BLOZIS COMPANY

The Blozis Company was a manufacturer of highly technical equipment. The $16 million gross

sales of the company consisted primarily of units designed to customer specifications by the

engineering department and produced on a job-shop basis by the production department. The

engineering department also designed highly complex control equipment of general industrial

application to be sold by the Blozis Company on an off-the-shelf basis. 

The supply department consisted of the supply manager, a buyer, and two clerks who

handled typing and filing. Although many of the items purchased were of a highly technical

nature, the supply manager had no technical training. Through the years, he had picked up a fair

grasp of the engineering terminology used in the field, but had made no attempt to keep up with

the specialized design problems of the company. The buyer was a woman who was known in the

trade as hard-boiled but big-hearted and was generally considered a competent general supplies

buyer. Without great ingenuity, the buyer also successfully handled technical items if detailed

specifications were supplied by engineering or production.

An expediter was attached to production. He formerly had been one of the technicians in

the production shop and had picked up some technical training in the Army. Because he could

understand verbal descriptions of items needed by engineering and production, these groups often

contacted him on ordering problems before submitting a requisition to supply. He frequently

would suggest substitute components that could be drawn immediately from the stock room; or he

would convert the oral description into a commercial specification, type a requisition, and submit

it to the supply department. The expediter had two primary responsibilities: to pick up rush orders

and to supervise the stock room. He spent about 50 percent of each day picking up items at

nearby suppliers, at truck terminals, or airports, or carrying materials to subcontractors, to platers,

or to various carriers for shipment. In the stock room, a clerk kept up the facilities, issued supplies

to engineering and production personnel, and kept stock records. The clerk reported to the

expediter, who reviewed the stock records, prepared requisitions for items at their reorder points,

and disposed of items that were turning too slowly or had deteriorated. 

Frequent problems had arisen when suppliers claimed long overdue payments on

materials that had been received by the Blozis Company. In these cases it always developed that

someone had forgotten to make up a receiving report. Since supply passed bills for payment only

after receipt of the receiving report, several sizable discounts had been missed and the company

had been substantially tardy in meeting the net date on several bills. In these cases, the expediter

was always sure that the item had come over the receiving dock, and the receiving clerk was just

as sure that the expediter had brought it into the plant in the back of his station wagon.

A particularly unfortunate incident had occurred when two special micrometers

disappeared within the plant after the Blozis Company had waited six months to receive them.

The supplier could prove receipt by the bill of lading signed by the receiving clerk. The receiving

clerk claimed the expediter had picked up the micrometers on the receiving dock to carry them to

the engineers as quickly as possible. The expediter claimed he had never seen the micrometers.

Both the production and plant maintenance managers had backed their respective men to the

fullest. No disciplinary action had been taken since there were no signatures on the receiving

reports to prove either case.

The expediter periodically typed up purchase orders for rush items. In other cases, he