FAUQUIER GAS COMPANY
Paper instructions:
Assignment Instructions
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 doubled space pages
FAUQUIER GAS COMPANY
On April 14, Mr. Bill Murphy, manager of supply management for the Fauquier Gas Company in the Carolinas, was 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.
Company Background
Fauquier Gas Company, as one of the nation’s 440 gas companies, served an area where land use was changing from agricultural to residential and commercial. To meet the increased demand for gas resulting from this conversion, 3 1/2 miles of new gas lines had to be ready for customer hookup by September. An additional 10 miles of new gas lines were planned for the next year.
The Supply Management Area
Mr. Murphy, as the manager of supply management, was responsible for the purchases of materials used in gas distribution such as pipe, meters, fittings, etc. Other major areas included the procurement of furniture, systems and forms, stores management, and materials forecasting and control. The supply organization was under the management control of the vice-president for operations.
The Specification Decision
In January, Mr. Murphy was having lunch in the company cafeteria when he heard Mr. Clive Byers, the construction project manager, talking about a new project. Fauquier Gas Company was going to add 3 1/2 miles of new gas lines and would start construction in June in order to “gas the line” that September. Murphy asked Byers for the purchase request so he could immediately contact suppliers (mills) and get quotations on prices and deliveries. Murphy knew from experience that the mills’ schedules for pipe production required a substantial lead time. He was concerned that the mills would not be able to accommodate Fauquier’s schedule. Byers told him that the purchase request would be sent over as soon as Pat Wilson, the design engineer, completed the pipe specification and Sam Law, the construction project engineer, approved it.
Mr. Charlie Buck, the design superintendent, headed the design organization. Both the design and construction organizations were under the management control of the vice president of operations.
Mr. Murphy called Pat Wilson and asked about the pipe specification. Wilson told him that the diameter of the pipe would be 24 inches with a wall thickness of 3/4 inches and that the length would be 57 feet. In prior purchases, the wall thickness was 3/8 inches and the length was “random double normal” (40 feet plus or minus 5 feet). When Mr. Murphy inquired about the change in wall thickness and length, Wilson replied that the operation of the line would be governed by less stringent specifications if the wall thickness was 3/4 inches. Wilson said using 57-foot-length pipe would reduce welding costs.
When asked which wrapper would be applied to the pipe, Wilson said that he had not yet gotten to that part of the specification. In past purchases, Fauquier had used two types of wrappers—coal tar and pry-tech. The mill supplying the pipe would apply the wrapper. The company that applied the coal tar wrapper was located in Philadelphia and the one applying pry-tech wrapper was in Atlanta.
Mr. Murphy was concerned about the economic consequences and the schedule impact of the proposed changes in wall thickness and length of the pipe. At lunchtime on April 14, he had
not yet received the purchase request with the pipe specification.
1. What are the key facts?
2. What is the problem?
3. List and discuss three alternative solutions.
4. What is your recommended solution?
Adapted from a case copyrighted by the Institute for Supply Management (formerly the National Association of Purchasing Management) and the School of Government and Business Administration, George Washington University. Reprinted by permission. Joseph Hood wrote this case during one of the ISM-sponsored case writing workshops
OUTLINE FOR CASE ANALYSIS
Title Page (APA formatted)
Case Name:
I. Major Facts
(State here the major facts as you see them. Make statements clear and concise for your own understanding as well as for the understanding of the other students and the instructor.)
II. Major Problem
(State here the major problem as you see it. Emphasize the present major problem. You may wish to phrase your statement in the form of a question. In a few cases, there may be more than one major problem. A good problem statement will be concise, usually only one sentence.)
III. Possible Solutions
A. (List here the possible solutions to the major problem. Let your imagination come up with alternative ways to solve the problem.
B. Do not limit yourself to only one or two possible solutions. These solutions should be distinct from each other.
C. However, you may wish to include portions of one solution in another solution, as long as each solution stands alone. Only in this manner will your subsequent choice be definitive.
D. Briefly note advantages and disadvantages of each possible solution.)
etc.
IV. Choice and Rationale
(State here your choice, A or B or ___ and the detailed reasons for your choice. You may also state your reasons for not choosing the other alterative solutions.)
V. Implementation
(Prepare a plan to implement your choice)
Appendix (Answer case study questions)
Reference Page (APA formatted)
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