The case study link is provided below for the Case Study 2 Facquier Gas Company. Read and study the case and complete the questions at the end of the study. Use the case study outline below to assist you with your analysis. Questions should be answered using case study format. Ensure that you adequately explain the problem, describe alternative solutions and justify your recommendation. This exercise should be able to be completed in approximately 3-6 doubled space pages. Attached completed Case Study #2 as a MS Word document in the assignment area of the classroom –
Mr. Murphy, the manager of supply management is responsible for procurement for Fauquier Gas Company. Mr. Murphy specializes in the procurement of materials used in gas distribution such as pipe, meters, fittings, furniture systems and forms, stores management, and materials forecasting and control.
A situation has occurred when it has come to the attention of Mr. Murphy that he has understood that Clive Byers, the construction project manager is working on adding an extra 3 ½ miles of new gas lines for the Fauquier Gas Company. Mr Murphy has a few concerns about the procedures and the pipe specification.
Mr. Murphy is asking a “purchase request” from Byers to be sent in good time as the lead time can slow the project down, thus wasting money and time. This requires getting quotations, contacting suppliers and delivery times and it looks like Byers schedule does not give Mr. Murphy enough time to ensure the procedures are carried out correctly. The process also involved ensuring that the purchase request is approved by two units, the design engineer Pat Wilson for approval and the pipe specification Sam Law. Mr. Murphy contacted Pat Wilson regarding the pipe specification of the standard wall thickness of “3/4 inches and 37 feet long had changed to 3/8 inches and 40 feet plus or minus 5 feet.” (Hood, J.)
Murphy was concerned when Wilson stated that the project would be “governed by less stringent specifications if the wall thickness was 3/4 inches” and also that Wilson did not get the specifications for the wrappers to be applied to the pipe and stated that “Fauquier had used two types of wrappers—coal tar and pry-tech.” (Hood.)
Murphy is the manager of supply management is responsible for procurement for Fauquier Gas Company and has every right to question Clive Byers actions. Mr. Murphy has identified that there is a problem with the pipe specifications, as “specifications and standardization play important roles in the search for the right quality and the right value.” (Burt.2009) Murphy is concerned that this deviation in in size and length of the gas pipe could potentially cause conflicts in “engineering, manufacturing, marketing, and supply management.” (Burt.2009) I can identify that there is a problem with communication, lack or procedures and Byers seems to working on his own instead of being part of a cross functional team.
The process of building pipe lines requires several teams to approve piping specifications and design, Byers seems to be misunderstanding of the company’s procedures and standards and is not meeting the standard piping specifications and is lowering the standards of Fauquier by taking less stringent specifications for the new piping. The wall thickness is an issue and the length of pipe might cause problems in construction and Murphy’s role as a supply manager is important that all materials meet the “specifications and standards set by the company, they must be “functional, precise and complete.” (Burt.2009) If the pipe is substandard and an accident occurs, life and property could be at risk, this would definitely cause a dispute between “the purchaser and the supplier.” Mr Murphy would have have gone through the correct procurement procedures to seek a supplier and settle a contract.
Mr Murphy’s job is to make sure the buying policies and practise I would recommend that Murphy contact Mr. Charlie Buck, the design superintendent of Fauquier in a timely manner to make sure that the change of specifications is acceptable and or to make the management aware that the piping standard is being reduced. Mr Buck needs to improve the communication and team work, this could be sorted by more meetings regarding procedures or training. There is a time management issue by Clive Byers, as he clearly doesn’t understand that purchase request may have lengthy lead time which could potentially slow down the business processes. This needs to be addressed by upper management to make sure that Byers submits the purchase request in a timely manner, as he is now potential adding weeks to the project.
I would recommend that Mr. Buck rejects the change of change of specifications, a management meeting would then be required to ensure that all upper / middle management understand that specifications and requesting a purchase order in a timely manner is essential to the success of Fauquier. Failing to comply with the piping specifications could cost the company millions of dollars in down time and could cause a potential danger and health hazard with a gas leak. The reputation of the company is at risk and Mr Murphy concerns are eligible to raise as a deviation from standard business practise.
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