What was the strategic advantage to microsoft outsourcing xbox production to flextronics

In Novemberthe Company agreed to a final settlement with Nortel primarily related to the pre-petition bankruptcy claims. Even financial analysts are starting to realize the shortcomings of outsourcing, for instance, when they questioned the wisdom of British telecom equipment maker, Marconi, which sold off most of its manufacturing plants to a contract manufacture.

Microsoft can reduce these risks by launching a gaming console powered by the strength of its technology in the PC industry. First, Flextronics had been pursuing an "industrial park" strategy that enabled the company to tightly manage its own supply chain, reduce the chances of supply disruptions, and lower costs, which could then be passed on to Microsoft in the form of lower prices for the Xbox.

In the worst cases, engineers base the product architecture around a custom A mega-piece with few, maybe only one, supplier who can build it. Some companies have even outsourced manufacturing altogether. Companies that focus on the core activities essential for competitive advantage in their industry are better able to drive down the costs of performing those activities and thus better differentiate their final products.

If the outsourcer tries to order parts and materials ahead of production based on forecasts, it will encounter the usual problems of forecasting: Case study, After review of several potential suppliers, it decided to outsource assembly and significant logistics functions to Flextronics, a Singapore-based contract manufacturer.

For more information, please visit www. Thus, as the manufacturing speed becomes more important, vertical integration and having nearby suppliers will provide another advantage B immunity from long-distance transportation delays.

What are the strategic advantage to Microsoft of outsourcing Xbox production to flextronics?

After reviewing potential suppliers, it decided to outsource assembly and significant logistics functions to Flextronics, a Singapore-based contract manufacturer. Having control of the supply chain enables manufacturers to drastically reduce all of these costs in the following ways: Integration lets the assembler understand, measure, and thus control all the costs within its scope of operations.

In other words, companies can enhance their core competencies and thus are able to push out the value creation frontier and create more value for their customers. Total trade with the United States and Canada tripled, and total exports and imports almost quadrupled between and Outsourcers that brag about A six sigma quality operations may have only achieved that performance for their highest volume operation that has enough volume to warrant a dedicated line and enough effort to please an important client.

Throughout his career, Ron has coached and mentored the execution of deals crossing complex hardware, software, business process reengineering, business process outsourcing, network optimization, systems integration, and professional services domains.

I believe everyone has the right to achieve their career potential, and that belief drives everything I do. Although Microsoft is primarily known as a software company, it has long had a small but important hardware business selling computer mice, keyboards, and joysticks under the Microsoft brand name.

MCAP certification is optional. Material cutting-to-shape The supplier base needs to be narrowed to those who can make parts to the A pull signals of the assemblers. In concurrent engineering, design engineers need to concurrently develop both products and new processes that do not already exist or may have to be modified from existing processes.

In extreme cases, assemblers have been denied access to tooling that they own during bankruptcy or any other seizure when authorities paddle-lock the suppliers facilities and sort out tooling ownership issues later B usually much later.

Siemens case study

These supplemental measures exclude, among other items, stock-based compensation expense, restructuring charges, intangible amortization, financially distressed customer charges, non-cash convertible debt interest expense and certain other items. The accounting requires the initial proceeds from the sale of convertible instruments to be allocated between a liability component and an equity component in a manner that results in non-cash interest expense on the debt component until maturity.

However, this cart-before-the-horse strategy results in the corporate business model being determined by a collection of A whatever everyone happens to be good at the time. A recent Business Week article on outsourcing summarized the trend: Benefits of Outsourcing Strategic outsourcing has several advantages.

For example, many computer hardware and software companies have outsourced their customer technical support function to specialists. During the three-month period ended July 3,the Company revised its initial fiscal estimates between charges associated with the write-off of inventory and provisions for doubtful accounts receivable with no net operating income impact.

Its largest concentration of activities is in China, where it has 35, employees. The following are explanations of each of the adjustments that we incorporate into non-GAAP measures, as well as the reasons for excluding each of these individual items in the reconciliations of these non-GAAP financial measures: Since we find these measures to be useful, we believe that investors benefit from seeing results "through the eyes" of management in addition to seeing GAAP results.

A replay of the broadcast will remain available on the Company's website afterwards. However, many spare parts are big money-losers, especially after sales decrease for the associated products or they go out of production. Case Discussion Questions- 1. In order to reap all these potential cost savings, the manufacturer must ensure that all costs are minimized throughout the supply chain.

Furthermore, if the outsourcer is far away, there may be more delays to wait for enough parts to fill a shipping container or truck.

Outsourcing Persuasive Analysis Essay

Example Roles and Industries: Sequentially, revenue growth and profitability both exhibited strong improvement. Benefits for Partners Joining the "Elite Program" For more details about the elite program and other partner programs, please download the "Microsoft Azure China Partner Elite Program" call or send an email to donxu microsoft.

Flextronics can execute production shifts very quickly-the company says within three weeks-since all of the relevant manufacturing data are stored in centralized information systems.

There decision to outsource the manufacturing of this product by the Flextronics which was a Singapore based contract manufacturer. The presentation of this additional information is not meant to be considered in isolation or as a substitute for the most directly comparable GAAP measures.The major strategic advantage to Microsoft via outsourcing Xbox productin to Flextronics was that Flextronics had the capability to produce Xbox at a lower cost and better quality as compared to Microsoft's inhouse capabilities and thus, such outsourcing allowed Microsoft to exploit the strengths of Flextronics, instead of utilizing its own weak manufacturing capabilities and focus soley on marketing.

Perceived Impact of Outsourcing Sample Essay

Microsoft Asia-Pacific Research and Development Group (ARD) is a complete innovation chain of fundamental research, technology incubation, product development, and strategic partnerships. It is the largest and most comprehensive R&D base for Microsoft outside of the United States.

´╗┐Microsoft Outsourcing XBox production at the end of Chapter 16 Case Discussion Questions 1. What was the strategic advantage to Microsoft of outsourcing Xbox production to Flextronics?

What are the strategic advantage to Microsoft of outsourcing Xbox production to flextronics?

The strategic advantage that Microsoft has is that it is a primary business that is used to develop software.

Contract manufacturing monolith Flextronics is the actual maker of the Xbox, and rapidly churns out the game boxes from a state-of-the-art manufacturing facility in the heart of poverty-ridden. Sony uses Foxconn for 60% of its outsourced production, and Asustek for 40%, both located in Taiwan.

Conversely, when production of the Xbox began, Flextronics was manufacturing all Microsoft's consoles in Gudalajara, Mexico (to serve the North American market) and two locations in Hungary (to serve the European and Asian Pacific markets).

There was a problem providing the content you requested

Though the cost of production in Spain is % more expensive than Asia, Zara does have a competitive advantage over its competitors in regards to operations.

Though there is a cost advantage in their approach in regards to labour, the lack of flexibility in changing orders based on current trends hinders their operational efficiencies.

Download
What was the strategic advantage to microsoft outsourcing xbox production to flextronics
Rated 5/5 based on 17 review