...strengths and weaknesses of the target costing system? First, target costing originally starts with mangers estimate the cost that customers are willing to pay and how competitor will price the same products or services. (Cost Accounting. Page 545). In the Nissan case, customers are very knowledgeable because the customer demand requires more variations and model types of automobiles. This is a favorable market for Nissan. Nissan managers can set an expected profit margin because the customers has a very high demand of automobiles and they know the automobiles market very well. Second, target costing for a product includes direct manufacturing costs direct materials, direct manufacturing labor, and direct machining costs. (Cost Accounting. Page 519). Analyzing each cost element and eliminate the unnecessary value-added is one of the cost management goals in the target costing system. In order to have a competitive price, Nissan managers have to eliminate some value-added costs which are unnecessary and not so helpful for the automobile manufacturing and selling process. Target costing can shorten the product lives and save Nissan company time to do marketing and financial management. A good example in the Nissan case it that they eliminated the "five-door variant" because it is unnecessary. Last, target costing system helps Nissan build a cross-functional team. The design department, manufacturing department, sales department and management department work together to analyze...
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...Quantitative Savings 4 Evaluation Criteria 5 Costs, Who to Involve, Process 6 Introduction Public Works and Government Services Canada, i.e., public service (http://www.tpsgc-pwgsc.gc.ca/) Compliance is rapidly emerging as one of the most important factors in contract management. Information management is at the heart of compliance management. If Public Works has ECM, we can manage and control our information in compliance oriented framework are best positioned to avoid problems and remain competitive. Issues Currently Experienced by Public Works * “Maverick” (unsupervised) spending by buyers. Some studies estimate that this activity occurs in 17% - 27% of purchases. * Overcharging by suppliers (deliberate or inadvertent). In some studies, 10% of transactions involved price discrepancies. * Unwanted/Unnecessary automatic renewal of products and services. Studies indicate that 10% of contracts renew automatically. * Inability to verify if payments and deliverables are accurate and timely. * Inability to analyze “actual” against “planned” or “contracted” spending. * Inability to track Accounts Payable. This includes inability to enforce discounts and dealing with time consuming and complex rebate calculations. * Inability to monitory effectiveness of contract management in terms of cycle time and contract quality (e.g., deliverables against plan, profitability, competitiveness). * Lack of insight into supplier performance vis-à-vis contractual...
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...same credit terms on the new turnover, its debtors are likely to rise by 30% i.e. $750,000. So this $750,000 needs to be obtain from existing working capital resources or injection of share capital. If management ignores this point by “overstretching”, it will face the “Overtrading situation”, • By increased investment in fixed assets like land and building, machinery, etc and acquiring investments in a subsidiary or associated companies without a corresponding increase in equity or borrowings. Any increase in the above-mentioned capital expenditure will then deplete the net current assets, • By allowing a longer than usual cash conversion cycle namely by the increase in stock levels and extending exceptionally long credit, • Through trading losses which will reduce the net current assets. This also happened in cases of...
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...Accounting (APC 309) Individual Assignment Part 1/ Question 1 Executive Summary The purpose of this report is to cover one of the most important topics in management accounting and analyze them critically. This topic is about traditional approach of budgeting and budgetary control. Analyzing this topic will help to find the benefits and problems of traditional budgeting in two different business, where they are operating at different business environment. It will also discuss some of the alternative methods of budgeting and how it can suit, where traditional methods are inappropriate. The beyond budgeting concept, by Hope and Fraser (2003) will be discussed to find critical and deep evaluation on the budgeting process. Table of contents Pages Introduction. 01 Traditional budgeting. 02 2.1 Multiple Functions. 02 2.2 Benefits. 03 2.3 Problems. ...
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...forecasting model and reduce OTD cycle times substantially. With new business models prevailing, Ford did not want to be left behind; they were looking at high-tech industry’s growth in the recent years and thought if they could implement some these ideas to their business. Ford has always been a forerunner in employing technology to overcome its constraints of information flow between its global manufacturing sites, they wanted to implement a similar I.T solution to get the better of its suppliers. But having such a large supplier base was making it difficult to manage; then they looked at high tech industry’s leading player DELL who was not only growing phenomenally every year but was also successful in building proximity to both its suppliers and customers. A comparative analysis of Ford and Dell’s SCM operation helps understand the differences in their organizational models and find strategies that could be applied for Ford’s success. Different areas like supplier management, sales, inventory management and customer experience have been compared to identify the bottlenecks in Ford’s operation. Like Dell, Ford can utilize IT systems to leverage its supplier relationships and bring value to the customer The case derives to conclusion that Ford cannot adapt to virtual integration completely except for some key areas which can be supported by implementation of technology. Issue(s) Identification Ford currently had a several thousand supplier base leading to a...
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...any 5 Questions All case carries equal marks Q.1. Read the following case and answer the questions given at the end. Passenger Interchange In most major cities the amount of congestion on the roads is increasing. Some of this is due to commercial vehicles, but by far the majority is due to private cars.There are several ways of controlling the number of vehicles using certain areas. These include prohibition ofcars in pedestrian areas, restricted entry, limits onparking, traffic calming schemes, and so on. A relatively new approach has road-user charging, where cars pay afee to use a particular length of road, with the fee possibly changing with prevailing traffic conditions. Generally, the most effective approach to reducing traific congestion is to improve public transport. These services must be attractive to people who judge them by a range of factors, such as the comfort of seating, amount of crowding, handling of luggage, availability offood, toilets, safety, facilities in waiting areas. availabilityof escalators and lifts, and so on. However, the dominant considerations are cost, time and reliability. Buses are often the most flexible form of public transport, with the time for a journey consisting of four parts : • joining time, which is the time needed to get to a bus stop • waiting time, until the bus arrives • journey time, to acnrallg do the travelling • leaving time, to get from the bus to the final...
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...2013-0953 Print ISSN: 2013-8423 A case study of lean, sustainable manufacturing Geoff Miller1, Janice Pawloski2, Charles Standridge 3 1 Grand Rapids Chair Company (USA); 2, 3 School of Engineering, Grand Valley State University (USA) geoff@grandrapidschair.com; pawloskj@gvsu.edu; standric@gvsu.edu Received December 2009 Accepted May 2010 Abstract: A small furniture production company has integrated lean tools and sustainability concepts with discrete event simulation modeling and analysis as well as mathematical optimization to make a positive impact on the environment, society and its own financial success. The principles of lean manufacturing that aid in the elimination of waste have helped the company meet ever increasing customer demands while preserving valuable resources for future generations. The implementation of lean and sustainable manufacturing was aided by the use of discrete event simulation and optimization to overcome deficits in lean’s traditional implementation strategies. Lean and green manufacturing can have a more significant, positive impact on multiple measures of operational performance when implemented concurrently rather than separately. These ideas are demonstrated by three applications. Keywords: lean manufacturing, green manufacturing, case-study, discrete event simulation, optimization 1 Introduction Manufacturers are under tremendous pressure to improve productivity and quality while reducing costs. This has led many organizations...
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...effectively in global context, business firms must also have the flexibility to cope with short product life cycles, demands for greater product variety from more segmented customers and increasing international competition. One of the approaches which have been proven in cutting costs, improving quality and productivity and decreasing waste is the Just-In-Time (JIT) management approach. It is undoubted that JIT management application as a system for forced problem solving which brings a successful execution management of all production activities from designing to delivery. On the other hand, this approach draws out a number of limitations and risks that have to be overcome to achieve final goal. This paper presents the author’s findings and evaluation to investigate the impacts of JIT management approach within the context of operation management in the world of globalization. 2. Concept of Just-In-Time (JIT) Just-In-Time (JIT) is defined by Bozarth & Handfield in Introduction to Operations and Supply Chain Management, 2008 as “a philosophy of manufacturing based on planned elimination of all waste and on continuous improvement of productivity. In the broad sense, it applies to all forms of manufacturing and to many service industries as well.” Ideologically, JIT is that producing necessary items with a right demanding quantity and in the right required time is an eternal factor of production and operation management especially in today world’s globalization. Moreover...
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...identifying problems and possible solutions to improve overall performance & management processes as an ongoing development. Alex Rogo, Manufacturing Plant Manager and the main character in the book reviews the fundamentals of redefining priorities in the process to achieve this goal. As I continued to read, the author elucidates diversified scientific, mathematic and upper level management methods. He identifies the problems as intrinsic constraints which are limiting people minds from moving forward and thinking out of the box. For instance, many businesses wasted labor hours and cost for studies and project reviews when the data is not applicable. Alex engages his team to list questions concerning daily operations, procedures and in some cases abandoned company policies. i.e., he replaced outdated methods with robot which required less overall labor hours but was costly. If the robot ran side by side with the old methods, the production could increase to almost double. The author embraces the magnitude of continues process improvement method for management processes in all different forms of businesses by relating scientific methods such as bottleneck “Theory of Constraints” to improve management processes, “Socratic Method” to lead people to the solution of future problems, and “Evaporating Cloud” to think laterally hence out of the box while utilizing available resources. I learned from the author that management is science which can solve problems with logical and scientific...
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...associated with supplier integration into new product development under conditions of technology uncertainty Gary L. Ragatza,*, Robert B. Handfieldb, Kenneth J. Petersenc a Department of Marketing and Supply Chain Management, Eli Broad Graduate School of Management, Michigan State University, East Lansing, MI 48824-1122, USA b North Carolina State University, Raleigh, NC, USA c University of Oregon, Eugene, OR, USA Abstract In many industries, firms are striving to integrate material suppliers earlier into the new product/process development process. This involvement may range from simple consultation with suppliers on design ideas to making suppliers fully responsible for the design of components or systems they will supply. In this paper, we develop and test a conceptual model of the effect of elements of the supplier integration process on cost, quality, and new product development time, under conditions of technology uncertainty. Technology uncertainty is operationalized here, as the degree to which the product or process technologies employed in the project are new, complex, and/or rapidly changing. The results suggest that technology uncertainty have a negative impact on cost results, but no direct effect on quality or cycle time. The results also show that certain elements of the supplier integration process are more likely to be employed under conditions of technology uncertainty, leading to significant improvements in cost, quality, and cycle time objectives. D...
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...Table of Contents 2 Executive Summary 4 3 Situation analysis 5 3.1 Company overview 5 3.2 Evaluation of Process Management approach at D2D 6 3.3 Evaluation of Just in Time (JIT) techique 10 3.4 Benchmarking 11 3.5 SWOT Analysis 12 4. RECOMMENDATIONS 13 Creating a value system: 14 Development of a Strategy Map 15 Reviewing the Organisational Strategy 15 Organisational Performance 16 5. Conclusion 18 6. Bibliography 19 EXECUTIVE SUMMARY The author conducted a situation analysis for D2D through analysing the approach to process management followed by D2D as well as the quality improvement techniques used by D2D. The analysis revealed the following: * Process Management at D2D- The approach followed by the company is very effective as every process is controlled and measured. This is applicable to all areas within D2D. However, the author is of the opinion that D2D should avoid implementing to many control systems to avoid their employees losing focus. It was also not clear what D2D’s market strategy; if any entails. * Just in Time (JIT) technique – The author found that certain elements such as Lead time reduction; flexible workforce and the required supplier quality assurance and implement a zero defects quality programme were being implemented at D2D. The author is however of the opinion that this is sufficient and that there is no need for D2D to implement additional elements of JIT. * Benchmarking – The assessment showed that D2D is very...
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...1.a. How are the tradeoffs between in-house production and outsourcing? In Mattel´s case the tradeoffs between in-house production and outsourcing are: Advantages of Outsourcing (= Disadvantages of In –house production) | Disadvantages of Outsourcing (= Advantages of In –house production) | 1. Low wages and strategic location of the supplier will translate into low prices. Mattel can receive benefits of having as its supplier a company that is located in a country were the wages are low, as this lower production costs will be translated into the final price of the product.In 1988 based on the McKinsey´s study, Mattel created its Vendors Operation Asia (VOA) that consisted of “about 35 suppliers who offered not only low labor costs but also skills and expertise in building relationships with local Chinese government officials and cutting through the Chinese government bureaucracy (…) in 1997, VOA´s manufacturing activities accounted for about 25% of Mattel´s revenues”.Also, if the supplier company is located in an industry cluster like the toy manufacturing industry in Guangdong, where the physical proximity of suppliers and buyers, the possibility to have inventories Just-in-time, easy finding of trained labor force, among others, will help to reduce costs of production of the outside vendors.Mattel had a special strategy to locate its manufacturing plants, as it owned and operated 10 worldwide, 5 located in China, and the other were in Indonesia, Malasya, Thailand and Mexico...
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...you get.” • “Anything measured gets done.” • “You can’t manage what you do not measure.” These are not new business ideas, but there are a few new twists. Using measurements to support manufacturing operations has its roots back to the late 19th and early 20th centuries with ideas espoused by Frederick W. Taylor, the father of applying scientific methods to running business. His ideas for time and motion studies of operations were successfully used to scientifically manage production lines and warehouse operations. These ideas, however, led to exaggerated business processes that transitioned into “running a business by the stopwatch” with employers treating human employees as if they were highly reliable, predictable machines to be monitored and controlled. Over time, the workplace’s view of performance measurement became more humane and these exaggerated types of monitor and control methods fell out of favor, replaced by a focus on measuring a business’ performance rather than that of the individual. Throughout the last decade, companies have expended significant amounts of time and effort to re-engineer their supply chains through business process change and technology focused on implementing integrated Supply Chain Management (SCM) principles....
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...Group: E2 Content 1. Company Background 4 2. Report Aim and Scope 4 3. Analysis of the Current Environment 5 3.1. PEST Analysis 5 3.2. Porter’s Five Forces 7 3.3. Resource Portfolio Analysis 8 3.4. Current SWOT Analysis 10 4. Analysis of the Future Environment via Scenario Planning 11 4.1. Impact of Scenarios on Apple’s Five Forces 12 4.2. Impact of Scenario Planning on Internal Environment (VRIN) 13 4.3. Future SWOT 15 5. Evaluation of Existing Strategies 16 6. Analysis of Apple’s Organizational Direction 16 7. Strategic Option Generation 18 7.1. Generic Strategy Model 18 7.2. BCG Matrix 19 7.3. Directional Policy Matrix 20 7.4. ANSOFF Matrix 21 7.5. TOWS 22 8. Strategy Evaluation through SAFe 23 8.1. Corporate Level Strategic Evaluation 23 8.2. Media Devices & Mobile Communications SBU Strategic Evaluation 24 8.3. Personal Computers Strategic Evaluation 24 8.4. Portable Media Players Strategic Evaluation 25 8.5. Software Strategic Evaluation 25 9. Comparison of New and Existing Strategies 25 10. Conclusion 26 11. Report Limitations 28 12. References 29 1. Company Background Apple Inc was founded in April 1976 by Steve Jobs and Steve Wozniak. The company that invented the first personal computer has diversified into designing and producing a vast range of consumer electronics and software supplied to millions of customers worldwide. With headquarters in Silicon Valley, California...
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...Business Markets and Buyer Behavior Business buyers purchase goods and services to achieve specific goals, such as making money, reducing operating costs, and satisfying social or legal obligations. Therefore to provide superior customer value to the business buyers this chapter familiarizes you with the underlying dynamics and process of business buying. Blanket contract establishes a long-term relationship in which the supplier promises to resupply the buyer as needed at agreed-upon prices over a specified period. Because the seller holds the stock, blanket contracts are sometimes called stockless purchase plans. Product value analysis is an approach to cost reduction in which components are carefully studied to determine if they can be redesigned or standardized or made by cheaper methods of production. Organizational buying is the decisionmaking process by which organizations establish the need for purchased products and services and identify, evaluate, and choose among alternative brands and suppliers. The Business Market versus the Consumer Market • • • Fewer buyers: Business marketers normally deal with far fewer buyers than do consumer marketers. Larger buyers: Buyers for a few large firms do most of the purchasing in many industries. Close supplier customer relationship: Smaller customer base and importance of larger customers, suppliers have to customize offerings to meet the needs of individual customers. • Geographically concentrated buyers Derived demand: Demand...
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