Captiva Conglomerate

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Case Name: Vignette: Lessons Learned

I. Major Facts

Al Carpenter, Materials manager at Captiva Conglomerate called a meeting with his Inventory and Spares manager, Supply manager, vice president of Operations, vice president of finance and the director of Information Technology to discuss the contract with S. O. Software (SOS), the developer/supplier of a custom inventory management and spare parts management system. The spares management module was completed and is four months behind schedule. The regional and centralized inventory management system is 10 months behind. Al thinks that they should sue them. Aaron tells them that under the contract that Gerry signed they don’t have a leg to stand on. The contract calls for ‘best efforts,’ ‘whenever possible,’ etc. $1 million they had in the contract is used up already. There were 17 unpriced change orders. The specs were drafted by SOS and the IT manager initialed each page of the contract.

II. Major Problem

The contract was not reviewed by the appropriate personnel prior to the award of the contract. The spares management module is 4 months behind schedule. The system is a hassle to use and does not provide relevant data. The regional and centralized inventory management system is 10 months late. The contract calls for ‘best efforts,’ ‘whenever possible,’ etc and the $1 million called for in the contract is already used up with 17 unpriced change orders. The specifications were drafted by SOS and the IT manager had initialed each page.

III. Possible Solutions/Alternatives

A. Renegotiate and restructure the contract.

B. Since Jim thinks the system is great and understand how to use it, he could train the personnel. The could get trained and figure out the system. Since the IT manager initialed each page of the contract, the IT department can work on ways to improve the system so that it would be easier for the personnel to use....
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