Strategic Manufacturing - Sample Assignment

Running head: STRATEGIC MANUFACTURING
Strategic Manufacturing
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Author Note

1STRATEGIC MANUFACTURING
1.
Aurora is a small producer of implantable cardio version defibrillation (ICD) - the
ACCUTRON.
Competitive Rivalry
The company is having its competitors inBiotronik; Boston Scientific; Medtronic; Ela
Medical. The competitors are available with the devices with variety of approaches and many of
its competitors are settled with merging and acquisition approach. The competitors are
differentiated based on their products and the size of the product, implantation process,
programming, product life and the varied software and hardware process.
Threat of New Entrants
The threat of the new entrants can be fulfilled by the price strategy, which can discourage
the entry of the entrants and the expensive investment that is required to manage the production
of the product. Arelation is needed to be builtwith the suppliers in order to access the product
design and material. The process of meeting the strict standards of the governments including the
testing and quality standards can stand out to be a threat for the new entrants and for Aurora.
Threat of Substitutes
Along with the threat of the competitor’s product which affect the sales of Aurora, the
substitutes which are available for the same treatment are transcutaneous pacing anti-arrhythmic
drugs which are preferred by the patients to take medication in place of doing implantation. The
technological conventions such as the ICD, which are generated due to the changes in the
culture, have also brought about changes and variedness in the customer preferences. The

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company reports the sales of its product per unit is $18750 which is relatively less as compared
to its competitors.
Bargaining Power of Buyers
The buyers serve with the power of bargaining are highly affecting for the industry and
the company as well. The choice of therapeutic approach depends completely over the patients
and the physician’s preference that will be providing with the treatment. Consumers are price
focused along with the quality, size and company reputation. The option is upto the customers to
decide that they need implantation or medication (Burton et al. 2015).
Bargaining Power of Suppliers
The company had less number of suppliers with respect to its core components supplies
such as titanium, battery, cardio version. Small number of specialist companies designs these
core components. Overall, the suppliers are common for all the products. Due to less suppliers in
2016 Aurora faced shortages of micro controller which is used in ACCUTRON, when the
tsunami destroyed the Freescale production factory which was responsible to supply materials
for devices. After building and designing, the products are undergone by the designing, testing
and quality standards that are regulated by the government.
2.
The product is introduced to the market for the patients of ECG and is programmed
accordingly to analyse various arrhythmias. The company focuses towards achieving overall
cost leadership in the industry by producing low cost product with high availability of its product
in the market. As compared to its competitors mainly the government companies, who sell the

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product at a range starting from $12000,the ACCUTRON is sold at $18750 per unit. The
company built its devices in a complete clean room environment under microscope. These
devices are handmade and are made by the help of trained facility. Among the private
companies, it provides its product with less price and best offered quality. The workers who are
trained make the products and development programmes for 6 months. The price is relatively
low as compared to its competitors because of the researches that are taken place within the
organization’s production process. The investing amount for Aurora is over USD 650 million
just for the training and development programmes. This stands out as the manufacturing price of
per unit product as $7685.
The company must ensure that product differentiation and brand loyalty had to be
secured in order to gain competitive advantage as the consumers are primarily focused on the
price, quality and reputation of the company product (Meihamiand Meihami2014). The company
Aurora needs to primarily focus on its technological interventions and be reliant on its suppliers
to increase the production and maintain the production of ACCUTRON smoothly, as it cannot
affect the production per unit. The supplier, if changed, can be an issue as it changes the overall
process of the product as such, revalidation, reprogramming and regulatory review of the new
devices.