AULIA NABILA

29119107
MM 6041 - SUPPLY CHAIN DESIGN
COORDINATED PRODUCT AND SUPPLY CHAIN DESIGN ASSIGNMENT
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Question :

1. List two low clock speed products, two medium clock speed products, and two fast clock
speed products!
2. How does a low clock speed impact the product design strategy? How about a fast clock
speed?
3. What are the advantages of downward substitution? What are the disadvantages?
4. Discuss some examples of modular and non modular products and processes!
5. How do standardization strategies help managers deal with demand variability and the
difficulty of making accurate forecasts?
6. What are the advantages and disadvantages of integrating suppliers into the product
development process?

Answers :

1. Example of low clock speed products, two medium clock speed products, and two fast
clock speed products :
a. Low clock speed products : Diamond mining and electricity
b. Medium clock speed products : Automobiles and computer operating systems
c. High clock speed products : cosmetics, games, and toys.
2. Low clock speed affects the product design strategy in that the focus is less on speeding
up product development or postponing differentiation and modularity as it is not that
important for more functional products. On the other hand, high speed affects product
design in that the focus is on modular product architecture since it allows independent
 development of product subcomponents. There is also greater weight placed on
postponement of product differentiation, sometimes until demand is realized.
3. The advantages and disadvantages for downward substitution :
a. Advantages
i. Able to make use of aggregate forecast for products. The forecasts would
be more accurate as they would be aggregated over a large number of
products that would then be differentiated further downstream.
ii. Components can be made ready for the consumer when demand arises but
no stock is kept for a specific end product, which means the available
components can be used thus capitalizing on downward substitution, and
thus loss due to obsolescence is less likely to occur.
b. Disadvantages
i. Certain products may require modules that are not of the same quality as
the standard module provides. This can lead to lower quality products
because one of the components was not of the correct quality.
ii. If the components had an error at manufacturing, all the products cannot
be assembled thus resulting in a loss of customer satisfaction.
4. Example of modular and non modular products and processes :
a. Modular product : cellphone, television, watch
b. Non modular product : remote controls
c. Modular process : the assembly of an automobile
d. Non modular process : making chocolate
5. Standardization strategies help managers deal with demand variability and accurate
forecasts. The organization can reduce the uncertainty of forecasts by using aggregate
forecasting across all the products thereby getting more accurate forecasts.
Standardization helps managers deal with the variability in demand in that the products
can be differentiated according to demand at the point by the customers. In this way, the
products that are wanted by customers are the ones assembled using the component parts
which can be used for other products as well.
6. The advantages and disadvantages of integrating suppliers into the product development
process :
a. Advantages :
i. The organization may not have the expertise to develop those new
products and involve suppliers. The organization can still continue with
the introduction of the new product but without going through the process
of trial and error that would incur costs.
ii. The suppliers can gain experience with the new product while the
organization continues with its core competencies.
iii. Risk could be separated between the organization and suppliers.
b. Disadvantages :
i. The organization may lose out on being credited for the idea alone but also
faces the possibility of the innovation getting out too early.
ii. The organization may not be learning everything about the product and
could thus lose out on further opportunities to innovate.