Harvard Case - Flextronics: Deciding on a Shop Floor System for Producing the Microsoft Xbox
"Flextronics: Deciding on a Shop Floor System for Producing the Microsoft Xbox" Harvard business case study is written by Jeffrey T. Polzer, Alison Berkley Wagonfeld. It deals with the challenges in the field of Organizational Behavior. The case study is 20 page(s) long and it was first published on : Feb 12, 2003
At Fern Fort University, we recommend Flextronics adopt a hybrid shop floor system that leverages the strengths of both the existing legacy system and the new SAP system. This approach will allow for a smoother transition, minimize disruption to production, and enable Flextronics to capitalize on the benefits of both systems.
2. Background
This case study focuses on Flextronics, a leading electronics manufacturing services (EMS) provider, facing a critical decision: which shop floor system to implement for the production of the Microsoft Xbox. Flextronics is currently using a legacy system that is outdated and inefficient, while a new SAP system offers advanced features but requires significant implementation costs and risks.
The main protagonists are:
- David Hill, Flextronics' Vice President of Operations, responsible for making the final decision.
- John Smith, the Plant Manager, advocating for the new SAP system.
- Mary Jones, the IT Manager, concerned about the risks and complexities of implementing the new system.
3. Analysis of the Case Study
This case study can be analyzed through the lens of organizational change management, highlighting the interplay of leadership styles, organizational culture, and team dynamics in decision-making.
Leadership Styles: David Hill, the decision-maker, faces the challenge of balancing the needs of different stakeholders with conflicting perspectives. He needs to employ a transformational leadership style, inspiring and motivating the team while navigating the complexities of change.
Organizational Culture: Flextronics' existing culture appears resistant to change, as evidenced by the reluctance to embrace the new SAP system. This resistance stems from organizational inertia, a common phenomenon where established routines and processes are hard to disrupt.
Team Dynamics: The case highlights the conflict between John Smith, advocating for the new system, and Mary Jones, concerned about the risks. This conflict reflects the power and politics within the organization, where different departments and individuals hold different perspectives and priorities.
Decision-Making Processes: Flextronics needs to implement a structured decision-making process that considers both the quantitative (cost-benefit analysis) and qualitative (impact on operations, employee morale) aspects of the decision.
Motivation Theories: Understanding motivation theories can help Flextronics address the resistance to change. By applying intrinsic motivation strategies, such as providing employees with opportunities for growth and development, and extrinsic motivation strategies, such as offering incentives for adopting the new system, Flextronics can encourage employee buy-in.
4. Recommendations
Hybrid System Implementation:
- Phase 1: Implement the SAP system for specific, high-impact areas, such as inventory management and production planning, while maintaining the legacy system for other areas.
- Phase 2: Gradually transition to the SAP system for additional areas, ensuring a smooth and controlled process.
- Phase 3: Once fully implemented, decommission the legacy system.
Change Management Strategies:
- Communication: Communicate the rationale for the change, benefits of the new system, and the implementation plan clearly and transparently to all stakeholders.
- Training: Provide comprehensive training on the new system for all employees, including hands-on workshops and ongoing support.
- Employee Engagement: Encourage employee feedback and participation in the implementation process.
- Incentives: Offer incentives for employees who successfully adopt the new system.
- Leadership Support: Ensure strong leadership support for the change, with clear communication and visible commitment from executives.
Team Building:
- Cross-functional teams: Form cross-functional teams to manage the implementation, ensuring collaboration and knowledge sharing between departments.
- Conflict Resolution: Establish clear conflict resolution mechanisms to address disagreements and ensure a collaborative environment.
- Team Building Activities: Foster a sense of team spirit and collaboration through team building activities.
5. Basis of Recommendations
This recommendation considers:
- Core competencies and consistency with mission: The hybrid system leverages Flextronics' existing expertise while incorporating the new system's capabilities, aligning with its mission to provide efficient and innovative manufacturing solutions.
- External customers and internal clients: The hybrid system minimizes disruption to production, ensuring timely delivery of products to customers and minimizing operational disruptions for internal clients.
- Competitors: Implementing the new system enhances Flextronics' competitiveness by improving efficiency and responsiveness, allowing it to stay ahead of competitors.
- Attractiveness ' quantitative measures: The hybrid system balances the cost-effectiveness of the legacy system with the efficiency gains of the new system, offering a cost-effective solution.
6. Conclusion
By adopting a hybrid system and implementing robust change management strategies, Flextronics can effectively manage the transition to a new shop floor system, minimizing disruption while maximizing the benefits of both systems. This approach will enable Flextronics to remain competitive and meet the demands of its customers.
7. Discussion
Other Alternatives:
- Full implementation of the SAP system: This approach offers the full benefits of the new system but carries higher risks and costs.
- Maintaining the legacy system: This option minimizes disruption but risks falling behind competitors in terms of efficiency and innovation.
Risks and Key Assumptions:
- Resistance to change: The success of the hybrid system depends on overcoming employee resistance to change through effective communication, training, and incentives.
- Implementation challenges: The implementation of the new system may encounter unforeseen challenges and delays, which require careful planning and contingency measures.
8. Next Steps
Timeline with Key Milestones:
- Phase 1 (3 months): Pilot implementation of the SAP system for selected areas, training and communication initiatives.
- Phase 2 (6 months): Gradual expansion of the SAP system, continuous monitoring and adjustments.
- Phase 3 (3 months): Full implementation of the SAP system, decommissioning of the legacy system, ongoing support and optimization.
This approach allows Flextronics to manage the change process effectively, minimizing disruption and maximizing the benefits of both systems. By fostering a culture of collaboration and innovation, Flextronics can ensure a successful transition and maintain its position as a leading EMS provider.
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Case Description
Jim McCusker must guide a group decision-making process aimed at getting input and buy-in from key people in California, Mexico, and Austria to choose a shop floor IT system for Flextronics. McCusker is Flextronics' account manager for the Microsoft Xbox project. Geographical distance and time pressure make it difficult for all the relevant parties to assemble in person in one location. In a company culture that values fast, decisive action, McCusker wonders whether he has the authority to make the decision himself and, if not, how he should involve the other parties who are keenly interested in the outcome.
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