1. If you were in a position of Mr. Carter, what action would you take on the design engineering contract?
Case 6-1 Moren Corporation (A) Moren Corporation was building three additional genera- COMPANY BACKGROUND tion stations to serve its rapidly expanding energy market. To link these stations with a total area grid, a new method Moren Corporation, established in 1895, was one of the of carrying the power lines using ornamental tubular poles largest power utilities in the eastern United States instead of towers had been adopted. Moren had had no serviced a highly industrialized area of 10 fosil-fuelhi previous operating experience with poles and decided to plants. With assets of over $19 billion and demand de subcontract the design engineering, fabrication, and erec- bling every decade, it had already earmarked funds to ie tion of the new line. crease its kilowatt capacity from 8.4 million to 13 milli For the first phase of engineering design, Mr. John Carter, over a four-year period. the vice president of supply, faced the responsibility of de- ciding with which supplier the business was to be placed af nology and its good public relations. Both purchasing u ter his staff had developed the information needed. He was engineering departments were centralized and locati b aware that Moren had only three years in which to complete the head office in the area's largest city. The new consin the entire project, and yet he had to ensure high-quality work. tion program was a heavy strain on both the prot The company was well known for its advancol and financial resources of the company, placing Case 6-1 Moren Corporation (A) Moren Corporation was building three additional genera- COMPANY BACKGROUND tion stations to serve its rapidly expanding energy market. To link these stations with a total area grid, a new method Moren Corporation, established in 1895, was one of the of carrying the power lines using ornamental tubular poles largest power utilities in the eastern United States instead of towers had been adopted. Moren had had no serviced a highly industrialized area of 10 fosil-fuelhi previous operating experience with poles and decided to plants. With assets of over $19 billion and demand de subcontract the design engineering, fabrication, and erec- bling every decade, it had already earmarked funds to ie tion of the new line. crease its kilowatt capacity from 8.4 million to 13 milli For the first phase of engineering design, Mr. John Carter, over a four-year period. the vice president of supply, faced the responsibility of de- ciding with which supplier the business was to be placed af nology and its good public relations. Both purchasing u ter his staff had developed the information needed. He was engineering departments were centralized and locati b aware that Moren had only three years in which to complete the head office in the area's largest city. The new consin the entire project, and yet he had to ensure high-quality work. tion program was a heavy strain on both the prot The company was well known for its advancol and financial resources of the company, placing
