MEMORANDUM

TO: Dwight Schrute, President/ CEO

FROM: Michael Scott, Manager

DATE: February 5, 2018

SUBJECT: Incident Report Scranton Plant

ACTION REQUIRED: YES, by Feb. 9

Distribution List: Regional Manager, Plant Manager

Dear Dwight Schrute,

INTRODUCTION

The following incident happened on February 1, 2018 at approximately 1:30PM. This report is
to serve a detailed explanation of an incident that occurred on the production floor as a result
of negligence on the paper mill. Rest assured, this will not push back any deadlines of our
current production as we have already finished most of our current orders for our current
customers. I have already briefed the entire production staff on proper handling and care of the
equipment, but work still remains as a solution to this problem. Dunder Mifflin has to get this
fixed as soon as possible, in case of a possible mass production from many of our customers.
Please be advised if we decide to outsource some of our production to the other Dunder Mifflin
branches around the area as a result.

Narrative of the Incident

On February 1, 2018, Lonnis Collins, a member of our production floor staff was cleaning the
paper mill numbered 3. As I have always briefed the plant manager on safety and policies, these
policies are always in place no matter the situation. Lonnis Collins had admitted to not
following procedure during cleaning of the mill. As a result, he damaged one of the rollers on
the paper mill needed to press the papers. This incident was not a result of common
mechanical failures. Lonnis Collins was not using a blocker for the mill and as a result, one of
the rags he was using got lodged in the mill rollers. This essentially made the mill non-usable at
the moment. We had to call mechanics in to come look at it hoping it was an easy fix, but upon
close inspection of the mill, the actual rollers that came in contact with the rag caused it to
bend. We will need to discuss potential solutions.
Challenges of the Situation

This incident was a result of negligence within the policies of our plant. As stated, within our
some of our policies listed below:

 Members of the production floor will adhere to policies posted around the plant
 Members of the production floor will acknowledge the briefings given by plant manager
 When cleaning the mills, a blocker will be used to ensure nothing can get lodged
between the rollers.

Here at the Scranton branch, we strive to keep our employees and machines safe and running,
which is indicated by some of our policies as listed above. We also would like to prepare where
potential work can be done at. I would also like to discuss potential punishment for Lonnis for
his negligence while cleaning the mill.

Possible Solutions

1. Outsource our future orders to other plants that can sustain the work. There are
multiple branches near Scranton that can take some of the work load from the Scranton
Branch while we wait for the rollers to come in next week and have a technician come
install it.
a. Orders bigger than 500 will be outsourced to Plant B
b. Orders smaller than 500 will be outsourced to Plant C.
c. Orders less than 100 will remain in the Scranton Branch.
2. Purchase new Mills. These mills can be delivered within 2 business days. We have
discussed the possibility to possibly purchase new mills that will produce paper 10 times
faster than our current mills. With this situation happening, what better time would it
be to buy new machines and have it improve our production at the same time. As we
both know, this won’t be an instant thing, but we could have more modern technology
that are suitable with our customer’s demands in the upcoming months. Listed below
are some mill options that I have looked over that will increase our production while
being cost efficient for the company.
a. Mill A- State of the art, producing 1000 Sq Ft of paper per hour
b. Mill B- Produces 850 Sq Ft per hour
c. Mill C- Produces 700 Sq Ft per hour

Cost Analysis

1. Solution 1
The cost to outsource our work to our other branches is only minimal. Transferring all our
work and having other plants work on them would roughly be around $500 per orders of
300Sq Ft. We would need to coordinate and let our customers know. We will forward the
 work to the plants. If we decide to just buy new rollers, the two rollers will come in at
around $4000 per roller which equates to almost $8000 total not including installation.
Installation is a separate $600 for the labor. This solution will be roughly a total of $12600
while keeping our current mills.

2. Solution 2
Solution two involves buying a new mill that will outperform our current broken one 10
times. I want to place an emphasis that if we decide to buy a new mill, it can be delivered
within two business days which won’t push back most of our orders. The cost of the mills I
listed are as follows:
 Mill A- $29000
 Mill B- $24000
 Mill C- $19000

Installation will be free which is courtesy of buying these mills from them. As these costs are
significantly higher than solution 1, I want to point out that these mills will help out our
Scranton Branch in the future with the bigger orders and growing customer base.

My Recommendations

1. Cost Efficiency at the time

Choosing this option with getting the mill rollers for less than the machines and out
sourcing our work to other branches, we will not spend as much as getting new
machines. As this will be good for our company short term, this is just allowing us to
remain the same as before.
2. Long Term Solution
Solution 2 is by far the best solution for our company’s long-term future. This will be at
most $29000 for the mill, but as our customer base is growing and order numbers are
rising, we will break even for the price of the mill in no time. This option will also help
Scranton Branch improve with our speed and efficiency of producing paper products.
This solution also requires less time as it can come in by two business days.

Thank you, Mr. Schrute. Please respond by the action required date to discuss things. I would
like to discuss these things more in detail and talk about Mr. Collins’ punishment. Please put
thought into both of my possible solutions and let me know what you think is the best choice
for Scranton Branch going forward. As we move forward as a company, I want to emphasize
that we are always following procedure to ensure safety of our equipment and employees.
Again, thank you for your time.