I. Mayor Factor 1. Mr. Bill Murphy, manager of supply management for the Fauquier Gas Company in the Carolinas. 2. Fauquier Gas Company, as one of the nation’s 440 gas companies. 3. Served an area where land use was changing from Agricultural, Residential and Commercial. 4. Mr. Murphy is responsible for the purchases of material used in gas distribution such as fitting, pipes and meters. 5. To meet the increased demand for gas. 6. Concerned about being able to find a supplier who could deliver 3 1/2 miles of large-diameter pipe for a new residential and commercial development.
7. Request immediately contact suppliers mills and get quotations on prices and deliveries. 8. The mills’ schedules for pipe production required a substantial lead time. 9. Concerned that the mills would not be able to accommodate Fauquier’s schedule. 10. Both the design and construction organizations were under the management control of the vice president of operations. 11. The change in wall thickness and length. 12. That the operation of the line would be governed by less stringent specifications of the wall thickness is 3/4 inches. 13. Using 57-foot-length pipe would reduce welding costs.
14. In past purchases, Fauquier had used two types of wrappers-coal tar and pry-tech. 15. Mr. Murphy was concerned about the economic consequences and the schedule impact of the proposed changes in wall thickness and length of the pipe. 16. Supply falls under the management control of the vice-president for operations. 17. Needs to acquire 3. 5 miles worth of large diameter pipe for a residential and commercial development. 18. To meet the increased demand the 3. 5 miles of new pipe must be installed by September. 19. Construction on the project was slated to begin in June. 20.
Construction on the project was to end in September to gas the line. 21. Mr. Clive Byers is the construction project manager. 22. Mr. Pat Wilson is the design engineer. 23. Mr. Sam Law is the construction project engineer. 24. Mr. Charlie Buck is the design superintendent who headed the design organization. 25. Design and construction organizations are under the control of the vice president of operations. II. Major Problem The biggest problem is the Fauquier Gas Company is scheduled to begin a new project to convert an area once used for agricultural work in residential and commercial property.
This means that new gas lines should be installed as soon as possible in January. Mr. Murphy prior purchases for pipe was 3/8 inches thick and 40 feet length and the new specification would be 24 inches and a wall thickness of 3/4 of an inches 57 feet long. Mr. Murphy would not have known this if he had not over heard it at lunch on April 14 to Mr. Byers. III. Alternatives 1. Mr. Murphy needs to request a meeting constantly with all in the company such as the design superintendent, the design engineer, and the vice-president of operation in the company.
2. Working overtime needed to meet the project due to the short time and comply with the provisions of the company. 3. Top executives of the company with a focus on common welfare of the company and comply fully with their projects. 4. Set deadlines between each stage of the approval of the project to streamline the approval process in the company. Assumptions
1. The group effort can increase the success of each project in the company and avoid time pressure to complete projects.
2. Keeping in full cooperation departments in each company’s management thus is overall success.
3. Improved communication and coordination in each design, construction, and purchasing groups in the projects. The staff of each should immediately start working together to solve problems. 4. Incorporate key elements in communication systems in each department to be successful and effective one in the company. 5. Knowledge in each of the departments of the company and provide valuable information to each department to assist in the development of projects in the company.
Alternative 1 1. Mr. Murphy needs to request a meeting constantly with all in the company such as the design superintendent, the design engineer, and the vice-president of operation in the company. Advantage – Better communication between departments in the company.
– Effectiveness approval processes faster and effective. – To be aware of all the projects of the company and know which projects are going to work in the company. Disadvantage – Overtime worked during the week between executives – High stress and a lot more responsibility to comply with the dates agreed in meetings. Alternative 2 2.
Working overtime needed to meet the project due to the short time and comply with the provisions of the company. Advantage – Compliance with the required dates of each project established by the company. – Possibility of more employees in the projects to meet the established. – More projects and satisfied customers for the company. Disadvantage – High cost of operation. – Sacrifice and managerial employees to work overtime. – Outsourcing companies to meet all assigned projects in the company. Alternative 3 3. Top executives of the company with a focus on common welfare of the company and comply fully with their projects.
Advantage – Saving money a year for the company. – Consensus among senior executives and more ideas to solve problems of the company and its projects. – Gets better services and high quality in the decisions. Disadvantage – More reports of each project in the process of the company to Mr. Murphy. – Long hours to prepare effective reports and explanatory. Alternative 4 4. Set deadlines between each stage of the approval of the project to streamline the approval process in the company. Advantage – Ensures quality service and commitment to good service.
– Fully compliance of each project on the dates set by the company. – Customer satisfaction with the good performance of the company. Disadvantage – Implementation of new SOP’s in the company. – Less time for cost research, purchase, etc… – Errors in the stages of the project will be detrimental for the time limit on each stage for approval. IV Choice Alternative 1 and 3 are selected to Fauquier Gas Company. A meeting of the entire involved person in question should be held to discuss the project to ensure that everyone in the company is informed that they do projects worked.
Mr. Murphy and all the company executives have to work hand in hand with effective communication and professionals and so to get everything related to projects such as prices, sizes, materials and equipment to use, the right sizes of piping, etc. So Mr. Murphy would not have the stress of mistakes in orders, costs, purchases, quotes or weather forecasts projects to delegate responsibilities to other employees to meet its projects on deadline and earn dividends for the company and its shareholders. V Implementation Mr. Murphy has to schedule a meeting with the vice president of operations.
Mr. Murphy has to explain that at present there is no consistent relationship between the departments of construction and supply management. The fact that his department did not notify the results and changes in project specifications presents that are not communicating. Mr. Murphy has to request an emergency meeting between Charlie Buck the superintendent design, Pat Wilson the design engineer, Mr. Byers the construction project manager and Sam Law the Construction Project Engineer and explain the importance of the fundamentals of communication open, and professionals change its relationship with the supplies and specifications in the company.
During its first meeting Mr. Murphy has to explain that all supplies and specifications must be brought to its attention as soon as they become aware of it because he needs to have enough time to order supplies for the construction and completion of the entire project. For these actions to be a success for the company needs to have the support of each of them. VI Questions: 1. What are the key facts?
A . The current procurement system does not include early purchasing involvement. B. Purchasing, design, and construction are not working as a team to complete the project. C. The design engineer works autonomously in determining material specifications. D. No purchase request has been completed for the project. E. Construction is scheduled to begin in few weeks. F. Pipes needed for project completion require substantial lead time. 2. What is the problem? A. The problem is the Fauquier Gas Company is scheduled to begin a new project to convert an area once used for agricultural work in residential and commercial property.
This means that new gas lines should be installed as soon as possible in January. Mr. Murphy does not have enough time to finish the project on time in April still had no reply from Mr Byers, director of the project. They discussed the need to add 3. 5 miles of new gas lines scheduled to begin in June, with an estimated completion date of September (3 months). Having worked with obtaining gas lines before, Mr. Murphy knew that plants need times substantial lead in the timeline to fit Fauquier Gas Company.
Mr. Byers informed Mr. Murphy the purchases request will be sent as soon as the design engineer’s specifications and finished with the project engineer approves the project with the approval by the vice president of operations. When Mr. Murphy contacts Pat Wilson, the design engineer, he learned that the specifications of the tubes are ordered prior orders were changing. Instead of 3/8 “wall thickness were prepared 3/4”. This was done because the line operation is governed by the less stringent specifications. The length of the tubes was also extended from 40′(+/-5′) at 57 ‘in order to reduce the cost of welding.
Finally, the envelope is not yet determined which is supplied by the factory and which is in different states as Philadelphia and Atlanta. As of April 14, the purchase request has not been received by Mr. Murphy and no order for pipes has been made to start the project. 3. List and discuss three alternative solutions. A. In the design phase, construction engineers have to design and develop a technical approach to complete the project. The development of alternatives allows more options and more opportunities to make better decisions about price, quality and timely delivery.
Different designs encourage the use of best practices to work hand in hand. B. The development of a series of requirements and procurement team. This team should include people from design, construction and purchasing to ensure cost and quality specifications. Mr. Murphy can contribute their views on market availability, cost, quality and waiting time for the materials to be purchased for the project. This also allows each functional group to learn about the needs of others and have better communication. This would allow more time to buy to get the best price of the requested materials.
C. The purchasing department should develop a catalog of material for the design engineer. The catalog should include information related to previously acquired pipes and casings specifications, market availability, and quality and delivery time of suppliers. This catalog would make easy work of the designer to provide specifications. Costs are controlled by minimizing and maximizing the use of pipe sizes. Mr. Murphy did not need to be frequently in communication with the design engineer due to large number of questions that the engineer may have can be answered with the catalog.
4. What is your recommended solution? A. Evaluate all processes such as communication between the management and the departments of design, engineering, construction, etc… Each department has to be focused on project evaluation, cost, and purchase of materials, pros, cons and delivery time of each project. The success and development of each company depends on its management, employees and all staff who contribute to its growth every day. References John J. Coyle, Robert A. Novack, Brian J. Gibson and Edward J. Bardi, (2003) Transportation A Supply Chain Perspective, Seventh edition, Mason, OH.
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