Youngwon Park, Paul Hong, Mingu Kang

Increasingly, global computer and TV panel manufacturers (GCTVPM) face growing business opportunities with an expanding global market. At the same time, with the continuous influx of competitors the overall prices of computers and TV have showed downward trends. In this environment it is critical for GCTVPM to manage efficiencies in terms of cost, delivery, and quality.

The realistic options for overall cost reduction in the value chains are: (1) manufacturing productivity enhancement through workers’ learning curve; (2) product process improvement through better operational systems; (3) effective outsourcing for the back-end assembly and logistical processes. This paper examines the strategic and operational issues related to the construction of efficient supply chain configurations between set-makers and back-end suppliers. The paper addresses specific issues related to GCTVPM that operates in China according to the Chinese government rules and operational constraints.

The literature review (1) describes the unique competitive circumstances of this industry, (2) prior research of collaborative patterns between set-makers and component suppliers; (3) emerging issues related to government regulations and competitive requirements.

The research model depicts the specific challenges from the standpoint of supply chain management of this industry. This research model identifies how GCTVPM achieves the premium value-added under the above mentioned business conditions and constraints. This paper lists key strategic challenges for this industry and their practical options for their competitive advantages.