Case Report: Blozis Company

Executive Summary

In order to address the inefficiencies in Blozis Company’s supply chain department, I recommend that the roles and responsibilities of the supply department as well as the stock room personnel and receiving area be clearly defined. All personnel must be properly trained according to the duties that they are expected to perform, and must only perform duties that are within their realm of responsibility.

A specific process must be enforced which outlines the requirements from the time a need for a good or service is identified, through to the point where the goods have been ordered, received, and paid for. This process shall include proper authorizations and approvals, documentation, and record keeping.

In order to ensure that these processes are being followed and are working properly, regular meetings will occur and reports from accounting and supply chain will be examined on a monthly basis. We will solicit input from the plant and engineering managers to ensure that we are operating as effectively and efficiently as possible.

Key Issues

As the supply manager, I see several inefficiencies that are costing the company time and money.

The supply department exhibits weak control over materials at the point where goods are picked up or delivered from the supplier. The documentation (receipt report) is not always created, and when the expediter picks up the goods directly from the supplier and delivers them to the plant, there is no paper trail to show that the goods were received.

The department also exhibits weak control over overall supply management performance throughout the entire supply process:

• requisitions are being submitted without a requirement for support from management,

• the supply department has to rely on others from outside the department to decipher the technical specifications for complex orders,

• the expediter, who is not even part of the supply department, is being allowed to issue purchase orders,

• orders are not being placed in a timely fashion,

• receiving and inspection are not consistently being performed in an orderly manner, and

• there is missing documentation throughout the entire process, making it difficult to process payments and putting the company at risk in the event that an auditor request the documents.

If something is not done to fix these issues, we will find ourselves getting further behind and more disorganized.

Root Cause Analysis

The issues discussed above are a result of several root

...