Francois Chenier is the purchasing agent for Highlight Manufacturing Company. Marge Belvedere is head of the production planning and control department. Every six months, Belvedere gives Chenier a general purchasing program. Chenier gets specifications from the engineering department. He then selects suppliers and negotiates prices. When he took this job, Chenier was informed very clearly that he bore responsibility for meeting the general purchasing program once he accepted it from Belvedere.
During week 24, Chenier was advised that Part No. 1234—a critical part—would be needed for assembly on Tuesday morning of week 32. He found that the regular supplier could not deliver. He called everywhere and finally found a supplier in the West and accepted the commitment.
He followed up by mail. Yes, the supplier assured him, the part would be ready. The matter was so important that on Thursday of week 31, Chenier checked by phone. Yes, the shipment had left on time. Chenier was reassured and did not check further. But on Tuesday of week 32, the part had not arrived. Inquiry revealed that the shipment had been misdirected by the railroad and was stuck in Winnipeg.
REQUIRED
What department should bear the costs of time lost in the plant? Why? As the purchasing agent, do you think it fair that such costs be charged to your department?