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The Bates Company Has Been Producing Tools for Over Fifty

question 96

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The Bates Company has been producing tools for over fifty years. In that time the company has been acknowledged as a producer of high quality tools at a reasonable price. Bates' competitive prices can be attributed to three factors. First, the company recognized early in its development that tools made from specific blends of various types of metal were less costly to produce and had superior performance compared to traditional metals. Accordingly, Bates made investments in developing tools made for specialty metals long before other competitors and has made a series of investments over its operating history that have put it far ahead of its competitors in terms of product development. Industry analysts believe that based on these investments it would be difficult and extremely costly, if it were even possible, for rivals to catch up with Bates. Second, in recognizing the importance of certain metals, Bates was able to sign long-term contracts with suppliers of the metals that have provided Bates with a lasting cost advantage. Finally, Bates maintains its cost advantages by using a thorough budgeting and reporting system that allows it to closely control costs, and these systems are supported by a frugal company culture and financial incentives that reward employees for finding ways to save money throughout the company.
-Bates' culture is an example of a(n)

Definitions:

Polar Ice

Frozen water in the polar regions of Earth, including ice caps, glaciers, and sea ice, which plays a crucial role in the global climate system.

Negative Feedback Loop

A process in a system where the output may feed back into the system to counterbalance changes and maintain stability within the system.

Permafrost

A dense layer of soil under the surface that stays frozen all year long, primarily found in regions near the poles.

Tundra Soils

Soil found in tundra biomes, characterized by permafrost, low temperatures, and minimal nutrient content, affecting vegetation and overall ecosystem productivity.