...Stryker Corporation Case Study Andrew Wyatt Brett Nymeyer Brett Sundberg Josh Ihnen Executive Summary It is 2003 and Stryker Corporation is proposing to build a new facility that would be able to produce a key component (printed circuit boards) in-house instead of outsourcing that activity to suppliers. Currently, Stryker purchases PCBs from a small number of contract manufacturers but recently the suppliers have been underperforming in quality and delivery. The proposed plan would create a high degree of control over this product, ensure quality, and create an economy of scale in the long run. However, this plan also required the most capital outlay in both money and resources. The project would have an initial investment of a new building, capital equipment, and IT infrastructure totaling $6,287,258. However, there would also be cost savings in the long run from decreased purchases from suppliers even after the increased expense of Stryker’s manufacturing costs. To find out if this project offered an adequate return on investment we performed a Net Present Value Analysis and also calculated Internal Rate of Return and Payback Period for years 2003 through 2009. Analysis 1. Does this project make sense? We like the insourcing proposal and think that it makes business sense for several reasons. However, these reasons are based off of the information taken from the case before we analyzed NPV, IRR, or Payback Period, so they are...
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...1. (1) Option #3 was for Stryker Instruments to manufacture its own PCBs in its own facility near company headquarters. (2)Benefits for option 3: ● Better control the quality, delivery and cost; ● Maintain the business stability; ● Supply PCBs to other Stryker businesses; ● Be able to implement cost shift and avoid tax; (3) Risks for option 3: ● Carry the inventory; ● Incur large capital outlay and sunk cost; ● Increase headcount, payroll and other expenditures (materials, infrastructure, R&D, maintenance, PP&E and depreciation) of Stryker; ●Bear the risk that the equipment may be outdated; (4) Compared with option #1: ●Benefit: no capital outlay; to some extent can protect future against disruptions with lower cost; flexibility; ●Risk: instability in quality, cost, delivery and responsiveness; Compared with option #2: ●Benefit: can improve quality of the supplies by increasing business with the supplier; ●Risk: the possibility of bankruptcy and weak financial performance of supplier; the sole supplier can strongly affect Stryker’s performance; coordination problem. 2. (1) Followings are the key assumptions of our write up: ● Stryker Instruments incurred all capital expenditures including (construction and improvements, furnishings and non-manufacturing equipment, communication equipment and IT infrastructure and capital equipment) in year 2003, before the implementation...
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...HARvAR D I " , srNEss I , . " Tt . W-rEr 5gor6ffi, TIMOTHY A. LUEHRMAN Stryker Corporation: In-sourci In late May 2003 executives in Stryker Corporation component of many of Stryker Instrument,s medica from a small number of contract manufacturers. more than 910 million in each of the next two Instruments business grew. In recent years, been unsatisfactory with respect to quali$ repeatedly found itself looking for new su bankruptcy, a financially weak suppl appearance of several current suppli Stryker Instruments' establish a Stryker was Stryker ucts. Currently, Stryker purchased ts had resolved to address the issue. nt basic sourcing policy for PCBs, but with important tect against future disruptions by acquiring safety stocks of rcing of all electronic assemblies. Option #2 would boost supplier of PCBs and ility for supplying them. The partnership and incriased business from the supplier, further boosting its reliability. Option #3 was for acture its own PCBs in its own facility near company headquarters in such a facility was up and running, as well. PCBs PCBs ments business anticipated spending an amount that would increase as the of some contract manufacfurers had /or responsiveness and Stryker had lly, contract manufacturers tended to were not uncommon/ and even without reliable. Given recent events and the shaky rs studied three options for improving the situation. Option #1...
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.... Cases are not intended to serve as endorsements, sources of primary data, or illustrations of effective or ineffective management. Copyright © 2007, 2008 President and Fellows of Harvard College. To order copies or request permission to reproduce materials, call 1-800-545- 7685, write Harvard Business School Publishing, Boston, MA 02163, or go to http://www.hbsp.harvard.edu. No part of this public ation may be reproduced, stored in a retrieval system, us ed in a spreadsheet, or transmitted in any form or by any meanselectronic, mechani cal, photocopying, recording, or otherwisewithout the permission of Harvard Business School. TIMOTHY A. LUEHRMAN Stryker Corporation: In-sourcing PCBs In late May 2003 executives in Stryker Corp orations Instruments business were actively considering a change in their sourcing strategy fo r printed circuit boards (PCBs), a key electronic component of many of Stryker Instruments medi cal products. Currently, Stryker purchased PCBs from a small number of contract manufacturers. The Instrument s business anticipated spending more than $10 million in each of the next two years on PCBs, an amount that would increase as the Instruments business grew. In re cent years, the performance of some contract manufacturers had been unsatisfactory with respect to quality, delivery and/or responsiveness and Stryker had repeatedly found itself looking for new suppliers. More generally, contract manufacturers tended to operate on thin margins with scant capital...
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...Harvard Case Study Stryker Corporation: Capital Budgeting Term Paper Laini Tsang Golden Gate University MS Finance, FI 312 Summer 2013 Stryker’s Capital Budgeting Harvard Case Study Table of Content Case Background and Summary Pharmaceutical Industry’s Landscape Stryker’s New CERS and why it is “painful”? Propositions Conclusions 2 Stryker’s Capital Budgeting Harvard Case Study Case Background and Summary Founded in 1941 in Michigan, Stryker Corporation is a fast-paced company with continuously exceptional growth rates. Over the last 27 years, the company historically increased revenues by 20%. The company’s culture prides itself on service ethics, integrity, innovations, accountability, and customer relationships; it is one of the world’s leading medical technology companies with history of successful stories. Stryker’s products focus on implants for joint replacement, trauma, spinal surgical products, neurologic and endoscopic equipment. The company has well diversified product portfolios with solid fundamentals. Over the years, the company’s accretive mergers and acquisitions brought operational synergies and cost efficiency, strengthening the pipeline with increasing profitability. This paper examines Stryker’s capital budgeting process (CER – Capital Expense Request) and why this process, after its modifications in 2005, had slowed down the company’s internal capital project requests. From the company’s financials, we can see their capital...
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...Case Study of Stryker Corporation 1. (1) Option #3 was for Stryker Instruments to manufacture its own PCBs in its own facility near company headquarters. (2)Benefits for option 3: ● Better control the quality, delivery and cost; ● Maintain the business stability; ● Supply PCBs to other Stryker businesses; ● Be able to implement cost shift and avoid tax; (3) Risks for option 3: ● Carry the inventory; ● Incur large capital outlay and sunk cost; ● Increase headcount, payroll and other expenditures (materials, infrastructure, R&D, maintenance, PP&E and depreciation) of Stryker; ●Bear the risk that the equipment may be outdated; (4) Compared with option #1: ●Benefit: no capital outlay; to some extent can protect future against disruptions with lower cost; flexibility; ●Risk: instability in quality, cost, delivery and responsiveness; Compared with option #2: ●Benefit: can improve quality of the supplies by increasing business with the supplier; ●Risk: the possibility of bankruptcy and weak financial performance of supplier; the sole supplier can strongly affect Stryker’s performance; coordination problem. 2. (1) Followings are the key assumptions of our write up: ● Stryker Instruments incurred all capital expenditures including (construction and improvements, furnishings and non-manufacturing equipment, communication equipment and IT infrastructure and capital equipment)...
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...Stryker corp case study Stryker choose to manufacture its own PCB in its own facility. ... cash flows for the PCB project, as well as its NPV, IRR, and payback period. ... Option #2 was to establish a partnership with one single company, which was one of . In 2003, the Stryker Corporation is contemplating a change in their sourcing strategy for printed circuit boards (PCBs), which are used in many of their instruments. Recently, Stryker's suppliers of PCBs have become less reliable. They want to eliminate this problem by building a PCB production facility and produce the boards in house. In other words, they want to in-source the production of PCBs. This would give the company a great control over the quality of their boards. This proposal will require a total capital outlay of $6,287,258. This includes $3,030,000 for building construction, $278,000 for architectural and engineering fees, $336,000 for furnishings and IT infrastructure, and $2,643,258 for equipment. Once this facility was up and running, Stryker would transition out of buying from suppliers into complete in house production. There will be savings from not having to pay suppliers, and an increase in manufacturing cost. In the long run, the savings will be greater than the increase in manufacturing costs. In order to figure out if this proposal makes financial sense, I calculated the Net Present Value, Internal Rate of Return, and the Payback Period for the years 2003 through 2009. So what...
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...Group Behaviour in Orgnisations PGDC 102 Prof. B K Mohanty, Asst. Prof. Amaresh C Nayak This course is designed to help the students to understand why employees behave the way they do and also there by predict how they are going to behave in the future. It is the study of how people think, feel and act in the organisational setting. Prediction and understanding of the behavior of employees as an Individual and in Groups. K. Aswathappa, Organisational Behaviour Stephen P. Robbins, Organizational Behavior. Trimester Credits : 1st :3 Learning Outcome: Text Book: Text Books are only indicative and not subjective and also not a limiting exercise. Being the Post Graduate Students you are required to refer to the online and offline journals. Besides you should also refer to other publications (Journals and Magazines) and books on the subject. Evaluation: Case Studies Current Issues Quiz / Surprise Test Mid Term Class Attendance End Term : : : : : : 15 Points 10 Points 10 Points 10 Points. 05 Points. 50 Points. Case Studies: This would involve the Groups of students taking up a case assigned to them for analysis and Presentation in the class. Besides, students need to produce the Individual analysis in writing of two cases for their evaluation as instructed by the course instructor. Current Issues: This would involve the Groups of students taking up an issue assigned to them. They are required to formulate the solutions to the issues with the help of theories and concepts they...
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...Global Human Resource Management Learning Objectives After studying this chapter, you should be able to: Describe the drivers behind globalization in the early 21st century. Discuss the role that culture plays in determining the effective use of human resource management practices in a global organization. Identify critical HRM issues faced by multinational and global organizations when they conduct business in the international marketplace. Internet/Web Resources General Sites www.expatexchange.com www.ilo.org www.odei.gov/cia/publications/factbook/ index.html www.mexicomaquila.com www.gmacglobalrelocation.com www.shrm.org globalgateway.monster.com Company Sites www.globaldynamics.com www.nortel.com www.bp.com www.dell.com www.ballygaming.com www.nestle.com www.unilever.com www.fiat.com www.volvo.com Career Challenge Chapter 4 Global Human Resource Management 97 Boswell Technologies is a computer software development firm located in Akron, Ohio. Michael Carl, vice president for human resources at Boswell Technologies, has just returned from San Benedetto, Italy. It seems that Boswell is soon going to become Boswell International. The company has just acquired a successful software firm located in San Benedetto. The purpose of the acquisition was to quickly allow Boswell to become a premier supplier of new and innovative computer software in Europe. On his first day back in Ohio, Michael has been called into the office of Boswell’s president, David Randolf, to give...
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...The Journal of Neuroscience, March 24, 2010 • 30(12):4467– 4480 • 4467 Development/Plasticity/Repair Demonstration of a Neural Circuit Critical for Imprinting Behavior in Chicks Tomoharu Nakamori,1,3 Katsushige Sato,2,4 Yasuro Atoji,5 Tomoyuki Kanamatsu,6 Kohichi Tanaka,1 and Hiroko Ohki-Hamazaki1,3,7 1 Laboratory of Molecular Neuroscience, School of Biomedical Science and Medical Research Institute and 2Department of Physiology and Cell Biology, Faculty of Medicine, Graduate School, Tokyo Medical and Dental University, Bunkyo-ku, Tokyo 113-8519, Japan, 3Division of Biology, College of Liberal Arts and Sciences, Kitasato University, Sagamihara, Kanagawa 228-8555, Japan, 4Department of Health and Nutrition Sciences, Faculty of Human Health, Komazawa Women’s University, Inagi-shi, Tokyo 206-8511, Japan, 5Laboratory of Veterinary Anatomy, Faculty of Applied Biological Sciences, Gifu University, Gifu 501-1193, Japan, 6Department of Environmental Engineering for Symbiosis, Faculty of Engineering, Soka University, Hachioji, Tokyo 192-8577, Japan, and 7Recognition and Formation, Precursory Research for Embryonic Science and Technology, Japan Science and Technology Agency, Kawaguchi, Saitama 332-0012, Japan Imprinting behavior in birds is elicited by visual and/or auditory cues. It has been demonstrated previously that visual cues are recognized and processed in the visual Wulst (VW), and imprinting memory is stored in the intermediate medial mesopallium (IMM) of...
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...A CORPORATE PROFILE About Food & Water Watch Food & Water Watch works to ensure the food, water and fish we consume is safe, accessible and sustainable. So we can all enjoy and trust in what we eat and drink, we help people take charge of where their food comes from, keep clean, affordable, public tap water flowing freely to our homes, protect the environmental quality of oceans, force government to do its job protecting citizens, and educate about the importance of keeping shared resources under public control. Food & Water Watch 1616 P St. NW, Ste. 300 Washington, DC 20036 tel: (202) 683-2500 fax: (202) 683-2501 info@fwwatch.org California Office 25 Stillman St., Ste. 200 San Francisco, CA 94107 tel: (415) 293-9900 fax: (415) 293-8394 info-ca@fwwatch.org www.foodandwaterwatch.org Copyright © 2013 by Food & Water Watch. All rights reserved. This report can be viewed or downloaded at www.foodandwaterwatch.org. A CORPORATE PROFILE Executive Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Company History . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Modern-Day Monsanto . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Monsanto’s Environmental Impact . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Market Share . . . . . . . . . . ....
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...the accuracy of the information. In addition, the discussion and examples presented in this paper are for educational purposes. They are not to be viewed as an authoritative statement by the Society of Actuaries or Ernst & Young LLP on the quality and/or appropriateness of an individual company’s practices or an indicator of “better” practice from one company relative to another. © 2013 Society of Actuaries, All Rights Reserved Acknowledgments We would like to acknowledge and thank a number of individuals who contributed to the success of this study: • Ronora Stryker and Jan Schuh from the Society of Actuaries for providing leadership and coordination The Project Oversight Group for guidance throughout this project: • Robert Baldwin • Mark Bergstrom • Jim Bridgeman • Joonghee Huh • Kathryn McCarthy (Chair) • James Norman • Jim Reiskytl • Doug Van Dam The companies that volunteered to be interviewed anonymously for this study Other members of the Ernst & Young team who contributed in various capacities: • Rob Barg • Zak Benjazia • Michael Chan • Cathy Fan • Tara Hansen • Graham Mackay • David Minches • Jordan Nadler • Xi Zhu • • • How Fair Value Measurement Changes Risk Management Behavior in the Insurance Industry 2 Table of Contents I. II. III. IV. IV.A. IV.B. IV.C. IV.D. IV.E. Executive...
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...Randel, Gangaram Singh Institute for Inclusiveness and Diversity in Organizations, Department of Management, College of Business Administration, San Diego State University, 5500 Campanile Drive, San Diego, CA 92182, USA a r t i c l e i n f o Keywords: Diversity Inclusiveness a b s t r a c t A great deal of research has focused on workforce diversity. Despite an increasing number of studies, few consistent conclusions have yet to be reached about the antecedents and outcomes of diversity. Likewise, research on different dimensions of diversity (e.g., age, race, gender, sexual orientation, disability, and culture) has mostly evolved independently. Therefore, the purpose of this review is to examine each of these dimensions of diversity to describe common themes across dimensions and to develop an integrative model of diversity. © 2008 Elsevier Inc. All rights reserved. While the term “workforce diversity” is commonly used in scholarly articles as well as in the popular press, the focus and scope of the research is both varied and broad. Until recently, most studies have focused on a single dimension of diversity (e.g., age, sex, race) in a domestic, typically U.S. context. In a world of globalization populated by boundaryless and virtual organizations, it is time to revisit the old theories of diversity and to create a new set of paradigms. Therefore, in this article we examine multiple dimensions of diversity to assess the current status of the...
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...ANNUAL REPORt 2011 Johnson & Johnson will continue to bring meaningful innovations to people around the world so they can live better and healthier lives. We are deeply committed and dedicated to the people who use our products, our employees, the communities in which we live and work, and you, our shareholders. Most important, we will never lose sight of who we are. ON tHE COVER Matt Cox, who has type 1 diabetes and uses the waterproof ANIMAS® VIBE™ insulin pump, swam an English Channel relay to raise money for the Juvenile Diabetes Research Foundation. Matt wants to show his son, Jack, who also has type 1 diabetes, that the condition need not hold him back in life. Read Matt’s story on page 16. CHAIRMAN’S LETTER To Our Shareholders hroughout our annual report this year, you’ll read the severe economic decline; the tightening of consumer about how Johnson & Johnson is bringing meaningful spending and health care budgets; over-the-counter (OTC) innovation to our patients and customers, and making product quality issues at McNeil Consumer Healthcare and a difference in their lives in a personal way—from the recall of the DePuy ASR™ Hip System. Brunhilde Wecker, who made a full recovery from her stroke Our company was severely tested. thanks to our new blood clot retrieval and removal device, In managing through this stretch, we relied heavily on the resolve to our own Bill Hait, an oncologist whose vision and insights of our people and on our time-tested business...
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...THE INTELLIGENT INVESTOR A BOOK OF PRACTICAL COUNSEL REVISED EDITION B E NJAM I N G RAHAM Updated with New Commentary by Jason Zweig To E.M.G. Through chances various, through all vicissitudes, we make our way. . . . Aeneid Contents Epigraph iii Preface to the Fourth Edition, by Warren E. Buffett viii A Note About Benjamin Graham, by Jason Zweig x Introduction: What This Book Expects to Accomplish COMMENTARY ON THE INTRODUCTION 1. 1 12 35 The Investor and Inflation 47 COMMENTARY ON CHAPTER 2 3. 18 COMMENTARY ON CHAPTER 1 2. Investment versus Speculation: Results to Be Expected by the Intelligent Investor 58 65 COMMENTARY ON CHAPTER 3 4. A Century of Stock-Market History: The Level of Stock Prices in Early 1972 80 General Portfolio Policy: The Defensive Investor 88 COMMENTARY ON CHAPTER 4 5. 101 124 Portfolio Policy for the Enterprising Investor: Negative Approach 133 COMMENTARY ON CHAPTER 6 7. 112 COMMENTARY ON CHAPTER 5 6. The Defensive Investor and Common Stocks 145 iv 155 COMMENTARY ON CHAPTER 7 8. Portfolio Policy for the Enterprising Investor: The Positive Side 179 The Investor and Market Fluctuations 188 v Contents COMMENTARY ON CHAPTER 8 9. Investing in Investment Funds COMMENTARY ON CHAPTER 9 213 226 242 10. The Investor and His Advisers 257 COMMENTARY ON CHAPTER 10 272 11. Security...
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