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BUSN495: Required Assessment Assignment: – Case StudyAssesses Course Learning Outcome #2 Justify strategy selection, goals, forecasts and tactics using research and financial .Assesses BBA OutcomesComprehensive Case Study Assignment Guidelines: (use the analysis processoutlined in the assignment description, which is adapted from the AmericanManagement Association 8 Step Case Analysis)Paper Outline Note: The paper should not exceed 6 pages (not including the cover page).Introduction: a brief overview of the topic and how you plan to proceed with your discussion.Case Facts and the root cause of the problemIdentifying and listing relevant case factsIdentifying and describing the root cause of the problemIdentifying and describing the problem componentsAnalysis & Decision MakingGenerating alternativesEvaluating alternativesChoosing and supporting alternatives(s)Action Planning: Describe how you will turn your solution or decision into action, how, when and what.Measurements: Recommend measures that will evaluate performance.Conclusion: a summary of the key points of the case analysis.Case Analysis Assignment DescriptionCase studies present you with real life scenarios and situations that help to develop your critical thinking, problem solving and decision making skills in the relatively safe environment of the classroom. Whether the situation described in a case is fairly straightforward or is highly complex, the entire problem solving process involves 4 phases and eight steps outlined below. The analysis process will involve four phases:Problem identification and definitionThe process of identifying and defining the problem involves three steps:i) Reviewing the case and identifying and describing the relevant facts.This step allows you to identify the key facts (the most relevant ones) so that you canfigure out what is going on before making a decision. Identify and stating the key factshelps you identify the most important facts. Provide a list of the most relevant case facts. These facts should be organized aroundexternal forces (external environment) that affect an organization including but notlimited to: political, economic, socio-cultural, technological, legal and competitive; orinternal factors such as management problems, staffing issues, financial, or marketingchallenges. ii) Determining the root or cause of the problemThis step expands on the previous step by identifying the facts in the case that arecontributing to the problem and/or are symptomatic of the problem. In this step, a simplequestion that might guide the discussion is: what are the current challenges faced byXYZ company? Identify all the challenges that the company is facing to includeinternational/global business decisions and ethical/social responsibility issues.iii) Identify the problem componentsThis third part of the problem identification fully identifies the problem and the key components of the problem. An example of part ii) and iii) is below: The current challenges facing XYZ are how to remain competitive and profitable,improve productivity and maintain good employee relations. A number of factors arecontributing to this situation. First, the government has recently passed laws toderegulate the industry. This is causing competition in the industry to increase. Second,widespread adoption of telecommunications and the internet means customers arefinding it much easier to shop around and compare prices. This is also stimulatingcompetition and is driving down prices industry-wide. Lower prices have led to lowerprofits in the industry and the 1% fall in XYZ’s net margin is reflected in the $1,000 000decline in net profit. Consequently, XYZ has been downsizing and recently laid off 10%of its workforce in an effort to cut costs. A recent company survey indicated thatdownsizing has adversely affected employee morale which the management believes isresponsible for the 2% decline in productivity. (XYZ, pp 214-215).Analysis and decision making Most business cases involve decision making. For instance, some might need adecision on questions such as, “What strategy or strategies should company XZYpursue in the future? This decision can be made after an analysis of the company’sstrategy and situation. The final decision will vary based on the data available and theperceived consequences. Analyzing the various dimensions of the decision requiresthree things: decision options or alternatives, decision criteria, and providing relevantevidence (Case Analysis Guideline, n.d). These three steps are below: Generating alternatives (options)Since the case assignment or question requires a solution, a decision or an opinion thenyou need to consider all the options. Brainstorming will help you generate a list ofpossible alternatives. Some questions that are being considered in this case that you must discuss and answer or list as alternatives in this section:a) How could the organization solve the primary challenges and problems problemsidentified in the case and any case questions? List as many alternatives for eachchallenge as possible.b) In addition to the challenges identified propose specific alternatives for thefollowing questions:a. What are the organization’s options for future growth in global markets? Whatmight be potential markets?b. Given the organization’s current financial situation and keeping in mind anypotential impact on return on investment capital to investors, what are the organization’sstrategic options for environmental sustainability and corporate social responsibilityinitiatives?In this step, you do not need to be judgmental; virtually any idea goes but if you do notlist it, you cannot then choose it as the best option. A few examples of company XYZ’salternative solutions:Close XYZ down – the future is bleakDo nothing – the company has already cut costs enoughIncrease productivity- to reduce unit costsEmploy more sales people- to increase sales revenueRun some extensive advertising campaigns- to increase sales revenue and product awarenessDiscontinue company benefits – to reduce costsContinue to lay off staff as needed – to reduce costsImplement voluntary redundancy/retirement and a hiring freeze – to reduce costs.Ask employees to pay a proportional cost of medical benefits – to reduce costs.Evaluate alternativesOnce you have listed all your alternatives, the next step is to narrow them down to thosethat seem most plausible; much like whittling down a long list of new cars to a fewpotential makes and models. After you’ve screened your list, take the relevant facts thatyou gathered in step 1 and apply them to each of the remaining alternatives. Thisprovides you with the necessary supporting evidence to reject most of the remainingalternatives and decide on the best. A few examples are provided below:Deregulation and consumer shopping habits mean competition is likely to be a fact of life for a long time to come– doing nothing is, therefore, not an option. The company must look for more ways to cut costsIncreasing productivity would help the company but without the commitment of the workforce this is unlikely to be successful.Employing more sales people is an option but would increase costs without any real guarantee of successThe company already advertises regularly – doing more would push costs up higher than the industry average making it more uncompetitive unless revenues greatly increase as a result. This seems unlikely with the advent of increasing competition.Discontinuing company benefits would decrease costs but may damage employee morale still further, However, it is a longer term possibility as employees have indicated they would rather pay for benefits than lose their jobs.Choose an alternativeAfter evaluating all your options, choosing the best alternative is usually a straightforward next step but it is also one that is often skipped, even by businessprofessionals. So, make sure that you state your preferred solution simply and clearly.Keep in mind that your readers aren’t as familiar with the case as you so, even if youthink the reasons for your solution, decision or opinion are obvious, you must stillexplain which facts led you to that conclusion. Imagine that you had decided to donothing because you think things will settle down.It is not enough to say, “XYZ could close down or spend a lot of money on advertisingand promotion to boost sales but the best solution is to do nothing, I think things willsettle down.” Support your recommended course of action using theevidence/information from the case, other research and your experience to clarify yourreasoning. For example:“Although management believes that the recent 10% reduction in staff has reducedcosts sufficiently to allay the effects of competition for the next 3 years (XYZ), theycannot afford to stand still or do nothing further because competition is increasing and ishere to stay (XYZ). Increasing promotional activity would also increase costs with noguaranteed results and more job losses would result in a further decline in morale andproductivity. Bearing all this in mind, XYZ’s best option, therefore, is to introduceemployee healthcare contributions. This will save the company $1, 500 000 per annumand employees have already indicated that they would be willing to accept this option inpreference to further job losses (XYZ) so, productivity is likely improve once thechanges are communicated and implemented.”Note: Your chosen alternative(s) must be supported by an integration of facts emanating from business concepts such as finance, management, marketing, operations, human resource, etc. They must also be supported using the results of the environmental analysis or case fact highlighted in section 1 (i). Action planning The first two stages of the case analysis process focus on identifying and makingdecisions about the big picture. In this last stage, steps 3 & 4 call for you to define howyou will turn your solution or decision into action, how, when and what you will monitorto ensure things are working out as planned and what you will do if they are not. In our XYZ example, we have decided to introduce a new benefits program to reduce costs. Let us assume that the benefits team in the Human Resources department will be responsible for communicating changes in the benefits program to employees. This communication must be complete by mid- May so that employees can make informed selections in the open enrollment period during the last two weeks of May.Communication Plan for New Benefits ProgramAction RequiredAction byTime required/Deadline Identify volunteers for focus groups to identify appropriate communication methodsBenefits Director1 week/ 31st JanConduct focus groupsBenefits Team2 weeks/14th FebPrepare communication & enrolment forms in formats identified by focus groupsBenefits Director & PR Consultants4 weeks/14th MarchSend draft communications & documents to printersPR firm1 week/21st MarchMeasurementsFinally, as with any plan, it is very important to build in measures so that you canperiodically monitor whether it is working. Therefore, you need to state HOW, WHENand WHAT you will measure, for example: quarterly reviews of new accounts opened,sales volume or number of units sold, increases in customer awareness or satisfactionlevels, gross profit margins or net profits. You must also have a contingency plan incase things do not go as expected. Will you make modifications to your existing plan?Will you start the process over? Will you choose some other alternative that you’velready identified?

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For the exclusive use of M. Davis, 2018.
Klaus Meyer and Alexandra Han wrote this case solely to provide material for class discussion. The authors do not intend to illustrate
either effective or ineffective handling of a managerial situation. The authors may have disguised certain names and other identifying
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Copyright © 2017, Richard Ivey School of Business Foundation
Version: 2017-09-29
Bossard AG (Bossard) based in Zug, Switzerland, was a leading supply chain service provider helping
manufacturing businesses take advantage of new opportunities arising in the digital economy, a trend
popularly known as “Industry 4.0.” Bossard purchased large volumes of basic components—screws, nuts, and
bolts—from a variety of suppliers, conducted extensive quality control, branded and repackaged the items for
its customers, and delivered them just in time and on short notice to manufacturing sites worldwide. Bossard
integrated the delivery of products with logistics solutions, advising customers on product selection, and
participating in customers’ product development. Bossard’s blue “SmartBins” had become a common sight in
factories across Europe, and increasingly also in North America and in Asia. Bossard enabled manufacturers
to enhance the productivity of their operations through real time data collection and analytics.
In Switzerland, the high cost of manual labour had, for several decades, put pressure on manufacturers to
reduce the use of low-skilled labour and enhance operational efficiency. Bossard’s logistics solutions were
thus in high demand, first in Switzerland and later throughout Europe, North America, and some parts of
Asia. However, the business model had to be adjusted to fit local client needs, especially in emerging
economies. Specifically, Bossard was looking for more ways to participate in upgrading Chinese
Bossard was founded in 1831 as a hardware store. Since the 1950s, it had grown due to rising industrial
demand for high quality screws, nuts, and bolts—also known as “fasteners”—in the manufacturing
industry. From the 1970s onward, Bossard spread beyond Switzerland to serve clients across Europe and
later in North America and in Asia, often following existing customers that established factories abroad.
Turnover reached CHF 695 million in 2016, up from CHF 485 million in 2012, with solid profitability of
EBITDA margins between 12 and 14 per cent in recent years.1 Bossard employed over 2,000 employees
around the world (see Exhibits 1 and 2).
CHF = Swiss franc; CHF 1 = USD 1.01 and EUR 0.92 at the end of 2015 (see Exhibit 1). EBITDA = earnings before interest,
tax, depreciation, and amortization.
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Since 1987, Bossard had been listed on the Swiss Stock Exchange, with a market capitalization of
CHF 1.09 billion in December 2015. The Bossard family remained in control to the seventh generation
through ownership of voting shares (B shares), whereas dividend bearing but non-voting shares (A shares)
were traded on the stock exchange. The family holding company owned 56.1 per cent of voting rights and
27.9 per cent of the dividend bearing capital, thereby securing the continued family control of the company.
David Dean had been running the company as a professional (non-family member) chief executive officer
(CEO) since 2005; he reported to the supervisory board, chaired by Dr. Thomas Schmuckli, a family
member whose primary occupation was managing director at Credit Suisse.
Bossard’s traditional core business was trading in screws, nuts, and bolts, which were basic consumable
products (“C-parts”) for manufacturing. These C-parts were mostly standardized mass-produced items, but
their quality could be critical for quality and reliability of downstream products. As described by Bossard:
Fasteners may not be everything, but almost nothing works without fasteners: electric razors, lawn
mowers, tractors, trains, computers, and printers—all of the products that we take for granted in
our everyday lives. [The products] work as well as their fasteners allow them to. Fasteners usually
work in the background so that one hardly notices them. . . . The most expensive fastener is the one
that’s missing. Only a steady flow of high-quality fasteners that never dries up guarantees efficient
production and maintenance.
Moreover, the quality of fasteners was often critical for the overall safety and reliability of products.
Bossard thus conducted extensive testing of the properties of its C-parts, including precise size, push and
pull pressures, corrosion protection, surfaces, and coatings. The quality of the product portfolio along with
its integrated logistics solutions were Bossard’s selling points.
Bossard initially grew organically but it made a few major acquisitions in the 2010s to strengthen its global
footprint, through, notably, the acquisition of KVT-Fastening in Germany in 2013. By 2015, Bossard had
become a leading international player, the biggest of its kind in Europe, operating in 27 countries
worldwide. Its central warehouse in Zug stored 50,000 catalogue items with 380,000 stock-keeping units
with a total weight of 8,000 tonnes. Bossard was operating 2,500 logistics systems for customers and
sourcing from over 500 suppliers worldwide.
Bossard’s customers included the leaders of Swiss manufacturing, many household names from across
Europe, and, increasingly, customers from North America and Asia. Key customers included Swiss
industrial companies such as Stadler Rail (see Exhibit 3) and global leaders that were manufacturing at
multiple sites around the world (see Exhibit 4). When electrical car pioneer Tesla, Inc. established its new
production facility in California in 2011, the company was looking not only for the latest technology to put
in the cars, but also for the latest technology for building cars. So, it turned to Bossard to optimize Tesla’s
C-parts management. Bossard thus began running intra-factory logistics for Tesla, regularly refilling 1,500
bins in 91 locations across the plant. Adapting to its client’s corporate image, bins in the Tesla plant were
red, rather than Bossard’s traditional light blue. To bring the pioneering spirit of Tesla to Bossard, a Tesla
car with the Bossard logo was parked right by the entrance to Bossard’s warehouse in Zug.
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Manufacturing was facing a fourth industrial revolution—popularly known as Industry 4.0—as
manufacturing converged with the digital economy, specifically with emerging big data collection systems
and analytics. Similar ideas were discussed in the United States as the “Industrial Internet of Things” (IIoT)
and in academic circles as “cyber-physical systems.” It was still primarily a vision for future manufacturing
rather than a clearly defined set of techniques, but experts were discussing how to create profitable business
models employing big data analytics. One popular idea was to replicate entire factories and production
processes in digital space, optimize the system through simulations in cyberspace, and then implement
insights from that analysis in the real world. A more hands-on approach was to identify bottlenecks, ask
what real time data was needed to overcome this bottleneck, and develop appropriate sensors, wireless
connections, and analytics to collect, transfer, and analyze this data. On that basis, real time data
visualizations could be provided to decision-makers, or even used to create decision algorithms that would
automatically decide what action should be taken.
Bossard aimed to be at the forefront of this impending revolution of manufacturing, not only by optimizing
its own logistics, but also by becoming the preferred supplier for manufacturing firms that wanted to
upgrade their operations to Industry 4.0. Specifically, Bossard innovated logistics systems by incorporating
real time data analytics with algorithms to optimize C-parts flows and order processing. In this way, Bossard
was helping industrial customers enhance their productivity, as expressed in Bossard’s corporate slogan,
“Proven Productivity.”
Bossard offered three types of services: product solutions, application engineering, and factory logistics.
Product Solutions: Bossard evaluated customers’ products and production processes to provide the best
fastening products for the situation. Specifically, Bossard could advise which specifications would best deliver
the safety and reliability standards required by each customer’s products. In some cases, this advice extended
to modifying a product to reduce the number of different C-parts, and thus, to reduce the complexity of the
client’s operations. Such changes in operations could enhance clients’ productivity and improve the reliability
of their final products. About half of Bossard’s product sales were in customized products.
Application Engineering: Bossard participated in some customers’ product innovation to develop solutions
for next generation products. By applying Bossard’s expertise in technology and logistics, clients could
bring their products to market faster. Customers would, for example, send work pieces to Bossard for tests
of product properties with alternative fastening solutions. Being involved in the development stage of new
products allowed Bossard to help customers choose an appropriate fastening solution that enhanced product
properties and facilitated the logistics and assembly processes.
Factory Logistics: Bossard supplied products to customer warehouses, and directly to specific sites within
clients’ factories where and when they were needed (see Exhibit 5). Its “Smart Factory Logistics” enabled
intelligent interaction between production and supply chains in real time. Embedded sensors and Internet
connectivity enabled signals to be sent from the point of use to the point of supply. Real time data enabled
clients to reduce inventory and procurement costs along their entire value chain, enhancing predictability
and enabling faster throughput. Thereby, Bossard enabled its clients to optimize operations concepts such
as lean management, smart manufacturing, agile production, and mass customization.
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Customers could choose from a range of different logistics systems with varying degrees of data-intensity
and service quality (see Exhibit 6). In particular, orders for C-parts could be triggered in alternative ways,
depending on the needs of the customer. Bossard’s full service logistics could even use Bossard’s own
internal factory logistics to eliminate customers’ needs for their warehouses.
The most traditional service model was known as “Bossard 2Bin.” This system used two or more of
Bossard’s light blue bins for each C-part, one bin arranged on a shelf behind the other. When the first bin
was empty, the customer used the second bin and moved the emptied bin to an agreed location. Bossard
collected empty bins at regular intervals, filled them, and returned each bin to its specific spot on the
production line. This traditional model could be enhanced with the “Bossard Code,” a barcode with product
information on each bin that could be read by a handheld device or with radio-frequency identification
(RFID) smartcards inserted into an RFID reader. When the minimum stock level was reached, the
information was sent to Bossard, who would then initiate the replenishment.
Bins could further be equipped with “SmartLabels” connected by wireless networks (Wi-Fi) to the client’s
information technology (IT) systems or directly to Bossard. The SmartLabel would give shop-floor workers
exact information about the content of the boxes, and provide signals when a new order was required. Staff
on the shop floor could initiate a refill by pressing a button on the label. SmartLabels could be applied to
any box at any storage site, using the existing infrastructure without the need for a costly conversion. Users
could easily order replacements from the site where they were needed, thereby keeping the process under
their control. The display showed an image of the product and product information together with the item
number, order status, order quantity, and delivery date. The ready availability of this data reduced
possibilities of confusion in the supply chain, and enhanced transparency of material flows.
The more sophisticated technology was an integrated logistics solution called “SmartBins.” These blue
boxes had built-in scales that would weigh the content at any time and infer the quantity of items still in the
box. SmartBins consisted of three major components: integrated weight sensors that met highest standards
for precision, long-term stability, and robustness; a Wi-Fi connection with wireless sensor network
technology; and a software package, ARIMS, that enabled remote monitoring of all bins. Data from
SmartBins along the production line would automatically be shared with a central data centre where the
information was aggregated and monitored. If customers wanted full integration of their logistics, an
algorithm in the software could automatically trigger new orders based on benchmark values for stock; the
predefined order quantity of new C-parts was shipped automatically or delivered by Bossard service staff.
The client’s staff did not need to be involved. This eliminated waiting times and enabled smooth movement
of C-parts, thus reducing the need for human intervention and enhancing the reliability of supply.
The data collected by Bossard’s devices was processed in its ARIMS software, which showed the information
on a customer dashboard or mobile app for decision-makers, and, if customers wanted, used algorithms to
trigger product orders. These solutions enabled optimization of interim storage, with full visibility and
transparency for the customer generally and also specifically for the machine operators using the C-part.
Detailed historical and real time data informed forecasts that, in turn, informed sourcing and inventory
optimization. For example, if a customer planned to increase output by 10 per cent, Bossard could predict the
need for C-parts through ARIMS, often more accurately than the customer’s own predictions. Customers
could integrate data generated by ARIMS with their own enterprise resource planning (ERP) system.
ARIMS was operating with a single server platform that was accessible worldwide from a mobile app.
Thus, factory supervisors or top management could, from a mobile phone or tablet, monitor the stock in
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every bin along with usage data and the refill schedule. In factories that did not allow mobile phones or
tablets on the shop floor, wall mounted monitors provided this function while protecting confidential data
on the shop floor. ARIMS provided customers with real time data of (1) item description and measurements,
(2) refills for the past year for each bin, (3) stock in each bin in real time, enabling quick inventory, and (4)
orders in process with projected delivery times.
Security was essential for customers to trust the system. ARIMS thus employed state of the art security
features. Special interface software could safely bridge ARIMS with a customer’s own ERP systems. Data
was encrypted and converted into the appropriate format—for example, a mirror archive—and then sent to
the customer. The customer’s firewall identified the Internet Protocol (IP) address and then scanned
documents to import data into the ERP system. Bossard emphasized the security features of its systems:
Unauthorized data access, data abuse, and system failure can seriously disrupt operating processes.
To prevent this, we use technical measures such as access authorization, virus scanners, firewalls,
and backup systems. Our IT systems are continuously monitored and updated in order to meet the
latest requirements. We have an emergency concept that includes daily backups and data mirroring.
Detailed internal policies govern how we use hardware and software.
Bossard’s main sales pitch focused on the concept of total cost of ownership (TCO), which referred to the
total cost incurred to secure a specific C-part, such as a screw, at the specified quality and available at the
right place at the right time in a manufacturer’s plant. Bossard estimated that 85 per cent of TCO was
typically operating costs related to purchasing, order processing, quality control, and internal logistics,
while only 15 per cent was the actual cost of the C-part. Bossard proposed that its service solution enabled
manufacturers to reduce the 85 per cent, hence achieving savings far greater than the cost of the C-part.
Bossard developed a standard cost calculation and process analysis method. The company conducted a
value stream analysis of the customer’s operations and C-part logistics, and identified optimization potential
in design and production processes. Using a set of key indicators, Bossard experts could calculate how
much money the customer could save by using Bossard’s logistics systems.
Bossard priced different aspects of its services separately, thus providing different service packages to
different clients. For example, Bossard rented the bins along with its logistics system and the associated
software. Customers opting for a frequent or automated delivery schedule paid a flat fee for the service plus
the price of each C-part delivered through the system. Consulting services were available separately, notably
to clients aiming to develop logistics systems that did not involve C-parts from Bossard’s product portfolio.
Since the 1980s, Bossard had been growing its international operations, and by 2015, was operating
worldwide in 26 countries with more than 60 service locations, 35 logistic centres, and 12 application
engineering laboratories. In Europe, Bossard was serving clients primarily from its central warehouse in
Zug, with additional warehouses in Denmark and France. With border controls removed within the
European Economic Area, Bossard trucks could smoothly travel across the continent and secure timely and
reliable delivery. Outside Europe, Bossard needed to establish a local distribution infrastructure to be able
to deliver the same level of service. Thus, in Asia, Bossard had 14 logistics centres, including four each in
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China and India. These regional warehouses provided all parts commonly used in their region; orders for
less common parts were sent directly from Zug, by air freight if necessary.
Bossard’s global footprint had been growing gradually at similar paces around the world (see Exhibit 2).
Eur …
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