4.9End-of-Topic Case: Adapt or DieThe Intel Way

You just found your dream joba strategic sourcing position at Intel. You're excited because you just lined up an interview. The question is, "How will you impress the interviewers to convince them that you really do have the attitude and know-how to contribute to Intel's success?" You want them to see you as a difference maker.

Why Intel?

Intel has been the world's leading semiconductor manufacturer since the 1980s when Intel wrestled supply chain power away from the box makers (i.e., Compaq, IBM, and Hewlett Packard). Intel's 386 chip had delivered on the idea that processing speed would change the way people used computers. Ever since, the language, "Intel Inside" had become a well-known co-branding tagline.

More important than Intel's legacy, you knew that Intel had continuously transformed itself to meet the needs of a fast-paced, high-tech world changes. Intel's catch phrase, coined by its former CEO, the late Andy Grove, is "Adapt or die." Today, Intel was focused on becoming, "...a company that powers the cloud and billions of smart, connected computing devices."1Intel is the perfect place to start your supply chain careerthe right place to be challenged and learn the skills needed to thrive in a fast-moving environment.

Intel's Annual Development Forum

Having done your homework, you know that Intel believes that suppliers are key to the future. You are especially impressed with Intel's Annual Development Forum. Each year, Intel holds a supplier conference that brings together leaders from industry, technology, and Intel to discuss the future. During the forum, Intel shares Intel's vision for the future, including technology roadmaps. The goal: Help key suppliers target investments so they can efficiently prepare for the future. You love that Intel still "makes stuff," and that Intel is positioning itself to be the backbone of the Internet of things. You want to get this interview right!

An Unexpected Homework Assignment

You were a little surprised that in anticipation of your interview, Intel had tasked you with a little homework. Specifically, Intel had asked you to develop a presentation that would describe your sourcing strategy for each of the hypothetical Intel suppliers listed below. Clearly, Intel wanted to assess both your grasp of strategic sourcing as well as your sense of Intel's strategy and value proposition.

• Small package carrier to ship multiple items daily to other plants and to business customers.
• Caterer to set up a meeting in a city where Intel does not have any operations.
• A manufacturer of a key piece of capital equipment that has a major impact on Intel yield (percentage of good product). Manufacturing equipment is Intel's largest spend categoryeven greater than raw materials.
• A supplier of raw material that is essential to production. The raw material is available from a number of other suppliers, though it would take several weeks for another supplier to fully ramp up and take over the business.

Questions:

Specifically address the following for each supplier:

1. Where would this supplier fit on the strategic sourcing matrix? Why?
2. What type of relationship would you recommend for this supplier? Why?
3. Would TCO analysis be appropriate for analyzing this buy? Make your case.
4. Would any of these suppliers be appropriate candidates for ESI? Make your case.
5. What do you think the top 3-5 supplier selection criteria would be for each purchase?