Caught With Their Chips Down
Hewlett-Packard Co. knows what a close call feels like. Last December, the company came within days of having to shut down a critical line producing computer servers--high-margin products that sell for $2,000 and up. The reason: HP had nearly run out of capacitors--humble components that normally cost about 2 cents apiece. HP's buyers scrambled and found 100,000 of the parts on the Internet. They were selling at a hefty premium, "but it was worth it," says Don Schmickrath, Hewlett-Packard's vice-president for manufacturing. "This is not a 2 cents problem."
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