2. Develop a recommendation for Jack and the Hatcher Gear Company to use in the long run, specifically to try to minimize the current dilemma from occurring again.

CompanyJack Fielding found himself in a real dilemma when the sales and marketing department presented him with the annual sales demand forecast for one of the gear lines. Jack, as materials manager for Hatcher Gears, was responsible for taking the forecast and translating it into projected production needs and, as part of that, requirements for raw material purchasing needs—both in quantities and dates. That fairly routine task went fine until he came to the V27 family of gears.The V27 family of gears was used by customers in highly stressful applications, and as a result they needed to be made from a highly specialized steel, made with a complex mixture of chemicals. The steel mill made the steel reluctantly, since it required shutting down a furnace and completely cleaning it out in order to avoid contamination. The time and effort to make the furnace ready, in combination with the costly chemicals used to make the steel, meant that the steel was extremely expensive for Hatcher to buy. In addition, the steel company had told Hatcher Gear that they would make only one batch of the steel and only once a year. They had their own annual production plans to execute, and the special steel was simply too disruptive to their production for Hatcher Gears to request any additional steel beyond the one batch during the year. Since Hatcher Gears was the only customer that needed that steel, the steel company required Hatcher to buy all the steel that was made in the batch. The steel company had no desire to maintain a very expensive inventory for Hatcher Gear. As it was, the steel company had reluctantly kept Hatcher Gears as a customer, and his recent attempts to find another steel company willing to make the steel was met with rapid and emphatic refusals.