Leitax Case Analysis

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Digital camera market has enjoyed tremendous growth since it was introduced in the photographic industry. Starting in 1998, price has been falling rapidly. In addition, the development of CMOS allowed digital camera to not only capture professional market, but also enter consumer market. It was estimated that in 2006 forecast would peak with 63% penetration rate for digital cameras in the US. After 2006, the growth rate was expected to fall negative.

Product lives for digital cameras had been shortened. While an average life was between 17 and 22 months, high-end, feature packed products had the shortest life cycle. However, the manufacturing lead-time for digital cameras was long. Taking Leitax for
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Before, the concept of demand forecast was to serve the key functional groups in achieving their own interest. Facing the new challenges, forecast needed to be more accurate. And therefore it needed a new concept that is to have a consensus forecasting that would accurately reveal market demand and align the needs of key actors in the forecasting process. Leitax implemented two specific changes in forecasting process. The first one is to switch the focus from sell-in to sell-through and second one is to ignore capacity constraints.


The mission of the Forecast Re-Design Team was to reduce expenses and risks associated with production and costs of procurement, inventory, quality control and technical infrastructure. According to Fowler, there were four objectives: "(1), to reduce inventory levels across the supply chain; (2) to increase velocity and accuracy of planning information throughout the supply chain; (3) to increase supply upside and downside flexibility; and (4) to improve on-time performance to customers.

The projects require individuals who have good technical skills and forecasting and industry knowledge. But more importantly, it needs people who could help implement the new changes. To be more specific, the qualities are the leadership abilities to shape an organization and know-how to effect senior management to modify the
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