Ash-mark Corporation: Dealing With A Supply Disruption Case Solution And Analysis, HBR Case Study Solution & Analysis of Harvard Case Studies

Ash-mark Corporation: Dealing With A Supply Disruption Case Solution

1.What is the role of the OEMs in this situation?

The original equipment manufacturers (OEM) were very much concerned about Ash-mark's supply distribution which had been affected badly due to the bankruptcy of Red Star. OEMs were anxious about the product availability of Ash-mark as this disruption had-become a threat for OEM’s ability to deliver diesel engines that powered agricultural and contraction equipment and expensive trucks to their high profile customers. However, they could not recognize the problems earlier as the bankrupt company didn’t give any sign of the disruption.

Due to the closure of Red Star, the workload had been increased as the company had to install tooling and other equipment's in the facility. Furthermore, Tilden and Davis had arranged a meeting with OEM managers and prepared a plan that would be presented to OEM in the meeting. In the meeting, Tilden allowed OEM to know his strategy and outlined some specific actions that the company would take in the given circumstances. The plan entails active management at Red Star in order to maximize its output for as long as possible and sourcing appropriate new suppliers together with duplicating utmost volume tooling for production at an additional source.In addition, Tilden had filled OEM managers that Ash-mark had off-site the tooling and stored it in a warehouse and had carefully built up an inventory of parts. Moreover, majority of the tooling had been moved to new suppliers successfully and were already in production pending final authorization. Tilden had explained the detailed qualification process which set out far beyond typical dimensional quality and compliance verification as they were major part of the emissions system of the customer’s diesel engines, and for this reason the components had to go through the performance and destructive testing. Furthermore, Tilden assured that the remaining tooling was on the way to the new suppliers and production would be started soon. However, OEM’s managers focused to know that which part had been constructed in inventory and how that inventory would matched with the customer’s ever-changing build agenda. The OEM’s managers also had a particular question regarding that the tools that had been already shifted to the new suppliers but not approved for the production. However, Ash-mark's major OEM was particularly distressed-regarding six units of a very low selling model, and one unit was low prior to the closure. However, the role of OEMs in the given situation is not clear and has a vague role. The OEM firms could have played their part by giving some flexibility to the Ash-mark as it has been the most competitive and high quality providing firm.

2.What were some of the actions taken by Ash-mark immediately after the bankruptcy, and what should they do next?

Ash-mark had done satisfactory efforts to address the distress situation. However, Ash-mark didn’t have any formal and contingency plan during the period when foundry had begun to close its doors. Therefore, Tilden had developed a transition plan and supervised its execution.He worked with Davis together in finding new sources for Red Star’s casting and set together a plan in order to build up as much inventory as feasible which Ash-mark had failed to do so far.

However, after the bankruptcy, Tilden called a meeting with Ash-mark's largest OEM’s managers. In the meantime, he found a new supplier and continuously was on the path to find the new suppliers. Moreover, he had explained his agenda to the OEM’s managers and tried to satisfy them upon the performance of Ash-mark. His plan included the following actions:

Active management at Red Star in order to maximize the output
Sourcing a suitable new suppliers
Duplicating the highest-volume tooling for production at another source.

Furthermore, after the bankruptcy, one to the two important managers of Tilden had been positioned on site at Red Star in order to manage and executing the withdrawal plane for Ash-mark's specialized production tool. Moreover, in order to facilitate the production Ash-mark had stored the tooling in a rented warehouse. Furthermore, Ash-mark’ employees who were working in the Red Star were organized, documented and marked all the tooling and arranged for direct shipment if necessary. Moreover, the number of tools had been successfully located to the new suppliers and more tools were already in pending for the final production approval. Ash-mark had charged Davis to bring the transferred tooling online and was also involved in locating the new suppliers. Tilden also planned a new qualification process which would help OEMs to ensure that the engines would meet the ordered pollution standards and actually safe for the end users. The company should have found the new suppliers earlier in order to take the OEMs in confidence.Below are some recommendations for Ash-mark in order to protect itself from being distress.

Joint Venture/ Merger:

The company should have form a joint venture to another competitive firm in order to protect itself from the worse coming situations.(Milton R. Stewart Ryan D. Maughn, 2011). The company should make the competent firm as its partner which could help the company to cope with the given situation.

The joint venture would help the company to duplicate tooling for the higher-volume parts which had been difficult and expensive when doing alone in addition the partnered firm would also help Ash-mark of duplicating the lower-volume tools. Furthermore, the company would also not be able to find additional new suppliers as it can acquire the partnered firm supplier(Paul W. Beamish and Nathaniel C. Lupton, 2009). Moreover, the Joint Venture with a reputable would also help Ash-mark to sustain its position in the market and to gain the confidence of its major OEMs as it would become a threat for the company that it might lose its significant OEMs if the given circumstances continued. The Joint venture would also assist the workers of Ash-mark to lower the burden of work which the company had been facing due to the bankruptcy of Red Star. Hence, by minimizing the workload the company would retain most of its senior and competent employees such as Davis who resigned due to the stress and pressure of the work.

The company should also merge with another competitive firm in order to protect itself from being bankrupt. The merger would help the company to work under the new management supervision which would eventually improve its overall strategies and operations.(Eglė Duksaitė ,Rima Tamošiūnienė, 2009)........................

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Ash-mark Corporation: Dealing With A Supply Disruption Harvard Case Solution & Analysis