Purchases Report Western Digital Company

Question: Discuss about thePurchases Reportfor Western Digital Company. Answer: Introduction The report shows how the company plans its product supply chain and what quality factors are responsible for the selection of the suppliers. Western Digital Company is an American company established in the year 1970 with the objective of manufacturing the storage devices for recording digital information. Initially the company was named as General Digital when the major product was semiconductor chips for the calculator market. Soon it became one of the largest manufacturers of hard disk drives in the world after which the name was changed as Western Digital Company. Today the major brand products include the name of WD and HGST. The product lines vary from mobile digital technology, stand alone personal computers, the internal and external storage devices, and the video recording techniques. Its Chief Executive Officer, Stephen D. Milligan, announced that the company has advanced after the merger with HGST as the portfolio range and the geographic range has expanded.(Milligan, n.d.) The major products of Western Digital Company today include Head-Disc-Assembly and a Printed Circuit Board Assembly. The company has its own designing and manufacturing wing which is substantially involved in producing the magnetic heads and media for the products. Thus, the company is self- reliant to some extent and does not prefer the benefits of technology advancements by other manufacturers. (Corporation, 1991) The company employs over 3000 people for the designing and manufacturing work and has a worldwide retail chain mechanism covering U.S., Canada, Europe, Israel, Japan and Australia. Currently the wide range of products includes over 150 products having their reach in more than 30 countries. It majorly serves the requirements of some of the large clients like ATT, Hewlett-Packard, IBM, Xerox, DEC and Motorola.(Corporation, 1991) The report wishes to cover the basic outline of product chain management and the supply chain management and to describe the efficiency level at which the company is working. Supplier Selection Criteria and Issues One of the major products of the company is Head Disk Assembly. The Head Disk Assembly is made up of four parts i.e. the heads, magnetic media, actuator which is used for head positioning and the spindle motor. The Disk is made with layers of magnetic materials. It has a smooth surface on which the layers are positioned. A spindly hub rotates the disk which is surrounded by one or more disks to package the disk-pack assembly. Each disk has an elevated surface which makes it able to acknowledge the data. The data is available at the spinning disk from where the elevated surfaced read and write it. Pre-amps and voice coil magnets are also used for the product. The other major product is Printed Circuit Board Assembly. It consists of three parts i.e. the integrated circuits, a power connector and an interface connector. Both standard and custom integrated circuits are used. The interface connector is used to connect to the host computer and received the instructions. A controller is used to direct the data and provide direction to the data flow and control the heads. The controller is used to read and write data received from the host computer on the basis of logical track and sector locations. (Corp, n.d.) While the above components are manufactured by the companys own designing and manufacturing department, the company can be called self reliant on this basis. However, there are a wide range of other products as well which require the networks from leading suppliers in the market to serve the purpose. The important such components include the parts required for manufacture of SSDs which are NAND semiconductor and SoC. These parts are purchased from the external suppliers. The NAND manufacturers are the companys supply partners for these components. The deep relationships with the supplier made it possible for the company to continuously serve the SSD market with its quality products. Further, the controller which is an important component for the major products is also acquired from the third party. The company aspires to widen its relationships with other suppliers to make a mark in the field of media market with it continuous supply of quality products. (Corp, n.d.) The selection criteria of the company includes adherence to the goals of the company according to the EICC code of conduct. The company has a supply chain management mechanism which provides training and guidance to the suppliers so that they can comply with the code of conduct rules. The other parameters of a trained supply mechanism include supplier site audits, business review and process training to first-tier suppliers. The company has a policy for conflict free minerals which means that the company outlooks the area of sustainable business goals ensuring the proper and efficient usage of conflict minerals. Further, the company is covered within the ambit of California Transparency in Supply Chains Act which requires it to fully disclose the companys workings so that the direct supply chains are not misused. The company fully adheres to the SB657 requirement of the act and fulfills the criteria for auditing, various certifications, verification and training.(WDC, n.d.) ICT for Purchasing Operations The information and Communications technology is an important tool for rapid development. Many developing countries like India, Philippines etc. are spreading their hands to welcome the advancements of communications technology to nail a name in the success books of world. The uses are of ICT are ever expanding. The major uses can be the increased access to the markets, cost reductions, efficient work, and high competitiveness, increased used to advanced technology to enter global markets, increased training of personnel for highly skilled performance etc. ICT is not about the use of computers and internet only. The World Summit on Information Society calls for division of ICT into two broad categories. First are the traditional communication devices which form the core of every business today. The internet is the biggest component of this area. Internet makes on-demand communications possible and tailor made customer services which enhances the customer satisfaction and service provision criteria. However, it still needs human intervention to a big extent. The processing of data, it usage and customization is totally dependent on human work. Second are the ICT applications which are human independent resources. The sensor based networks used for climate control in buildings or sensor networks used for detection of malarial virus detection are the good examples. These applications work on the basis of some preset formulas and guidelines which does not require further human intervention. Thus, ICT and its uses are expanding majorly toda y by providing a number of services like e-commerce, e-governance etc. The major challenge now is to integrate both the phases so that more packaged and controlled systems can be generated. (Shamos, n.d.) The Western Digital Company has taken the computer technology to another level. The company is the inventor for computer microprocessor. The company started its business by producing semi conductors in California when it was supported by a number of investors. The quality experience of the company in semiconductor manufacturing has multiplied its technology absorptions. The experienced personnel of the company produced wire-wrapped prototype of hard drive controller within two weeks. It further developed the skills for the PC market products. The company was the first one to involve the leading companies like IBM, Hewlett-Packard etc. to use controllers for PC manufacturing. The company also developed an artificial intelligence computer called Nu-machine which was sold to Texas Instruments. The advent of Macintosh buses was also the result of the concert with MIT. Years after its success, the company also donated hands in manufacture of smaller peripherals like Adaptive Date Systems, Paradise etc. The company further shifted from PC storage to integrated disk drive storage. It also succeeded in producing 1-gigabyte enhanced IDE drive from 240-megabyte drive. The company marked a name in the technology business and has always reported advancement in the market. The invention of many advanced technology products which enable big business hubs to produce and develop well is the contribution of companies like Western Digital Company. Its partnerships with big established and emerging businesses like Macintosh and IBM increased its areal density as well as financial foothold. The major concern now is to have competitive edge in the market and to raise the market share more with introduction of hi-tech machines and devices.(Company, n.d.) Purchasing Cost Analysis The storage segment of Western Digital Company is the fastest growing segment ever. The number of hard disk drives has increased over the 2011-2013 period. In the year 2013, the company recorded production of 30 million hard disk drives. However, the growth did not witness a rise after that. Other products of the company included SSD and Flash based storage which also gained important over the time. The introduction of flash based chips also increased the good rumors about the company. The other advantages were NAND based storage and solid state devices. They were known for their high reading and writing speeds, low date latency, less consumption of power and increasing durability of devices. However, the consumption of SSD was confined to enterprise customers only. (Team, 2015) The manufacturing need a number of supplies like Equipments, services etc. The major parts are the magnetic media, magnetic heads, HGAs, spindle motors, controllers and other standard electronic items. The substantial parts of the magnetic heads and media are manufactures by the company itself. However, other components are purchased from the third party vendors. The solid state devices like the semiconductor media and system chips and controllers are also purchased from external suppliers. The company believes in producing high quality products with low manufacturing and designing costs. The company follows multiple supplier chain maintenance system for the major line of parts but for some parts there are single suppliers over a long period of time. Presently, the company is getting all the supplies readily available at the acceptable costs. The company generally follows a fixed shipment regime with 30days to 60days log. The order cancellation systems are also easily available with short notice systems. Company follows JIT approach for ordering the supplies therefore not much investment is blocked for maintaining the inventory.(Commission, 2012) The recent news of the purchasing costs of the company is the acquisition of SanDisk. The deal cost about $19 billion to the company. This shows that the Information Technology industry is moving rapidly with high advancements in internet and cloud technologies. The acquisition of SanDisk by the company is one the biggest acquisitions ever. Earlier, Dell was recorded in acquiring EMC worth $67 billion. Western Digital Company has mostly been engaged in producing storage devices especially the Hard Disk Technology but now its facing the wide evolution phase with the advent of new technology efficient enterprises. The company is not confined to tape drives used for back up storage or hard drives used for primary storage in computers but the high speed application requirements are also served by the company for accessing online transactions and analysis of bulk data. Today, multi-tiered storage devices critically need the solid-state devices. SanDisk was known for its manufacturing of SSDs typically made for laptops and desktops. However, the company has also developed pocket size external devices as well. With the acquisition of SanDisk the company will get a good hold of the global SSD market. Additionally, the NAND industry is also getting infected with the emergence of 3D technology and Western Digital Company needed access to that frame also. Now the company could be said as well positioned in the computer storage industry. (Mearian, 2015) Conclusion Western Digital Company has shown its mark in the storage business. It has showed that the company has the required personnel and experience to conquer the market and produce quality products and services. The company is running at the 2nd position in Hard disk drive market and it Return on Equity is very high compared to other similar companies. The companys worldwide networking made it possible to have access to a wide range of available suppliers for the product parts and make its recognition in 17 countries. The product range varies from Personal computer storage devices to Cloud computing devices which make the company a widely acceptable and professionally qualified enterprise. The customers relationship maintained by the company shows that the clients have trust on the company abilities. However, the increasing inventory levels thereby increasing costs are making it problematic for the company to grow in the industry. The Research and Development costs are also increasing lead ing to low profitability ratios. The ever increasing competition in the global market like the EMC Corporation, Samsung Electronics, Seagate etc. pose a great threat to the future existence of the company. However, with the increasing demand of PCs, gaming software, computer electronics and legislative requirements for storage of information opens the gate of wide opportunities to the company. With its innovative techniques and good experience the company will be able to maintain in global recognition and goodwill in the market.(mbaskool, n.d.) Works Cited Commission, U. S. S. a. E., 2012. Western Digital Corporation. [Online] Available at: https://investor.wdc.com/secfiling.cfm?filingID=1193125-12-361018 [Accessed 6 February 2017]. Company, W. D., n.d. Western Digital Corp. - Company Profile, Information, Business Description, History, Background Information on Western Digital Corp.. [Online] Available at: https://www.referenceforbusiness.com/history2/76/Western-Digital-Corp.html [Accessed 6 February 2017]. Corporation, A. T., 1991. StarLan Technology Report, Minnesota: Architecture Techonology Corporation. Corp, W. D., n.d. Western Digital's Suppliers Performance. [Online] Available at: https://csimarket.com/stocks/suppliers_glance.php?code=WDC [Accessed 6 February 2017]. mbaskool, n.d. Western Digital SWOT Analysis, USP Competitors. [Online] Available at: https://www.mbaskool.com/brandguide/it-technology/4675-western-digital.html [Accessed 6 February 2017]. Mearian, L., 2015. Here's why Western Digital is buying SanDisk. [Online] Available at: https://www.computerworld.com/article/2996037/data-storage-solutions/heres-why-western-digital-is-buying-sandisk.html [Accessed 6 February 2017]. Milligan, S. D., n.d. CORPORATE OFFICERS. [Online] Available at: https://www.wdc.com/about-wd/corporate-officers.html [Accessed 5 February 2017]. Shamos, M., n.d. Informations and Communications Technology (ICT). [Online] Available at: https://www.cs.cmu.edu/~rtongia/ICT4SD_Ch_2--ICT.pdf [Accessed 6 February 2017]. Team, T., 2015. Is Western Digital's Stock Undervalued After The SanDisk Announcement?. [Online] Available at: https://www.forbes.com/sites/greatspeculations/2015/12/22/is-western-digitals-stock-undervalued-after-the-sandisk-announcement/#8a6b4e736c56 [Accessed 6 February 2017]. WDC, n.d. Supply Chain Management. [Online] Available at: https://www.wdc.com/about-wd/global-citizenship/supply-chain-management.html [Accessed 6 February 2017].