...distributed an electronic controller for solar energy equipment. The name "Solectron" was a portmanteau of the words "solar" and "electronics". The company was acquired by Flex on October 15, 2007. Solectron was established in 1977 to provide outsourced manufacturing services to third parties. It was a major manufacturer, but you would have not found its name on any products. The company was the world´s premier supply chain integrator, with $18.7 billion in annual revenue. However, the economic downturn of 2001 hit the company hard. Also, while revenue for the first quarter of fiscal 2001 were twice that of the same quarter in the previous year, quarter-to-quarter revenue decreased each quarter during fiscal 2001, with a 27 percent decrease from Q2 to Q3. The stock had fallen 77 percent from it is high, and market capitalization was just 40 percent of annual revenue, and the company had laid off 20000 of it is 80000 workers and closed facilities. The electronic manufacturing services industry The electronic manufacturing services industry grew out of a large number of small jobs shops that manufactured assemblies for clients. Clients OEMs, would often use these shops to increase their own production skills, or to offload production that did not contribute to their competitive advantage. The company Solectron grew rapidly during the 80s and 90s, becoming the dominant company in the industry by the mid-90s. Solectron founder Roy Kusumoto saw a growing number of electronics companies...
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...University of Hertfordshire Business School MBSP0186 – Organisations and Context Assignment No. 1 Study Case: Solectron |Author |Fabio Oliveira | |Student Number |06132095 | |Hand In Date |13th December 2006 | |Course |MSc Strategic Marketing | |Tutor |Eric Hall | |Word Count |2.504 | Introduction During the last ten years the market environment has been changing constantly. The people have high access to information through the Internet, for instance in Asia-Pacific the Internet access market grew by 18.7% in 2005 to generate total revenues of $30.5 billion. This represents a compound annual growth rate of 24.3% for the five years period spanning 2001-2005 (DataMonitor:2006). The international commercial deregulation offered to countries such as China (China’s economy grew by 10.1% in 2004 and by 10.2% in 2005 – Business Monitor International) the opportunity to explore new markets and to offer labour low costs and high quality products for international markets. On the other hand, and at the same time, the female workers rate is increasing year by year, generating new trends, opportunities...
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...design, construction, ship and service a complete product for their customers. Integration Services include printed circuit boards, flexible circuit manufacturing, system components and the manufacturing industry, logistics, after-sales services, design and engineering, and Original Design Manufacturing (ODM) service. We believe that the large-scale and global presence of Flextronics' operations serves as a competitive advantage. It helps appeal to customers seeking to do business with a limited number of vendors, as well as with procurement of supplies, with distribution, and with siting acilities in low-cost regions. (Forrestor Research, 2012). The company has grown during the past five years in part by acquisition, with its purchase of Solectron Corporation in October 2007 standing as a landmark deal in the industry and total consideration was about $3.6 billion. How the Industry is served? Consumers demand electronics products that provide more utility, convenience and user-friendly. These showed results of electronics sales are driving global demand for electronics components. This should be a boon for the Circuit Board and Electronic Component Manufacturing industry, which primarily manufactures printed circuits, circuit boards, capacitors, transformers, connectors and other products. However, import penetration is having a stark effect on the industry’s bottom line. The Circuit Board and Electronic Component Manufacturing industry has a low level of concentration, with...
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...Solectron case Solectron Corp. grew rapidly from a small contract manufacturer in the early 1980s to the dominant company in the electronics manufacturing services industry by the late 1990s. In doing so, it evolved from providing peak capacity for its clients to providing services that clients could not provide on their own (low-cost materials and access to expensive capital equipment). Its next phase was to provide its clients with new ways of operating--such as outsourcing all operations except research, product conceptualization, marketing, and sales--allowing clients to outsource those activities that were not part of their core competencies. Describes this evolution and the rapid growth of the company. In 2001, the company's clients suffered severe business downturns, which in turn caused the first contraction in Solectron's history. Describes the company's initial response and raises questions about how the company should proceed. How has Solectron’s value to its customers evolved over time? In the beginning, Solectron was offering mainly the contract manufacturing services; it produced PCB’s and other components. Thus, the company” provided little more than substitution for capabilities that its customers already possessed.” But gradually it started to not only to expand its area of operation but to focus on quality and the company culture. Nowadays the main vision of Solectron is to deliver value to the customer through integrating supply chains. As a supplier...
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...Cisco etc. Initially, Solectron manufactured a wide range of products for its customers in many business segments like Networking, Telecommunications, Computers, Computer peripherals, avionics, consumer electronics, GPS etc. As Solectron grew, it expanded its services so much so that by the end of 90s it had three strategic business units: * Technology Solutions, which provided technology building blocks which helped customers minimise time-to-market for new products * Global Manufacturing, which provided design, new product introduction, and manufacturing and distribution services * Global Services, which provided repair, upgrade, maintenance etc The company, with Mr. Chen concentrated on offering high quality, responsiveness, communication, service and technical support. The main objective was to achieve customer satisfaction by providing high quality. When Solectron offered contract manufacturing services to OEMs, its aim was to offer them services at reduced prices due to greater volume purchasing. Rather than outsourcing as a way to access relatively inexpensive skilled labour, it became a source of tactical advantage which they provided. Tactical turnkey assembly meant that OEMs specified what was needed, and Solectron bought the materials, built the product, and shipped it to customers. In 1992, Solectron introduced a new business model when it purchased manufacturing sites from IBM. As a part of the asset acquisitions, Solectron received long term supply...
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...CASE : Solectron: From Contract Manufacturer to Global Supply Chain Integrator Most people think we're a manufacturing company. We're good at manufacturing, but we're really a service com In mid-2001, Solectron Corporation was con fronting issues that it had never before faced in its twenty-four year history. The company was the world's premier supply chain integrator, with pany. 1Bill Roberts, "CEO of the Year Koichi Nishimura, Contract rate with automo- tishi, and own sup e-market non pro- 3S, thee us supply :omaker's respond ;hallenge ;tandards lustry will 3.Y to their • Covisint ation and example s.ln 1999, 1ce to pro lSferred to that is, the ast. Unlike more than He market hangs and th benefits ms should rm has the decisions mce, tech- categories ·ocurement rate with automo- tishi, and own sup e-market non pro- 3S, thee us supply :omaker's respond ;hallenge ;tandards lustry will 3.Y to their • Covisint ation and example s.ln 1999, 1ce to pro lSferred to that is, the ast. Unlike more than He market hangs and th benefits ms should rm has the decisions mce, tech- categories ·ocurement CHAPTER 9: PROCUREMENT AND OUTSOURCING STRATEGIES 305 CHAPTER 9: PROCUREMENT AND OUTSOURCING STRATEGIES 305 -Koichi Nishimura, Solectron CE01 Manufacturing Visionary," Electronic Business, December 1999. 306 DESIGNING AND MANAGING THE SUPPLY CHAIN 306 DESIGNING AND MANAGING THE SUPPLY...
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...Solectron Supply Chain Management Best Practice Background Solectron was founded in 1977 as the as the “Solar Energy Company”, and originally produced solar energy products. Today it is a worldwide provider of electronics manufacturing services to original equipment manufacturers (OEM’s). The company provides customized, integrated manufacturing services that span all three stages of the product life cycle, including pre-manufacturing, manufacturing, and post-manufacturing (see Table 1). These servies are now integrated to the point where Solectron is now responsible for all supply chain processes associated with sourcing parts, building, and distribution of electronics and systems for almost every major OEM customer in the industry. A list of primary OEM customers is shown in Table 2, which spans the telecommunication, networking, computer systems, peripherals, semiconductors, consumer electronics, industrial equipment, medical electronics, avionics, and automotive electronics industries. These industries are in different stages of maturity, with network manufacturers fairly new, and computer systems fairly mature. The diversity of major customers in this list is testimony to their success. In 1991, Solectron won the Malcolm Baldrige National Quality Award, reflecting the high level of performance achieved within this company. The company has also been honored with more than 100 recognition awards, 25 of which were received this year (see Table 3). The...
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...Solectron Supply Chain Management Best Practice Background Solectron was founded in 1977 as the as the “Solar Energy Company”, and originally produced solar energy products. Today it is a worldwide provider of electronics manufacturing services to original equipment manufacturers (OEM’s). The company provides customized, integrated manufacturing services that span all three stages of the product life cycle, including pre-manufacturing, manufacturing, and post-manufacturing (see Table 1). These servies are now integrated to the point where Solectron is now responsible for all supply chain processes associated with sourcing parts, building, and distribution of electronics and systems for almost every major OEM customer in the industry. A list of primary OEM customers is shown in Table 2, which spans the telecommunication, networking, computer systems, peripherals, semiconductors, consumer electronics, industrial equipment, medical electronics, avionics, and automotive electronics industries. These industries are in different stages of maturity, with network manufacturers fairly new, and computer systems fairly mature. The diversity of major customers in this list is testimony to their success. In 1991, Solectron won the Malcolm Baldrige National Quality Award, reflecting the high level of performance achieved within this company. The company has also been honored with more than 100 recognition awards, 25 of which were received this year (see Table 3). The...
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...Network organization structures are businesses contracted to perform multi-tasked outsourcing functionalities for other companies. Whatever the client company specializes in, the network structure will perform all the other supply chain activities. The object is the minimize boundaries within the supply chain (Nelson, D. L., & Quick, J. C. 2006). Network organizations adapt to unstable conditions, when problems and requirements for action arise which cannot be broken down and distributed among specialists' roles within a hierarchy. ... Jobs lose much of their formal definition ... Interaction runs laterally as much as vertically. Communication between people of different ranks tends to resemble lateral consultation rather than vertical command (http://ccs.mit.edu/papers/CCSWP192/ccswp192.html#2). In the recent years, innovative organizational structures explored where the boundary within the organization is more flexible and more permeable allowing a faster knowledge transfer. Other types of structures have been “Modular organizations” and “Virtual Organizations”, these organizational ideas revolve around knowledge sharing for better operational decision-making. Modular, Virtual, and Boundary less organizational structures are optimized for faster information creation and sharing. In today’s information driven world, it makes sense to have an organizational structure to exploit faster movement of information (http://www.geocities.com/akottolli/Business_Organization_and_Structure...
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...Cisco etc. Initially, Solectron manufactured a wide range of products for its customers in many business segments like Networking, Telecommunications, Computers, Computer peripherals, avionics, consumer electronics, GPS etc. As Solectron grew, it expanded its services so much so that by the end of 90s it had three strategic business units: * Technology Solutions, which provided technology building blocks which helped customers minimise time-to-market for new products * Global Manufacturing, which provided design, new product introduction, and manufacturing and distribution services * Global Services, which provided repair, upgrade, maintenance etc The company, with Mr. Chen concentrated on offering high quality, responsiveness, communication, service and technical support. The main objective was to achieve customer satisfaction by providing high quality. When Solectron offered contract manufacturing services to OEMs, its aim was to offer them services at reduced prices due to greater volume purchasing. Rather than outsourcing as a way to access relatively inexpensive skilled labour, it became a source of tactical advantage which they provided. Tactical turnkey assembly meant that OEMs specified what was needed, and Solectron bought the materials, built the product, and shipped it to customers. In 1992, Solectron introduced a new business model when it purchased manufacturing sites from IBM. As a part of the asset acquisitions, Solectron received long term supply...
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...Electronics Contract Manufacturing: Global Production and the International Division of Labor in the Age of the Internet Boy Lüthje Institute of Social Research Johann Wolfgang Goethe-Universität Senckenberganlage 26 60325 Frankfurt Germany E-mail: luethje@soz.uni-frankfurt.de Submitted for publication to Industry and Innovation – special issue on “Global Production Networks, Information Technology and Local Capabilities”, coordinated by Linsu Kim and Dieter Ernst Comments welcome, please do not quote December 2001 2 The role of information technology for production networks in developing countries cannot be assessed without an analysis of the profound changes in the productive structure of global capitalism. In contrast to the general perception of the “informational economy” (Carnoy e.a. 1993, Castells 1996) as service- or science-based, it has to be stressed that in the "new economy" manufacturing continues to matter (Cohen/Zysman 1987). In the electronics industry, a new model of outsourced manufacturing has emerged as a centerpiece of globalized production networks: Contract Manufacturing (CM) or Electronics Manufacturing Services (EMS). This form of network-based mass production closely linked to the emergence of the “Wintelist” (Borrus/Zysman 1997 model of competition and the rise of “fabless” product design companies in key sectors of the information technology (IT) industry. Our analysis of electronics contract manufacturing explores three interrelated...
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...IT and the Changing Social Division of Labor: The Case of Electronics Contract Manufacturing[1]GLOBAL PRODUCTION AND THE INTERNATIONAL DIVISION OF LABOR IN THE AGE OF THE INTERNET Boy Lüthje Institute of Social Research University of Frankfurt Senckenberganlage 26 D-60325 Frankfurt/M Germany Telephone: 069/756183-30, -43 Fax: 069/747709 E-Mail: luethje@soz.uni-frankfurt.de Draft paper for conference Transforming Enterprise Department of Commerce Auditorium Washington, D.C., January 27-28, 2003 Draft! Comments and suggestions welcome, but please do not quote! The impact of information technology on business, economy and society cannot be examined without an analysis of the profound changes in the productive structure of global capitalism. In the electronics industry, a new model of outsourced manufacturing has emerged as the centrepiece of globalized production networks: Contract Manufacturing (CM) or Electronics Manufacturing Services (EMS). This form of network-based mass production is closely linked to the disintegration of the value chain and the emergence of the “Wintelist” (Borrus and Zysman 1997) model of competition and the rise of “fabless” product design companies in key sectors of the IT industry. In contrast to the general perception of the “informational economy” (Carnoy et al 1993, Castells 1996) as service- or science-based, the rise of the CM-model demonstrates that manufacturing still matters in the "new economy" (Cohen and Zysman 1987)...
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...In bound logistics Sony engages in a series of complex In bound logistics activities that the company either possess or provided by third parties. As the company expands, Sony also gain to engage third parties such as Flextronics and Solectron to manufacture some of its product components so that the company will continue to possess sufficient wave length to engage in its core businesses and core competencies. To lower its cost of production Sony also restructured and shut down some manufacturing facilities. In fact, the company has shifted some of its production plants to low cost counties such a china take advantage on the cheaper labor cost. The ability to manage the complex and geographically dispersed in bound logistics activities is certainly Sony’s strength....
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...Electric & Electronic Industry The strong E&E industry in Malaysia is a result of the Government‘s initiatives to promote laborintensive and export-oriented industries. Since the establishment of the first semiconductor plant in Penang in 1972, Malaysia has become a major global manufacturing hub for the electrical and electronics industry, as attested by the large number of multinational companies (MNCs) from USA, Japan, Europe, Taiwan and Korea which have chosen Malaysia as their base. Unsurprisingly, the E&E sector has grown into Malaysia‘s largest contributor to output, employment, investments and exports (35% of total exports15) 16 . The presence of leading electronic manufacturing services (EMS) companies such as Flectronics, Solectron, Celestica, Jabil, Plexus and Sanmina-SCI provides opportunities for local companies to be part of their supply chain in the supply of equipment, materials, parts and components, and dedicated services such as contract design, burn-in testing, failure analysis and rapid prototyping. Other local supporting industries focus on activities such as moulds, tools and dies, metal stamping, surface treatment, plastic injection moulding and M&E (Mechanical & Electrical). Nowadays, there are more than 50 companies operating as contract manufacturing...
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...In recent years, there has been marked increase in competition in virtually all areas of business. The ability to outperform competitors and produce above average profits lies in the pursuit and execution of an appropriate business strategy (Yoo, Lemak & Choi, 2006). This has resulted in greater attention to analyzing competitive strategies under different environmental conditions. Specific HR strategies Specific HR strategies set out what the organization intends to do in areas such as: * Talent management – how the organization intends to develop its people and using them at their best. * Continuous improvement – providing for focused and continuous innovation rhymed with development of an individual * Knowledge management – creating, acquiring, capturing, sharing and using knowledge to enhance the learning curve of all employees. * Resourcing – attracting and retaining high-quality people in the organization. * Learning and developing – providing an environment in which employees are encouraged to learn and develop individually. * Reward – defining what the organization wants to do in the longer term to develop and implement reward policies, practices and processes that will further the achievement of its business goals and meet the needs of its stakeholders in alignment with employees satisfaction. * Employee relations – defining the intentions of the organization about what needs to be done in terms of employee engagement and what needs...
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