Pacific Systems Case
1. What is your recommended sourcing strategy in this case? Please support your decision with quantitative and qualitative evidence gathered during the case analysis. Also, present your plan to reduce any risks associated with your sourcing decision. Pacific Systems Company should single source their DVD drives and build a good relationship with the chosen supplier. Not only computer industry is hungry for DVDs, other electronic sectors such as home entertainment devices are competing for this item too, making lack of supply a major issue. If Pacific Systems wants to guarantee supply in such environment, it would be a good idea to create a single source strategic alliance with a long-term contract (2 years), renewable according to satisfaction parameters. Other major requirement of Pacific Systems is that suppliers can increase supply components by 25% within 4 weeks a change in market conditions, which is more possible in this type of relationship. Additionally, open communication in closer and long term relationships often lead to less delivery and quality issues, which is another critical point for PSC. 2. This case provided the data necessary to perform a cursory supplier financial analysis. In reality, cross-functional sourcing teams must often obtain this data during their assessment of potential suppliers. Discuss possible sources of supplier financial information. What may impact a purchaser's ability to obtain supplier financial data? There exist sites and organizations that provide financial information divided by regions, UK, Euro zone, North America, Australasia etc. Some of the sites are subscription based, whereas some are free or pay-as-you-go. On the other hand, if a company trades on the stock market, the financial information is public therefore is free and easy to get. These sites could be company