Authors
Dr. Marlene Smith
University of Colorado Denver
Objective
Evaluate the price quoting process of two different sales associate to determine if there is inconsistency between them to decide if a new more consistent pricing process should be developed.
Background
When an order is placed by a customer of a small manufacturing company, a price quote must be developed for that order. Because each order is unique, quotes must be established on an order-byorder basis by a pricing expert. The price quote process is labor-intensive, as prices depend on many factors such as the part number, customer, geographic location, market, and order volume. The sales department manager is concerned that the pricing process is too complex, and that there might be too much variability in the quoted prices. An improvement team is tasked with studying and improving the pricing process.
After interviewing experts to develop a better understanding of the current process, the team designed a study to determine if there is variability between pricing experts. That is, do different pricing experts provide different price quotes? Two randomly selected pricing experts, Mary and Barry, were asked to independently provide prices for twelve randomly selected orders. Each expert provided one price for each of the twelve orders.
The Task
Preliminary results of the study have been made available to you from Mary and Barry. Interpret the results for the manager in the context of the problem posed above. Because you have the data set, you can do any further analysis that you feel is warranted.