Blozis Company Case Study

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The Blozis Company is a manufacturer of highly technical and customer specific engineered equipment. As the company is responsible for engineering very complex and complicated equipment both for general industrial applications as well as customer specified creations, it is required that this company has well-trained individuals that are working in highly involved departments. It is important to the company and their customers that everyone is knowledgeable in the technical complexities of the work so that the company can ensure that there is no financial loss to them due to sourcing of improper products, losing assets and or products and ultimately not being able to satisfy the customers.

As the supply manager of this company, if I were to be presented the complaints and after looking at the overall company processes and procedures I would say that a lot of things need to be addressed.

One issue that needs to be addressed is educating everyone so they understand their roles, it is especially important to address the role of the expediter. The problem with the expediter is that one individual is doing many individual’s jobs in a tactical and reactive way, instead of in a strategic manner. Thus putting a large and uneven workload on a single person and not properly utilizing the structure of the departments and their strengths. The expediter not only does specifications, they act as receiver and purchaser, not being able to do any one job well, and also creating a bottleneck in terms of communication between the engineering /production teams and the supply/purchasing team. With all the many tasks the expediter has to perform in a given day, it is also creating lack in documentation that is negatively affecting the receiving and invoicing steps for the company.

It is thus important that the expediter’s role be clearly defined and that some of their work is returned to their respective roles, such as the receiving and purchasing roles. I would suggest that since the expediter does have expertise in dealing with engineering and production on the technical side of the process, they should continue to support the two departments by continuing to address problems and suggest stocked substitute components before sending a requisition to supply. As the expediter has the tech knowledge to create designs and translate oral descriptions into specifications to be forwarded to the supply group, he can work with the two groups to ensure that the requisitions are done properly so that the supply group can procure the right items. The expediter can also work closely with the supply group to explain the technical specifications they’ve made so that supply understands what to ask of from their suppliers when sourcing.

Though the expediters name implies that their main goal is to help expedite the process by picking up rush orders, I believe his technical knowhow is more valuable to the company and thus rush pickups should be delegated to the shipper or driver. In the same way, the expediter should not act as a receiver and a separate person assigned as the receiver would be responsible for properly checking and documenting item receipts so stock levels can be maintained in the systems and any claims on damages can be made. Having an assigned receiver will also help to ensure products are properly received according to a structured process that the company needs to formalize and that all incoming products are sent to the right departments to lessen losses in products as seen previously with the case of the micrometers.

Now that the role of the expediter has been clarified to working between engineering and production to create specifications, it is up to the other departments to step up and take some of the responsibilities that the expediter was performing. A large player that has been underutilized in this company is the supply team. From common sense, a task that is more difficult or more complex would require more time, expertise and involvement to complete well and this would hold true for the supply team for the Blozis company. The supply team needs to be more involved and at an earlier stage in the procurement process with the engineering and production teams so that better and more direct communication can be established so that details are not lost.

The supply manager, buyer and purchasing clerks all need to gain better knowledge of the technical aspects of their company’s purchasing so that they are able to manage and communicate the engineers’ designs correctly to the suppliers so that less bad or incorrect purchases are made. This will have the added benefit of reducing over budget spends and costs to the company as well as ensuring the right departments are charged so there are no over budget surprises currently seen when the expediter is ordering, which is another large problem.

 As the supply group become more proficient, then they can take up a more direct contact with engineering and thus reducing the bottleneck effect currently seen when communications solely traveled via the expediter. As the expediter is also not acting as a buyer, the supply group can properly source product and ensure that PO’s are correctly created and invoices are matched properly. This will help to grow better rapport with the suppliers as there is less need for suppliers to fulfill the company’s requests based on ‘good faith’ and invoices are paid in a timely manner as there are documentations to match the purchases/receivings.

Currently the supply group is weak overall in performance and material control, most of the work is currently being done by the expediter. Forecasts need to be created so that the supply group can take on the role to oversee the stocks of the company, this will take some time to setup and communications from the other departments to ensure stock levels are in line with the demands, but this will have an overall benefit where the purchasers can deal with purchases in a more strategic and planned manner, such as bulk buying or multi-/single-sourcing.      

In conclusion, the current Blozis company’s procurement processes as well as role description needs to be clarified and formalized to improve their performance as a company. As stated before, the complexity of the products being dealt with and manufactured are high and thus the level of interaction and involvement should be equally high. The graph below is a visual representation of this idea, especially for the case of supply’s (or procurement’s) involvement.

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If the procedures and processes are to stay the way that they are, the Blozis company will suffer in the long run as this set up will lead to more missed purchasing opportunities as well as receiving issues that have resulted in loss of assets and products. This will lead to the detriment of supplier rapport and decreased customer satisfaction leading to less business and ultimately profits. It is in the best interest of Blozis to re-evaluate their current situation and make the necessary changes to the processes so that not only will the supply team be better utilized, but the company’s operations as a whole will grow and improve.