A conversation with Harvey (on or about the end of June).

"Harvey, the current levels of overtime, for about the past eight weeks, has been between 400 and 1600 hundred hours to drive inventories of all items up to minimum levels."

Harvey said,"Why are they below minimums?"

"Harvey, as you know, many operations people transferred out over the past several months, and for the most part, they were not replaced because we were trying to control our labor budget and demands (sales) had been off twelve of the past fourteen months."

Sales picked up in April, and after the adjustments to the forecasts were made to eliminate negative bias, we over-sold in May and June. Contract labor had to be used, along with excessive overtime, to meet demands. The July shutdown, long a bone of contention (not so much for the event, but rather, the timing) forced demands forward into an already overloaded schedule and operation.

Excessive overtime was the result of summer vacations, high demand and efficiency related issues

Relating to a high level of contractors.

Harvey said ," What's the rest of the year look like?"

"Year to date we've completed about fifty million customer gallons and have approximately fifty million left to do, plus or minus five million. I really wish I could say overtime will go down in the

second half, but we haven't changed anything and with half left to do, the result should be about the same."

Harvey said,"What about contracts?"

"Contracts this year should run as much as ten time the original plan. We thought sixteen weeks

of contractors across the summer would do the trick. Contracts have been with us now since March and some will stay the year."

Harvey said,"What about quality of work life?"

"Harvey, it's not possible to improve quality of work life in Photochemicals when our operators are working six days a week, months at a time. Isn't it their lives we're suppose to be watching out for, improving?"

Harvey said,"What are you doing about this?"

You know, when someone asks a question like that you just want to reach through the phone and choke them, just a little, until, perhaps, their tongue hangs just outside their mouth.

"Harvey, the tradeoffs for excessive overtime and improved quality of work life are increased finished goods inventory necessary to eliminate any backorders, and sufficient raw materials necessary to build any item requested for any type of emergency, OR a Planning System that could

tell us what we really need instead of the current guesses. "

Harvey said,"Keep me posted."