Lecture 11

Question 1

Corporate accelerators

Answer 1

• a subset of startup programs

- offers cohorts of startups, mentoring, educations, access to specific resources, funding

Question 2

key elements of Startup supplier programs & CA

Answer 2

• short term
• engage startup in a joint project
• provide mentors from top management

Question 3

strategic scope CA

Answer 3

objective: pursue multiple goals
value proposition: establish a business, develop a business model, funding, access to corporate resources, mentoring
type: early stage

Question 4

strategic scope startup supplier programs

Answer 4

objective: integrate entrepreneurial innovations into the corporate’s core business
value proposition: become an official supplier
type: mid/later stage

Question 5

program content CA

Answer 5

• focus: development of first prototype
• application procedure: cohorts, application dates
• duration: 3-6 months
• organizational setup: internal with other established firms, or with a professional provider
• number of startups: limited to the # of relationships managers
• main contact: innovation manager
• end of program: demo day with a pitch in front of VC

Question 6

program content startup supplier programs

Answer 6

• focus: customization of technology
• application procedure: continuous
• duration: flexible 1-6months
• organizational setup: internal
• number of startups: unlimited
• main contact: manager from core business
• end of program: pitch in front of decision makers from BU

Question 7

provided resources CA

Answer 7

• financial: fixed amount of money
• education: startup related
• networking: internally within corporate, externally with alumni
• product related: prototyping facilities, co working, space

Question 8

provided resources startup supplier programs

Answer 8

• financial: flexible payments
• education: corporate related
• networking: decision makers in customer business units
• product related: testing and production facilities

Question 9

stage gate process advantages

Answer 9

• overview of innovation and product development portfolio
• help managers to rank projects
• reduce risk of putting too many resources into wrong projects

Question 10

4 stages and 3 gates

Answer 10

stage 1: identification 
gate 1: pre selection 
stage 2: internal matchmaking 
gate 2: market fit 
stage 3: pilot project 
gate 3: pilot evaluation 
stage 4: transfer into the new supply base

Question 11

stage 1 identification

Answer 11

• identify promising startups
• two strategies:
  1. screen the market for suitable startups
  2. invite to submit innovation proposals

Question 12

gate 1: pre selection

Answer 12

• sort out startups that do not meet the requirements

- after assessing the skills of a startup the focus shifts to the technology it offers

Question 13

stage 2: internal matchmaking

Answer 13

• connect startups with a division

- common issue: gap between startups units and actual customer

Question 14

gate 2: market fit

Answer 14

• evaluate whether startup represents a viable business case
• those that manage to convince at least one BU go on to the next stage

Question 15

stage 3 pilot project

Answer 15

• customize technology to customer requirements

- reduce information asymmetries since it is an opportunity to assess a startup capabilities directly

Question 16

gate 3 pilot evaluation

Answer 16

if the pilot is successful they source the startup to start a new product development project

Question 17

stage 4 transfer into the new supply base

Answer 17

• transition stage
• supplier collaboration moves to the standard processes used for established suppliers
• two paths:
  1. directly initiate the sourcing process
  2. collaborate on follow up product development project which may result in sourcing

Question 18

implications

Answer 18

• integrating different internal startup activities
• preparing purchasing for its new role
• fostering exchange with external entrepreneurial ecosystems

Question 19

integrating different internal startup activities

Answer 19

complement, integrate and reinforce startup engagement and collaboration models

Question 20

preparing purchasing for its new role

Answer 20

effective measure to ensure established firms will not become late majority customers by involving purchasing into startup collaborations

Question 21

fostering exchange with external entrepreneurial ecosystems

Answer 21

improve firms visibility to external startup ecosystems and help firms to participate and exchange more actively with the most important players

Question 22

hybrid structure

Answer 22

mix of centralized and decentralized structure

Question 23

corporate procurement officer

Answer 23

senior executive responsible for the management and co-ordination of key purchasing and supply processes throughout the corporate organization

Question 24

purchasing as an operational activity

Answer 24

purchasing department low in the hierarchy

Question 25

purchasing as a competitive factor

Answer 25

purchasing department high in the hierarchy

Question 26

levels of task, responsibilities, and authority

Answer 26

- strategic - tactical - operational

Question 27

strategic level

Answer 27

- purchasing decisions that influence the market position of the company in the long run

Question 28

tactical level

Answer 28

involvement of the purchasing function affecting product, process and supplier selection medium term impact cross functional

Question 29

operational level

Answer 29

- all activities related to the ordering and expediting function - related to the requisition to pay process

Question 30

organizational structures within purchasing

Answer 30

- centralized - decentralized - hybrid - line/staff organization - category/sourcing structure

Question 31

centralized

Answer 31

advantage - better conditions from suppliers can be achieved - facilitate efforts towards product and supplier standardization disadvantages - management of individual business units has limited responsibility for decisions on purchasing appropriate when several business units buy the same product

Question 32

decentralized

Answer 32

- all BU managers are responsible for their financial results of their purchasing activities - disadvantage: different BU may negotiate with the same suppliers for the same product

Question 33

hybrid structure

Answer 33

``` efforts aimed at combining common materials requirements among two or more operating units - major characteristics voluntary co-ordination lead buyer ship lead design concept ```

Question 34

line/staff organization

Answer 34

may serve as a vehicle to facilitate co-ordination issues between divisions or business units mainly for very large international companies

Question 35

category/sourcing structure

Answer 35

- common among large international companies - purchasing components organized through divisional global procurement executives - key factors to improve global sourcing: 1. strong leadership 2. active involvement of management 3. formalized supplier management 4. corporate commodity plans 5. cross functional teams 6. standardization of logistics and delivery processes

Question 36

category sourcing managers

Answer 36

lead the global sourcing teams that are responsible for developing and executing the company's product related and non related spend categories

Question 37

Corporate buyers

Answer 37

focused on very specialized tasks | responsible for developing corporate sourcing strategies for key commodities

Question 38

purchasing engineers

Answer 38

working at a decentralized level

Question 39

project buyers

Answer 39

deal with investment goods

Question 40

materials planner

Answer 40

responsible for materials planning and ordering | manage inventory and monitor control suppliers on their quality and delivery performance

Question 41

NPR buyers

Answer 41

responsible for buying non-product related goods and services

Question 42

factors determining the optimal organizational form at the organizational level

Answer 42

- demand specifications (similarity --> centralization) - supply market characteristics (globalization --> centralization) - corporate coherence (coherence --> centralization) - purchasing maturity (maturity --> hybrid) - competitive strategy (cost focus --> centralization)

Question 43

advantages of decentralized purchasing

Answer 43

- direct responsibility of operating companies - stronger orientation towards internal and external customer - less bureaucratic procedures - less friction costs - direct communication with suppliers

Question 44

disadvantages of decentralized purchasing

Answer 44

- dispersed purchasing power - no uniform way of handling suppliers - scattered supply market research - limited possibilities for building up specific expertise on purchasing - different purchasing conditions