4 Should Ben change his business model? As Ben Lawson, CEO of Custom Fabricators, Inc., drove back...
Question:
4 Should Ben change his business model? As Ben Lawson, CEO of Custom Fabricators, Inc., drove back to his home in South Indianapolis, he thought about the day. I've done a lot of business with Orleans Elevator in Bloomington over the years, but just wonder how long this will continue. I have much invested in my manufacturing plant located right next to their plant, but now that United Technologies [the parent company of Orleans] is all into this FreeMarkets Internet purchasing system, I just wonder how long they are going to be interested in keeping me in the supply chain loop. It's been a good business over the past few years. I was in the right place at the right time when Orleans got into just-in-time and lean manufacturing in the late 1980s. Initially I was just making the control panels for the elevators. It was interesting to walk into a new building, get on the elevator, and see my company's handiwork in that beautiful stainless steel panel that houses the buttons for the floors on the building. I could take a lot of pride in the craftsman- ship even though it was largely a technology thing. That new numerically controlled machine tool that I purchased in 1985 made making the holes in those custom panels easy. We are still making beautiful panels. Since that time, my company has gotten a lot of other business from Orleans. We now make all kinds of special brackets and pan- els for the plant. This has been great for us over the years. We have set up a very efficient process for fabricating exactly what the plant needs in these parts with very little lead time. For most items, Orleans simply gives us the production schedule for elevators being shipped over the next month, and we make the required parts auto- matically. We know exactly what they need based on their schedule. Of course, it is easy to modify things for the specific needs of a par- ticular elevator order.
Step by Step Answer:
Operations Management For Competitive Advantage
ISBN: 1572
11th Edition
Authors: Richard B. Chase, F. Robert Jacobs