Decision Making at Cat Cooperation - Article Example

1. Introduction A-CAT Corp. was a leading producer of electrical appliances that catered to the low end of the market segment that was sensitive to price fluctuations. It believed that rural market had great potential. Through its two manufacturing units, situated in the rural district of Gondia in Maharashtra, India, it produced 100 different models of electrical appliance including TV boosters, transformers, ballasts, FM radio kit etc. But TVR500, voltage regulator that was used for refrigerator and TV, remained the flagship product.

It had alliance with Jupiter Inc. for production of cabinets and collaboration venture with Global Electricals manufacturing of signal boosters and battery chargers.2. Problem The major problem was choosing the best supplier for one of critical subassemblies for manufacturing of its leading product TVR500 voltage stabilizer from the four short listed four vendors: Ideal; Dolphin; Boss; and Freedom. Good vendor was critical as lead time in manufacturing had increasingly become crucial criteria for competitive advantage.

The company considered efficiency, power factor, losses, turn ratio and cost as main factors for choosing vendors. The decision on final vendor had become difficult as consensus from people coming from different departments like purchase, finance, manufacturing and quality could not be reached.3. Solution The three qualitative factors: efficiency, power factor and losses were subjective in nature where turn ratio and cost could easily be evaluated because of their quantitative nature. The pair wise comparison of the product showed that Ideal was better in terms of efficiency and power factor with slightly more cost.

But as efficiency and power factor significantly contribute to the credibility of the product, Ideal should be chosen as vendor.(words: 273)ReferenceCase study as provided