American Connector Co. is compelled to reevaluate operations at its Sunnyvale plant when a Japanese contender declares arrangements to fabricate an "extreme" plant in the United States. Case looks at issues identified with benchmarking a contender's assembling capacities and efficiency. Permits students to look at two organizations' assembling systems and their suggestions for efficiency and adaptability.
· Cost Comparison
· Raw Material: Product
· Raw Material: Packaging
· Total Labor
1. How serious is the threat of DJC to American Connector Company?
2. How big are the cost differences between DJC’s plant and American Connector’s Sunnyvale Plant? Consider both DJC’s performance in Kawasaki and its potential in the United States.
3. What accounts for these differences? How much of the differences are inherent in the way each of the two companies compete? How much is due strictly to differences in the efficiency of the operations? How much of the differences are due to the market conditions? Focus your analyses on material, labor, and depreciation (capital) components of the total difference that you have identified in the answer to
#2. You write-up must have some quantitative analyses to support your answers.
4. What should American Connector’s Management at the Sunnyvale plant do?