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Butler

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Case Study: Butler Systems

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Butler Systems

Case 6: Brief summary of the case and main points

The case in question involves Butler Systems Company, which is in a binding contract with SDX Company. Butler Systems specializes in the manufacture of power conditioning equipment as well as environmental control systems and relies on battery supplies from SDX. Butler Systems uses HD-5 battery as the main component for emergency supply system (Benton, 2010). SDX is in a five-year contract with Butler Systems for the supply of batteries. However, SDX has not supplied adequate quantities of batteries to Butler Systems for two months. Moreover, SDX changed their battery prices without informing Butler Systems early enough as their contract agreement requires. This shortage of batteries and change in battery prices has affected Butler Systems operations.

As the VP of Operations, what is your assessment of the battery shortage problem?

My assessment of the battery shortage problem is that SDX Company is failing to meet its contractual obligations regarding battery supplies to Butler Systems. The contract requires the supplier to ensure it observes a service rate that is complete and satisfying (Benton, 2010). From the contract agreement between Butler Systems and SDX, the obligation of the supplier is to ensure it provides a 90-day battery supply. Contrary to this, SDX is currently providing only a 20-day supply resulting in a 70-day battery shortage. As the Vice President (VP) of Operations, I believe that SDX is violating the contractual agreement and this is unacceptable.

The actions I would take and the reasons why

I will try to solve the problem as quickly as possible to facilitate normal company operations by holding…...

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