Brief History about Bose and Inferences:

1. Bose Corporation was established in 1964 and was the brainchild of Dr Amar Bose.
Initially they started with battery operated portable equipment, however, their
ultimate aim was to reproduce high quality hi-fi sound accurately through research
which would sound like a live sound.

2. Bose corporation were ambitious in their plans to provide outstanding sound

experience to everyone across the globe. In pursuit of global expansion, the
company shown exceptional perseverance in finding and opening in new markets.

3. Bose corporation can be said to be adaptive to the latest trends because they
provided solution to the emerging trend of integrated systems or ‘plug n play’.

4. Bose Corp had a natural evolution in the products produced by each plant from
producing components for other plants in the beginning to becoming self-sufficient
themselves by expanding its manufacturing capabilities.

5. The management at Bose corporation felt that long-term sourcing components from
suppliers will preclude Bose from developing its own expertise. It shows their strong
belief on both forward and backward integration.

6. The management’s commitment to provide exceptional quality of audio systems by

whichever means can be inferred from Tom Beeson’s statement that If we were big
enough, we’d do everything ourselves when it comes to quality or performance of
Bose products.

7. Bose Corporation originally believed in decentralization when it came to taking

purchase decisions in each of the plants. It shows that the management empowered
their plant managers to take decisions at plant level.

Is Bose a good buyer?

Yes, I consider Bose as a decent buyer as it had both positives and negatives.

1. Bose had a central corporate procurement team which looked after locating new
vendors and sourcing new parts. After 1990, the contract with these vendors were
negotiated and finalized by the corporate procurement team and then the contract
was turned over to the plant-level purchasing departments. It would provide
individual plants to source their components at their own comfort with a centralized
standard price.

2. It can be inferred from the case that most of the buyers at the corporate
procurement team had engineers who dealt with the techno-commercial
negotiations better than the buyers at one of their plants because there were less
engineers in the plant’s buyer team. The decentralization could affect the overall
 quality of procurement because of less engineers in the team where most of the
components were mostly related to engineering.

Possible JIT II Implementation Issues:

1. Bose management was not sure that G&F would supply to all the Bose plants. G&F
supplies only one-sixth (by revenue) of their total capacity to Bose. It means G&F has
other clients as well. G&F might not want to upset the relationship with the other
clients by supplying the injection-molded plastics to all the plants of Bose (if their
capacity permits)

2. In case, G&F agrees to become a part of JIT II, it may not be able to satisfy 100% of
Bose corporations’ plastic requirements given its continuous expansion. In that case,
multiple vendor representatives stationed full-time at Bose facility would create a
conflict of interest in case they get to know the terms of contract of other suppliers.

3. The DNA of Bose corporation is to develop the capability themselves to control the
quality and performance of the Bose products. Going for JIT II for a long-term
contract would preclude Bose from developing in-house capability. It definitely
delays the process of moving into self-control. It may lead to conflict in opinion
among the ones who wants to become self-sufficient and the ones who wants to go
with JIT II. The implementation may not materialize due to conflict of interest.

4. Formalizing the criteria for determining when, whom and how to partner with JIT II
could result in internal conflict among the employees of the Bose Corporation. This is
because, a few people believe they would not be able to evaluate the vendor prices
over a long term due to the inflation and fluctuation in prices of raw materials.