••• 1.9 Brown's, a local bakery, is worried about increased costs-particularly energy. Last year's records can provide a fairly good estimate of the parameters for this year. Wende Brown, the owner, does not believe things have changed much, but she did invest an additional $3,000 for modifications to the bakery's ovens to make them more energy efficient. The modifi- cations were supposed to make the ovens at least 15% more effi- cient. Brown has asked you to check the energy savings of the new ovens and also to look over other measures of the bakery's productivity to see if the modifications were beneficial. You have the following data to work with: LAST YEAR NOW Production (dozen) 1,500 1,500 Labor (hours) 350 325 Capital investment ($) 15,000 18,000 Energy (BTU) 3,000 2,750 PX

••• 1.9 Brown's, a local bakery, is worried about increased costs-particularly energy. Last year's records can provide a fairly good estimate of the parameters for this year. Wende Brown, the owner, does not believe things have changed much, but she did invest an additional $3,000 for modifications to the bakery's ovens to make them more energy efficient. The modifi- cations were supposed to make the ovens at least 15% more effi- cient. Brown has asked you to check the energy savings of the new ovens and also to look over other measures of the bakery's productivity to see if the modifications were beneficial. You have the following data to work with: LAST YEAR NOW Production (dozen) 1,500 1,500 Labor (hours) 350 325 Capital investment ($) 15,000 18,000 Energy (BTU) 3,000 2,750 PX

Marketing

20th Edition

ISBN:9780357033791

Author:Pride, William M

Publisher:Pride, William M

Chapter19: Pricing Concepts

Section: Chapter Questions

Problem 6DRQ

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Scenario 4 Sharon Gillespie, a new buyer at Visionex, Inc., was reviewing quotations for a tooling contract submitted by four suppliers. She was evaluating the quotes based on price, target quality levels, and delivery lead time promises. As she was working, her manager, Dave Cox, entered her office. He asked how everything was progressing and if she needed any help. She mentioned she was reviewing quotations from suppliers for a tooling contract. Dave asked who the interested suppliers were and if she had made a decision. Sharon indicated that one supplier, Apex, appeared to fit exactly the requirements Visionex had specified in the proposal. Dave told her to keep up the good work. Later that day Dave again visited Sharons office. He stated that he had done some research on the suppliers and felt that another supplier, Micron, appeared to have the best track record with Visionex. He pointed out that Sharons first choice was a new supplier to Visionex and there was some risk involved with that choice. Dave indicated that it would please him greatly if she selected Micron for the contract. The next day Sharon was having lunch with another buyer, Mark Smith. She mentioned the conversation with Dave and said she honestly felt that Apex was the best choice. When Mark asked Sharon who Dave preferred, she answered, Micron. At that point Mark rolled his eyes and shook his head. Sharon asked what the body language was all about. Mark replied, Look, I know youre new but you should know this. I heard last week that Daves brother-in-law is a new part owner of Micron. I was wondering how soon it would be before he started steering business to that company. He is not the straightest character. Sharon was shocked. After a few moments, she announced that her original choice was still the best selection. At that point Mark reminded Sharon that she was replacing a terminated buyer who did not go along with one of Daves previous preferred suppliers. Ethical decisions that affect a buyers ethical perspective usually involve the organizational environment, cultural environment, personal environment, and industry environment. Analyze this scenario using these four variables.
Scenario 4 Sharon Gillespie, a new buyer at Visionex, Inc., was reviewing quotations for a tooling contract submitted by four suppliers. She was evaluating the quotes based on price, target quality levels, and delivery lead time promises. As she was working, her manager, Dave Cox, entered her office. He asked how everything was progressing and if she needed any help. She mentioned she was reviewing quotations from suppliers for a tooling contract. Dave asked who the interested suppliers were and if she had made a decision. Sharon indicated that one supplier, Apex, appeared to fit exactly the requirements Visionex had specified in the proposal. Dave told her to keep up the good work. Later that day Dave again visited Sharons office. He stated that he had done some research on the suppliers and felt that another supplier, Micron, appeared to have the best track record with Visionex. He pointed out that Sharons first choice was a new supplier to Visionex and there was some risk involved with that choice. Dave indicated that it would please him greatly if she selected Micron for the contract. The next day Sharon was having lunch with another buyer, Mark Smith. She mentioned the conversation with Dave and said she honestly felt that Apex was the best choice. When Mark asked Sharon who Dave preferred, she answered, Micron. At that point Mark rolled his eyes and shook his head. Sharon asked what the body language was all about. Mark replied, Look, I know youre new but you should know this. I heard last week that Daves brother-in-law is a new part owner of Micron. I was wondering how soon it would be before he started steering business to that company. He is not the straightest character. Sharon was shocked. After a few moments, she announced that her original choice was still the best selection. At that point Mark reminded Sharon that she was replacing a terminated buyer who did not go along with one of Daves previous preferred suppliers. What should Sharon do in this situation?
Scenario 4 Sharon Gillespie, a new buyer at Visionex, Inc., was reviewing quotations for a tooling contract submitted by four suppliers. She was evaluating the quotes based on price, target quality levels, and delivery lead time promises. As she was working, her manager, Dave Cox, entered her office. He asked how everything was progressing and if she needed any help. She mentioned she was reviewing quotations from suppliers for a tooling contract. Dave asked who the interested suppliers were and if she had made a decision. Sharon indicated that one supplier, Apex, appeared to fit exactly the requirements Visionex had specified in the proposal. Dave told her to keep up the good work. Later that day Dave again visited Sharons office. He stated that he had done some research on the suppliers and felt that another supplier, Micron, appeared to have the best track record with Visionex. He pointed out that Sharons first choice was a new supplier to Visionex and there was some risk involved with that choice. Dave indicated that it would please him greatly if she selected Micron for the contract. The next day Sharon was having lunch with another buyer, Mark Smith. She mentioned the conversation with Dave and said she honestly felt that Apex was the best choice. When Mark asked Sharon who Dave preferred, she answered, Micron. At that point Mark rolled his eyes and shook his head. Sharon asked what the body language was all about. Mark replied, Look, I know youre new but you should know this. I heard last week that Daves brother-in-law is a new part owner of Micron. I was wondering how soon it would be before he started steering business to that company. He is not the straightest character. Sharon was shocked. After a few moments, she announced that her original choice was still the best selection. At that point Mark reminded Sharon that she was replacing a terminated buyer who did not go along with one of Daves previous preferred suppliers. What does the Institute of Supply Management code of ethics say about financial conflicts of interest?
Brown's, a local bakery, is worried about increasedcosts- particularly energy. Last year's records can provide afairly good estimate of the parameters for this year. WendeBrown, the owner, does not believe things have changed much,but she did invest an additional $3,000 for modifications to thebakery's ovens to make them more energy efficient. The modificationswere supposed to make the ovens at least 15% more efficient.Brown has asked you to check the energy savings of thenew ovens and also to look over other measures of the bakery'sproductivity to see if the modifications were beneficial. You havethe following data to work with:
Refer to Problem 7.1. If a contract for the secondand third years is pending, what a re the implications fo r processselection?
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The Star Paper Division of Royal Industries islocated near Los Angeles. A major expansion ofthe division’s only plant was completed in April2015. The expansion consisted of an addition to theexisting building, additions to the production linemachinery, and the replacement of obsolete andfully depreciated equipment that was no longer efficientor cost-effective.of Star. Harris had a meeting with Marie Fortner,vice president of operations for Royal, whoexplained to Harris that the company measured theperformance of divisions and division managers onthe basis of return on gross assets (ROA). WhenHarris asked if other measures were used in conjunctionwith ROA, Fortner replied, “Royal’s topmanagement prefers to use a single performancemeasure. Star should do well this year now that ithas expanded and replaced all of that old equipment.You should have no problem exceeding the division’shistorical rate. I’ll check with you at the endof each quarter to see how you are doing.” Fortnercalled…
Brown's, a local bakery, is worried about increased costs particularly energy. Last year's records can provide a fairly good estimate of the parameters for this year. Wende Brown, the owner, does not believe things have changed much, but she did invest an additional $2,500 for modifications to the bakery's ovens to make them more energy efficient. The modifications were supposed to make the ovens at least 15% more efficient. Brown has asked you to check the energy savings of the new ovens and also to look over other measures of the bakery's productivity to see if the modifications were beneficial. You have the following data to work with: Last Year Now Production (dozen) 1,600 1,600 Labor (hours) 350 325 Capital Investment ($) 16,000 18,500 Energy (BTU) 3,000 2,800 Energy productivity increase = %(enter your response as a…
Brown's, a local bakery, is worried about increased costs particularly energy. Last year's records can provide a fairly good estimate of the parameters for this year. Wende Brown, the owner, does not believe things have changed much, but she did invest an additional $2,500 for modifications to the bakery's ovens to make them more energy efficient. The modifications were supposed to make the ovens at least 15% more efficient. Brown has asked you to check the energy savings of the new ovens and also to look over other measures of the bakery's productivity to see if the modifications were beneficial. You have the following data to work with: Last Year Now Production (dozen) 1,600 1,600 Labor (hours) 340 320 Capital Investment ($) 15,000 17,500 Energy (BTU) 3,000 2,800 Energy productivity increase =____ (enter your response as a percentage rounded to two decimal places and include a minus sign if necessary). Capital productivity increase = ____(enter your…
Develop a fair procedure that will be used to determine merit raises and then decide the dollar raise to be given to each professor. provide not only the dollar amount of the raises, but also explain the process fordetermining raises and the rationale behind them.SituationSmall State University is located in the eastern part of the United States and has anenrollment of about 8,000 students. The College of Business has 40 full-time and morethan 30 part-time faculty members. The college is divided into five departments:Management, Marketing, Finance and Accounting, Decision Sciences, and InformationTechnology. Faculty members in the Management Department are evaluated each yearbased on three primary criteria: 1) teaching, 2) research, and 3) service. Teachingperformance is based on student course evaluations over a two-year period. Service tothe university, college, profession, and community is also based on accomplishmentsover a two-year period. Research is based on the number of…
Develop a fair procedure that will be used to determine merit raises and then decide the dollar raise to be given to each professor. provide not only the dollar amount of the raises, but also explain the process fordetermining raises and the rationale behind them.SituationSmall State University is located in the eastern part of the United States and has anenrollment of about 8,000 students. The College of Business has 40 full-time and morethan 30 part-time faculty members. The college is divided into five departments:Management, Marketing, Finance and Accounting, Decision Sciences, and InformationTechnology. Faculty members in the Management Department are evaluated each yearbased on three primary criteria: 1) teaching, 2) research, and 3) service. Teachingperformance is based on student course evaluations over a two-year period. Service tothe university, college, profession, and community is also based on accomplishmentsover a two-year period. Research is based on the number of…
Brown's, a local bakery, is worried about increased costs particularly energy. Last year's records can provide a fairly good estimate of the parameters for this year. Wende Brown, the owner, does not believe things have changed much, but she did invest an additional $2,500 for modifications to the bakery's ovens to make them more energy efficient. The modifications were supposed to make the ovens at least 20% more efficient. Brown has asked you to check the energy savings of the new ovens and also to look over other measures of the bakery's productivity to see if the modifications were beneficial. You have the following data to work with: Last Year Now Production (dozen) 1,600 1,600 Labor (hours) 350 320 Capital Investment ($) 15,000 17,500 Energy (BTU) 3,200 2,800 Energy productivity increase = (enter your response as a…