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Answer & Explanation:Need a 150-200 word discussion
Please review the case below.
It has many facets, including procurement, contracts, manufacturing,
operations, sales, marketing, and finance. It has strategic
implementations for the entire company, but I want you to focus only on
the procurement aspects of the case (and we will deal with the interactions
between the procurement department and other departments later this semester).
The VP of operations
has interrupted your vacation with some startling news. One of your
company’s important products is called “The Superwidget”. The US
Government, and the national governments of many NATO countries, Japan,
Australia, Argentina and Brazil each buy thousands of these Superwidgets a
year.
Several companies manufacture
a similar competing product and competition for Superwidgets is fierce, based
on technical innovation, price, and delivery criteria. The Superwidget is
manufactured from components, software, and firmware from numerous companies
plus some internal fabrication of parts and subassemblies in your own plants.
The final Superwidget u

sually sells for between $800 and $1200 per unit, based
on some special features, warranty, and service. Your company has manufacturing
facilities for the Superwidget in the US, Germany, Australia, and Brazil. These
manufacturing facilities service specific areas of the world and there is no
overlap.
Your company buys a particular
subwidget for about $100/unit. This subwidget is a critical component of your
Superwidget. You source the subwidget from only one supplier in the US through
an exclusive supply contract. Your key competitors have similar exclusive
arrangements for their subwidgets from other suppliers.
The phone call to your
vacation spot is very disturbing. You have just been informed that deliveries
of the subwidget will be late for the next 3 to 4 months. After your staff
completed an analysis, it determined that your company does not have sufficient
stock of subwidgets to cover the required deliveries for the next 4 to 6
months.
What are the procurement
issues here? How do you address the aspects of this issue that concern
procurement process?Notes
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