Case Study Questions
1. If you were a small chemical company, what concerns would you have about joining Elemica?
If I were a small chemical company, my concerns with joining Elemica would be very few. Some of these concerns would be how my company’s concerns and problems would be addressed by Elemica. Would the small size of my company cause a decrease in priority with Elemica? How might my company’s size effect its ability to compete within such a large marketplace in efforts to supply larger companies? Would Elemica provide the same level and priority of service to all the company sizes? These would be my primary concerns that may create hesitation in joining and utilizing Elemica’s platform and services.
2. Elemica provides a community for participants where they can transact, coordinate, and cooperate to produce products for less. Yet these firms also compete with one another when they sell chemicals to end-user firms in the automobile, airline, and manufacturing industries. How is this possible?
The setup of Elemica allows competitors to utilize their platform and services to conduct business transaction and still be in competition with one and other. Elemica provides the means by which these companies can all utilize their own information systems and still conduct business with others in the industry. This helps to level the playing field throughout the chemical industry while also helping to drive costs down. Further protection for competitors is maintained by Elemica’s handling of secured bids. Companies are not allowed to access previous bids or any other information from the network that may create an unfair advantage between the companies involved with the exchange. These are reasons why competitors can utilize Elemica and yet remain as competitors.
3. How does the purchase of Elemica by Thoma Bravo, a private equity firm, change how Elemica fits into the B2B framework illustrated in Figure 12.10?
The purchase of Elemica by Thoma Bravo has helped Elemica to continue to improve its B2B platform. The primary change Thoma Bravo has enabled is with technology utilized to digitize supply chain solutions. As part of the influence of technology, supply chains have been transformed from the need to place an order to a supplier monitored fulfilment and delivery setup. Solutions like this enable Elemica to provide dynamic solutions through technological advancement to improve supple chain efficiency for suppliers and their customers.
2. Examine the website of one of the e-distributors listed in Figure 12.10, and compare and contrast it to one of the websites listed for e-procurement Net marketplaces. If you were a business manager of a medium-sized firm, how would you decide where to purchase your indirect inputs from an e-distributor or an e-procurement Net marketplace? Write a short report detailing your analysis.
When comparing an e-distributor (Grainger) to an e-procurement Net marketplace (Ariba Network), one can find several differences. The e-distributor’s site is designed to engage a business customer directly with support and sale of products directly to them. They are relying on the customer coming to their site to source the products needed. This contrasts with an e-procurement site in that the e-procurement site provides resources that are situated to bring a business-customers together with business-suppliers. The procurement site is not actually selling the products, it is selling the digital solutions that bring sellers and buyers together.
If I was a medium sized firm manager, I would lean toward utilizing an e-procurement net marketplace to source my indirect inputs. I would choose this route because of the support and services that he e-procurement net can provide. This net would help to provide flexibility in finding suppliers for the products my company would need. Additionally, I feel this option would help to provide access to more suppliers that would compete for my business. This should help to provide efficiency in sourcing the supplies need for my company.
4. You are involved in logistics management for your company, a national retailer of office furniture. In the last year the company has experienced a number of disruptions in its supply chain as vendors failed to deliver products on time, and the business has lost customers as a result. Your firm only has a limited IT department, and you would like to propose a cloud-based solution. Go to the website of GT Nexus. Explore the Why GT Nexus tab, and the Solutions By Industry/Retail tab. Read several case studies on the site. Write a report to senior management why you believe that a cloudbased B2B solution is best for your firm.
To the senior management team, I recommend moving to a cloud-based solution to our supply chain failures. There are a few reasons that make this option stand out from more traditional options. To start with, the current restrictions from a limited IT department creates undue pressure on improving or migrating to new and efficient in-house software. The cloud-based service will eliminate much of the expense related to procuring and maintaining new software systems in-house. Further advantages come from the support and knowledge that a cloud service provides. Additionally, with a cloud-based service, our company can seamlessly interact with suppliers and customers without having the barriers from different types of software systems they each use. Increased efficiency in transactions along the supply chain will promote a decrease in costs from end to end within the supply chain. Lastly, the cloud-service provides a complete picture of our entire supply chain. It integrates all aspect of the supply. This allows real-time tracking and decision make to help alleviate supply chain issues at much earlier stages. Earlier detection will allow our company to address problems as they arise to ensure minimal operation disruption. Results from this will allow us to provide smoothing to our production which will then lead to increased customer service, satisfaction, and ultimately retention.