Orion Controls (a)

4 Pages Posted: 21 Oct 2008

See all articles by Sherwood C. Frey

Sherwood C. Frey

University of Virginia - Darden School of Business

Dana Clyman

University of Virginia (UVA), Darden School of Business (deceased)

Multiple version iconThere are 2 versions of this paper

Abstract

Avion is interested in a new valve to manage the highly volatile phenol in its production process. Avion and Orion strike a deal for Orion to try to produce these valves. There are time, engineering, and software constraints that make the valve-redesign project a risky endeavor. The A case uses the basic decision tree that has been used in an introductory case in decision analysis to the core material for an exam. The A case is a rewrite of two earlier cases (QA-0480 and QA-0481). In those cases, the key issues were scheduling of the projects, and in this case, the scheduling is fixed and the issues are less calculation-intensive and more interesting. Also in the A case, there are two options: one the students usually see and one they don't. This case also has a real option embedded in the problem around which an entire class can be built. Followed by the B case, QA-0603.

Excerpt

UVA-QA-0602

ORION CONTROLS (A)

Even though the hiking trip to Shenandoah National Park was intended to be a restful interlude in his frenetic work-pace, Nathan Armstrong, head of marketing at Orion Controls (Orion), found his mind wandering to his recent conversation with Andre Gide, executive vice president of Avion Chemicals (Avion). Contract discussions with Gide, who was responsible for worldwide corporate safety programs at Avion, had taken an interesting turn. Gide had initially contacted Orion to place an order for 50 of Orion's Model SV44A-10 smart-valve systems to manage the phenol flows at Avion's nine chemical plants worldwide. Their conversation, however, had led to the possibility that Orion would develop an improved model for Avion at a substantially increased price.

The new system that Gide wanted would require an improvement in the flow-sensing and -control part of the existing valve system to allow for real-time information processing and dynamic responses to changes in process states. In addition, the new system would require substantial improvement in valve capability to enable quick changes in valve-gate positions. Because of the dynamic nature of the real-time information flow, these improved valve systems would need to respond to instruction changes far more rapidly than the existing model could.

The Avion Contract

Orion was the leading designer and manufacturer of industrial valve systems. Much of its reputation was based on its leading-edge technology, outstanding record of product reliability, focus on cooperative customer relations, and willingness to design customized products.

. . .

Keywords: decision analysis, simulation, decision tree

Suggested Citation

Frey, Sherwood C. and Clyman, Dana, Orion Controls (a). Darden Case No. UVA-QA-0602. Available at SSRN: https://ssrn.com/abstract=1284192

Sherwood C. Frey (Contact Author)

University of Virginia - Darden School of Business ( email )

P.O. Box 6550
Charlottesville, VA 22906-6550
United States

HOME PAGE: http://www.darden.virginia.edu/faculty/frey.htm

Dana Clyman

University of Virginia (UVA), Darden School of Business (deceased)

P.O. Box 6550
Charlottesville, VA 22906-6550
United States

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