Quick Chips INC

Quick Chips $($QC$)$ is a joint venture of five competing manufacturers of semiconductor chips used primarily in the production of smartphone and tablet technologies. Essentially, QC provides a full$-$range of e$-$commerce and fulfillment services that help to meet customer demands for increasingly faster turnaround times for these very expensive chips. Although the concept of collaborating with competitors is relatively unique to manufacturers of semiconductor chips, it is not unusual for QC to provide supply chain services to common customers of its members.

CHANGES AND EVOLUTION OF MOBILE TECHNOLOGIES. Recent years have seen expectational growth in the demand for smartphone and tablet technologies, and for apps that require an increasing range of chip types and capabilities that support functions of mobile devices such as user interface, texting, gaming, GPS$,$ and other highly interactive capabilities. This has resulted in a robust group of highly competitive companies that produce these devices in a few principal geographic regions of the world including Asia, South America, and Eastern Europe. Considering the need for more expensive, sophisticated chip technologies, these manufacturers have begun to place more emphasis on faster delivery times from their suppliers than on stockpiling inventories of chips to buffer against volatility in demand.

CONCEPT AND CAPABILITIES OF QUICK CHIPS. Three structural components comprise QC$\text{'}$s range of value$-$added services for its member manufacturers: $(1)$ Web site housing, $(2)$ supply chain, and $(3)$ logistical fulfillment. QC is a different kind of company in that it does not own, plan, release, or insure any inventory, and does not sell directly to the manufacturers of mobile devices only its member$-$manufacturers do$.$ These members provide QC instructions as to what to move and when, and then QC provides a turnkey fulfillment service to see that customers receive the needed chips when and where they are needed. Although the executive offices of QC are located in Singapore, distribution centers with foreign trade zone status are located in Shenzhen, China; Sao Paulo, Brazil, and Prague, Czech Republic.

QC also provides its members manufacturers with e$-$commerce capabilities through its web$-$hosting services that passes transaction data from customers to the chip manufacturers, using a standardized data format. This "common gateway" for the transfer of information facilities the operations of the member$-$manufacturers and also for the customer firms that manufacture the mobile technologies.

ORGANIZATION AND MEMBERSHIP. QC is not$-$for$-$profit organization that provides the type of services described earlier. Membership in the joint$-$venture is open to other chip manufacturers who must undergo a formal application process, pay a membership fee, and agree to use the services of QC for their shipments to customers. All members have full$-$access to the capabilities available at QC$,$ and are assessed fees on a pro$-$rata basis to cover all the costs of the QC operation.

CASE QUESTIONS:

$1.$ Describe the elements of the value proposition for the member$-$manufacturers of Quick Chips. What would be the elements of the value proposition for the mobile technology manufacturers that are served directly by QC$?$

$2.$ Identify some of the major sources of savings for member$-$manufacturers of Quick Chips?

$3.$ To facilitate the success of this joint$-$venture, what are some of the ways in which the mobile technology manufacturers should collaborate with QC and its members?