once the level of water (inventory) is reduced, rocks (problems) can be exposed. In Meditech, the high level of inventory avoids detecting problems while incurring in additional costs (holding, etc.) related with inventory management. The inventory policy is not adequate for the current situation of Meditech. Organizationally: * Company’s Structure The Functional Departmentalization of the company is a possible cause of bad coordination among areas to identify problems with deliver service, forecasting, production, etc. For example, is stated in the case that Meditech has an aggressive Sales Force, this group of workers must know the limitations that the company is facing in matching the demand. Different managers are responsible for different activities, with the risk of misalignment of product development and supply chain. * Development Chain In Meditech it seems that activities and processes associated with new products introduction are not being coordinated

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