Real-Life Decision Making -- Solution
You wait for the brand name the motel owners ordered and deliver
the motel units late.
Your contract has a clause for a specific delivery date, not seven days
later. Not surprisingly, the motel owner phones daily wondering where his
modules are. He's had the site ready for a week. In the meantime, there's
been a heavy snowfall and that will hamper the installation process.
Your boss is none too happy. Not only has this delay cost the motel owner
a considerable chunk of change, but it's also going to have an impact
on the company's reputation for reliability.
You also find out that failure to live up to your end of the contract can
result in heavy fines.
"Fines are set forward in a contract, depending on the size
and complexity of the building and on various inconsistencies for many given
situations," says Mick Modulinski, a production supervisor at a modular building
manufacturing plant.
"A standard clause in these types of contracts says that 80 percent of
a project must be complete by a particular date, or you must be on site by
a certain date." Therefore, seven days late can amount to a loss of credibility
and profit.