Taking the Plant to the Board
The quarterly meeting of the Board of Directors is set to commence at 2:00 p.m. Jim Elliott has
been reviewing his notes and agenda for the meeting most of the morning. The issue of the
temporary plant is clearly the most important agenda item. Reviewing his detailed presentation
of this matter, including the associated financial analyses, has occupied much of his time for
several days. All the available information underscores his contention that the temporary plant
in Plainville is the only responsible solution to the demand problem. No other option offers the
same low level of risk and ensures Byte’s statues as industry leader.
At the meeting, after the board has dispensed with a number of routine matters, Jim Elliot
turns his attention to the temporary plant. In short order, he advised the 11-member board
(himself, 3 additional inside members, and 7 outside members) of his proposal to obtain an refit
the existing plant to ameliorate demand problems in the short run, authorizes the construction of
the new plant (the completion of which is estimated to take some three years), and plans to
switch capacity from the temporary plant to the new one when it is operational. He also briefly
reviews additional details concerning the costs involved, advantages of this proposal versus
domestic or foreign licensing, and so on.