Innova Corp

Innova Corp. designs engineering solutions and equipment for the construction and civil engineering industry worldwide. It is particularly concerned about supply problems occurring in the concrete machinery division of the company. These problems are causing a serious loss of customer confidence.

The root of the problem lies with one of products made and sold by Innova - a vibrator that is used to settle and compact newly poured concrete. These vibrators are made from a number of precision engineered components that have to withstand not only those stresses resulting from the function inherent in the task they perform, but also the frequent abuse received from the often untrained operatives using them.

One particular component, the outer casing of the vibrator, often fails because of the inadequacy of the heat treatment process used to harden it. This process is critical. Not only has the temperature to be within narrow tolerance limits, but the length of time the component is subjected to that temperature is also critical.

Comfrey is a long-established and normally very reliable company that supplies the casing to Innova. Comfrey subcontracts the specialised, low cost, heat treatment work to an independent metal engineering contractor. Aware of the problem, Comfrey has tried to source the work elsewhere, but without success. Many companies throughout the world provide heat treatment services but apparently few have the capability of meeting Innova' specific standards.

questions

- Construct the Portfolio Analysis (Kraljic Matrix) model and locate on it, the supply position between Comfrey and its subcontractor, the heat treating company. Explain your answer.

- Explain the practical steps Innova should take in an attempt to resolve its supply chain problem.