Reddy Corporation is an industrial enterprise making ball bearings for the electric motor market and has 100 workers on its rolls working on the shop floor. For every twenty workers there is a supervisor and the supervisors report to a plant manager and the company has a factory manager.
Mr. Sardar the marketing manager of Insta brand of starters visit the company and offer their electronic starters to the company as a replacement to conventional starters used in fluorescent lamps used in the shop floor. The shop floor has some 250 fluorescent lamps. The starters are tested by the plant manager and gives an okay report to the factory manager Mr.Mirwani Giri.
The company decides to replace all the starters with the new starter and on a Sunday overtime electricians replaced all the old starters with new ones.
Because of the dusty environment and heat conditions….at least ten of the starters were getting burnt every week creating serious problems in the shop floor and some parts of the shop floor were not getting light.
After three months the problem was becoming even more serious and the workers made a written complaint to the CEO Mrs. Sayeda Grace Shilpa in Chennai who immediately ordered the replacement of all the starters to the old format and the plant manager was suspended for one week.
1. Try to identify User Buyer, Technical buyer and Economic buyer in this case.
2. Should the company have replaced the old starters..if not why?
3. How do you think this confusion could have been avoided?
4. What steps the company should have taken in the purchasing process?
5. What fresh purchasing policy would you outline so that such problems don’t arise in the future.