1.

Describe the customer value proposition and the profit model that underlay Western
Digitals business model.
The customer value proposition defines how a firm distinguishes itself to a target customer
base in terms of the products and services offered to that customer base. Customers of
western digital include computer manufacturers, providers of enterprise storage, makers of
homer entertainment applications, its distributors and individual users of hard drives. The
customers of WD are high volume customers. Therefore, WD based its customer value
proposition on making products as per changing needs of such customers. The managers at
Western Digital adopted OODA thinking to quickly respond to customer demands. Also, the
vigilant information system implanted at WD enabled it to gather all the granular information
across the supply chain to analyze the performance against the customer value proposition.
The quality information system (QIS) also gave western digital insights into quality of the
products manufactured, hence improving the quality for customers. With the help of QIS,
Western Digital maintained high quality, uncovered root causes of product failures and
improved future versions of products. QIS also helped WD to maintain its customer value
proposition by forecasting demands of high volume customers.

The profit model of Western Digital has two components: the revenue model and the cost
model. The revenue model describes where, when and how revenue the streams will
materialize. WD generates its revenue from sales of hard drives to its customers such as
computer manufacturers, technology retailers and users of hard drives. The cost model
describes the nature of costs to be borne and how these costs will be controlled to allow for
the business models profitability. The sources of costs for WD are manufacturing costs,
inventory storage costs and distribution costs. However, the implantation of OODA and VIS
enabled Western Digital to save costs as well. Inventory carrying costs reduced by $3 million
by increasing inventory turnover from 22 to 29, the margins of Western Digital also
improved because of improvements in supply chain management by VIS and OODA, report
requests dropped from 200 to 50 per quarter, saving about $900K a year. The dashboards also
eliminated the need of paper by 50% with an estimated savings of $800K a year and the
information available for managers on dashboard reduced meeting times to 1.5 hours
translating into a time savings of $350K a year.
2. Describe three very different business events whose capture is critical in Western
Digitals efforts to increase its operational visibility? Then, explain as best you can
(given the information provided in the case) how Western Digitals information systems
capture data about these business events.
The three business events whose capture is critical in Western Digitals efforts to increase its
operational visibility are: supply management, demand management and customer
management. Western digitals information systems capture data about these business events
by first capturing the data in layer 1 of VIS. This data comes from different sources. Data
related to supply management is captured in Material dashboard. This dashboard tracks
factory inventory, including the receiving warehouse, work in progress, engineering
locations, and finished goods inventory. The data related to demand management is captured

in production output dashboard. This dashboard tracks assembly line output, including hard
drive and printed circuit board assemblies. With the help of this dashboard, outputs can be
compared with targets on manufacturing schedule.

Corporate dashboards capture data related to customer management. The forecasts of

customer demands from WD distributors and original equipment manufacturers flow into
corporate business management information system. Corporate combines these demand
forecasts with feedback on production and inventory levels to create build requirements. As a
result, each factory can determine its supply requirements for manufacturing hard drives. [I
think Manufacturing is also one of the important business event]
3)The case describes a number of factory dashboards and corporate dashboards that
Western Digital provides for its managers. Indicate which of these dashboards requires
data regarding one or more of the three business events described in your answer to
question (2). Then, for each of these so-indicated dashboards, explain how the events affect
the dashboard metrics.
YIELD DASHBOARD:

The yield dashboard from the category of Factory dashboard indicates the
percentage of units that pass inspection .

This dashboard requires data regarding the business event Manufacturing. The data
regarding the number of manufactured units is required for this dashboard to report
the percentage of the units which passed the inspection test.

The dashboard also reports the cycle time of key processes at a key manufacturing
station. This task also requires the data from the business event Manufacturing

PRODUCTION OUTPUT DASHBOARD:

The Production Output dashboard from the category Factory Dashboard tracks
the assembly line output.

This dashboard also requires the data from the business event Manufacturing .This
dashboard requires the market schedule to compare it with the actual assembly line
output

This dashboard after obtaining the market schedule makes sure that there is no delay
or slip in the output which can affect the entire manufacturing event

MATERIAL DASHBOARD:

The Material dashboard from the category Factory Dashboard tracks the factory
inventory

This dashboard requires the data from the business event Supply Management.
This dashboard requires the data regarding the Warehouses, Finished goods
inventory.

This dashboard compares the data obtained from the business event with the
marketing schedule

DISTRIBUTION INVENTORYAND SELL THROUGH:

The Distribution inventory and sell through dashboard from the category
Corporate Dashboard displays the data of goods sold and goods in inventory
This dashboard requires the data from the business events supply management
and manufacturing . This dashboard requires the data regarding the number of
goods manufactured and the number of goods supplied to the distributors.
This dashboard after obtaining the data from the business events displays the
number of finished goods still in the inventory and the number of goods sold