THE OEM - OBM DEBATE: FACTORS INFLUENCING CHIN ESE FIRMS' BRANDING DECISIONS IN THEIR INTERNATIONALISATION PROCESS

A key international marketing decision for many Chinese (and firms from other emerging markets) is whether to internationalise their own brands-labelled by the Chinese as OBM (Original or Own Brand Manufacturing)-or to be international players by acting as contract manufacturers(labelled by the Chinese as OEM (Original Equipment Manufacturing) for foreign brand owners(FBOs). The paper discusses some of the extant research on the advantages and disadvantages of each business model and then focuses on primary research conducted amongst 8 Chinese firms in electronics and textiles and the OEM-OBM decisions they face. In so doing, it discusses some of thefactors influencing such decisions and proposes a framework for reviewing them as firm and environmental circumstances change

Design and Prototyping of Centrifugal Pump Impeller to be used as Water Injection Pump for Hydrocarbon Artificial Lift

Execution of maintenance activities for mechanical equipment is essential in order to preserve and enhance plant and equipment reliability. It is common especially during corrective and preventive maintenance activities to replace defective or to-be defective components. Typically the replacement components are procured through the original equipment manufacturer (OEM). However, due to the long lead-time delivery imposed by the OEM, an alternative means of procuring spares with shorter lead-time delivery should be established, in order to reduce the downtime of critical equipment should extreme cases such as repetitive failure of certain components occur. This project was carried out with such objective by studying the feasibility of locally designing and manufacturing mechanical components to reduce shipping time, and adopting rapid prototyping technology into spare parts manufacturing, to reduce manufacturing time. A centrifugal pump impeller was chosen to be designed and manufactured. The data of operating requirements of the particular pump was acquired from an existing water injection module in an actual oil field. The project started with impeller numerical design, establishing the geometry in numerical terms. The methodology was then preceded by impeller modeling, resulting in a virtual three dimensional representation of the designed impeller. The virtual model was then rapidly transformed into a solid wax prototype using rapid prototyping technology. The wax prototype was then directly used as a pattern for investment casting process, resulting in solid metallic model of the impeller. The whole processes duration and costs was recorded. A costs-time benefit analysis was carried out in the latter part of the project, to study the feasibility of the approaches adopted in this project, and to compare the its practicality to that of the conventional spare parts procurement through the OEM, in terms of costs and led-time delivery. It was concluded from the analysis, that this project dramatically reduced the lead-time delivery, and radically reduced the product’s costs. In conclusion, the approaches adopted in this project (locally designing, locally manufacturing, and introducing rapid prototyping into spare parts manufacturing) are verified to be very feasible and favorable as far as the lead-time delivery and costs are concerned. This project also adds to plant and equipment reliability by reducing equipment downtime thus enabling continuation of production and plant operation

Workflow Optimization of World Micro, Inc. Quality Department

Our group member Nick is currently an intern at World Micro, which is an electronic components distributor for companies manufacturing a variety of commercial, aerospace and military products. When electrical components are purchased from the open market, they need to be traced back to the OEM (Original Equipment Manufacturer) or have a series of tests performed to verify that the parts are authentic and work. The current process time for World Micro’s quality testing and inspection is not efficient causing long lead times, extra work hours, and extra expenses in outsourcing services

The Value of Design-led Innovation in Chinese SMEs

Organised by: Cranfield UniversityThis paper focuses on understanding the role and use of design-led innovation in Chinese SMEs. The insights were gained by undertaking a pilot study, based on an applied developmental research approach involving participatory workshops, quantitative and qualitative positioning activities, in depth case studies and an individual pilot project undertaken with SMEs in the Pearl River Delta [PRD] over an 18 month period. It will discuss the findings, highlighting key areas of uncertainty that SMEs experience when attempting to make the transition from OEM to OBM, and how the findings have contributed to the development of a new design-led innovation framework.Mori Seiki – The Machine Tool Compan

What Permits Small Firms to Compete in High-Tech Industries? Inter-Organizational Knowledge Creation in the Taiwanese Computer Industry

This paper addresses a puzzle related to firm size and competition. Since Stephen Hymer´s pioneering contribution (Hymer, 1960/1976), theories of the firm implicitly assume that only large, diversified multinational enterprises can compete in industries that combine high capital intensity, high knowledge-intensity and a high degree of internationalization. Small firms, by definition, have limited resources and capabilities and are unlikely to possess substantial ownership advantages. They also have a limited capacity to influence and shape the development of markets, market structure and technological change. One would thus expect that they are ill-equipped to compete in a knowledge-intensive industry that is highly globalized. Taiwan’s experience in the computer industry tells a different story: despite the dominance of small- and medium-sized enterprises (SMEs), Taiwan successfully competes in the international market for PC-related products, key components and knowledge-intensive services. The paper inquires into how this was possible. It is argued that organizational innovations related to the creation of knowledge are of critical importance. Taiwanese computer firms were able to develop their own distinctive approach: due to their initially very narrow knowledge base, access to external sources of knowledge has been an essential prerequisite for their knowledge creation. Such “inter-organizational knowledge creation” (Nonaka and Takeuchi, 1995) was facilitated by two factors: active, yet selective and continuously adjusted industrial development policies; and a variety of linkages with large Taiwanese business groups, foreign sales and manufacturing affiliates and an early participation in international production networks established by foreign electronics companies. A novel contribution of this paper is its focus on inter-organizational knowledge creation. I first describe Taiwan´s achievements in the computer industry. The dominance of SMEs and their role as a source of flexibility is documented in part II. Part III describes some policy innovations that have shaped the process of knowledge creation. The rest of the paper inquires how inter-organizational knowledge creation has benefited from a variety of linkages with large domestic and foreign firms; I also address some industrial upgrading requirements that result from this peculiar type of knowledge creation.knowledge creation; learning; small firms; networks; firm strategy; industrial policies;

Remanufacturing and product design: designing for the 7th generation

The following is taken directly from the research report. This report investigates Design for Remanufacture in terms of both detailed product design and the business context in which Design for Remanufacture may operate. Key Study Objectives • To understand the link between design and remanufacture • To understand how Design for Remanufacture can lead to increased innovation and Sustainable Development (SD) • To identify proactive strategies to further Design for Remanufactur

Remanufacturing: a key strategy for sustainable development

Remanufacturing is a process of bringing used products to "like-new" functional state with warranty to match. It recovers a substantial proportion of the resource incorporated in a used product in its first manufacture, at low additional cost, thus reducing the price of the resulting product. The key remanufacturing problem is the ambiguity in its definition leading to paucity of knowledge and research in the process. Also, few remanufacturing tools and techniques have been developed to improve its efficiency and effectiveness. This paper addresses these issues by describing the findings of in-depth UK case studies, including, a robust remanufacturing definition and an analytic model of the generic remanufacturing business process for improving remanufacturing knowledge and expertise

Conceptualising the impact of information asymmetry on through-life cost: case study of machine tools sector

Information asymmetry (IA) in terms of contextual variety and importance is one of the most challenging aspects of through-life costing in product-service systems (PSS). IA is an imbalance in the information, data and knowledge shared among the parties involved in a contractual agreement. In manufacturing systems under PSS, interaction and effective communication among several parties who are involved in a contractual agreement, rely on the continuity and accuracy of information and context. In such systems, contextual variety exhibits complexity and uncertainty in through-life costing and subsequently in PSS cost assessment. Although the economic aspect of PSS has been studied previously, the impact of IA on through-life cost and for different PSS solutions has not been detailed. Considering manufacturing value chains, this paper introduces a new concept of PSS-hierarchy to perform through-life costing in the presence of IA for various PSS solutions. Moreover, this paper proposes a generic life-cycle model for different PSS solutions to assess the total cost of ownership (TCO). The proposed model has been developed to support decisions on contract design in manufacturing systems. This study considers the manufacturer, service provider and customer perspectives to develop the TCO model using a machine tool manufacturing case study

The Industrialisation Process of Asian Small and Medium Firms

National governments throughout the Asia-Pacific Region have identified small and medium enterprises as an important source of economic growth and employment. In the past, SME business strategies have focused on production, relying on their subcontracting and sales contacts with large firms for technological innovation and marketing and on abundant domestic labour forces for comparative advantage. Recently, structural problems in the region arising from the Japanese recession, currency appreciation and rising labour costs have upset these relationships forcing SMEs to move offshore (DFI) to restore cost competitiveness and to upgrade their internal technological and organisational capacities to international standards in order to compete for contracts within more open, international markets. This paper analyses this process of change, analysing the development of SMEs within four Asian countries using a six stage evolutionary model. The majority of SMEs in these countries are still in the earlier second (dependency) or third (internalisation) stages. The more advanced SMEs have moved into the fourth (externalisation) stage, where firms develop independent technology and marketing capacities. To the extent that localisation (stage five) had occurred, it involved local embedded relationships which had limited scope for further internationalisation. Little evidence of regional integration or networking among SMEs was found.Asia-Pacific, industrialisation process, Asian small and medium enterprises