Spartan Heat Exchangers

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Spartan Heat Exchangers Inc. Case Study ------------------------------------------------- Company Overview: * Spartan was a leading designer and manufacturer of specialized industrial heat transfer equipment. * Spartan was owned by Krimmer Industries, headquartered in Denver, and employed more than 10,000 employees worldwide. * Primary produced transformer coolers, motor and generator coolers, hydro generator coolers, air-cooled heat exchangers, and transformer oil coolers. * Sales revenues were $25 million and operated in a 125,000-square-foot plant. * Business Strategy – * Utmost importance to customer satisfaction. * Made customized and unique heat transfer products to meet customer requirements through their design and research capabilities for a premium price. Current Situation: * A new business strategy that focuses more on reducing lead time and production costs to keep up with severe competition from Korea and Europe. * Rick Coyne, materials manager – Spartan Heat Exchangers Inc - Springfield, needs to come up with a plan supporting the business strategy. * Reports to Max Brisco, Vice President of Manufacturing. * Managed an in-house warehouse that housed the raw material inventories and, maintained adequate buffer inventories. * Executed purchase contracts with vendors, ensuring specifications were met while achieving the best possible price. Basic Issues: * Materials and purchasing department had over 350 vendors for raw material supply. * Raw material lead time ranged from few days to 6 weeks, causing delay. * Manufacturing operations flaws were detected via material shortage and stock outs. * Significant discrepancies with inventory records on the company’s computer system. * Irregular material management caused an amount of stock

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