Question 1: How does Ben Lawson’s Custom Fabricators, Inc., create value for Orleans? Custom Fabricators, Inc. is able to create value to Orleans because Custom Fabricator’s manufacturing plant is right next to Orleans’ plant. Ben is able to minimize lead-time for Orleans. They are able to deliver parts to Orleans really fast. Quality is also something Custom Fabricators could ensure because they are able to fix something and deliver it to Orleans quicker because they are so close to each other. Custom Fabricators would also be more effective for Orleans because they’ve cooperated for so long, so Custom Fabricators know the needs and requirements of Orleans really well. They can offer Orleans better field support and problem solving.
Question 2 In the past, what has been Ben Lawson’s competitive advantage in keeping the Orleans business? CFI can maintain its competitive advantage due to its propel location, it is near Orleans facility, and it also invest new machines to improve the processes of manufacture for Orleans; meanwhile, its employee loyalty is good because it pay its employees good. In this case, it make CFI have a competitive advantage.
Question 3 Have Orleans’s priorities changed?
From the case, it is clear to see the Orleans has changed priorities. There are trying to change base to the high quality products. Also they change products to cheaper price as a base strategy. They reduce the cost with elevators and the raw materials, also something else. Ben was concerned about some big issues, such as reducing labor costs and competing with the Mexican labor market. He also was concerned the security of his position relationship with the company.(Can Chen 9362)
4. Should Ben change his business model?
Yes, Ben should change his business model because Orleans, its customers, is changing. Orleans outsourced the whole elevator. Orleans reduced its plant size from 400,000 square feet to 150,000 square feet. Recently, Orleans is reducing its material cost associated with its elevators by contracting many suppliers from Mexico. Meanwhile, Ben cannot compete with suppliers from Mexico in price. Therefore, Ben should work with some suppliers from Mexico to negotiate the material costor outsource totally. When dealing with suppliers from Mexico, Ben may face some difficulties, such as transportation and communication.
Question 5: How should Ben position his company in the value chain? There are a few options for Ben to position his company in the value chain because of it’s close proximity to the Orleans plant. Inbound logistics would be one because delivery speed would be fast since they are so close. Orleans does not have to store too much inventory because of this. They can get materials from Ben in short time. Ben’s company could also easily provide service support to Orleans if any problems arise from parts manufactured by Custom Fabricators.
Question 6 What should Ben do to ensure his company’s future success? I think CFI should improve their operation management to make their processes more efficient and effective, meanwhile they need to match their current marketing strategies to global market. the top management of CFI should also consider whether carry out more capital investment because these new technology could reduce cost, improve quality, therefore increase competitive advantage in the market. finally, CFI could partner with some other companies to improve overall competitiveness.
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