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"I can change the base we're using for determining the cost of parts. Instead of using the cost factor of the past twelve months, which is what I'm supposed to be doing, we can use the past two months. That will help us, because for the past two months, we've had big increases in throughput."
"Yeah," I say, sensing the possibilities. "Yeah, that might work. And actually the past two months are a lot more represen- tative of what's really going on here than what happened last year."
Lou leans from side to side. He says, "We-l-l-l, yes, that's true. But according to accounting policy, it's not valid."
"Okay, but we have a good excuse," I say. "The plant is different now. We're really a hell of a lot better than we were."
"Al, the problem is Ethan Frost will never buy it," says Lou.
"Then why did you suggest it?"
"Frost won't buy it if he knows about it," says Lou.
I nod slowly. "I see."
"I can give you something that will slide through on the first glance," says Lou. "But if Frost and his assistants at division do any checking, they'll see through it in no time."
"You're saying we could end up in very hot water," I say.
"Yeah, but if you want to take a chance..." says Lou.
"It could give us a couple more months to really show what we can do," I say, finishing the thought for him.
I get up and walk around for a minute turning this over in my mind.
Finally I look at Lou and say, "There is no way I can show Peach an increase in the cost of parts and convince him the plant is better off this month than last. If he sees these numbers and gets the idea our costs are going up, we'll be in hot water any- way."
"So you want to try it?" Lou asks.
"Sure."
"All right," he says. "Remember, if we get caught-
"Don't worry. I'll practice my tap dancing."
As Lou is on his way out, Fran buzzes me to say Johnny Jons is on my line. I pick up the phone.
"Hello there," I tell him, We're practically old pals by now; I've been on the phone with him just about every day-and sometimes three or four times a day-for the past few weeks. "What can I do for you today?"
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"Remember our dear friend Bucky Burnside?" says Jons. "How could I forget good ole Bucky," I say. "Is he still com- plaining about us?"
"No, not anymore," says Jons. "At the moment, in fact, we don't even have a single active contract with Burnside's people. That's the reason I'm calling. For the first time in months, they've expressed interest in buying something from us again."
"What are they interested in?"
"Model 12's," he says. "They need a thousand units."
"Terrific!"
"Maybe not," says Jons. "They need the whole order by the end of the month."
"That's only about two weeks away," I say.
"I know," says Jons. "The sales rep on this already checked with the warehouse. Turns out we've only got about fifty of the Model 12's in stock."
He's telling me, of course, we'll have to manufacture the other 950 by the end of the month if we want the business.
"Well... Johnny, look, I know I told you I wanted busi- ness, and you've pulled in some nice contracts since I talked to you," I say. "But a thousand Model 12's in two weeks is asking a lot."
He says, "Al, to tell you the truth, I didn't really think we could do anything with this one when I called. But I thought I'd let you know about it, just in case you knew something I didn't. After all, a thousand units means a little over a million dollars in sales to us."
"Yes, I realize that," I say. "Look, what's going on that they need these things so fast?"
He tells me he did some digging and found out that the order had originally gone to our number-one competitor, who makes a product similar to the Model 12. The competitor had had the order on its books for about five months. But they hadn't filled it yet, and this week it became clear they would not be able to meet the due date.
"My guess is that Burnside turned to us, because they've heard about us offering such fast turn-around to everyone else," he says. "Frankly, I think they're desperate. And, hell, if there is any way we can pull this off, it'd sure be a good way for us to save face with them."
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"Well, I don't know. I'd like that business back again, too, but..."
"The real kick in the head is if we had only had the foresight to build a finished goods inventory of Model 12's while we had those slow sales months, we could have made this sale," he says.
I have to smile to myself, because at the beginning of the year I might have agreed with that.
"It's too bad," Johnny is saying. "Aside from the initial busi- ness, it could have been a big opportunity for us."
"How big?"
"Strong hints have been dropped that if we can come through on this one, we could become their preferred supplier," says Jons.
I'm quiet for a moment.
"All right. You really want this, don't you?" I ask him.
"So bad I can taste it," he says. "But if it's impossible..."
"When do you have to let them know?" I ask.
"Probably sometime today, or tomorrow at the latest," he says. "Why? Do you think we can really do it?"
"Maybe there's a way. Let me see how we stand and I'll give you a call back," I tell him.
As soon as I get off the phone with Jons, I round up Bob, Stacey, and Ralph for a meeting in my office, and when we're all together I tell him what Jons told me.
"Ordinarily, I would think this is out of the question," I say. "But before we say no, let's think about it."
Everybody looks at me with the certain knowledge this is going to be a waste of time.
I say, "Let's just see what we can do, okay?"
For the rest of the morning, we're busy with this. We go over the bill of material. Stacey checks on raw materials inventories. Ralph does a quick estimate of how long it will take to produce a thousand units after the materials are on hand. By eleven o'clock, he has calculated that the bottlenecks can turn out parts for the Model 12 at the rate of about one-hundred per day.
"So, yes, it would be technically feasible for us to take the order," says Ralph. "But that's only if we work on nothing else for two weeks except the thousand units for Burnside."
"No, I don't want to do that," I tell him, thinking about us
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screwing up relations with a dozen customers just to please one. "Let's try something else."
"Like what?" asks Bob, who is sitting there with us, looking about as enthusiastic as a bump on a log.
I say, "A few weeks ago, we cut our batch sizes by half, and the result was we could condense the time inventory spends in the plant, which also gave us an increase in throughput. What if we cut the batch sizes by half again?"
Ralph says, "Gee, I hadn't thought of that."
Bob leans forward. "Cut them again? Sorry, Al, but I don't see how the heck that can help us, not with the volume we're already committed to."
"You know," says Ralph, "we have quite a few orders we'd planned to ship ahead of their due dates. We could re-schedule some of those in the priority system so they'd ship when prom- ised instead of early. That could give us more time available on the bottlenecks, and it wouldn't hurt anybody."
"Good point, Ralph," I tell him.
"But, hell, we still can't get a thousand units done no-how," drawls Bob. "Not in two weeks."
I say, "Well, then, if we cut the batch sizes, how many units can we do in two weeks and still ship our current orders on time."
Bob pulls on his chin and says, "I guess we could look into it."
"I'll see what I can find out," says Ralph, standing so he can leave and go back to his computer.