Material Mngt
Case 1 (10 Marks)
Renuka Machines Manufacturing Corporation
(A case on vender rating in material management)
Renuka Thomas, President of Renuka Machines Manufacturing Corporation (RMMC), is concerned about company’s choice of suppliers for cleaning brushes, which are used in the company’s data processing equipment.
Renuka occasionally plays tennis with Sheela George, President of George Machine Company (GMC), one of the company’s suppliers of cleaning brushes.
Recently, Sheela complained to Renuka that her company has been having difficulty in getting the traditional share of Renuka’s business. On the last buy, Sheela’s company failed to get any business, even though Sheela believed she was the lowest bidder. Renuka tells Sheela that normally she does not get into the details of procurement, but she promises to ask her Purchasing Manager, Dannis Chako to investigate.
The next day morning, Renuka calls Dannis Chako and tells him of Sheela’s complaint. He said (says), that he does not want to influence the company’s procurement policies, but he does not feel that Renuka should investigate to make sure that Sheela’s firm was treated fairly.
Purchasing Manager, Dannis discovers that George Machine Company was indeed the lowest bidder on the last buying. Quotations for an order of 20,000 units were as under:
George Machine Company Rs 2.22
Data Matics Electronics Company Rs 2.23
Royal Tools and Machine Company Rs 2.25
Royal and Data Matics each got order for 10,000 pieces. Royal has done considerable development work on brushes, while George and Data Matics have done very little. The quality and delivery records of the three
AN ISO 9001 : 2008 CERTIFIED INTERNATIONAL B-SCHOOL suppliers on the last ten orders for the brushes are shown below. Renuka Machines Manufacturing Quality
Control Department has set an acceptable quality level of three per cent on the brush.
Supplier Quantity
Ordered
Quantity Defective Delivery
Royal 4,000 122 One week
Renuka Machines Manufacturing Corporation
(A case on vender rating in material management)
Renuka Thomas, President of Renuka Machines Manufacturing Corporation (RMMC), is concerned about company’s choice of suppliers for cleaning brushes, which are used in the company’s data processing equipment.
Renuka occasionally plays tennis with Sheela George, President of George Machine Company (GMC), one of the company’s suppliers of cleaning brushes.
Recently, Sheela complained to Renuka that her company has been having difficulty in getting the traditional share of Renuka’s business. On the last buy, Sheela’s company failed to get any business, even though Sheela believed she was the lowest bidder. Renuka tells Sheela that normally she does not get into the details of procurement, but she promises to ask her Purchasing Manager, Dannis Chako to investigate.
The next day morning, Renuka calls Dannis Chako and tells him of Sheela’s complaint. He said (says), that he does not want to influence the company’s procurement policies, but he does not feel that Renuka should investigate to make sure that Sheela’s firm was treated fairly.
Purchasing Manager, Dannis discovers that George Machine Company was indeed the lowest bidder on the last buying. Quotations for an order of 20,000 units were as under:
George Machine Company Rs 2.22
Data Matics Electronics Company Rs 2.23
Royal Tools and Machine Company Rs 2.25
Royal and Data Matics each got order for 10,000 pieces. Royal has done considerable development work on brushes, while George and Data Matics have done very little. The quality and delivery records of the three
AN ISO 9001 : 2008 CERTIFIED INTERNATIONAL B-SCHOOL suppliers on the last ten orders for the brushes are shown below. Renuka Machines Manufacturing Quality
Control Department has set an acceptable quality level of three per cent on the brush.
Supplier Quantity
Ordered
Quantity Defective Delivery
Royal 4,000 122 One week