Salt River Labs Case Study

Topics: Inventory control system, Supply chain management, Inventory Pages: 4 (1437 words) Published: April 3, 2013
Salt River Labs
Q- What is the major problem at SRL?  Who are the people involved and how do they contribute to the problem?

1. There are many problems that are apparent at Salt River Labs. The first major problem is the purchasing process. There are way too many people involved in this process. The current process involves series of five different people, or groups of people. This starts with the Chemists who send requisitions to supervisors, who send the requisition to Suzie Martinez, who sends the same requisition to Barbara, who finally sends the requisition to Arthur who makes the final decision about the requisition. Once a decision to approve or disapprove the requisition has been made, the requisition gets sent to Paul Jensen, or sent back to the chemists, respectively. There are too many hands touching the requisition forms, which cause delay in the ordering process. Another big problem that Salt River Labs has is their cash flow deficiencies. They do not have money to pay suppliers at the moment, and to many suppliers they have huge debts. Many suppliers are not sending materials because of the debt that has been accrued. SRL can only receive materials from vendors who are willing to accept orders on credit. This is a huge problem for SRL because of the fact that new suppliers do not like to give away materials to companies who are struggling to pay their current suppliers. There is an overwhelming trust issue among the employees at SRL. At times it even seems that there is hostility between different levels of employees. Upper level management such as Arthur, the VP of Finance, does not understand what other sections of the business are doing on a day-to-day basis. The sales team is not in direct communication with anyone who knows what/how much production is going on which also leads to tension among those groups of people. Chemists are getting very angry at all levels of the business because it is their job to get the tests done...
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