http://kaco1.tumblr.com/post/11940822584/newshoes
After LGO, one of the common traits alumni share is looking at ordinary things in a new light.
I excitedly bought a new pair of running shoes this weekend. Then I started thinking…
This spring, we did a case on New Balance in our Operations Strategy class. This course is the capstone of LGO, normally taken during the final semester and co-taught by the head LGO and textbook author, Don Rosenfield.
I reflected back on the New Balance case, and in particular how New Balance does part of their manufacturing in the US - and not for PR or ‘feel-good’ reasons. By having some manufacturing in the US, they can produce top-of-the-line, industry-leading shoes with a short domestic lead time. This results in lower inventory levels, decreased storage and transportation costs, with higher customer service. Meanwhile, New Balance is able to leverage decreased costs on less trendy or older models with overseas manufacturing, where the increased lead time is less impactful to the shoe market. A great, business-focused balance drawing advantages from both domestic and overseas manufacturing.
Following our case discussion, we were honored to have the New Balance executives speak to us. We heard updates on business changes since the time of the case, and they enjoyed hearing our ideas and perspectives as we discussed their supply chain and manufacturing strategy.
Not just a pair of shoes anymore - and I didn’t even discuss the raw material chain for each component and sub-component of the shoe! :)
Also - in case you were also wondering, the New Balance website says my shoes were assembled in the US.
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Kacey Fetcho-Phillips
