Topic 3 - External & Internal Integration

Question 1

Definition of Integration

Answer 1

Collaboration with different parties to work on common problems and goals
Utilising information systems to link members
Can be external and internal
Integration is a scale

Question 2

Dimensions/Factors of Integration

Answer 2

1. Situational - Characteristics of projects (Why?)
2. Structural/process - degrees and mechanisms (how much?)
3. Outcome - Impact of integration on success (What is the ROI?)

Question 3

Ways of achieving integration

Answer 3

1. New product development teams
2. Cross-functional teams
3. Cross-location teams
4. Commodity teams - each team is responsible for one commodity
5. Co-location - with suppliers, procurement with internal stakeholders

Question 4

Keys to successful integration

Answer 4

1. Formalized process
2. Cross-functional teams
3. Early supplier selection
4. Supplier membership and participation on the buying company’s project team
5. Direct cross-functional inter-company communication on the project
6. Co-location of buyer and supplier company personnel
7. Formal trust development efforts between business
8. Sharing of technology
9. Joint education/training efforts

Question 5

Extent of Supplier Involvement in Design

Answer 5

1. No involvement
2. White box - informal supplier integration
3. Grey box - Joint development with formalised integration
4. Black box - Design is driven by supplier according to buyer’s tech specs

Question 6

Drivers of Integration

Answer 6

1. Customer expectations
2. Cycle time and cost reduction
3. Rapid technological change
4. Core competency focus
5. Global competition
6. Corporate downsizing
7. Shortened product life cycle
8. Quality and reliability improvements

Question 7

Benefits of Integration

Answer 7

1. Brings together knowledge and resources (synergies) required for responding to new sourcing demands
2. Reduced time to market
3. Increased quality
4. Increased innovation
5. Joint ownership of decisions
6. Enhanced ownership amongst stakeholders

Question 8

Drawbacks of Integration

Answer 8

1. Groupthink
2. Lack of buy-in
3. Lack of trust
4. Unwillingness to commit resources (no gurantee of results for new products)
5. Resource intensive and time consuming