Business Finance - Operations Management The topic of your second Individual Assignment is the case study of Zipline, Your task is described in the attached PDF Document "Assignment2-Supply-Chain-Winter2024". AI (ChatGPT) must not be used to create your

CASE STUDY: Zipline Dr. C. Guckel

Assignment2-Supply-Chain-Winter2024.docx 2024-02-19 - 1 -

Opera&ons Management

OPMT 620 Winter Term 2024

Assignment Paper 2

Topic: Supply Chain Management

Zipline: Life-Saving Drone Service Redefining the Supply Chain Case Study IN1921 by Insead, distributed through Harvard Business School

IntroducKon Zipline is a delivery company for medical products operaBng unmanned aerial vehicles (UAVs). With its expansion to Ghana in 2019, zip line became world's largest medical drone delivery service, reaching around 25 million people. Founded in 2014 by Keller Rinaudo (CEO) and Keenan Wyrobek (CTO) at Half Moon Bay CA it is different from its Silicon Valley peers. Zipline has ambiBons to reach 700 million people in need of medical supplies by 2024 with its drone services. The case study sheds light on the company, its drone technology, its innovaBve approach to the delivery of medical supplies, as well as the difficulBes that lie ahead as it expands. Zipline is a young company operaBng first-of-a-kind unmanned aerial vehicles to deliver supplies. The case study discusses the technology, iniBal use cases and its evoluBon from a small start-up in Silicon Valley to a Unicorn. It covers a series of issues that commonly confront young organizaBons, implemenBng new technologies in the social impact sector, parBcularly those related to the novelty of the technology/soluBon, the regulatory environment, and financing. The Technology It is suggested that you watch following videos to familiarize yourself with the drone technology:

1) News report: hbps://www.bloomberg.com/news/videos/2018-08-16/this-man-delivers- blood-to-hospitals-by-drone-video

CASE STUDY: Zipline Dr. C. Guckel

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2) Success story how Zipline developed their soluBon: hbps://www.tedmed.com/talks/show?id=686750

3) Engineering challenges of flying autonomously: hbps://www.youtube.com/watch?v=xB29HG5JNlE

Your Task Based on the case study presented, compose a report covering following aspects and quesBons:

1) Give an overview of Zipline as a company. Explain the moBvaBon for founding this company, what is their unique posiBon in the industry, and what was the need they saw in the field (the gap the company wants to fill). What were challenges that Zipline had to overcome since their incepBon? What does the compeBBve environment look like?

2) If customers can receive any product they desire instantly aker ordering how does that influence the type of products they buy, the volume of products procured, and the extent to which they are kept in stock?

3) With the ability to reduce waiBng Bmes to under an hour, ziplines delivery service will affect the assortment of health products offered at the health faciliBes it serves in terms of greater diversity and reliability, availability without overstocking or stock outs. Using a graph, explain the phenomenon of stockouts and overstocking as they could occur in a business with tradiBonal inventory management, and show how this scenario can be avoided with Zipline. What effect can a secure supply chain have on the hospitals and their customers, the paBents?

4) For Zipline to operate successfully, following condiBons must be met: o Regular demand (50-100 flights/day cover the fixed costs of the distribuBon

centre) o Narrow Bme window (product required within hours of order) o The product is difficult or expensive to stock o Packages must be small o Centralized distribuBon centres o Poor infrastructure o One-way delivery, hub and spoke model

Compare Zipline with tradiBonal delivery methods, such as truck or motorcycle, and with alternaBve drone delivery systems. Refer to the points above, as well as speed and reliability of Zipline’s delivery method, to draw your conclusions. What other markets could be abracBve for Zipline?

5) Zipline will need to balance its social and commercial goals to be sustainable. What are the potenBal downsides of not finding a balance? Zipline is a medical supplies delivery company. It started out in developing countries where its service had a high social impact. Its mission to reach 700 million by 2024, and to transform the accessibility of medical supplies, made it immensely popular in the eyes of the public. It also allowed Zipline to hire top talent and raise funding from social investors. Recently, Zipline signed a deal with

CASE STUDY: Zipline Dr. C. Guckel

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Walmart and is exploring delivery services with lower social impact. Is it possible to balance the two? How should Zipline go about doing this?

6) What are the main new aspects that Zipline brought to tradiBonal supply chain management? Even though Zipline’s approach is tailored to a niche market, what impact can their model have on some areas of supply chain management?

Structure your report according to the content you want to present and opBmize the flow, so that the reader can easily follow your logic and arguments. You should be able to accomplish the task with about 3,000 words of text, there is no upper or lower limit though. It is expected that you apply the APA formanng. Reference Grades and Topics (refer to tasks described above):

Topic Incomplete SaBsfactory Very Good ExcepBonal Actual Mark

Introduce Zipline (1) 6 7.5 9 10 Customers’ reacBon to

Zipline’s model (2) 6 7.5 9 10

Inventory management tradiBonal & Zipline (3) 9 11 13.5 15

Comparison of delivery methods (4) 6 7.5 9 10

Commercial and social goal balance (5) 6 7.5 9 10

Impact on tradiBonal supply chain

management (6) 9 11 13.5 15

Logic & criBcal thinking 9 11 13.5 15 Format and overall

presentaBon 9 11 13.5 15

SUM 60 75 90 100