Medicom: Building A Resilient Supply Chain
Fraser Johnson, HBA ’82, MBA ’92, PhD ’95, Professor, Operations Management (with Ramasastry Chandrasekhar)
Throughout the pandemic, there have been shortages of almost everything, from paper products to computer chips, as a result of rising demand and reduced capacity in supply chains during the COVID-19 pandemic.
Fraser Johnson’s Medicom case explores the operational and strategic trade-offs in developing a strategy aimed at improving supply chain resiliency. The context is disruption to the supply of personal protective equipment (PPE) due to shortage of a critical raw material, which put lives at risk during the pandemic. It details how the Chief Operating Officer at Medicom Group (Medicom) evaluated a potential investment in a new facility to manufacture melt-blown polypropylene, a key raw material for surgical and respirator masks.
Johnson says the case allows the instructor to guide class discussion involving the analysis of the financial, operational, and strategic implications of insourcing production of a key raw material.
“It helps students understand the implications of investing in capacity for a capital-intensive business and to assess supply chain risks. The case also helps to highlight the pros and cons of vertical integration,” he said.
Since managing supply chains and suppliers is essential for any successful leader in any organization, Johnson said the lessons help students to build their business acumen.
“Students will see different economic cycles during their careers and need to assess opportunities as the competitive business environment changes. Developing the ability to identify opportunities and implement new strategies is essential for students,” he said.