DRW technologies, a defence and aerospace manufacturer company with 21 manufacturing plants in

US, southwest, mid-west and west-coast, made advance electronics system for the US military and
commercial aircraft manufacturers. The company was known for its innovation and profitability.
However, there had been anticipation that there would be decline in defence budget if US and as
there was increase in the number of the fixed price contracts, the company was forced to try lower
costs. About 10% of the annual sales had occurred due to the rush or priority orders to the high
priority customers like the US military’s special operations command. Though, annual sales for such
orders had been trending upwards the profitability for such sales was less. But DRW would still
continue serving them because it did not want to loose out on the high loyalty customers. The plant
executives attributed these shortfalls to certain factors most of which were external. Claiborne was
hired from another company from within the industry, and the news of his arrival was announced in
an email to corporate executives and plant managers and in the company newsletter. Before he has
even met the procurement team, Claiborne is assigned his first task of cutting procurement costs
and messaging the news to the company.

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