OPIM_HP_case.docx - OPIM501 Hewlett-Packard Company...

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OPIM501 Hewlett-Packard Company DeskJest Printer Supply Chain (A)
Table of Content 1. Hewlett-Packard Company and DeskJet Printer 2. HP DeskJet Printer Inventory/Service and Supply Chain 3. Target Inventory Levels with two scenarios: 3.1. 5-week Sea Shipment Lead Time 3.2. 3-day Air Shipment Lead Time 4. Total Supply Chain Inventory Levels 4.1 Sea-Shipment 4.2 Air-Shipment 5. Inventory Pool 6. Recommendation 7. References 1
1. Hewlett-Packard Company and DeskJet Printer Hewlett-Packard Company was established by William Hewlett and David Packard in 1939, it’s headquarter in Palo Alto, California. The company has developed within 50 years and they became a dominant arbiter in computers and peripherals products’ field. After 50 years, HP had $13,2 billion revenue and $739 million net income in 1990. “DeskJest Printers” is HP’s most favorable product and company presented this product in 1988.This product was discerned and began to see great interest by consumers in a short time. But this rapid growth and more units causes problems in inventory levels. “Hewlett- Packard Company DeskJest Printer Supply Chain (A)” case mentions about the inventory management crisis of DeskJest printer in early 1990s in Europe. Solutions of the inventory problems were produced by Brent Cartier, who was the Manager for Special Projects in the Materials Department of HP Company’s Vancouver Division, to deal with this crisis. He focused on setting up a “sister plant” to overcame the inventory and service problems, developing the demand forecasting system to reduce the demand uncertainties and making lower lead times in deliveries of materials and machine downtimes. HP’s DeskJet industry realizes their operational features with three criteria; industry, product and supply chain features. Industry has six product groups; these groups are partially by products and partially by function with different revenues and specific set of products. Company in a competitive industry; HP guides in US inkjet printer market, while Canon dominates in Japanese market. Epson, Manisman-Tally, Siemens and Olivetti are the competitor printers in different in the world markets. HP provides and produces personal computer and disposable printers for customers; with the intense demand of the products make the company fast-growing personal market. Because of its rapid technological progress; company does not have difficulty in meeting customers’ expectations. Their main products ; which have inkjet, laser and impact/dot matrix segments, have high print quality, and customer interests with affordable prices, dominates the technological equipment in the market, their main features of the printers are smaller and lighter than the competitive industries’ products. Their supply chain systems are different from other companies, they focus on centralized manufacturing so DC (Distribution Center) is the decision-maker and make to stock of the distribution operations, and also this center makes the some lean- manufacturing. They prefer shipping for the peripherals and other products to Europe, Asia and US; called for bulky products. In addition to this

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