The growing Supply Chain impact of an Intel Chip Flaw

An article in the New York Times (February 7,2011, B10) describes the growing impact of a flaw in the Series 6 chipset called Cougar Point which had been shipped in early January.  Once Intel announced the problem – that about 5 % fail over the three to five year lifespan, the impact was felt downstream at OEMs like HP and Dell.  HP claimed this chip had been in products shipped to customers in Europe, Africa and the Middle East, while Dell claimed it impacted some business customers and computers for gamers. Over 0.5 million computers were potentially affected. Intel claims that the corrected chips will be back in full production by April. Getting all these computers back, the chip replaced or refunds issued would cost the supply chain, and thus Intel, over $ 1 billion.    This burgeoning supply chain impact suggests the importance of bottleneck components – how many such components are there in modern global supply chains ? Should designers anticipate such risks while designing products ?

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About aviyer2010

Professor
This entry was posted in Global Contexts, Operations Management, Supply Chain Issues and tagged , , , , . Bookmark the permalink.

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