Lawford Electric Company Case
Lawford Electric Company Case
Critical Summary On January 13, 1978, Mr. Robert Allen, a field sales engineer of Lawford Electric Company learned from a phone call with Mr. George Gibson, purchasing agent of Bayfield Milling Company that Bayfield was interested in purchasing a drive system for a new shearing line. The cost of the new shearing line that Bayfield recently ordered from Magna Machinery Corporation was about $2 million and the drive system was going to cost roughly another $900 thousand dollars. The shearing line recently ordered by Bayfield would add new capability and value to Bayfield’s mill operation. Per Gibson, the preliminary bids on the drive system for the shearing line were due on July 14, 1978. Final bids were due on December 29, 1978 and decision on which company had won the bid to be announced on February 2, 1979, approximately about a year from the time of Mr. Allen’s initial phone conversation with Mr. Gibson.
This drive system was an $871,000 order and it was not an ordinary size order considering that Bayfield’s annual sales from Lawford occasionally totaled as much as only $50,000. Mr. Gibson also specified to Mr. Allen that no supplier sales personnel including staff and management were to contact Bayfield engineering personnel to discuss product specification. Instead, all supplier personnel were to work through Mr. Gibson, although contact was permitted with operations personnel. However, Gibson did give the name of the Megna engineer to contact for details of the new line. Mr. Allen also learned that the decision makers for the purchase of the drive system for the new shearing line would be made by Gibson, Lorenz, chief engineer; Mainwaring, plant superintendent; and Vogel, operations vice president – also not be contacted in person. On February 2, 1978, Mr. Allen learned from his meeting with Gibson and lunch with Mainwaring and his assistant, Hughes, there was an issue with drive system specs, and nobody in operations
Critical Summary On January 13, 1978, Mr. Robert Allen, a field sales engineer of Lawford Electric Company learned from a phone call with Mr. George Gibson, purchasing agent of Bayfield Milling Company that Bayfield was interested in purchasing a drive system for a new shearing line. The cost of the new shearing line that Bayfield recently ordered from Magna Machinery Corporation was about $2 million and the drive system was going to cost roughly another $900 thousand dollars. The shearing line recently ordered by Bayfield would add new capability and value to Bayfield’s mill operation. Per Gibson, the preliminary bids on the drive system for the shearing line were due on July 14, 1978. Final bids were due on December 29, 1978 and decision on which company had won the bid to be announced on February 2, 1979, approximately about a year from the time of Mr. Allen’s initial phone conversation with Mr. Gibson.
This drive system was an $871,000 order and it was not an ordinary size order considering that Bayfield’s annual sales from Lawford occasionally totaled as much as only $50,000. Mr. Gibson also specified to Mr. Allen that no supplier sales personnel including staff and management were to contact Bayfield engineering personnel to discuss product specification. Instead, all supplier personnel were to work through Mr. Gibson, although contact was permitted with operations personnel. However, Gibson did give the name of the Megna engineer to contact for details of the new line. Mr. Allen also learned that the decision makers for the purchase of the drive system for the new shearing line would be made by Gibson, Lorenz, chief engineer; Mainwaring, plant superintendent; and Vogel, operations vice president – also not be contacted in person. On February 2, 1978, Mr. Allen learned from his meeting with Gibson and lunch with Mainwaring and his assistant, Hughes, there was an issue with drive system specs, and nobody in operations