FANSHAWE LAWRENCE KINLIN SCHOOL OF BUSINESS PROGRESSIVE ENGINE DIVISION It was 4 o'clock on Thursday afternoon of November 2016 and Richard Prendergast, Senior Supply Chain Manager for castings for the Progressive Engine Corporation of Woodstock, Ontario, had just finished a telephone conversation with an upset supplier. It was the fifth such call Richard had received in response to a letter he had sent out to his magnesium castings suppliers concerning a severe corrosion problem. All five had told Richard that they could not adhere to his request without a significant increase in their costs. The Progressive Engine Division Progressive Engine was a division of Progressive Products Corporation, a three billion dollar company that enjoyed a worldwide reputation for quality and innovation leadership in several product areas, including aviation, aerospace and industrial. In operation for forty years Progressive Engine Division had built more than 50,000 gasoline engines for a wide variety of commercial, industrial and military applications. Currently the majority of Progressive's sales were in the commercial and general aviation markets, but the company had created a strategy to balance the revenues between the commercial, general aviation and military sales. The Corrosion Task Force In the summer of 2016 Progressive began receiving complaints from its customers concerning corrosion on gearboxes on the engines. The problem was significant and serious enough to warrant the attention of the Senior Vice President of Progressive, Mr. Floyd Timmerman. In order to resolve this problem and find a permanent solution Floyd created a Corrosion Task Force, which immediately solicited input from Supply Quality Assurance Manufacturing Engineering Production Control Materials Magnesium Corrosion Task Circle (reliability Circle) O This task force was established in 2014 to deal with the general problem of magnesium corrosion as part of Progressive's Reliability Circles Program. The task force met as required. The input solicited from this group was to suggest solutions to the corrosion problem, and make recommendations for implementing suggested changes to programs to Neil Bishop adapted this case for the Lawrence Kinlin School of Business at Fanshawe College. It was prepared solely to provide teaching materials for class discussion. The writer does not intend to illustrate either effective or ineffective handling of a managerial situation. The writer may have disguised certain names and other identifying information to protect confidentiality. Copyright 2016, Neil Bishop and Lawrence Kinlin School of Business Fanshawe College Version: 14-06-20