Map and explain a position in the PC supply chain

Abstract

Background Supply chains in low margin, high innovation speed industries with
strong customers generate a highly competitive environment. The
conditions for such environment are continuously changing and put
high demands on its actors.
FlatFrog is a case company, which was founded in 2007 and
develops a unique touch technology targeting a wide range of
screens sizes and applications. External capital from Intel capital,
among others, has enabled FlatFrog to aim for integrating their touch
solution in the PC market. In order to be able to enter this low
margin, highly competitive market, FlatFrog wants to analyze the
alternative business models available, e.g. uses a licensing model or
taking full product ownership and the risk of initial investments in
terms of material and production facilities. The PC value chain and
supply chain are tense and there is no space for decreasing economic
margins in exchange for additional features. The result is highly
competitive environment, which is extremely hard for new actors to
enter. Hence, FlatFrog has an interest in investigating their initial
position in the supply chain and which possible solutions there are in
order to gain good profitability.
IV
Purpose The purpose of this thesis is to map and explain FlatFrog´s position
in the PC touch supply chain and how it implies corresponding ways
of making business and enter the market. By research create an
understanding of the market, its actors and characteristics.
Method In this thesis, a combination of the system approach and the actors
approach was used as scientific approach. The data was collected by
interviews, observations, focus groups, a literature review and
continuous market research. The analysis was approached by an
inductive approach where real life observations, by participating in
meetings and studies of the latest trends in the consumer electric
market, has been adopted after suitable models and accepted
research to create a trustworthy analysis.
Conclusion The choice of business model and supply chain set up not only
should consider the characteristics of the specific company. It
should also be based on the conditions of the market and the
improvement of competition. The choice of model should always be
challenged since these conditions continuously are changing. From a
theoretical standpoint, a license model would be the optimal choice
due to less risk and a fast market entrance. After increased insights
and experience of the market and its supply chain it may not be
realizable because of the characteristics of the market. Operational
reality will always beat best theoretical strategy and a product owner
model could even be a requirement to enter the market. Even if it
not may result in short term profitability, future benefits generated
by greater control could be enjoyed. Hence, it is difficult to
determine the most optimal business model and supply chain set up
for a specific company. It is in large extent dependent of the current
status and agility of the market which will change over time.

• author: Dahlgren, Johan and Samuelsson, Tobias
• supervisor: Bertil Nilsson
• organization: Production Management
• course: MIO920
• year: 2013
• type: M1 - University Diploma
• subject: Technology and Engineering
• keywords: Business Development, Supply Chain Mapping, Supply Chain Enablement
• other publication id: 13/5466
• language: English
• id: 4024528
• date added to LUP: 2013-09-13 15:35:47
• date last changed: 2013-09-13 15:35:47