Category: Case Study

Apple Company Strategic Plan Assignment

Apple Company Strategic Plan
Apple Company Strategic Plan

Apple Company Strategic Plan

Apple Company Strategic Plan Paper

Order Instructions:

Report Outline
1. Cover page and Table of Contents – Cover page should include: Title: Strategic Plan, Company Name, Date, Author, Course Name. Table of Contents should include a listing of all of the topics in your strategic plan.
2. Company Description – What is the state of the business today including the company background, products, services, markets serving, key technologies, key manufacturing and operations, financial strength, key partners…etc.
3. Mission and vision statements of Apple company
4. External Audit – Assess the external forces that affect the organization: economic, social, cultural, demographic, environmental, political, governmental, legal, technological and competitive. Use the tools for external audit.
5. Internal Assessment – Assess the interrelationships between departments, marketing, finance/accounting, production/operations, research & development and management information systems. Use the tools for internal assessment (SWOT, Financial ratio analysis, IFE, SWOT strategies, QSPM…..etc)
6. Establish Long Term Objectives. The objectives should provide direction for the organization, be quantifiable, address key external and internal forces and be SMART objectives which are:
Specific: The objective tells exactly what, where, and how the problem or need is to be addressed.
Measurable: The objective tells exactly how much, how many, and how well the problem/need will be resolved.
Action-oriented: The objective uses “activity indicators” to insure that something will be done. As with goal-setting, use action-oriented verbs such as deliver, implement, establish, develop, supply…etc.
Realistic: The objective is a result that can be achieved in the time allowed.
Time-bound: The objective includes a specific date for it’s achievement.
7. Evaluate and select a strategy or strategies (David, Table 5-4, page 137). Large companies commonly have multiple strategies.
8. Implementation Plan – Develop for the selected strategy or strategies
9. Conclusions and Recommendations
10. References and Appendix

Apple
Company Information http://www.apple.com/sitemap/ Retrieved (March 2013)
Investor / Financial Information http://investor.apple.com/ Retrieved (March 2013)

SAMPLE ANSWER

Table of Contents

Report Outline: Apple Company Strategic Plan. 2

Introduction. 2

  1. Company Description. 2

Mission and vision statements of Apple Company. 5

  1. External Audit 6
  2. Internal Assessment 8
  3. Establish Long Term Objectives. 12
  4. Evaluate and select a strategy or strategies. 14
  5. Implementation Plan. 15
  6. Conclusions and Recommendations. 16

References. 18

Report Outline: Apple Company Strategic Plan

Introduction

Strategic planning is the process of defining the strategies of a company and how they can be used to promote the attainment of competitive advantages (Erica, 2012). Such planning helps direct the decision making process regarding allocation of resources among other control and management mechanisms. The company in focus is Apple Company Inc. which is a renowned multinational company. In particular, strategy formation at Apple Company could involve setting goals and mobilizing resources and labor towards executing the set goals and objective. The senior management is charged with the role of strategic planning in most organizations. Strategies can be categorized into two; intended strategies and emergent activities. Formulating strategies for Apple Company takes the form of a cohesive and comprehensive analysis that entails synthesizing strategic thinking into planning activities.

1.         Company Description

Apple Company is a multinational corporation based in the United States. It’s headquarter is in California. It is specialized in the development, designing, marketing and selling of consumer electronics, online services, personal computers and computer software. The company has managed to create its market niche by producing a dominant hardware which is used in the Mac product line such as iPod media players, iPad table computers and iPhone smartphones. The software used to run the Mac hardware is known as the iOS operating systems and the OS X (David, 2007). The company was founded by three principles; Steve Jobs, Ronald Wayne and Steve Wozniak in the year 1976. The company then became incorporated into Apple Computer, Inc. in 1977 and later renamed to Apple Company Inc. in 2007. The new name reflected the companies shift in focus to produce a diversified line of consumer electronics. Currently, the company ranks as the second largest in the IT industry. This rank comes after Samsung Electronics which has been ranked as the world’s largest mobile phone manufacturer.

Apple sales it products via an online store as well as its chain retail stores. Its other products are sold by direct sales force, resellers, value added resellers and third party wholesalers (David, 2007). These products include Macintosh, iPods, iPhones and other compatible hardware products such as storage devices, printers, watches, branded television sets, headphones, speakers among other computer peripherals and accessories. The online services provided by Apple Company include iTunes Store, iCloud as well as an App Store. Apple also manufacturers digital contents which are sold through iTunes Store. These services include software programs which are sold through the Apple App Store to its diverse groups of consumers. The iCloud online service has been helpful in synchronizing a wide range of data such as contacts, email, documents, calendars and photos. The iCloud also offers backup storage for iOS.

Apple has specialized in segmenting, creating market niches and penetrating market segments. The company has created a blue ocean for its products since, in spite of the high prices, the company has managed to retain its customers who range from small and mid-sized businesses, individual consumers, educational institutions, government agencies, creative customers and enterprises. Apple Company Inc. serves multinational customers through its 425 chains of retail stores which are strategically located in 14 countries. The supply chain is facilitated by other independent sellers. The latest technologies by Apple Company Inc. include the iOS 8 which has more than 4000 APIs that lets developers improve the capabilities and features of applications. The technology enables a deeper integration of iOS thus enabling extended functionality. The technology has facilitated game development. The iCloud for developer’s technology has leveraged the full power of building applications through the cloud kit framework. The developers can now securely and easily store and retrieve essential data on their applications from an online database.

Manufacturing and operations at Apple Inc. are highly innovative thus leading to the production of innovative products which move through the fast product life-cycle associated with the IT industry. The company promotes its products through spectacular promotions and marketing campaigns. The products are of high quality thus they are charged at a premium price. Apple Company Inc. has the largest market capitalization estimated at $446 billion. Because of its financial strength, the company has 75,800 full time employees globally and it enjoyed an annual revenues of $170 billion in 2013. The company is ranked in the top ten of the Fortune 500 companies. Another ranking by the Inter-brand Best Global Brand have reported that Apple is the most valuable brand in the world with a value of $118.9 billion. Apple’s key partners include social networking sites developers and programmers such as Facebook and LinkedIn. These companies have been essential in partnering with Apple in marketing its products because the company pre-install these applications in their electronic gadgets such as the iPhones. The Taiwan Semiconductor Manufacturing Company (TSMC) has been a confidential key partner for Apple Company since it shares with it important data on the A7 system on chip technology (SoC).

Over an extended period of time, Apple Inc. has appreciated that its growth and development would be equally dependent on the input of its key partners which include AT&T. This company is the closest partner to Apple since it is the sole carrier of iPhones. The partnership deal begun in 2007 it lasted till 2011 when Verizon begun competing it by selling iPhone 4s. Verizon Communications is another major business partner. It is the largest telecommunication carrier in the US and it has participated in the launch of the iPhones. The Verizon provides a CDMA network. The other partner is Foxconn Technology Group which is a leading electronic manufacturer globally. It is also the largest exporter of electronics in China. It is the company that assemblers the hardware for Apple in its plants in Taiwan and China. TPK is another vital partner as it deals in the supply of touch-panels across the world. It is the largest supplier of touch panels for the iPhones and the iPads. It is reported that approximately 75% of TPK’s revenues came from its partnership with Apple. The Quanta Computer Company is another key partner as it manufacturers the MacBook and iMac product lines for Apple. The partnership between the Taiwan based Quanta Computers and Apple dates back to 1998. Quanta is among the leading notebook manufacturers across the world as it supplies brands such as Gateway and Hewlett-Packard.

2.         Mission and vision statements of Apple Company

The management at Apple Company have not set out a clear and elaborate mission and vision statement. Nonetheless, the company has shown signs that its mission statement is either dynamic or that it is embedded into the hearts of its employees and the other stakeholders. Accordingly the most suitable mission statement has to entail such rubrics associated with a strong believe that the company is focused on revolutionizing the world by offering quality products through innovation, research and development (Erica, 2012). The management has to show its commitment towards customer satisfaction by providing simple products which are not complex to the end users. Another pertinent statement to be included in the Apple mission statement would be the company’s strong believe that it has to make a contribution towards bettering humanity by carefully selecting its market segments and creating niches. This objective can enable directing resources towards products and market that offer most profits while promoting investing into projects that are meaningful to the stakeholders. For the work teams, the company believes in cross-pollination and deep collaboration that will allow the company to be creative and innovative. The groups and work teams have to be seamlessly integrated so as to help them acquire basic virtues that will propel the company into attaining the company’s vision. The vision of Apple Company can therefore be focused on continuously investing into innovations that will transform human life while making the company a center of excellence and global market leadership in the electronic and IT industries. Both the mission and vision statement will second the Apple Company Inc. slogan which states that an apple a day keeps the doctor away.

3. External Audit

An external audit of Apple Company’s Inc. can be facilitated by the use of a PESTEL analysis. This term is an abbreviation for Political, Economic, Social, Technological, Environmental and Legal factors. It describes a strategic framework which can be used by a company to analyze its macro-environmental factors by scanning the environment. This analysis will be helpful in understanding market growth factors and thus contribute towards formulating a viable research strategic plan.

Political factors determine the degree of government intervention in the growth and development of the economy. The government through its policies and regulations have impacted on decisions made by the management at Apple. For instance, since 2005, the company has expanded its market segments outside the United States thus selling most of its products outside the USA. The countries that account for most of its sales include China, Ireland, Czech Republic and Korea. The global market place is diverse with developing and developed countries. These governments impact on the sales volume of products through taxation, tariffs and quotas so as to achieve a Balance of Payment (BOP) (David, 2007). In the event that Apple disregards these international rules and those set by the US government, then it will have a hard time marketing its products.

Economic factors have impacted on the decision making process at Apple Inc. This is because global factors such as economic growth, inflation rate, exchange rates and interest rates impact how a business operates. Economic situations such as recession and bloom could impact on the sales made on Apple as a company. The products produced by Apple are mostly viewed as luxuries thus an increase inflation could result into low sales volumes. This is because of the increase in unemployment rates which will reduce disposable income thus lowering the buyer’s propensity to purchase. Economic factors can affect Apple either negatively or positively.

Social-cultural factors describe the living patterns and values of the global consumers of Apple electronic products and services. Social factors impact on customer preferences, income groups, and perception and life priorities towards purchasing Apple products. Whereas other social factors such as fashion, social class and peer pressure could drive people into purchasing Apple products, the same forces could make people value other products instead of Apple’s (David, 2007). The company has managed to associate itself with quality, reliability and innovation. The consumers are also aware that Apple Inc. is an expensive brand. Social factors are synonymous with cultural aspects such as population growth rate, age, demographics and distribution of people. These factors collectively impact the company’s positioning of its products and creation of niches.

Technological factors are determined by the ability of Apple to manufacture and design highly innovative and differentiated products through research and development. So far, Apple Inc. has managed to win over more customers because of its unique products. The IT industry is competitive based on the ability for a firm to be innovative in creating appeal through appearance and product features (David, 2007). Legal factors describe the global laws governing the manufacture of electronic products by companies such as Apple Inc. The company has benefited from laws allowing for sub-contracting of countries with cheap labor such as Korea, and China. As a result, the company has managed to create a competitive advantage due to its low costs of production. Environmental factors are determined by the geographic location of a country since it has an impact on the climatic changes and apparently, this forms the bulk of environmental influence on trade and consumption trends. These factors include the climate, weather and geographic location. This factor mostly affects farming and agri-businesses thus it does not influence much of the operations at Apple Company.

4. Internal Assessment

An internal audit for Apple Company entails the use of strategic management and planning tools such as Financial Ratios, IFE, QSPM and SWOT analysis. SWOT analysis is an abbreviation for the Strengths, Weaknesses, Opportunities and Threats. In terms of strengths, Apple Company has for a long time been associated with innovations. The history of the company dates back to a visionary leader; Steve Jobs who had an inert passion for developing new technologies. Steve jobs created this competence by introducing a research and development department which worked hand in hand with the other departments. The specific contributions of these departments include the management information systems department which was vigil in analyzing the IT trends among key rivals such as Samsung and Nokia. The second department was finances and accounts department which coordinated the allocation of resources towards research and development. The marketing department contributed towards innovation by collecting statistics on marketing trends and the consumer wants thus the research and development department used the information in connecting the product design to future customer wants. The production and operations department was upfront in designing new technologies so as to maximize on the returns by reducing cost of resources. The production unit was essential in ensuring that the new technologies adopted matched the political legal requirements set by the government.

As a result, the cutting edge innovations have been seen in the launch of the iPhone, the iPad and other devices. This has made innovation a hallmark for the company which strives to improve its previous models of phones as seen in the recently launched iPhone 6. These innovations include a wider display size, an upgrade of the iOS operating system and other hardware. They have also designed an iWatch which is a novel offering in its product line. The other innovations which will likely improve the company’s sales include the launch of the iPad Air 2, iPad Pro, new MacBook and iPad Mini 3. These innovations form part of the strategic planning process since they have contributed towards competitive advantages and increased sales which has earned Apple Company an increase in their market share (Lorenzen, 2006). The second strength is associated with the finances of the company. As it has been reported by the finance department which helps the other departments in budgeting and resource allocation, the company has had a positive cash-flow since its inception. The company currently has an asset base of $38 billion and an additional $127 billion in long term securities. Because of this financial endowment, the company can decide to use acquisition strategies so as to leverage itself against competitors. An example is the recent decision by the company to purchase Beats Electronics at a cost of $3 billion. With the purchase, the company has widened its capital returns program. Financial capabilities also mean that the company is better placed to advertise and market its products. The marketing strategy is often a collaboration between the finance department together with the sales and marketing department. For instance, during the fiscal 2013, Apple spent $1.1 billion on advertising budgets.

Apple Company has in the past experienced weaknesses such as premium pricing. The company’s products are among the priciest computing devices in the market. The marketing department targets a market niche dominated by luxurious buyers. Because of this marketing strategy, the company has failed to penetrate developing markets where companies such as Tecno and Huawei have dominated because of their low priced telecommunication gadgets. The luxury positioning of the product has also rendered Apple to price competition in developed markets such as South Korea where Samsung and China’s Xiaomi have significantly increased their market share. The second weakness is associated with the iPad product line which in spite of previous successes has lost out on its former market share. The shipment of iPads fell by 9% in the fiscal 2013. This signifies that Apple managed to sell only 13.4 million units in Europe and U.S. Most of the sales were made in the BRIC countries. The iPad has in the recent past suffered stiff competition and the growing number of manufacturers of tablets such as Google’s android powered tablets which retail at a much lower price. It is projected that the sluggishness of the market towards the iPad is likely to persist unless the company does something about its pricing strategies so as to fit into the developing countries and other oversea markets. The other strategic move towards solving this two problems is the need to partner with companies such as IBM. The two companies are reputable thus it would be prudent if their partnered towards developing more superior applications for the iPhones and iPads.

Apple could embrace strategies aimed at increasing its opportunities by growing its market share growth. Given the fact that Apple has been losing its market to Samsung due to intensive rivalry, the marketing department can still work together with the operations department to redesign their marketing strategies so as to increase the market share. Apple holds 20% of the global tablet/PC market share. On an overall scale, it ranks higher than Samsung and Lenovo. According to the projections made by the marketing department, the company is expecting a growth in its market share in 2014 especially after the launch of iPhone 6 and an increase in marketing activities in China and Pacific regions. It is further expected that the penetration of the iPhones into the BRIC geographies will contribute towards creating opportunities for the company. This is because Apple has made contracts with influential wireless carriers in the local target countries thus increasing the customer segments. Its most promising agreements was that with China mobile which is expected to increase the exposure of Apple’s products to the more that 760 million subscribers of the huge network. The second opportunity arises from the purchase of Beats Electronics. By purchasing this Beats, Apple proved that mergers and acquisitions was a strategic option into increasing a company’s competitive advantages. The deal which was completed in August 2014 opens up new opportunities for Apple Company. The acquired company will boost the iTunes product line including the radio services. The same company will also help Apple in developing its iWatch among other wearable audio devices. There is also the opportunity of talent infusion from music industry icons and managers such as Dr. Dre and Jimmy Iovine who have been the creative managers for the Beats Electronics.

Competition has been the biggest threat to Apple Company. Technology is faced passed and because of this the electronics industry as well as the IT industry are very elusive. The product cycle for these industries moves fast from the introduction, growth up to the maturity stages. This rapid growth into maturity and decline phases have intensified competition since the companies that are better positioned at making innovations have in the past used innovations to win over customers from competitors. According to the Porters generic analysis, it is also made evident that the premium pricing makes it hard for Apple to compete in some markets which are dominated by low-cost rivals as it is the case in China, India and most African countries. The second threat results from gross margin pressures stemming from intensive competition. A loss in the pricing power, rising costs of production and product shortages have also impacted on the company especially in the past years where at times demand has exceeded supply leading to shortages. According to the SWOT analysis of Apple Companyi, which presents an interplay between the various departments; operations, marketing, finance, research & development departments, development and management information systems department and their contribution towards the advancement of the internal audit at Apple Company, it is highly likely that the strengths and opportunities presented for the company far much outweigh the weaknesses and the threats. The overall results reflect on the company’s ability to grow its dividends, improve its product quality through more innovations and increase its returns and market share through aggressive marketing.

5. Establish Long Term Objectives

Just like any other company that is guided by a mission and a vision statement, Apple is looking forward to establishing formidable strategies that will see it thought turbulent financial times. The most preferable strategies begin acknowledging the fact that Apple as a company is looking towards introducing new products and services as part of its diversification plan. The introduction of these products and services triggers a thorough analysis of the pricing strategies implemented at the company. Product pricing determines the ability of a product to be accepted by the customers. For instance, the launch of the iWatch by Apple has to conform to the customers’ expectations of the prevailing market prices by competitors such as Samsung Galaxy Gear, Qualcomm Toq and Sony Smart-Watch (Boundless, 2014). The Moto 360 smart watch stands out as the most dominant rival for the iWatch. When considering the pricing for the smart-watches, Apple has to consider cost based pricing which is computed using the formulae;

Cost + Fixed profit percentage = Selling price.

Alternatively, the company could decide on using competition based pricing, value-based pricing, or demand based pricing. Given the intensity of competition in the smart watch market, it is financially feasible for Apple to use the competition based pricing but in the event that the company wants to use value based pricing, then it has to consider such factors as the uniqueness of their products and the product features embedded into their hardware system. The software also has to be reliable and seamlessly inter-operable with other iOS 8 devices on the market. Given the fact that the product is at the introduction product life cycle, then its prices have to be low so as to attract customers after which the prices can be adjusted as the product moves to the growth stage and into maturity. According to marketing analysts, when a company is launching new products, it has to consider the best way to capture the market. In order to attract the customers, Apple will have to implement a pricing structure that is transparent in future so as to compete effectively rather than using the current premium pricing strategies.

The second futuristic objective for Apple Company is tied to its need for continuous growth. The IT industry is at its growth life cycle since it is coupled with extensive research, development and innovations. This means that the long term objectives for Apple Company have to promote growth in what is known as a growth strategy. The growth strategy includes improving on the current products while making plans to introduce new products and services for the diverse market segments. Cell phone and computer manufacturing companies are aware of their continuous need to improve on their technologies and this should be the trend at iPhone. It is highly suggested that unlike the current trend where Apple only develops one or two brands of electronics such as the iPhone 6 and iPhone 6 plus launched in 2014, the company could start manufacturing products for the different market segments. This will ensure that the company keeps abreast with the demands posed by the customers. Apple could also venture into upcoming smartphone and computer/PC markets in Africa and Asia such as India so as to explore the market and identify the products that could perform well in such markets. So far it is acknowledged that Apple has managed to implement the product differentiation strategy and it has been a key factor in creating a blue ocean for its products. This is because of the uniqueness in the products coupled with the innovations in hardware and software. This has made the products unique and superior to its competitors. The accessibility of the company’s services has been facilitated by its multiple chain stores strategically located in 14 overseas countries.

6. Evaluate and select a strategy or strategies

The selected strategy that is mostly used by global organizations is the acquisition strategy. Acquisition is defined as the corporate action of buying another company by a more dominant and established company. The process of acquisition mostly begins with the identification of a target company where the parent firm begins by acquiring partial ownership that will enable it to influence policies and decisions. An increase in stake to a percentage exceeding 50 will give the firm control over the target company. This strategy has been found suitable where a company intends to take over an existing company together with its market niche. It is often beneficial where a company weights the cost of expanding on its own as being a more expensive and uncertain strategy than acquiring an already existing business. There are two types of acquisitions and this can either be hostile or friendly. Friendly takeovers occur when a firm expresses and enters into an agreement making it possible for it to be acquired while a hostile acquisition happens when the acquiring firm forcefully takeover the ownership of a target firm by purchasing more than 50% of its stocks and shares. The process of acquisition is often accompanies by a strategic logic which includes the need to expand operations or the market. This strategy could also be driven by the need to eliminate competition especially in duopolistic industries dominated by two firms. All in all, the strategy is aimed at a general goal of value creation. According to an empirical research by David, (2007 backing this strategy, it is observed that companies could decide to acquire another company so as to achieve the following archetypes. First, the acquiring companies have the intent of improving their performance, second, they could be focused on minimizing competition, third, the acquiring company might want to expand on its market by merging its current customer base with the niches created by the target company and fourth, acquisition has the benefit of helping a company to acquire technologies and skills that could have been more expensive to create.

Examples of multinational companies that have been successful using the acquisition strategy include IBM which pursued the strategy by purchasing software firms. This was between the years 2002 and 2009 where it acquired 70 software companies at a cost of $14 billion. The company had made a previous estimation that the acquisitions would bolster its software products thus increasing its revenues by 50% within the first 2 years and a growth margin of 10% in the following three years. In another example drawn from the consumer goods industry, Procter and Gamble after acquiring Gillette created a stronger company that increased its sales volume by merging markets. Their working together enabled them to expand their market with more ease. Another example is where Cisco Systems acquired a broad line networking company so as to gain technological leverage (Boundless, 2014). The acquisition helped Cisco to access internet equipment after it acquired 71 companies at a cost of $650 million and $150 million in 1993 and 2009 respectively.

7. Implementation Plan

As it has been exhibited in the examples listed in the previous section of this paper, Apple Company also has a chance to embrace acquisition as its main business strategy. So far, Apple has made several acquisitions and mergers. According to a statement by the current CEO, Tim Cook, the company’s main goal of acquiring other companies is for it to own the intellectual property because the company always wants to own its production lines. So far, Apple has acquired the PA Semiconductor Technology Company so as to control its team of employees and technologies since the company has been instrumental in developing proprietary chips for the iPads and the iPhones. Apple also acquired Siri, which is a voice recognition business start-up that also owned mapping technologies. This company has formed a basis for Apple Maps. According to the financial reports for fiscal 2013, Apple has $137 billion in cash while other capital has been preserved in marketable securities (Mckeown, 2012). Over the past years, the implementation of acquisition strategies has been seconded by talent acquisition as well as the purchase of patents and novel technologies. The process of acquiring small firms by Apple has been aimed at easing the process of integrating the new products and services into their product line.

8. Conclusions and Recommendations

In conclusion, it is prudent to consider both the internal and external analysis when making decisions about strategies to be implemented by Apple Company. The analysis made in this report identifies that Apple is currently leveraged this gives it a better position to exploit a larger market coupled with its talented employees and financial resources. As a result, if the company refined its acquisition strategies while matching up with pricing strategies and continuous innovations, then the company will sure reach its optimum productivity. This will be evident in its increased market share, which will considerably boost its revenues and earnings. As a result, it is recommended that Apple Company has to invest in diversifying its products and creating market niches that will compete its such as rival. This is to mean that Apple has to use selective pricing in is market segment so as to win over a larger market share.

References

Boundless. (2014). Growth Strategy: Boundless Management. Retrieved 12 November, 2014 from https://www.boundless.com/management/textbooks/boundless-management-textbook/strategic-management-12/common-types-of-corporate-strategies-90/growth-strategy-434-1452/

David, E. H. (2007). Strategic Management: From Theory to Implementation. New York: Routledge.

Erica, O. (2012). Strategic Planning Kit for Dummies. (2nd Ed.). London: John Wiley & Sons, Inc.

Lorenzen, M. (2006). Strategic Planning for Academic Library Instructional Programming. In: Illinois Libraries, 86(2), 22-29.

Mckeown, M. (2012). The Strategy Book. New York: FT Prentice Hall.

We can write this or a similar paper for you! Simply fill the order form!

Preliminary research on Apple Company

Preliminary research on Apple Company
Preliminary research on Apple Company

Preliminary research on Apple Company

Order Instructions:

Purpose:

Start preliminary planning for your strategic plan project.

Assignment Description:

Select from the 3 companies Ford Motor Company, Apple or iRobot which company you plan to write your strategic plan for and begin your preliminary research on the company background, products, services, markets serving, key technologies, key manufacturing and operations, financial strength, key partners…etc.

Parameters:

This assignment is worth 75 points.

You are to follow APA formatting and style, and the assignment will be graded following the grading rubric “BU482 Phase 1 and 2 Research Plan Project Work Grading Rubric.“

BU482 Strategic Plan Project Description
The strategic plan project is broken into 4 parts:
Phase 1 Research Strategic Plan Project Preparation Work
Phase 2 Research Strategic Plan Project Preparation Work
Phase 3 Strategic Plan Sections 1- 5
Phase 4 Final Strategic Plan Sections 1-10
Develop a strategic plan for iRobot, Ford or Apple. This should be your writing of a strategic plan for either of these companies and not a copy of their strategic plans. Be creative in your vision for these companies by analyzing the company information provided and using your own research. For example, analyze/develop the mission and vision statement, external and internal forces, long term objectives, desired strategies, management organization/issues, implementation plan/issues and a conclusion. Each of these companies are in dynamic industries undergoing significant changes. For example, Apple is under extreme pressure from Samsung, Google and other Android devices, new tablets and technology, smartphones, cloud computing, sustainability, cost pressures, economic and environmental pressures. Ford is under pressures from the United States and other foreign governmental regulations, zero emission requirements, global competition, product costs, safety technology, satellite systems, intense innovative competitive designs and growth in the emerging markets like India, China and Brazil. iRobot is developing technology that has both military and commercial use, governments are beginning to regulate the use of robots such as drones, robot and computer technology changes quickly and the public is unsure how robots will affect or be a part of their lives. Be creative and develop your strategic plan for one of these fantastic companies. You are to follow the strategic planning process outlined in our textbook shown in (David, Figure 1-1,page 14) and which is highlighted in each chapter of the book but be creative and include sources and information from outside of our test book.
Report Length should be at least 10 pages double spaced (not including the cover page or appendices), 12 point font and following APA 6th Edition writing guidelines.
Phase 1 Research Strategic Plan Project Preparation Work – Select from the 3 companies Ford Motor Company, Apple or iRobot which company you plan to write your strategic plan for and begin your preliminary research on the company background, products, services, markets serving, key technologies, key manufacturing and operations, financial strength, key partners…etc.. – Due in Week 2

Company Information http://www.apple.com/sitemap/ Retrieved (March 2013)
Investor / Financial Information http://investor.apple.com/ Retrieved (March 2013)

SAMPLE ANSWER

Phase 1: Preliminary research on Apple Company

Company Background

Apple Company is a multinational corporation based in the United States. Its headquarter is in California. It is specialized in the development, designing, marketing and selling of consumer electronics, online services, personal computers and computer software. The company has managed to create its market niche by producing a dominant hardware which is used in the Mac product line such as iPod media players, iPad table computers and iPhone smartphones. The software used to run the Mac hardware is known as the iOS operating systems and the OS X (David, 2007). The company was founded by three principles; Steve Jobs, Ronald Wayne and Steve Wozniak in the year 1976. The company then became incorporated into Apple Computer, Inc. in 1977 and later renamed to Apple Company Inc. in 2007. The new name reflected the companies shift in focus to produce a diversified line of consumer electronics. Currently, the company ranks as the second largest in the IT industry. This rank comes after Samsung Electronics which has been ranked as the world’s largest mobile phone manufacturer.

Products

Apple sales it products via an online store as well as its chain retail stores. Some of its other products are sold by direct sales force, resellers, value added resellers and third party wholesalers (David, 2007). These products include Macintosh, iPods, iPhones and other compatible hardware products such as storage devices, printers, watches, branded television sets, headphones, speakers among other computer peripherals and accessories.

Services

The online services provided by Apple Company include iTunes Store, iCloud as well as an App Store. Apple also manufacturers digital contents which are sold through iTunes Store. These services include software programs which are sold through the Apple App Store to its diverse groups of consumers. The iCloud online service has been helpful in syncing a wide range of data such as contacts, email, documents, calendars and photos. The iCloud also offers backup storage for iOS.

Customers

Apple has specialized in segmenting, creating market niches and penetrating market segments. The company has created a blue ocean for its products since, in spite of the high prices, the company has managed to retain its customers who range from small and mid-sized businesses, individual consumers, educational institutions, government agencies, creative customers and enterprises.

Markets serving

Apple Company Inc. serves multinational customers through its 425 chains of retail stores which are strategically located in 14 countries. The supply chain is facilitated by other independent sellers.

Key technologies

                The latest technologies by Apple Company Inc. include the iOS 8 which has more than 4000 APIs that lets developers improve the capabilities and features of applications. The technology enables a deeper integration of iOS thus enabling extended functionality. The technology has facilitated game development. The iCloud for developer’s technology has leveraged the full power of building applications through the cloud kit framework. The developers can now securely and easily store and retrieve essential data on their applications from an online database.

Key manufacturing and operations

Manufacturing and operations at Apple Inc. are highly innovative thus leading to the production of innovative products which move through the fast product life-cycle associated with the IT industry. The company promotes its products through spectacular promotions and marketing campaigns. The products are of high quality thus they are charged at a premium price.

Financial strength

Apple Company Inc. has the largest market capitalization estimated at $446 billion. Because of its financial strength, the company has 75,800 full time employees globally and it enjoyed an annual revenues of $170 billion in 2013. The company is ranked in the top ten of the Fortune 500 companies. Another ranking by the Inter-brand Best Global Brand have reported that Apple is the most valuable brand in the world with a value of $118.9 billion.

Key partners

                Apple’s key partners include social networking sites developers and programmers such as Facebook and LinkedIn. These companies have been essential in partnering with Apple in marketing its products because the company pre-install these applications in their electronic gadgets such as the iPhones. The Taiwan Semiconductor Manufacturing Company (TSMC) has been a confidential key partner for Apple Company since it shares with it important data on the A7 system on chip technology (SoC).

Reference

David, E. H. (2007). Strategic Management: From Theory to Implementation. New York: Routledge.

We can write this or a similar paper for you! Simply fill the order form!

VCI/EIIison Equipment-Coordinated Global Sourcing

VCI/EIIison Equipment-Coordinated Global Sourcing
VCI/EIIison Equipment-Coordinated Global Sourcing

VCI/EIIison Equipment-Coordinated Global Sourcing Process across Continents

Order Instructions:

VCI/EIIison Equipment-Coordinated Global Sourcing
Process across Continents

VCI/EIIison, which represents the consolidation of the heavy transportation equipment units of
two previously separate and regional companies, is facing worldwide pricing pressures from customers
and competitors. The ability to meet financial targets has presented a major challenge for this new
global company. With limited ability to raise product prices, the alternatives facing VCI/EIIison have
become managing material costs better or absorbing price increases through lower profit margins and
profitability. Given that direct materials represent over 70% of the company’s total costs, it becomes
easy to appreciate the impact that improved global sourcing efforts should have on profitability.

From the time VCI, a European company, assumed ownership of U.S.-based Ellison both companies have sought to leverage the commonality between them on a global basis. The company concluded early on that procurement offered excellent opportunities for global synergy across the two continents. Ellison Equipment, working with VCI, has implemented a multi-step global sourcing process designed to leverage the volumes available through the newly combined units. This case offers insight
into how two geographically and culturally diverse companies, brought together through acquisition, are attempting to gain synergy and efficiency through integrated global sourcing. The challenges facing this global effort include not only geographic separation, but also cultural, language, technical, and business practice differences.

Global Sourcing Process Overview The global process at this company features two teams, one
at Ellison Equipment and one at VCI, working concurrently on the same global project. While Ellison had experience using cost reduction teams, VCI had never used teams within their procurement or engineering areas. As part of this process teams are aligned on both sides of the ocean working jointly on a commodity category or project. The teams eventually work face-to-face as they progress through the process steps.

Each global sourcing project has an expected duration of six months (although the transition to a
new supplier can take much longer). After working with an external consultant to segment its primary
products into six commodity groups, VCI and Ellison jointly identified 27 project opportunities. This
process is designed to support nine projects at a time (each having a six-month duration) with three
iterations or waves. Each team pursues three categories of commodities (which may have subcategories or sub-commodities) simultaneously, so three teams in a wave pursue a total of nine projects.
VCI/EIIison has also decided to apply its global process to contracts that the sourcing teams
determine are regional rather than global (a region is defined as North America or Europe only). A
global supplier is one that can competitively supply a product or service to all of VCI/EIIison’s worldwide
production and assembly locations. To date a majority of contracts have been classified as regional.
This is not surprising given the fact that the major competitors in the heavy equipment industry operate
regionally, which the supply community is structured to support.
VCI/EIIison’s Global Sourcing Process With the help of an external consultant VCI/EIIison has
created a rigorous and thorough nine-step global strategy development and implementation process.
Steps 1-4 of this process involve strategy development, while Steps 5-8 involve strategy implementation.
Global sourcing project teams are responsible for the first four steps. Step 0 involves the executive
steering committee selecting nine global sourcing projects at a time (called a wave) and identifying the
cost savings expected from each project.
Perhaps the most important task associated with Step 1, which is project launch, is the
formation of the global sourcing teams. Team members are selected based on their familiarity with the commodity or items under review. Since there is usually only one engineer and buyer for the
commodity, these individuals become team members almost by default.

The team leader works with the team to develop time schedules, a list of deliverables, and
expected milestones within the six-month project window. During this part of the process the teams
begin to quantify what they are studying by collecting and validating data. Across each category there
may be four or five segments or sub-categories that require separate analysis. While each team decides
on the segmentation of a category, both teams assigned to the project must agree on the segmentation.

Even thought each project technically has two teams assigned (one at each company working
simultaneously), they are really one team looking at the same project. Teams can proceed to the next
process step without the explicit approval of the executive steering committee. However, teams are
required to publish progress updates weekly. A major responsibility of the business analyst (discussed
later) is to compile and provide performance updates to the executive steering committee.
Some managers consider Step 2, sourcing strategy development, to be the most interesting and
critical part of the global process. During this step the project teams identify potential worldwide
suppliers. One of the realizations when beginning this process was that supplier switching, including
switching from long-established suppliers, was likely to occur. This realization was based partly on the external consultant’s global sourcing experience. Supplier switching can be time-consuming and difficult as new supply chain relationships are established.

From the list of potential suppliers, the teams send Requests for Information (RFis), which they
can modify to meet the specific needs of their category or segment. The RFI is a generic supplier
questionnaire that introduces the global process and requests data about sales, production capacity,
quality certification (such as ISO 9000), familiarity with the equipment industry, and major customers. It
is not unusual to send 400-500 RFis during a project, depending on the complexity of the category and
segments the team is working.
The RFI is a first filter in the supplier selection process. During this step it is critical that
suppliers return a high percentage of the RFis, which are separated and reported by region of the world.

Of the 400-500 RFis forwarded to suppliers, a team may receive and analyze several hundred completed
RFis. The teams also conduct a detailed supply market analysis to develop a thorough understanding of the economics and dynamics of a particular market.

Step 2 is usually the first time that the two teams working on a global sourcing project meet face
to face. The European and U.S. teams meet physically to conduct face to face analysis of the RFis
returned by suppliers. It is each team’s responsibility to establish the criteria for determining which
suppliers will receive Requests for Proposals (RFPs). A key decision during Step 2 is whether a
procurement opportunity appears to be regional versus global. A lack of globally capable suppliers can
make a project a regional opportunity.

Step 2 requires a major effort on the part of engineering. Engineers on both sides will examine
drawings in an effort to commonize part specifications between locations. While a project team may conclude that a global supply source does not exist, there may be opportunities to commonize or standardize specifications across the two locations.

Step 3, requests for proposals, features the development, sending, and analysis of formal
proposals to the most promising suppliers identified in Step 2. The average number of proposals
forwarded to suppliers per project is 20-30. Suppliers typically require six weeks to analyze and return
the RFPs. The teams strive for a high percentage of returned proposals, similar to the RFis. Team
leaders, representing the project teams, report RFP progress to the executive steering committee at a
weekly meeting.

Teams are responsible for analyzing the returned supplier proposals. Like the RFis, teams can
set their own evaluation criteria and weights, but members must reach consensus in their choices. The
proposal allows suppliers to provide design suggestions.

The teams usually meet via video or audio conferencing to review the proposals. Engineers
again take a lead role in evaluating technical merits. Complex purchase requirements may require teams to meet face-to-face for a second time. Using standardized spreadsheet tools that are available
to all teams, each team analyzes its proposals and decides, based on the analysis, which suppliers will be invited to negotiations.

A negotiation workshop takes place at VCI’s European learning center during this step. This
session has several objectives-team members receive training in negotiation, the project teams
develop their negotiating strategy, and the teams select a negotiation leader. If a team determined that
a sourcing opportunity was regional, negotiation will occur separately by region. Teams select regional
negotiation leaders if the project is a regional opportunity or a single negotiator if the project is global.

The decision of who should be the negotiating leader is based on discussion and consensus rather than
voting. Of the first 27 projects, fully one-third of the negotiating leaders were selected from outside the
project teams.

Step 4 involves recommending a strategy and negotiating with selected suppliers. Project teams
make a recommendation to an executive committee, specifically the vice presidents of purchasing and
engineering from VCI and Ellison. The executive committee may ask questions but to date has not
overturned any team recommendations. Team recommendations include the selected supplier(s) with expected savings and timings identified. The teams also identify whether the suppliers are regional or global but do not recommend contract length.
In this step the negotiating team probes and discusses in-depth the proposals submitted by
suppliers. Suppliers can be disqualified if engineering determines the supplier cannot satisfy technical
requirements, or the team is not satisfied with the commercial issues.

All negotiation in Step 4 is conducted face to face with suppliers at VCI/EIIison sites. Half the
negotiations so far have occurred in the U.S. and half in Europe. Before suppliers arrive they receive
feedback concerning the competitiveness of their proposal, which they are allowed to revise before
negotiations commence. Suppliers may be excused if they are informed that they are not competitive and choose not to revise their proposal. Once the lead negotiator takes over, the team leader’s role
begins to diminish (unless the team leader is also the lead negotiator). The team leader usually remains
as part of the negotiating team.

Step 5, called supplier certification, features purchasing and engineering groups receiving the
team’s recommendation and preliminary terms of the negotiated agreement. At this time functional
directors will begin to budget expected savings from the proposed contract into their financial projections. Supplier site visits can occur during this step by representatives of the functional groups.
For example, engineering, procurement, and quality assurance may want to validate a number of topics
during this step. The time frame for this step varies from one month to over a year.

Step 6, finalizing the contract, involves crafting the final contract based on the outcome of the
negotiations. The negotiation leader remains with the process until the contract is complete. While the
legal department is also involved, a buyer writes the contract using an agreement template. Contracts
are typically three years in duration. Both sides of the ocean are involved in formalizing the contract if
the agreement is global rather than regional.

Global agreements differ from traditional contracts. They include productivity improvement
requirements to offset material increases. The agreements also encourage technical advancements by the supplier to further reduce material costs or enhance product performance. This process also
includes a formal process to manage improvements, whereas the process for previous or non-global
agreements has been informal. And, in a somewhat significant departure from previous contracting
practices, incentives such as 50/50 improvement sharing are starting to appear.

Step 7, sample testing and approval, assesses the samples provided by the selected supplier.
Production facilities go through a production readiness stage, initial sample inspection reports are
developed, parts are checked off of production tooling, and the negotiation leader develops a
production rollout plan with help from his or her counterpart on the other side of the ocean.

Step 8, the concluding step of a global project, is the production readiness stage. The selected supplier may send a day or weeks worth of supply to be used in actual production. Logistics becomes part of the implementation team if there is a switch from one supplier to another.

Organizational Enablers VCI/EIIison has put in place certain enablers that support global sourcing. This includes the formation of an executive steering committee, the use of global teams, formally selected team leaders, and the creation of a business analyst’s position to support the operational and analytical needs of the teams. An executive steering committee at each unit reviews and prioritizes projects for study.

A sourcing director at VCI and a counterpart at Ellison drive the process at both organizations. Working jointly, these executives recommend projects for study, solicit input from functional areas in terms of cost savings and quality improvement opportunities, develop a plan to pursue the project (including assembling a cross-functional team), track the status of each project through weekly progress updates, and manage the global process to ensure its continued success. The executive steering committee members conduct a video conferencing meeting each week for two hours. This meeting also involves team leaders for projects that are in process.
Cross-functional teams are an integral part of this process. Two teams, one from VCI and one
from Ellison, work simultaneously on the same sourcing opportunity, each with a formal team leader, two functional members (usually from engineering and purchasing), and a business analyst that supports both teams. Each project consists of seven combined positions across two teams. The team leader and business analyst are full-time assignments while the buyer and engineer provide a part-time commitment.

Teams are responsible only for the first four steps of the global sourcing process. The two teams usually come together physically two or three times over a project’s duration. Both sides agree, however, that face to face interaction is time consuming. At the conclusion of each project the teams are required to write a “white book” documenting the lessons learned from their experience.

With any team-based approach the role of the team leader is critical to success. Project leaders
are responsible for planning team meetings, which are held once or twice a week depending on the
phase of the project, and reporting project status to the executive steering committee. Planning includes setting the meeting agenda, ensuring the global process steps are followed, and working with team members to meet time lines and achieve project goals. The leader also communicates with each
member’s management when necessary to ensure commitment. Agreement is widespread that the
team leader is a critical part of the process, particularly when the leader must work with members to balance their priorities while still challenging the team to achieve demanding performance improvement targets.

Each set of teams that works on three projects simultaneously has a business analyst assigned to
support the effort. The time required for managing requests for information {RFis) and requests for
proposals {RFPs) across two continents is extensive. Vel/Ellison created a full-time business analyst
position to manage the required tasks when pursuing global agreement. Exhibit 1 outlines the key features of this position.

Exhibit 1
Positive and Negative Features Related to the Business Analyst Position

Positive Features Negative Features

Experience from the position builds Managing three projects expertise about the global sourcing simultaneously creates an intense process work pace Full-time commitment to the process helps the business analyst avoid other job distractions

Process has some inefficiencies (faxing,
handling reams of paper, some software inefficiencies), creating additional and perhaps unnecessary work burden

Team leader and business analyst are Long and stressful days can affect key “point people” to management morale and promote turnover and suppliers

Given the work required to manage Too many RFI suppliers pass to RFP RFis, RFPs, and negotiations, the global stage, creating intensive work sourcing process would not succeed requirements for the analyst without the analyst position and a strong analyst Business analyst position prepares Obtaining drawings for RFPs from individuals for future sourcing careers engineers is a time consuming process

The analyst is central to the success of the RFI and RFP process. Analysts compile and send RFI
and RFP packages to suppliers, track and report response rates, input RFI and RFP response information into a sourcing software system and database, and follow-up with suppliers who are late with their submission. The business analyst also answers any questions that suppliers have or forwards their inquiries to the appropriate procurement or engineering representative. The analyst also provides feedback to suppliers concerning the competitiveness of their initial quotation or proposal. Finally, analysts have responsibility for forwarding the project database to their counterpart team across the ocean on a regular basis. Team members are relieved of extensive analytic and clerical duties, which allows members to commit time to value-adding activities.

While management views the business analyst position as an ideal way for high-potential
individuals to gain exposure to purchasing and sourcing, there are some issues with this part of the
process. Managing three projects simultaneously creates an intense work pace that affects morale and
promotes turnover. Furthermore, one analyst maintained that too many RFPs are forwarded to
suppliers, resulting in an intensive work requirement. Obtaining the necessary drawings from
engineering is also a time consuming activity. Finally, the process to coordinate team activities between the U.S. and Europe presents some difficulties. The analyst must fax documents daily, manage reams of paper, and use software that was not compatible between the U.S. and European systems.

Global Sourcing Outcomes A number of themes emerge when managers describe the value of
taking an integrated approach to worldwide sourcing. Perhaps most importantly, global sourcing was
the first major integrative effort undertaken between VCI and Ellison. This process demonstrated that
the two organizations could work jointly to capture the benefits offered by taking a global rather than
regional perspective, although the company is somewhat disappointed by the number of opportunities that were determined to be regional rather than global. Second, this process demonstrated that material savings are available from a disciplined approach to worldwide sourcing. Contracts resulting from this process average over 10% in material price savings, which is not as high as the savings that Santek is realizing. Part of this is due to the fact that many of VCI/EIIison’s agreements are regional rather than global.

Global sourcing has also narrowed the differences between Ellison’s and VCI’s sourcing
practices. Ellison has historically been more relationship focused with suppliers and viewed negotiation as a means to build upon those relationships. VCI has shown a greater willingness to switch suppliers more frequently and faster due to cost and quality considerations. The global process has enabled the two companies to converge on a consistent sourcing approach that combines the best features of both sourcing philosophies.

A repeated sentiment among managers is that this nine-step process introduced a discipline to
sourcing at VCI/EIIison. Each sourcing project moves lock-step over a six-month period with weekly
reporting to an executive steering committee. Global sourcing teams must meet deadlines and
milestones, make sure information gets to suppliers, and thoroughly research the supply base before
negotiating and awarding contracts. The process has made everything “official” with suppliers, who
have taken VCI/EIIison’s global efforts seriously.
The process is not without less positive outcomes or observations. One issue concerns a lack of
knowledge between VCI and Ellison personnel about each other’s supply base. As a result, each side
during a project has had a natural tendency to favor its own suppliers. When the two project teams
work together face-to-face, they have to spend time sorting out who the best suppliers from each side
are globally. This “home market bias” has hindered the process to some degree. Global sourcing teams
have been forced to learn more about each other’s suppliers, which requires greater effort and an open
mind.

As expected, all 27 global project teams to date have not been equally effective. One team
leader argues that any differences in performance are due to the quality and effort of the team
members and leaders rather than project complexity. This highlights the need for careful member
evaluation and selection. Unfortunately, team leaders do not receive special training before they
assume that critical position. And, team members are usually selected because they are most familiar
with the item or category under study rather than their ability to be effective team members.
While external consultants played a critical and highly visible role in developing and using
VCI/EIIison’s global process, managers point out that the use of consultants caused some concern. For
example, consultants assumed the role of team leader with several early teams, raising questions
concerning who should lead the teams and their qualifications. The consultants often dictated what the RFPs should contain, which created some disagreement within project teams. The consulting group also  insisted on top management presence at weekly meetings. While this demonstration of executive commitment was valuable for the first few months, later meetings became too detailed to warrant executive attendance. Finally, too much time was spent educating consultants about the heavy
equipment industry. There was some surprise initially at the lack of experience of the consultants sent to work with VCI/EIIison on a day-to-day basis.
Concluding Observations An issue that all companies should address is whether the supply base
that supports their industry has global capabilities. Most competitors in the heavy equipment industry
operate regionally, which the supply community is structured to support. The issue of a regional versus
global industry raises a critical question-is the heavy equipment industry, with its regional perspective
and different customer tastes and requirements, a true global industry? How much time should
VCI/EIIison spend searching for common interests, including in procurement and design, when perhaps
limited opportunities are available?
As VCI/EIIison completes the first major iteration of its global process (three waves of nine
projects each that addressed the entire product structure), some managers are openly concerned about losing the discipline associated with this process. When first introduced the global sourcing process was something new that received special attention from executive leadership and suppliers. Some managers have expressed a concern that internal participants and suppliers already perceive the process is “winding down” and that most of the available savings have been captured. Maintaining momentum rather than succumbing to complacency will likely require a group that is committed to driving this process forward. In all likelihood that group must be the executive steering committee that is responsible for directing VCI/EIIison’s global efforts.

Discussion Questions

3. The assessment of worldwide suppliers creates an extensive workload. Discuss how VCI/EIIison
supports the analysis requirements faced by each global sourcing team.

SAMPLE ANSWER

VCI/EIIison Equipment-Coordinated Global Sourcing Process across Continents

VCI/Ellison agrees with all the requirements that are supposed to be met by every global sourcing organization. Global sourcing is very essential in the current society since all businesses are coming together in order to have a mutual working relationship. This cooperation ensures that a lot of value is given at a very low cost.

Development and changes in how businesses are conducted is a must. Competition is so stiff, there are so many emerging competitors, organizations are coming up with very new ways of doing business, leaders are developing new rules to govern how they run their business and customers are demanding for value for their money. Consequently, this has pushed almost every company to make use of the little resources that they have to produce more. With global sourcing, most of these challenges are solved. Global sourcing will enable this two organizations get the right skills at the right time and at a reasonable amount of money. Maintaining and training a workforce is so expensive hence, many companies are unable to manage this.  Furthermore, global sourcing will generate more savings for the two organizations which can eventually be used to support very valuable projects in the organization. Therefore, with globalization, VCI/EIIison organizations are in support of this initiative since it lowers any challenge that can arise within the organization. As a result of this initiative, these two organizations are assured of very high efficiency rate and initiate projects of great value which are also very profitable. In addition, global sourcing will enable the two organizations to have an advantage over their competitors. Furthermore, they will also improve on the quality of goods and services offered to the clients both nationally and internationally (Gong, 100-150).

Work cited

Gong, Y. (2013). Global operations strategy: Fundamentals and practice. Berlin: Springer.

We can write this or a similar paper for you! Simply fill the order form!

Ford Motor Group Case Study Assignment

Ford Motor Group
Ford Motor Group

Ford Motor Group

Ford Motor Group Case Study

Order Instructions:

This is per your request to complete the order.

SAMPLE ANSWER

Introduction

Ford Motor Group is a multinational public company that’s based in Michigan in the USA. Its shares are traded in NYSE under the initial F. It majors in automotive production and its current Executive chairman is William C. Ford, Jr. while the CEO is Mark Fields. The ford Family owns 2% of the company while the employees number about 181,000. It has a market capitalization of $54.65 Billion and its shares are currently trading at $14.09 dollars with a yield of 3.5%. (Luenberger, 1997) Ford has outstanding shares numbering 9 million while the market prices of its shares are currently costing 14.1 which amounts to a total of $126.9 million in outstanding stock valuation.

Part One

The directors of Ford Motor Group have impeccable academic backgrounds and experience that warrant their positions. The executive management of the Ford board as at the end of July 2014 were Richard A. Gephardt, Ellen Marram, Stephen Butler, Kimberly Casiano, Edsel Ford, Mark Fields (CEO & President, Homer Neal, Antony F. Earley, William Clay Ford Jr., the executive chairman, James P. Hackett, John L. Thornton, Gerald L. Shaheeen, James H. Hance, Jr., William W. Helman John C. Lechieter, James H. Hance and Jon M. Huntsman.

Mark Fields, the current CEO and President was initially appointed as the America’s President of operations in the year 2012. (Adams, 2008) The board is mostly concentrated in running the operations of the company from the head office. Almost 50% of its annual turnover is achieved in North America while the rest are from South America, Europe, Asia, pacific and Africa. The duties of each director are not included in the reports together with the salaries of other senior staff. The academic background for the senior positions office holders is not available on the 2013 annual report. The performance of Ford Motor Group has not been very impressive and it was expected that it would have more financial problems in the current financial period. However, Ford has endured hard times before and it’s expected that it will come out of financial woes on its own.

Part Two

The net assets turnover for Ford decreased by 2.5% in the year 2013 as compared to a 50% increase in the year 2012. GM registered a decrease of 13% in its net assets turnover in the year 2013 while in the year 2012 it experienced an increase of 6.5%. (Vance, 2003)

Dupont Analysis

The following is the Dopont model breakdown for Ford and GM. The profit margin for Ford amounted to 13% of sales for both 2013 and 2012. The return on Equity was 27% in 2013 while in2012 it was 36%. The profit margin on sales for GM amounted to 12% in 2013 while in 2012 it was 7%. The ROE for GM amounted to 13% and 17% respectively for the years 2013 and 2012 respectively. The return on assets amounted to 3 and 4% respectively. The earnings per share for Ford in 2013 and 2012 were 1.54 and 1.48 respectively while the dividends per share amounted to 0.4 and 0.2 respectively. Both companies are heavily leveraged and Ford is the one that has the highest concentration of debt compared to GM.

The interest expenses for Ford increased by 16.3% in 2013 while in 2012 it had decreased by 12.7%. The interest expense for Ford in the year 2013 and 2012 were 829 million and 713 million respectively. GM interest expenses decreased by 31.7% in 2013 while in 2012 the expenses decreased by 9.4%. The interest expenses for 2013 and 2012 were 334 Million and 489 Million respectively

The net assets turnover for Ford’s decreased by 2.5% in the year 2013 as compared to a 50% increase in the year 2012. GM registered a decrease of 13% in its net assets turnover in the year 2013 while in the year 2012 it experienced an increase of 6.5%. The dividend per share for Ford in 2013 and 2012 was 0.4 and 0.2 respectively. This represented a return of 22% to the shareholders in 2013 while in 2012 it was 23%.

Ford Motor Group 2013 2012 2011
Current Ratio Total Current Assets/Total current liabilities 2.11 2.32 2.26
Quick Ratio TT C/ Assets – inventories /TT/ C Liabilities 1.98 2.18 2.15
Receivable turnover Annual credit sales/average receivables
Inventory Turnover Cost of goods sold/Average inventory 17.00 17.51 19.87
Asset turnover Sales/Average total assets 0.75 0.73 0.76
Dividend yield Div per Share / Current Share price
Dividend cover EPS/ Dividend per Share
Net assets turnover Net assets / total sales 1.24 1.27 0.85
Times interest earned EBIT/Annual Interest Expense 9.45 11.83 11.63
Debt to total Asset Debt/Assets 0.57 1.03 0.56
Book value per share
Interest cover EBIT/Annual Interest Expense 9.45 11.83 11.63
Profit margin on sale GP/sales 0.13 0.13 0.14
R.R return on assets EAT/Total  Assets 0.04 0.03 0.11
R.R com stock equity Profit after taxes/Shareholders equity 0.27 0.36 1.35
Earnings per share Profit after taxes-pref div)/No. of comm O/S 1.54 1.48
Payout Ratio cash dividends/income 0.22 0.13 0.00
ROE Return On Equity (ROE) 0.27 0.36 1.35
ROA Return on average Assets 0.04 0.03 0.11

 Ford has low average but a relatively stable financial performance as compared to GM very high and very low performances that are unpredictable. Ford has a better growth trend thatis fairly predictable.

GM 2013 2012 2011
Current Ratio Total Current Assets/Total current liabilities 1.31 1.30 1.22
Quick Ratio TT C/ Assets – inventories /TT/ C Liabilities 1.08 1.02 0.95
Receivable turnover Annual credit sales/average receivables
Inventory Turnover Cost of goods sold/Average inventory 9.56 9.74 9.16
Asset turnover Sales/Average total assets 0.93 1.02 1.04
Dividend yield Div per Share / Current Share price
Dividend cover EPS/ Dividend per Share
Net assets turnover Net assets / total sales 0.27 0.24 0.25
Times interest earned EBIT/Annual Interest Expense 23.33 -57.68 17.99
Debt to total Asset Debt/Assets 0.04 0.02 0.02
Book value per share
Interest cover EBIT/Annual Interest Expense 23.33 -57.68 17.99
Profit margin on sale GP/sales 0.12 0.07 0.13
R.R return on assets EAT/Total  Assets 0.03 0.04 0.06
R.R com stock equity Profit after taxes/Shareholders equity 0.13 0.17 0.24
Earnings per share Profit after taxes-pref div)/No. of comm O/S 2.92
Payout Ratio cash dividends/income
ROE Return On Equity (ROE) 0.13 0.17 0.24
ROA Return on average Assets 0.03 0.04 0.06

 Part three

The information was gathered from the Yahoo’s business finance websites http://finance.yahoo.com/echarts?s=F+Interactive#{%22range%22%3A%225y%22%2C%22scale%22%3A%22linear%22}

Ford’s Dividend Growth Model g
Div Number Record Date Payable Date Ford’s Div Pay Trend
196 1/30/2006 3/1/2006 $0.10
197 5/2/2006 6/1/2006 $0.10 0.00%
198 8/2/2006 9/1/2006 $0.05 -50.00%
199 1/31/2012 3/1/2012 $0.05 0.00%
200 5/2/2012 6/1/2012 $0.05 0.00%
201 8/3/2012 9/4/2012 $0.05 0.00%
202 11/2/2012 12/3/2012 $0.05 0.00%
203 1/30/2013 3/1/2013 $0.10 100.00%
204 5/3/2013 6/3/2013 $0.10 0.00%
205 8/2/2013 9/3/2013 $0.10 0.00%
206 11/1/2013 12/2/2013 $0.10 0.00%
207 1/31/2014 3/3/2014 $0.13 25.00%
208 5/2/2014 6/2/2014 $0.13 0.00%
209 8/1/2014 9/2/2014 $0.13 0.00%
210 10/8/2014 12/1/2014 $0.13 0.00%
Average p.a. 5.00%

 

The dividend earnings growth trend has been calculated on average per year. There are financial periods where the dividend pay rate and amounts are similar has the growth trend is not reliable as the average would be very low. The general average however is 5%.

The growth rate number is logical as it reflects the general performance on the ground. The major problems with the calculation are the constant figures payable as dividends reflects a constant growth trend and the calculations reflect a zero growth trend. The company pays dividend as shown in the table above. It would be fair assume a constant growth trend for Ford Company.

Part four

Stock Options for Employee compensation for the year 2013

Fair value per stock option 2013 2012 2011
5.03 5.88 8.48
Assumptions made
Annualized Dividend yield 3% 2% –
Expected volatility 52.20% 53.80% 53.20%
Risk free interest rate 1.50% 1.60% 3.20%
Expected stock option (yrs) 7.7 7.2 7.1
Company stock options as at December 31 2013 (millions)
Outstanding options Exercisable options
Shares weighted av life yrs weighted av Exc price Shares weighted av life yrs
Range Prices available in $
1.96 -2.84 15.5 5.2 2.16 15.5 2.16
5.11 – 8.58 23.2 3.1 7.29 23.2 7.29
10.11 – 12.98 29.1 5.3 12.58 19.1 12.56
13.07 – 16.64 11.3 2.8 13.86 9.8 13.71
Total stock options 79.1 67.6

These options are company specific and they are payable on the range of prices available and the average years the employee has spent in the company. The share prices are weighted as shown on the table above. (Garrison, Noreen & Brewer, 2009)

The stock options would have to be provided for as their prices are usually provided for employees only and not for the general investors.

Part Five

The beta for Ford Motor Group according to yahoo business finance is 0.88.  The current risk free market rate is 0.03%. The rate of risk premium is the amount that the expected asset’s rate of return is extra or exceeds the market risk free rate of interests.  The risk premium for trading companies is the company stocks or their expected rate of return less the risk free rate of return.

Capm = rf + β (rm -rf)
rf = risk free rate 3.00%
β = Beta 0.880
rm = return on the market 5.00%
Capm = 4.76

The average Capm rate is equal to 5% as calculated in the excel formula which is attached. The expected return for Ford Motor Group is 5%. (Reilly & Brown, 2011) Using the model, the rate of return is 4.76%.

The cost of equity using the capital asset pricing model = Risk Free Rate + Beta * Market Risk Premium = 3+0.88*3= 11.64 (French, 2003)

Ford has outstanding shares numbering 9 million while the market prices of its shares were costing 14.1 which amounts to a total of $126.9 million. (Black, Jensen and Scholes, 1972)

The Capital Asset Pricing theory suggests that the cost of capital depends largely on how the asset was initially. The cost of the debt capital, the cost of the equity capital and the weighted average of the two depending on the debt and equity financing represents the actual cost of capital.

Part six

Ford Calculations 2013 2012 2011
Dividend yield Div per Share / Current Share price 0.11
Dividend cover EPS/ Dividend per Share 0.11
Net assets turnover Net assets / total sales 1.24 1.27 0.85
Times interest earned EBIT/Annual Interest Expense 9.45 11.83 11.63
Debt to total Asset Debt/Assets 0.57 1.03 0.56
Book value per share
Interest cover EBIT/Annual Interest Expense 9.45 11.83 11.63
Profit margin on sale GP/sales 0.13 0.13 0.14
R.R return on assets EAT/Total  Assets 0.04 0.03 0.11
R.R com stock equity Profit after taxes/Shareholders equity 0.27 0.36 1.35
Earnings per share Profit after taxes-pref div)/No. of comm O/S 1.54 1.48
Payout Ratio cash dividends/income 0.22 0.13 0.00
ROE Return On Equity (ROE) 0.27 0.36 1.35
ROA Return on average Assets 0.04 0.03 0.11

Part Seven

Capital Structure

Interest payments that are payable by lenders are all deductible from the ones or a company’s taxable income while the payments to shareholders as dividends are not. Most tax systems encourage the companies to use debt financing instead of equity. (Black, Jensen and Scholes, 1972) The higher the rate of interest the higher the incentives.  The interest expenses for Ford increased by 16.3% in 2013 while in 2012 it had decreased by 12.7%. The interest expense for Ford in the year 2013 and 2012 were 829 million and 713 million respectively. GM interest expenses decreased by 31.7% in 2013 while in 2012 the expenses decreased by 9.4%. The interest expenses for 2013 and 2012 were 334 Million and 489 Million respectively. (Bodie, Kane, Marcus, 2008)

The capital structure for Ford is mostly made up of borrowed money. In 2013, the long-term debts amounted to $114, 688 million while in 2012 and 2011 the debts amounted to 105, 058 and 99488 respectively. The total stockholder equity amounts to $26,383 Million and $15,947 million for the same period. Ford Company is highly levered and it needs to cut down on borrowing. General Motor’s long term debts amounted to $6573 Million and $3424 Million for the year 2013 and 2012 while the total stockholders equity amounted to $42,607, $36,244 and $38120 for the years 2013, 2012 and 2011. Gm is relatively levered. (Markowitz, 1959)

The credit ratings for Ford currently are CCC+ from S & P performance of CC in 2012. Ford managed to pay its 9.9 Billion debts in the year 2014 and it helped to boost its credit rankings. Ford credit rankings place it in front of GM and Chrysler and they are currently fitting hard to avoid bankruptcy petition. According to Modigliani and Miller (1958) the cost of equity capital is mostly determined by the asset’s cost of capital and not the other way round.

Ford has outstanding shares numbering 9 million while the market prices of its shares were costing 14.1 which amounts to a total of $126.9 million. The Capital Asset Pricing theory suggests that the cost of capital depends largely on how the asset was initially financed (Bierman & Smiddt, 1966). The cost of the debt capital, the cost of the equity capital and the weighted average of the two depending on the debt and equity financing represents the actual cost of capital. (Black, Jensen and Scholes, 1972)

Some theories of the Capital assets pricing model, have been applied in relation to heterogeneous beliefs (Merton, 1987) and risk free lending rate elimination (Black, 1972)

Ford Executive Summary

Ford Motor Group is a Gross Profit 7.9% in 2013 as opposed to 2012 when it decreased by 5% from the previous year. The GP for General Motors on the other hand increased by 70% in the year 2013 while in the year 2012 it decreased by 43%. The net profit for Ford for the same period increased 26% in 2013 while in 2012 it decreased by 72%. GM registered a 13.7 % reduction in 2013 while in 2012 it registered a further reduction of 32.7%. The total shareholder’s equity for Ford increased by 65.5% in 2013 while in 2012 it increased by 6%. General Motor’s shareholders equity increased by 17.6% in 2013 while in 2012 it decreased by 4.9%. In 2012 Ford Motor Group reduced its total liabilities by almost 70% while GM increased its total liabilities by 15.6% in 2013. The sales revenue for Ford increased by 10% in 2013 while GM sales for the same period increased by 2.1%. Ford total sales revenues increased from $133,559 million in 2012 to $146,917 million in 2013. GM sales for the same period were 152256 million and 155427 million from the same period respectively. The interest expenses for Ford increased by 16.3% in 2013 while in 2012 it had decreased by 12.7%, GM interest expense decreased by 31.7% in 2013 while in 2012 it decreased by 9.4%. (Bodie, Kane, Marcus, 2008)

The ratios for Ford also indicate that the liquidity ratios are above average for all the years for Ford Motor Group. The current ratios were 2.11, 2.32, 2.26 for the years 2013, 2012 and 2011. The quick ratios also indicated a positive trend. The Times interest earned for the year 2013 for  ford were 9.45, 11.83 and 11.63 for the years 2013, 2012 and 2013.  The interest cover for the same period indicated the same results like Times interest earned. (Drucker, 1999)

The ford Family owns 2% of the company while the employees number about 181,000. It has a market capitalization of $54.65 Billion and its shares are currently trading at $14.09 dollars with a yield of 3.5%. (Ross, Westerfield & Jaffe, 2013) The net assets turnover for Ford decreased by 2.5% in the year 2013 as compared to a 50% increase in the year 2012. GM registered a decrease of 13% in its net assets turnover in the year 2013 while in the year 2012 it experienced an increase of 6.5%. The dividend per share for Ford in 2013 and 2012 was 0.4 and 0.2 respectively. This represented a return of 22% to the shareholders in 2013 while in 2012 it was 23%.

Ford Motor Group has a great potential to return to great profitability and also be able to pay off all its outstanding debts. The Current ratios and the quick acid test ratios indicate that Ford Motor Group is has a stable liquidity and with the right leadership it would be able to make more profits like the earlier years. Given all these factors I would definitely invest my money in Ford Motor Group but I would be cautious besides I would also be requiring a plan on how the management of the company would be proposing to settle the huge loans that it owes several financiers. Ford may be earning some profits but it has a lot of debts that are four or five times its total equity.

References

Adams, S. (2008) Fundamentals of business economics. Financial Management (UK), 46–48. Retrieved from Business Source Premier Database.

Bierman, H. and Smidt. S. (1966).The Capital Budgeting Decision—Economic Analysis and Financing of Investment Projects. New York: Macmillan Company

Bodie, Z., Kane, A., Marcus, A. J. (2008). Investments (7th International Ed.) Boston: McGraw-Hill. p. 303.

Black, F., Jensen, M.C. and Scholes, M. (1972) “The Capital Asset Pricing Model: Some Empirical Tests,” in Studies in the Theory of Capital Markets. Michael C. Jensen, ed. New York: Praeger, pp. 79–121

Black, F. (1997) “Capital Market Equilibrium with Restricted Borrowing.” Journal of  Business. July, 45:3, pp. 444–55.

Drucker, F. (1999) Management Challenges of the 21st Century. New York: Harper Business.

Fama, E. F, French, K. R (2004). “The Capital Asset Pricing Model: Theory and Evidence”. Journal of Economic Perspectives 18 (3): 25–46.

financial problems and make effective business decisions. New York: McGraw-Hill.

French, C. W. (2003). “The Treynor Capital Asset Pricing Model” Journal of Investment Management 1 (2): 60–72.

Garrison, R., Noreen, W. & Brewer, P. (2009) Managerial Accounting, McGraw-Hill Irwin.

Higher Education.

Khan, M. (1993) Theory & Problems in Financial Management, Boston: McGraw Hill

Luenberger, D. (1997). Investment Science. Oxford University Press

Modigliani, F. and Miller, M. (1958) “The Cost of Capital, Corporation Finance, and the Theory of Investment,” American Economic Review, June, 48:3, pp. 261–97.

Markowitz, H. (1959) Portfolio Selection: Efficient Diversifications of Investments. Cowles Foundation Monograph No. 16. New York: John Wiley & Sons, Inc.

Merton, R. (1997). “An Intertermporal Capital Asset Pricing Model.” Econometrica, September, 41, pp. 867–87.Merton, R.C. 1987.

Reilly, F. & Brown, K. (2011) Investment Analysis and Portfolio Management, (10th Edition) South-Western College

Ross, S. A., Westerfield, R. W., & Jaffe, J. (2013) Corporate finance (10th Ed.) New York: McGraw-Hill Irwin.

Vance, D. (2003) Financial analysis and decision making: tools and techniques to solve

We can write this or a similar paper for you! Simply fill the order form!

Investment Analysis Paper on Ford Motor Group

Investment Analysis Paper on Ford Motor Group
Investment Analysis Paper on Ford Motor Group

Investment Analysis Paper on Ford Motor Group

Order Instructions:

Dear Sir,

I need a paper with in the following subject:

Why do you think competency-based management of rewards is the least popular area of use?

The following conditions must meet in the paper

1) I want a typical and a quality answer which should have about 550 words.

2) The answer must raise appropriate critical questions.

3) The answer must include examples from experience or the web with references from relevant examples from real companies.

4) Do include all your references, as per the Harvard Referencing System,
5) Please don’t use Wikipedia web site.
6) I need examples from peer reviewed articles or researches only.

Appreciate each single moment you spend in writing my paper

Best regards

SAMPLE ANSWER

Investment Analysis Paper on Ford Motor Group

Ford Motor Group is a multinational public company that’s based in Michigan in the USA. Its shares are traded in NYSE under the initial F. It majors in automotive production and its current Executive chairman is William C. Ford, Jr. while the CEO is Mark Fields. The current brands or models are Ford Focus, Ford Escort, Ford Cortina, Ford Sierra and Ford Capri. There are several other brands that Ford manufactures besides an array of trucks and other automobiles. The Ford Family owns 2% of the company while the employees number about 181,000. It has a market capitalization of $54.65 Billion and its shares are currently trading at $14.09 dollars with a yield of 3.5%. (Luenberger, 1997) Ford has outstanding shares numbering 9 million while the market prices of its shares are currently costing 14.1 which amounts to a total of $126.9 million in outstanding stock valuation.

Board of Directors

The directors of Ford Motor Group have impeccable academic backgrounds and experience that warrant their positions. The executive management of the Ford board as at the end of July 2014 were; Richard A. Gephardt, Ellen Marram, Stephen Butler, Kimberly Casiano, Edsel Ford, Mark Fields (CEO & President, Homer Neal, Antony F. Earley, William Clay Ford Jr., the executive chairman, James P. Hackett, John L. Thornton, Gerald L. Shaheeen, James H. Hance, Jr., William W. Helman John C. Lechieter, James H. Hance and Jon M. Huntsman.

Monitoring Potential of the Firm’s Board of Directors

Mark Fields, the current CEO and President, was initially appointed as the America’s President of operations in the year 2012. (Adams, 2008) The board is mostly concentrated in running the operations of the company from the head office. Almost 50% of its annual turnover is achieved in North America while the rest are from South America, Europe, Asia, pacific and Africa. The duties of each director are not included in the reports together with the salaries of other senior staff. The academic background for the senior positions office holders is not available on the 2014 proxy annual report. The performance of Ford Motor Group has not been very impressive and it was expected that it would have more financial problems in the current financial period. However, Ford has endured hard times before and it’s expected that it will come out of financial woes on its own.

Strengths and Weaknesses of Board Structure

The major strengths of the members of the board are the wide experience and skills the director’s posses. The executive chairman has been a director since 1988 and has also been the vice president at the commercial truck center before his recent promotion. He has also been the chair of the finance committee and the chairman of eBay Inc. The other board members are also equally skilled and experienced in automobile industry.

The board has also professional structures that vet all the qualifications of the directors before they are appointed. The nominating and governance committee scrutinizes all the background information on all the nominees before their names are forwarded to the board.

The major weaknesses of the board are the lack of clearly defined organization structures that spell out the role of each director and the hierarchy of the functions of their offices and their occupants. The structures are not clear and maybe they have their own system of operations but the structures have to be clearly drawn and the functions of each department clearly defined and addressed. http://corporate.ford.com/our-company/governance-hub/board-of-directors-801p

Ethical Concerns

The other ethical issues that may arise is that some directors like Gerald L. Shaheen who may have served as the president of the Caterpillar Inc before he retired may be having the connections with the group hence his interests may also be linked to the company. H e should be allowed to serve the interests of one company only.

The other issue is that the company has some former politicians in the board like the former governor Jon M. Huntsman Jr. It reflects a little unprofessionalism to include some politicians in the board and who may have had different policies that may have been unpopular with some people hence it can influence the performance of the company negatively.

Competitive Financial Ratio Comparison

The net assets turnover for Ford Motor Group decreased by 2.5% in the year 2013 as compared to a 50% increase in the year 2012. GM registered a decrease of 13% in its net assets turnover in the year 2013 while in the year 2012 it experienced an increase of 6.5%. (Vance, 2003) The following table shows the complete analysis.

Ford Motor Group 2013 2012 2011
Current Ratio Total Current Assets/Total current liabilities 2.11 2.32 2.26
Quick Ratio TT C/ Assets – inventories /TT/ C Liabilities 1.98 2.18 2.15
Receivable turnover Annual credit sales/average receivables
Inventory Turnover Cost of goods sold/Average inventory 17.00 17.51 19.87
Asset turnover Sales/Average total assets 0.75 0.73 0.76
Dividend yield Div per Share / Current Share price 0.03 0.01
Dividend cover EPS/ Dividend per Share 3.70 7.40
Net assets turnover Net assets / total sales 1.24 1.27 0.85
Times interest earned EBIT/Annual Interest Expense 9.45 11.83 11.63
Debt to total Asset Debt/Assets 0.57 1.03 0.56
Book value per share 9.17 9.17 9.17
Interest cover EBIT/Annual Interest Expense 9.45 11.83 11.63
Profit margin on sale GP/sales 0.13 0.13 0.14
R.R return on assets EAT/Total  Assets 0.04 0.03 0.11
R.R com stock equity Profit after taxes/Shareholders equity 0.27 0.36 1.35
Earnings per share Profit after taxes-pref div)/No. of comm O/S 1.54 1.48
Payout Ratio cash dividends/income 0.00 0.00 0.00
ROE Return On Equity (ROE) 0.27 0.36 1.35
ROA Return on average Assets 0.04 0.03 0.11

 

GM 2013 2012 2011
Current Ratio Total Current Assets/Total current liabilities 1.31 1.30 1.22
Quick Ratio TT C/ Assets – inventories /TT/ C Liabilities 1.08 1.02 0.95
Receivable turnover Annual credit sales/average receivables
Inventory Turnover Cost of goods sold/Average inventory 9.56 9.74 9.16
Asset turnover Sales/Average total assets 0.93 1.02 1.04
Dividend yield Div per Share / Current Share price
Dividend cover EPS/ Dividend per Share
Net assets turnover Net assets / total sales 0.27 0.24 0.25
Times interest earned EBIT/Annual Interest Expense 23.33 -57.68 17.99
Debt to total Asset Debt/Assets 0.04 0.02 0.02
Book value per share
Interest cover EBIT/Annual Interest Expense 23.33 -57.68 17.99
Profit margin on sale GP/sales 0.12 0.07 0.13
R.R return on assets EAT/Total  Assets 0.03 0.04 0.06
R.R com stock equity Profit after taxes/Shareholders equity 0.13 0.17 0.24
Earnings per share Profit after taxes-pref div)/No. of comm O/S 2.92
Payout Ratio cash dividends/income
ROE Return On Equity (ROE) 0.13 0.17 0.24
ROA Return on average Assets 0.03 0.04 0.06

 DuPont Identity

The following is the Dopont model breakdown for Ford and GM. The profit margin for Ford amounted to 13% of sales for both 2013 and 2012. The return on Equity was 27% in 2013 while in2012 it was 36%. The profit margin on sales for GM amounted to 12% in 2013 while in 2012 it was 7%. The ROE for GM amounted to 13% and 17% respectively for the years 2013 and 2012 respectively. The return on assets amounted to 3 and 4% respectively. The earnings per share for Ford in 2013 and 2012 were 1.54 and 1.48 respectively while the dividends per share amounted to 0.4 and 0.2 respectively. Both companies are heavily leveraged and Ford is the one that has the highest concentration of debt compared to GM.

The interest expenses for Ford increased by 16.3% in 2013 while in 2012 it had decreased by 12.7%. The interest expense for Ford in the year 2013 and 2012 were 829 million and 713 million respectively. GM interest expenses decreased by 31.7% in 2013 while in 2012 the expenses decreased by 9.4%. The interest expenses for 2013 and 2012 were 334 Million and 489 Million respectively

The net assets turnover for Ford’s decreased by 2.5% in the year 2013 as compared to a 50% increase in the year 2012. GM registered a decrease of 13% in its net assets turnover in the year 2013 while in the year 2012 it experienced an increase of 6.5%. The dividend per share for Ford in 2013 and 2012 was 0.4 and 0.2 respectively. This represented a return of 22% to the shareholders in 2013 while in 2012 it was 23%.

Table 1

Raw Data Ford Motor Company

Company Name Year 2013 Year 2012 Year 2011
Net income 7.155B 5.665B 20.213B
Revenue 146.917B 195.058B 135.605B
Assets 202.026B 189.406B 178.348B
Equity 26.383B 15.947B 15.028B

Raw Data GM Motor Company

Company Name Year 2013 Year 2012 Year 2011
Net income 5.346B 6.188B 9.190B
Revenue 155.427B 152.256B 150.276B
Assets 166.344B 149.422B 144.603B
Equity 42.607B 36.244B 38.120B

ROE Formula

(1)

Table 2

DuPont Analysis

 

ROE

 

  

Profit Margin

 

 Asset Turnover Equity Multiplier

 
TELUS Year 2000 0.072621 0.71662 0.75 7.66

Differences or Trends

Ford Motor Group seems to be having better ROE and Profit margins than GM. However the asset turnover for GM is higher than Ford. The equity multipliers for Ford are higher than those of GM which means that Ford is more levered than GM.

Growth

Dividend Growth Model

This section will require a table or appendix or both.  Add a comment or two regarding your findings – are they logical or feasible?

Table 3

Dividend and Stock Price Raw Data for Ford Motor Group

Ford Motor Group Year 2013
Net income $ 7.155B
Equity $26.383B
Total dividends paid $1.574B
Outstanding shares 3,881,659,802
Earnings per share (EPS) $1.82
Dividends paid per share $0.4
Stock price as of 2/11/2014 $14.07

Table 4

Growth Rate for Ford Motor Group

Analysis Formula Year  2013
ROE Net income/ Equity 0.2712
Retention ratio 1 – (cash dividends/ net income) 0.78001
Growth rate in earnings (g) Retention ratio x ROE 0.21154

Dividend Discount Model (DDM) =                              (2)

(3)

Growth rate Ford Motor Group 2013
ROE Net Income/Equity 0.2712
Retention Ratio 1-(cash dividends/net income) 0.78001
Growth rate in earnings Retention rate X ROE 0.21154
Dividend Discount Model Return rate R = Dividend /price of stock + g 0.23997
Price of Stock Dividend/Return Rate R – Growth Rate g 14.07

 Issues with Using the Growth Model

The dividend earnings growth trend has been calculated on average per year. There are financial periods where the dividend pay rate and amounts are similar has the growth trend is not reliable as the average would be very low. The general average however is 0.212%.

Reasonableness of Constant Growth

The growth rate number is logical as it reflects the general performance on the ground. The major problems with the calculation are the constant figures payable as dividends reflects a constant growth trend and the calculations reflect a zero growth trend. The company pays dividend as shown in the table above. It would be fair assume a constant growth trend for Ford Company.

Annual Report

Potential Real Options

Stock Options for Employee compensation for the year 2013

Fair value per stock option 2013 2012 2011
5.03 5.88 8.48
Assumptions made
Annualized Dividend yield 3% 2% –
Expected volatility 52.20% 53.80% 53.20%
Risk free interest rate 1.50% 1.60% 3.20%
Expected stock option (yrs) 7.7 7.2 7.1
Company stock options as at December 31 2013 (millions)
Outstanding options Exercisable options
Shares weighted av life yrs weighted av Exc price Shares weighted av life yrs
Range Prices available in $
1.96 -2.84 15.5 5.2 2.16 15.5 2.16
5.11 – 8.58 23.2 3.1 7.29 23.2 7.29
10.11 – 12.98 29.1 5.3 12.58 19.1 12.56
13.07 – 16.64 11.3 2.8 13.86 9.8 13.71
Total stock options 79.1 67.6

These options are company specific and they are payable on the range of prices available and the average years the employee has spent in the company. The share prices are weighted as shown on the table above. (Garrison, Noreen & Brewer, 2009)

The stock options would have to be provided for as their prices are usually provided for employees only and not for the general investors.

Capital Budgeting Process

The options would have to be provided for when budgeting for capital projects. All projects with average returns that are less than the weighted average cost of capital should be rejected as the cost of capital would be more the profits of the project.

Beta

Expected Return – CAPM

The beta for Ford Motor Group according to yahoo business finance is 0.88.  The current risk free market rate is 0.03%. The rate of risk premium is the amount that the expected asset’s rate of return is extra or exceeds the market risk free rate of interests.  The risk premium for trading companies is the company stocks or their expected rate of return less the risk free rate of return.

Capm = rf + β (rm -rf)
rf = risk free rate 3.00%
β = Beta 0.880
rm = return on the market 10.00%
Capm = 9.16%
(4)

The average historical equity premium is 6.9%, so 7% is an estimate for the risk premium (Ross, Westerfield & Jaffe, 2013).

The average Capm rate is equal to 6.52% as calculated in the excel formula which is attached. The expected return for Ford Motor Group is 7%. (Reilly & Brown, 2011) Using the model, the rate of return is 6.52%.

The cost of equity using the capital asset pricing model = Risk Free Rate + Beta * Market Risk Premium = 3+0.88*3= 11.64 (French, 2003)

Ford has outstanding shares numbering 3.88 Billion while the market prices of its shares were costing 14.07 which amounts to a total of $54.5916 Billion. (Black, Jensen and Scholes, 1972)

The Capital Asset Pricing theory suggests that the cost of capital depends largely on how the asset was initially. The cost of the debt capital, the cost of the equity capital and the weighted average of the two depending on the debt and equity financing represents the actual cost of capital.

Dividend Growth Model versus CAPM

The CAPM is 0.916% compared to the 0.21154 %. The differences are not so high but the most logical one is CAPM which is about 1%. However the general trend for the Ford Motor Group has been retrogressive at around -0.3. (Appendix B)

Debt and Equity

Equity

According to Modigliani and Miller (1958) the cost of equity capital is mostly determined by the asset’s cost of capital and not the other way round.

Ford has outstanding shares numbering 3.88 Billion while the market prices of its shares were costing 14.07 which amounts to a total of $54.5916 Billion. The Capital Asset Pricing theory suggests that the cost of capital depends largely on how the asset was initially financed (Bierman & Smiddt, 1966). The cost of the debt capital, the cost of the equity capital and the weighted average of the two depending on the debt and equity financing represents the actual cost of capital. (Black, Jensen and Scholes, 1972)

 Table 5

Market Value of Equity

Company name Year 2013
Shares outstanding 3.88B
Price as of 14.07 per share

Market value of equity

 54.5916B

26.83B
CAPM 6.52

Debt

Interest payments that are payable by lenders are all deductible from the ones or a company’s taxable income while the payments to shareholders as dividends are not. Most tax systems encourage the companies to use debt financing instead of equity. (Black, Jensen and Scholes, 1972) The higher the interest rates the higher the incentive.  The interest expenses for Ford increased by 16.3% in 2013 while in 2012 it had decreased by 12.7%. The interest expense for Ford in the year 2013 and 2012 were 829 million and 713 million respectively. GM interest expenses decreased by 31.7% in 2013 while in 2012 the expenses decreased by 9.4%. The interest expenses for 2013 and 2012 were 334 Million and 489 Million respectively. (Bodie, Kane, Marcus, 2008)

The capital structure for Ford is mostly made up of borrowed money. In 2013, the long-term debts amounted to $114, 688 million while in 2012 and 2011 the debts amounted to 105, 058 and 99488 respectively. The total stockholder equity amounts to $26,383 Million and $15,947 million for the same period. Ford Company is highly levered and it needs to cut down on borrowing. General Motor’s long term debts amounted to $6573 Million and $3424 Million for the year 2013 and 2012 while the total stockholders equity amounted to $42,607, $36,244 and $38120 for the years 2013, 2012 and 2011. Gm is relatively levered. (Markowitz, 1959)

The credit ratings for Ford currently are CCC+ from S & P performance of CC in 2012. Ford managed to pay its 9.9 Billion debts in the year 2014 and it helped to boost its credit rankings. Ford credit rankings place it in front of GM and Chrysler and they are currently fitting hard to avoid bankruptcy petition.

Table 6

Cost of Debt

Company name 2013
Long term debt

Current Portion of Debt

Total Debt

 114.688B

–

114.688B
Cost of Debt % 7%
Tax Rate 40

 

       (5)

Weighted Average Cost of Capital

Table 7

Weighted Cost of Capital Raw Data

Ford Value $ %
Equity (Rs)  26.383B  18.7
Debt (Rb) 114.688 81.3
Total Value 141.071 100Rs

(6)

Ford Value %
Equity(Rs) 26.383 0.86635
Debt(Rb) 114.688 0.13365
Total Value 141.071 1
Rwacc 3.98%

Capital Budgeting Assumptions

The major assumptions are that the tax rate is 40%. Following the losses incurred by ford in its foreign branches no taxes were chargeable in 2013.

Competitive Review of Debt and Equity Mix

The average weighted cost of capital is higher for Ford than GM. In 2013, the WACC for Ford was 3.98% while for GM it was 3.16%. Ford Motor Group seems to be in a lot of debts compared to GM.

Competitive Review

GM Value %
Equity(Rs) 42.607 0.86635
Debt(Rb) 6.573 0.13365
Total Value 49.18 1
Rwacc 3.16%

 Capital Structure Theories

According to Modigliani and Miller (1958) the cost of equity capital is mostly determined by the asset’s cost of capital and not the other way round.

Ford has outstanding shares numbering 3.88 Billion while the market prices of its shares were costing 14.07 which amounts to a total of $54.5916 Billion. The Capital Asset Pricing theory suggests that the cost of capital depends largely on how the asset was initially financed (Bierman & Smiddt, 1966). The cost of the debt capital, the cost of the equity capital and the weighted average of the two depending on the debt and equity financing represents the actual cost of capital. (Black, Jensen and Scholes, 1972)

Some theories of the Capital assets pricing model, have been applied in relation to heterogeneous beliefs (Merton, 1987) and risk free lending rate elimination (Black, 1972)

Summary

Ford Motor Group is a Gross Profit 7.9% in 2013 as opposed to 2012 when it decreased by 5% from the previous year. The GP for General Motors on the other hand increased by 70% in the year 2013 while in the year 2012 it decreased by 43%. The net profit for Ford for the same period increased 26% in 2013 while in 2012 it decreased by 72%. GM registered a 13.7 % reduction in 2013 while in 2012 it registered a further reduction of 32.7%. The total shareholder’s equity for Ford increased by 65.5% in 2013 while in 2012 it increased by 6%. General Motor’s shareholders equity increased by 17.6% in 2013 while in 2012 it decreased by 4.9%. In 2012 Ford Motor Group reduced its total liabilities by almost 70% while GM increased its total liabilities by 15.6% in 2013. The sales revenue for Ford increased by 10% in 2013 while GM sales for the same period increased by 2.1%. Ford total sales revenues increased from $133,559 million in 2012 to $146,917 million in 2013. GM sales for the same period were 152256 million and 155427 million from the same period respectively. The interest expenses for Ford increased by 16.3% in 2013 while in 2012 it had decreased by 12.7%, GM interest expense decreased by 31.7% in 2013 while in 2012 it decreased by 9.4%. (Bodie, Kane, Marcus, 2008)

The ratios for Ford also indicate that the liquidity ratios are above average for all the years for Ford Motor Group. The current ratios were 2.11, 2.32, 2.26 for the years 2013, 2012 and 2011. The quick ratios also indicated a positive trend. The Times interest earned for the year 2013 for  ford were 9.45, 11.83 and 11.63 for the years 2013, 2012 and 2013.  The interest cover for the same period indicated the same results like Times interest earned. (Drucker, 1999)

The ford Family owns 2% of the company while the employees number about 181,000. It has a market capitalization of $54.65 Billion and its shares are currently trading at $14.09 dollars with a yield of 3.5%. (Ross, Westerfield & Jaffe, 2013) The net assets turnover for Ford decreased by 2.5% in the year 2013 as compared to a 50% increase in the year 2012. GM registered a decrease of 13% in its net assets turnover in the year 2013 while in the year 2012 it experienced an increase of 6.5%. The dividend per share for Ford in 2013 and 2012 was 0.4 and 0.2 respectively. This represented a return of 22% to the shareholders in 2013 while in 2012 it was 23%.

Ford Motor Group has a great potential to return to great profitability and also be able to pay off all its outstanding debts. The Current ratios and the quick acid test ratios indicate that Ford Motor Group is has a stable liquidity and with the right leadership it would be able to make more profits like the earlier years. Given all these factors I would definitely invest my money in Ford Motor Group but I would be cautious besides I would also be requiring a plan on how the management of the company would be proposing to settle the huge loans that it owes several financiers. Ford may be earning some profits but it has a lot of debts that are four or five times its total equity. The classification of shares as common shares and also class B shares that have unequal voting rights is also some disquietedness among the shareholders.

Reference

Adams, S. (2008) Fundamentals of business economics. Financial Management (UK), 46–48. Retrieved from Business Source Premier Database.

Bierman, H. and Smidt. S. (1966).The Capital Budgeting Decision—Economic Analysis and Financing of Investment Projects. New York: Macmillan Company

Bodie, Z., Kane, A., Marcus, A. J. (2008). Investments (7th International Ed.) Boston: McGraw-Hill. p. 303.

Black, F., Jensen, M.C. and Scholes, M. (1972) “The Capital Asset Pricing Model: Some Empirical Tests,” in Studies in the Theory of Capital Markets. Michael C. Jensen, ed. New York: Praeger, pp. 79–121

Black, F. (1997) “Capital Market Equilibrium with Restricted Borrowing,” Journal of

Business. July, 45:3, pp. 444–55.

Drucker, F. (1999) Management Challenges of the 21st Century. New York: Harper Business.

Fama, E. F, French, K. R (2004). “The Capital Asset Pricing Model: Theory and Evidence”. Journal of Economic Perspectives 18 (3): 25–46.

financial problems and make effective business decisions. New York: McGraw-Hill.

French, C. W. (2003). “The Treynor Capital Asset Pricing Model” Journal of Investment Management 1 (2): 60–72.

Garrison, R., Noreen, W. & Brewer, P. (2009) Managerial Accounting, McGraw-Hill Irwin.

Higher Education.

Khan, M. (1993) Theory & Problems in Financial Management, Boston: McGraw Hill

Luenberger, D. (1997). Investment Science, Oxford University Press

Modigliani, F. and Miller, M. (1958) “The Cost of Capital, Corporation Finance, and the Theory of Investment,” American Economic Review, June, 48:3, pp. 261–97.

Markowitz, H. (1959) Portfolio Selection: Efficient Diversifications of Investments. Cowles Foundation Monograph No. 16. New York: John Wiley & Sons, Inc.

Merton, R. (1997). “An Intertermporal Capital Asset Pricing Model.” Econometrica, September,

41, pp. 867–87.Merton, R.C. 1987.

Reilly, F. & Brown, K. (2011) Investment Analysis and Portfolio Management, (10th Edition) South-Western College

Ross, S. A., Westerfield, R. W., & Jaffe, J. (2013) Corporate finance (10th Ed.) New York: McGraw-Hill Irwin.

Vance, D. (2003) Financial analysis and decision making: tools and techniques to solve

www://corporate.ford.com/our-company/governance-hub/board-of-directors-801p

Appendix A

Date Shares
2013 Low High Average  % Trend
1-Sep 16.21 17.35 16.78
8-Sep 17.1 17.68 17.39 3.63528
15-Sep 17.3 17.7 17.5 0.632547
22-Sep 16.69 17.34 17.015 -2.77143
6-Oct 16.35 17.12 16.735 -1.64561
13-Oct 16.92 17.55 17.235 2.98775
20-Oct 17.39 18.02 17.705 2.727009
27-Oct 16.76 17.72 17.24 -2.62638
4-Nov 16.55 17.2 16.875 -2.11717
11-Nov 16.64 17.2 16.92 0.266667
18-Nov 16.82 17.18 17 0.472813
2-Dec 16.42 17.2 16.81 -1.11765
9-Dec 16.2 16.79 16.495 -1.87388
16-Dec 15.17 16.99 16.08 -2.51591
23-Dec 15.1 15.5 15.3 -4.85075
30-Dec 15.25 15.64 15.445 0.947712
2014
6-Jan 15.35 16.11 15.73 1.845257
13-Jan 16.08 16.78 16.43 4.450095
20-Jan 15.78 16.68 16.23 -1.21729
27-Jan 14.9 16.01 15.455 -4.77511
3-Feb 14.4 15.13 14.765 -4.46457
10-Feb 14.78 15.36 15.07 2.065696
24-Feb 15.07 15.46 15.265 1.293962
3-Mar 15.03 15.83 15.43 1.080904
16-Mar 15.16 15.74 15.45 0.129618
30-Mar 15.48 16.49 15.985 3.462783
6-Apr 15.59 16.17 15.88 -0.65687
20-Apr 15.71 16.44 16.075 1.22796
27-Apr 15.75 16.2 15.975 -0.62208
4-May 15.43 15.95 15.69 -1.78404
11-May 15.55 15.9 15.725 0.223072
25-May 16.05 16.56 16.305 3.688394
8-Jun 16.5 17.12 16.81 3.097209
15-Jun 16.38 16.87 16.625 -1.10054
22-Jun 16.68 17.29 16.985 2.165414
29-Jun 17.07 17.4 17.235 1.471887
6-Jul 17.05 17.49 17.27 0.203075
20-Jul 17.51 18.12 17.815 3.155761
27-Jul 16.72 17.85 17.285 -2.97502
3-Aug 16.74 17.14 16.94 -1.99595
10-Aug 17.11 17.49 17.3 2.125148
17-Aug 17.51 17.52 17.515 1.242775
24-Aug 17.19 17.49 17.34 -0.99914
31-Aug 16.94 17.87 17.405 0.374856
7-Sep 16.5 16.87 16.685 -4.13674
14-Sep 16.16 16.77 16.465 -1.31855
28-Aug 14.44 16.4 15.42 -6.3468
5-Oct 13.52 14.7 14.11 -8.49546
12-Oct 13.26 14.25 13.755 -2.51595
19-Oct 13.65 14.49 14.07 2.290076
-15.6592
Trend -0.31957

Appendix B

Appendix C

 We can write this or a similar paper for you! Simply fill the order form!

Sky High Airlines Report Assignment

Sky High Airlines Report
Sky High Airlines Report

Sky High Airlines Report

Information Management Assignment: Sky High Airlines Report

Order Instructions:

The Assignment is a term paper for Logistics, Procurement and Supply chain management for Sanford university.

I need to submit it on 9 Nov 2014 and I am not a native english speaker so i need a paper that does not look plagiarized.

The total word is 1750. However, i will manage 100 words. Please use UK English Harvard business style APA 6

SAMPLE ANSWER

Information Management Assignment: Sky High Airlines Report

Introduction

Technology has become one of the strategies for attaining competitive edge in many companies.  It is however important that companies carry out in-depth evaluation and analysis of technologies before adopting to overcome challenges inherent. This report provides an analysis and recommendations concerning introduction of an integrated booking system based on that of Fresh Air (South African airline) into Sky-High Airlines. The report outlines ways in which the new IT strategy will benefit Sky High Airlines. It as well identifies key challenges of Sky High Airlines transitioning to this integrated system. A detailed recommendation for effective implementation of the strategy is as well discussed.

Overview of Sky-High Airlines

The airline market share has reduced due to increased conglomerates of airlines focusing on low costs strategy. This competition has threatened Sky-High Airlines that provides luxury travel at a premium price to rethink its corporate strategy.  Various options have emerged to counter the competition. Acquisition of Fresh Air by Sky-High Airlines to expand the market to South Africa is motivated by its leading booking system based upon open source technologies. The chief information officer of the company as well as CEO believes this technology is a source of competitive advantage.  Some quarters such as CEO believe that the Sky-High Airlines should not adopt IT since its unnecessary expense that will cost too much money hence it should focus on traditional efficiency techniques and redundancies.

Ways new IT strategy can benefit Sky High Airlines

Significant number of research studies has linked firms’ investments in IT with overall competitive advantage as they pursue superior performance. Adoption of technologies in the operations of the companies remains an area of opportunity that Sky High Airlines need to take advantage of.

Integrating the booking system will benefit Sky High Airlines in many ways. The company will incur fewer costs in implementing the technology, as it will build on the already established open source system of Fresh Air. The fact that Fresh Air has a system in place; it will not cost a lot for the company. Furthermore, the time it will take to implement the technology will be reduced allowing the company to accrue the benefit relating to the technology (Orlikowski, 1992).

The firms’ competitive ability to create and capture value through positioning in the industry is improved.  SHA stands a chance of competing favorably in the market courtesy of the technology.  SHA will improve efficiency in its bookings, as customers will not have to experience delays in their bookings. The increased customer base is going to boost the profitability of the company making it compete effectively in the current market (Feller, Finnegan, Fitzgerald, & Hayes, 2008).

This integration will allow SHA to complement its previous accumulated resources, as the company will unlock its value from the existing underlying investments. This will allow the airline an opportunity to remain competitive in the market as it will accrue profits from the reduced resource utilization (Drnevich & Croson, 2013).

According to the flexibility-based theories, the firm has the ability to quickly respond to changes in an effective manner which ensures that there is improvement in the efficiency (prices minus cost).  By SHA adapting to this technology it will improve in its efficiency hence the firm will minimize its costs of engaging in business. Customers will be able to use this technological platform to book their tickets easily. Flexibility will as well increase effectiveness by enabling them to seize every opportunity that will help it accrue extra ordinary profits.  Through this booking system, customers will be able to make enquiry easily and well as follow up, on their progress without necessarily having to appear at the airplane physical premises

Key challenges of Sky High Airlines transitioning to an integrated system

Even though the company will accrue some benefits as a result of transitioning to an integrated system, there are a number of challenges the airline will encounter.

One of the challenges is resistant to change. Various stakeholders hold varied opinions about adapting to this new technology. For instance, the CEO is not supporting this technology because of fear of increased cost. Such resistant will impact on the transitioning making the process long.

Another key challenge is selecting the most appropriate system that will better meet the expectations of the company. There are various software packages available in the market that the company can adopt (Feller, Finnegan, Fitzgerald, & Hayes, 2008). The two options to choose from is packaged and open sources software. Packaged software offers rich propositions in terms of broad and diffuse implications and in generation of energy. Such software are selected through a linear model of activities that includes identifying the user needs, evaluation of software on the basis of needs and then selecting the most suitable package. Open source software on the other hand  are produced/created by a consortium of experts and are not sold these two options have their advantages as well as drawbacks and therefore, it would require the  company to agree on the best modality something that  may take quite some time delaying the process of transitioning (Samoladas,  et al., 2012). The users at their own wish use free/open source software; they can copy and redistribute the software and can as well modify it to suit their own use.

Recommendations on effective implementation of the strategy

Implementing the strategy in the correct way will ensure that it succeeds. This however will require SHA to take adapt to appropriate strategy.

The company will have to create a conducive environment whereby all the stakeholders agree and support the integration process.  A section of the stakeholders has indicated some resistance and this is likely to be an impediment. To avoid such, they should be made to understand the benefit of integrating to the new system through practical demonstrations on how the system works (Drnevich & Croson, 2013). They should as well be convinced through examples of the companies that have embraced the technology and how it is working for them. This will help to increase the level of resistance.

It is also recommended that the company carry out a SWOT analysis about packaged and free open source software to adapt to before making an appropriate decision.  Even though open sources software is preferred, its strength, weaknesses, and threats and opportunities must be highlighted and assessed. This will ensure that the best decision is reached making the process of implementation easy and successful.

To implement the project well, it requires that the company come up with a defined process of strategic systems integration planning (SSIP) that will provide basis on the successful integration of the new technology. This is a cost-effective approach that allows better decisions making and improve the productivity of the system.  Once SSIP process is in place, it is then easier for the company to implement and integrate new IT the deliverables as they are easily defined, resources and assigned (ArcView Associates, LLC, 2009).

The first step is managing the SSIP and organizational change.  This is the initial step but continues in the other phases and if well deployed it continues throughout the life of an enterprise. At the start, the scope, work plans, tracking and reporting of the program are established to manage the introduction of the SSIP to gain executive-level support and commitment.  It is also important to define the project team for the initial SSIP phase. The team will be required to carry out various functions such as to manage the project, manage the process change and organizational change and ensure commitment through organization communication and executive communications. In SHA, the combined team of IT from all the branches of the airline, business representatives and customers must have insight in the business process (ArcView Associates, LLC, 2009).

The second phase is assessment of the current IT and business environments. The teams will review the current IT environment and business environment. They must engage leaders to understand the business direction, competitive situation, industry trends, and customer segments.  To have a clear understanding of what the future has in store for the technology.

Internal IT environment require assessment including the data center telecommunications infrastructure, physical  system  architecture and infrastructure, deployed systems, applications users, application interfaces, and development process, access security, QA and test processes, databases and IT organization and management function among many others (ArcView Associates, LLC, 2009).

The industry trends should as well be assessed with attention focus to those that could affect current environment. The company is also required to consider and assess the IT solutions for their competitors. This will ensure that it avoids technology that is not going to be productive to their company.

The third phase is identification of opportunities and issue. Appropriate methodology should be adopted to develop process models may include high-level views and detailed data flow diagrams among many others (Basahel & Irani, 2009). Functional areas, process, functions, and inert process relationships should be defined. The model will be used in identifying the areas with gaps and to assess the maturity level of the new technology.

The fourth phase is development of an IT strategic plan that will provide an IT strategic direction (ArcView Associates, LLC, 2009). The plan with include application architecture, information architecture. IT team organizational structure and resources as well as technology strategy.  The strategic vision is defined then reviewed and strategic options assessed putting into consideration the IT objectives,   resource requirements limitations and business priorities of SHA .

The last phase is development of an IT tactical plan that will help in supporting the implementation of this technology (ArcView Associates, LLC, 2009). Various issues that could be an obstacle from IT, perspective or business are deliberated and amicable solution provided.  Capacity of the SHA to accommodate this changes in process and business in IT facility while it serves its customers and operated effectively are considers and deliberated on. Other issues that SHA would assess include, impact of external entities, whether deliverables and priorities will be redefined,   financial trade off, improved business processes and competitive level among others.

The development plan should illustrate the overall costs, benefits risks and impacts. It should as well show the alternatives of deployment considered and provide schedule for the required developments projects and migrations. By adhering to these recommendations, integration process will be smooth and SHA will be able to achieve its plans.

Marketing opportunities

The airline has an opportunity to expand and accrue higher prices through marketing initiatives.  To ensure that the company remains competitive in the market, it should adopt the following strategies.  One is use the internet to market its services, second is to improve its services to attract more customers and lastly is for the company to increase its adverts on traditional media such as television, radio and print media. Internet has become widespread and many potential customers will be able to access to the company services through platforms such as social media, blogs and twitter among others. Improvement of services provided is yet another important market strategy that will help the company attract more customers who require value for their money. Using traditional media such as TV and radio will as well increase information supply in the public domain triggering increase in number of customers. These marketing ideas rhyme with the goals and future objectives of the organization of remaining competitive in the market. The company, through these marketing strategies will capture huge market base making it achieve economies of scale that will enable it gain a competitive edge. Increased number of customers’ presents an opportunity to the company to increase its branches and improve its services.  It will be able to provide better services to the customers and carry out a growth strategy by expanding in other areas.

Assignment Brief Part B

Before handling this assignment, my knowledge on open source software was limited. I could not imagine that various software were available free of charge on the internet. As a business oriented individual, it is important to seek for more information pertaining to the requirements to start a business. This information is accessible through various platforms on the internet.  Some of these sources are credible and provide in depth information on the best strategies, technologies, or networks to adopt in doing a business.

In any business, it is required that people innovate and use their skills and knowledge well to impact positively on their business.  Regardless of the fact that open source software is available, it is not always that this software will work in an entity.  It is therefore important to evaluate the organization needs and capability before adopting such software.

Through this assignment, I must attest to the fact that my level of knowledge about open source software has increased. I can now operate and even manage a company IT system smoothly to help it in attainment of their goals and objectives.

I have identified various issues that pertain to this assignment. One is that, it is possible to get grants and assistance to help already existing businesses to innovate and grow to achieve their success. This is an opportunity that many people lacks and if they can get such assistance, it is likely to improve the kind of software they adopt.  It is also important for business to seek for advices and support to enable them engage in their businesses well. This support and advice widens the scope of thinking of the people in the business and as well may impact on technology.

References

ArcView Associates, LLC. (2009). Strategic systems integration planning.

Basahel, A., & Irani, Z. (2009). Evaluation of strategic information systems planning (SISP)  techniques: Driver perspective, European and Mediterranean conference  on information  systems, Crowne Plaza Hotel.

Drnevich, P., & Croson, D. (2013). Information technology and business-level strategy: toward   an integrated theoretical perspective.  MIS Quarterly, 37(2): 483-509.

Feller, J., Finnegan, p., Fitzgerald, B., Hayes, J. (2008). From peer production to productization:   A study of socially enabled business exchanges in open source service networks, Information systems research,  19(4): 475-493.

Orlikowski, W. (1992). The duality of technology: Rethinking the concept of technology in             organizations, Organization Science, 3(3): 398-427.

Samoladas, I et al., (2012). Exploring the quality of free/open source software: A case study on an ERP/CRM system. Department of Informatics, Aristotle University

We can write this or a similar paper for you! Simply fill the order form!

The Montara Oil Spill Research Assignment

The Montara Oil Spill
The Montara Oil Spill

The Montara Oil Spill

Order Instructions:

REFERENCING

Students are required to use correctly one of the following referencing systems for Task 2:

  • APA (in-text referencing with reference list at the end)
  • Chicago 16 (footnotes and bibliography)
  • Harvard (in-text referencing with reference list at the end)
  •  MLA (footnotes and bibliography)
  •  AGLC

NB

The deadline is in 24 hrs not as shown as it was to enable us to get the agreed price.

SAMPLE ANSWER

The Montara Oil Spill

Description of the Issue

The world has been experiencing various disasters such as earthquakes, hurricanes, tornados, and other forms of natural disasters that pose threat to all living things. However, in August 2009, Australia was attacked by an oil spill that took place in Montara oil field in the Timor Sea, which was named Montara oil spill. Montara development project is owned by a company known as PTTEPAA, a subsidiary of Thai production public company limited (PTTEP) and PTT Exploration Company (Cheremisinoff, 2011). The development is situated at Timor Sea that is approximately 250 kilometers in the western side of the Australian coast. The spill occurred after the blowout and fire in the wellhead platform of Montara. Surprisingly, the lick continued for the next 74 days without stoppage although the government and the company worked hard to stop it. The intervention to stop it became successful on the third of November. Within this time, the leak was spreading and threatening the lives of people along the shore. Australian marine safety authority reported that the slick was about 170km from the coast of western of Australia and was moving towards the shore (Guertin, & Neville, 2011). Thai technicians estimated that the flow was about 1500 barrels in the early stages which reduce late to 400 barrels.

The issue in Relation to Common Good and Social Justice

The Montara Oil Spill is an issue of common good or social justice. One of the most dangerous disasters is oil spill. The spill poses threats to all of living things since it interferes with the food chain. Benestad (2012) says that the effects of oil spill stays for years before it ends. An example is Exxon Valdes oil spill which still has the effect on the environment. The issue of montara oil spill looks at the welfare of animals and human beings. Oil on the surface is capable of preventing the passage of oxygen into the sea. In this case, animals including fish are killed destroying the food chain at that point. It is an issue of common good in that, the oil on the surface of the sea can easily explode to an extent that kills plants and animals. The government and the companies involved took a lot of time to stop the slick, however, the companies looked at the welfare of individuals who were affected and rewarded handsomely. On top of that, as assign of social justice and common good of the future generations, the government employed strategies and rules that governs oil exploration so that individuals are not threatened and lives at their best of state. Guertin and Neville (2011) say that by doing that, the government and the responsible companies looked at the welfare of the society which is the principle of common good and social justice.

Stakeholders and their Perspective

There are various groups known as the stakeholders who are involved in this issue in one way or the other. Such stakeholders include the company who was responsible, the Australian government where the issue occurred, the people of Timor who were affected by the issue, and the environment which was affected by the issue. Their perspectives that are discussed here evaluates whether they showed a concern of common good or social justice.

The companies such as Thai-based Company, PTTEP Australasia (PTTEP AA) did not show the common good of the community at the early stages of the slick. Any person can agree that with the help of the government and global companies, the slick could not stay for 74 days. It is therefore the obligation of the company to act as fast as possible because its present in the country is what has caused the spill. Later on, the companies accepted their responsibility that showed social justice. Scibilia et al. (2012) argue that by just agreeing that they were responsible, some people forgive them. The company has pleaded guilty of the act. Fitzpatrick pleaded to be guilty and says that “Mistakes were made that should never be repeated.” The chief executive ken says that “From the outset we have admitted responsibility for the incident and deeply regret it occurring,” in this manner the gentlemen showed their concern for the community about the incidence. The company went ahead and compensated those who were directly affected by the incidence. The company has also changed the culture of operation which assures people of unlikelihood of such incidences in future to protect communities and its people.

Secondly, show of social justice by the Australian government has been criticized in several ways. First, the country prioritizes the economic development and leaves people and the environment at a risk. Even before the incidence happened, the government new that exploration of oil along the shore is not only unhealthy, but also put a lot of threats to the sea. A good way they would have shown the social justice and common good is any prohibiting exploration of the oil in the area. Two, other than just acting after 74 days to get the solution, the government took long duration before compiling t reports about the incidence. It seems that the government is less interested in the community affairs. Martin Ferguson The minister of resource and energy says that the penalties will be put up to $ 320 dollars for companies that will be engaged in such in incidences. According to Cook and Wasson (2013) such kind of penalties would have been long time ago after observing the effects of oil spill of Exxon Valdes. As much as there are mitigation processes about natural disaster, the Australian government has not shown social justice by just giving a fine of $1.7billion to such a wealthy company.

The people of Timor are considered to have suffered the negative side of the social justice. This is through the Australian, Indonesian government and the company. Both of the above parties took considerable time to mitigate such a deadly accident. Report through questionnaire identifies the three groups as very irresponsible and slow in matters that concern several lives. Although the directly affected people were evicted and given shelter by the government after the company compensation, indirectly affected people up to now pose threats to the future generation. The report revealed that there are possibilities of liver intoxication that results from oil compounds. These later problems have not been addresses by either the governments or the company.  Therefore, if these conditions are genetic as said by Benestad (2012) the future generation is likely to be affected. All these acts violate the principle of social justice and common good as the future generation is liable to suffer the sins they never committed. It is for these reasons that the people of Timor have seen the other side of common good.

The role that the environment plays to both human beings and animals was violated. The oil spill has affected the life of marine animals and fishes.  The lives of birds were also threatened as their wing got stuck on contact with the oil. The mitigation process of using dispersant chemicals reached west Timor which resulted to loss of livelihood of many individuals. The interest of economic development has passed the interest of the environment which host animals and plants. If the government and the companies were in deed considering the common good of individuals, they would have not used another chemical that could pose more threat to people. The compensation does not reclaim the affected land. The company and the government delays on the safe process of montara reclamations so that it becomes to be the home of fauna and flora again.

Analysis of the Issue in Relation to the Stakeholders’ Perspective

There are stakeholders that became part of the issue to see a change in future. Their main reasons are governed by the principles of common good and social justice. These stakeholders believe on the principle of human flourishing which states that “to live within an optimal range of human functioning, one that connotes goodness, generatively, growth, and resilience” (Appleby & Kenny, 2010). Flourishing is the opposite of both languishing and pathology, which are defined as living a life that feels empty and hollow. Flourishing is an optimistic psychology notion, which is a degree of overall life well-being of individuals and is seen as important to the idea of personal success and happiness. These stakeholders are the government, the environment leaders, people of Timor and the religious leaders.

Environmental leaders argue that the environment is the home of all living things and should be kept at high level of sanity. Pritchard, the Director of the Environs Kimberley environment group argues that he was disappointed by the fine that was given to the company. He says “it was an absolutely massive oil spill,” he argues that the fine was too small for an oil exploration company. The environmentalists argue that making the environment clean by all parties is a social justice and common good for both current and the future generation. It is for this reason that Pritchard says that reclaiming the Montara region is more beneficial than compensating the individuals.  The point of environment reclamation arises from Exxon Valdes that has taken years to be reclaimed and still pose threats to sea animals and fish. Leaders of the environments’ arguments are based on the reports that the long existing compounds of oil can intoxicate even the future generation. As a result, they say that the common good of people and social justice will only come after the environment where man leaves is made safe for their existence.  Benestad (2012) adds that in making political and economic decisions, states should focus and evaluates the effects on such decisions on the environment which is the home of people.

When the interests of individuals come to be the priority of the nation, social justice becomes the order of the day (Renn, Baram,  & Lindøe, 2014). That is the stand of Timor people. In this situation, the government gives the economic development a priority and neglects the citizens. Melé (2014) says that when the economic principle become the priority of the state, the leaders can do anything including sacrificing the citizens to gain political and economic fame. As the stakeholder of the issue, the agreement between the companies and the government to allow the oil exploration on shore without proper precaution of spills which have been seen in other countries was a move to violate the social justice and common good of the citizens. Thus, there point concerning social justice is that people’s interests in a country should come first before the economic interest.  In this case, people of Timor are likely to get intoxicated; they have been evicted from their place of living hence the principle human flourishing is violated as people of Timor live under condition that they must survive.

The religious leaders draw their argument from religious perspective and sandwich it with human flourishing. They say that no human being should suffer the consequences of other human beings. The act of subjecting innocent individuals to serious suffering such as contacting liver diseases does not only violates religious principles but is also injustice.  The religious consequences of the act are harsh and can lead to total demolition of the company out of the country. Religious leaders also agree with environmental leaders that the company has been given small fine that is incomparable to the effects It has caused to the future generation that will be affected by the oil compounds since it takes years to disappear from the environment. In a bid to stop future explosion, the religious leaders called for an environment that regards God’s creations as important aspects in the world. Hence, a culture that respects them should be fostered.

The fact that the government has employed and initiated acts such as a fine of $320 billion on companies that may be caught in such incidence in future will assist to guard the common good. In this manner, the companies will ensure that every aspect of precaution and mitigation actions is put in place to avoid human humiliation and violate the social justice. The government has also provided the shelter of the evictee after compensation that calls for the principle of human flourishing. Although people of Timor are complaining of future effects of the oils spill, the government has solved the current problem.

Evaluation

Following this discussion, it important to negotiate a balance that exists between social justice and development; environmentally sustainable development and just development. After evaluating those aspects regarding this case study, a definition of social justice, human flourishing, and common good will be automatically seen. Therefore, the oil company should put the interest of its citizens first before the development interest. The company should also look for better solutions of such predicaments if they happen in future. If those factors are observed, both the company and the government will be institutions that foster human flourishing, common good, and social justice.

References

Appleby, B., & Kenny, N. P. (2010). Relational Personhood, Social Justice and the Common Good: Catholic Contributions toward a Public Health Ethics. Christian Bioethics: Non-Ecumenical Studies In Medical Morality, 16(3), 296-313

Benestad, J. (2012). 4. Seeking the Common Good through Justice and Social Justice. In , Catholic moral thought (p. 143). The Catholic University of America Press.

Cheremisinoff, N. P., & Davletshin, A. R. (2011). Emergency Response Management of Offshore Oil Spills : Guidelines for Emergency Responders. Salem, MA: Scrivener

Cook, E., & Wasson, K. (2013). The Common Good and Common Harm. National Catholic Bioethics Quarterly, 13(4), 617-624.

Guertin, L., & Neville, S. (2011). Utilizing Google Earth to Teach Students about Global Oil Spill Disasters. Science Activities, 48(1), 1-8.

Melé, D. (2014). ‘Human Quality Treatment’: Five Organizational Levels. Journal Of Business Ethics, 120(4), 457-471.

Renn, O., Baram, M. S., & Lindøe, P. (2014). Risk Governance of Offshore Oil and Gas Operations. Cambridge: Cambridge University Press

Scibilia, D. P., Giamario, P., & Rogers, M. (2009). Learned Piety: Education for Justice and the Common Good in Jesuit Secondary Education. Peace & Change, 34(1), 49-61.

We can write this or a similar paper for you! Simply fill the order form!

Taxation Law Case Study Assignment

Taxation Law
Taxation Law

Taxation Law Case Study

Sebastian Dangerfield is a Computer Programmer and IT Consultant. He started working on a series of projects for Giga Systems Ltd in March 2012 and since then he has worked on a new project for them every 4 to 6 weeks until the present
The projects usually provide about £4000 to £6000 each and he usually does 10 per year
Sebastian is under no obligation to accept any of the projects and works entirely under his own control
Sebastian works from his office at home which has been fully equipped for his likely range of tasks. He rarely visits the premises of Giga Systems. His
office occupies one room of his 5 room home and incurs considerable overhead costs for typical items such as heat/light, phone, etc
In relation to Giga Systems: List those factors which will be considered by HMRC when they determine whether Sebastian is an employee or is self-employed, and the relevant law as authority.
Advise Sebastian as to his situation and how best he should proceed.

Reference should be made to all relevant sources of law and should be appropriately researched.
The essay should be double spaced, font size 11 Verdana. The word limit cannot go under 1800 or more than 2200 words.

We can write this or a similar paper for you! Simply fill the order form!

RMO CASE & PHARMACEUTICALS

RMO CASE & PHARMACEUTICALS
RMO CASE & PHARMACEUTICALS

RMO CASE & PHARMACEUTICALS

Order Instructions:

HOMEWORK 2 (Module 2) 40 Points

Due Date: End of Module2

Read chapters 2, 4, 5 and 6 of the text and the case studies at the end of these chapters. Then answer the questions about the Rocky Mountain Outfitters and the Reliable Pharmaceutical Service case studies at the end of these chapters. Make your answers short (2-3 sentences).

Suggestions and Guidelines:
• Use your own words and Thoughts. Plagiarism and/or cheating will result in a grade of Zero.
• Give short answers to each question (not more than 3-4 lines)
• Total page length (not more than 3 pages, 300 words per page)
• 1-inch margins, Double spaced, 12-point, Times New Roman font

SAMPLE ANSWER

CHAPTER 2: RMO CASE

How extensive would the training needs be for the RMO staff?
The new RMO staff will need very extensive training in system design, requirements identification, analytical skills and project management.

What type of training would be required?
Training in project management, programming language and technical skills would be required.

Is it just about new programming languages, or is it broader than that?
The developer not only need to be knowledgeable on programming languages, which should include java and C++, but also be technical and know how to use tools.

How far can the project progress before the decision is made?
The project can progress through all the phases because regardless of the approach used, planning, analysis, designing and implementation activities are vital in each approach.

Do you think she is correct? Why or why not?
Yes, because both are approaches to designing a system. However, most systems that are being designed today employ both approaches.

Do some types of projects require an OO approach?
Yes, especially the customer oriented ones need to be natural and intuitive, benefits which are derived from object oriented approach.

What life cycle variations are under consideration?
Barbra may need to consider including the analysis phase, system design phase, and system testing.

What else might she do to speed up the development process?
She might need to define what the system’s requirements are and then find possible solutions that fit the system and plan on gradual release of the system parts that are complete.

What else might she consider adapting from the United Process, from Extreme Programming, or from Scrum?
She might adapt the responsive nature of scum to change since the environment is rapidly changing.

CHAPTER 2: FOCUSING ON RELIABLE PHARMACEUTICAL SERVICE.

What are some of the risks of taking this approach?
High possibilities in making mistakes, difficulties in making corrections, and impossible to add forgotten components into the system.

What planning and management difficulties would this approach entail?
Rigidity, ineffectiveness, and generalized assumptions. The approach is rigid in that once a plan is made it cannot be reversed and requires too much planning.

What are some of the risks of taking this approach?
High likelihood of committing mistakes that cannot be reversed, and it may be difficult to meet original requirements.

What planning and management difficulties would this approach entail?
Planning needs to be very thorough and it may overburden an analyst since analysis and designing may need to be done at the same time.

Briefly describe what you would include in each iteration?
The four parts that may be included in iteration include the inception, elaboration, construction and finally transition.

Describe how incremental development might apply to this project.
This approach involves finishing several parts and then releasing them to the end users. When more parts are complete, they are integrated with other parts and made operational. In this project, reliable may complete designing the system dealing with basic patient information, then make it operational as it still designs other information systems.

How would an iterative approach decrease project risks compared with the first approach?
By breaking the risks from their complex nature to simple ones that solutions can be provided with ease. It also offers opportunity for changing plans in case a fault is noticed.

How might it decrease risks compared with the second approach?
It ensures the most vital components of a system are implemented by giving them priority unlike the second approach where phases are overlapped.

What are some risks the iterative approach might add to the project?
Early release of a system part may cause rejection from the end users and distort the whole system since it may require developers to rethink or re-strategize.

CHAPTER 4: ROCKY MOUNTAIN OUTFITTERS CASE

What advice would you give your project team to help it manage the user expectations?
The project team should treat user information with seriousness and adjust to changes as per user expectation. All the users’ views should be incorporated into the system being developed.

What early planning can you do now to ensure that the scope is realistic—to meet the need but within the time and budget allotted?
A feasibility plan will be necessary in ensuring that the scope is not only realistic but also attainable within the allotted time and budget. This will be achieved by clearly defining the content of the project, its intended purpose, and the extent of project work that the team is to cover.

CHAPTER 4: RELIABLE PHARMACEUTICALS

What information-gathering methods are most appropriate to learn about requirements from Reliable own management staff and other employees?
Through interviewing them or observing them while they are using the system.

From client health-care organizations?
By talking to them or interviewing them.

From suppliers?
Through talking to them and interviewing them, and studying what other companies do.

Should patients in client health-care facilities participate in the information-gathering process? If so, why, and in what ways should they participate?
Yes, the patients should participate. This is because in system development and design, excellent outcome will be achieved if all stakeholders are involved.

3. With respect to gathering information from suppliers and clients, how deeply within those organizations should systems analysts look when defining requirements?
They need an in-depth knowledge not only of how the system should function, but also be knowledgeable of the organizations core business in order to fully come up with the appropriate system requirement.

How might Reliable deal with supplier and client reluctance to provide detailed information about their internal operations?
Reliable might consider providing incentive for them to participate such as bonuses or discounts.

4. For which user community or communities (internal, supplier, or client) are prototypes likely to be most beneficial? Why?
Prototypes are most useful to the internal users because it enables them to identify areas that need changes. Necessary adjustments are then implemented to improve the final system so that the final system will be very efficient.

CAPTER 5: RMO CASE

QN 1 Discuss the implications that such a change would have on the scope of the project. How might this new capability change the list of stakeholders the team would involve when collecting information and defining the requirements?
If ROM decides to incorporate customer charge and payment plan, then it will have to be included in their system and not be a research item in the RMO initial list of things. In the scope, the project will now have to stretch and even include customer account, details on customer purchase history, and payment plan details.

Would the change have any effect on other RMO systems or system projects planned or under way?
The changes will have insignificant effect on the plan underway since adjustments can be made along the way to achieve the most desired and efficient system.

Would the change have any effect on the project plan originally developed by Barbara Halifax?
The changes will have no effect on Barbra’s original plan.

In other words, is this a minor change or a major change?
This makes the changes minor and insignificant.

What events need to be added to the event table?
What needs to be added in the event table include
• customer wants order delivered
• customer wants to recommend orders to friends.

QN. 2 Complete the event table entries for these additional events.
Event Trigger Source Use case Response Destination

Customer wants order delivered

Delivery request
Customer Look up delivery options Delivery details customer
Customer wants to recommend to friends

Recommend to friends
Customer Recommendation options Recommendation details Customers
Customers friends

What activities or use cases for existing events might be changed because of a charge account and payment plan? Explain.
If charge account and payment plan are incorporated into the system, then the charge adjustment might be merged with the charge account. The payment plan will cause changes in ‘update customer account’ use case.

3. What are some additional things and relationships among things that the system would be required to store because of the charge account and payment plan?
Things to be stored include payment plan options and customer account details.
Modify the entity-relationship diagram and the class diagram to reflect these charges.

Order

Order ID
Order date
Order amount

Customer

Customer name
Customer I.D
Account details
Address
Telephone

Customer charge

Purchase history
Charge adjustments

Payment plan.

Cash
1st installment
2nd installment

Chapter 5: FOCUSING ON RELIABLE PHARMACEUTICALS

QN.1 Create an event table that lists information about system Requirements

Event Trigger Source Use case Response Destination
Nursing homes(clients)needs prescription order Order inquiry Nursing homes (clients) Place New order Order details Clients
Management wants to record prescription orders Record orders Management Update records
Time to produce order summaries Start of each 12 hour Produce order summary reports Order summary reports management

Need to update patient information
Patient information update Nursing home/clients Update patient records
Need to generate order fulfillment forms End of week Create order fulfillment Order fulfillment report Management
Management need to update drug inventory Update drug inventory Management Update inventory

QN.2 Create an entity-relationship diagram that shows the data storage requirements for the following portion of the system:

Order Item

Price
Item I.D
Quantity
Price

Prescription order

Order ID
Order date
Order amount

Nursing home (Client)

Patient’s name
Address
Age

CHAPTER 6 : ROCK MOUNTAIN OUTFITTERS CASE STUDY

QN. 1 Develop DFD fragments for all of the events not documented
Order status inquiry 6

Order status details
Order status inquiry

7

Order
Fulfillment
notice

8

Back order notification
Back order notice

Catalog request 11

C

QN. 2

QN.3 Customer order form

Customer
Requests
Order

CHAPTER 6. RELIABLE PHARMACEUTICALS
QN.1

End week report Order fulfillment report

Order inquiry

New order update drug inventory

Update patient details

QN.2

Monthly
report

QN.3

patient
Requests
Update

QN.4

Order request

Place new order

QN.5. Physical billing procedure does not have to be developed because it can be automated in the system.

Reference
John W. Satzinger, Robert B. Jackson & Stephen D. Burd, (2010). System analysis and design in a changing world. Fifth Edition.

We can write this or a similar paper for you! Simply fill the order form!

Key HRM Issues at UniCall Assignment

Key HRM Issues at UniCall
Key HRM Issues at UniCall

Key HRM Issues at UniCall

Order Instructions:

the Case Study title is ‘Call centres in the financial services sector—just putting you on hold…’.

After reviewing your assigned reading and the information presented in the case study, answer the following questions:

1. Identify and assess the key HRM issues at UniCall.
2. Recommend and justify HRM interventions that would improve business performance.

SAMPLE ANSWER

UniCall

Key HRM Issues at UniCall

Human resource professionals are often involved in making key personnel decisions/resolutions in organizations of all sizes. These individuals are in charge of implementing ongoing trainings of workers in different areas within companies. Since human resource professional are always in the management of employees with various qualifications and from various backgrounds, they often face several issues that need their attention (Marie, 2012). In relation to this, UniCall happens to be faced with several HRM issues. These issues are related to personnel and training issues.

One of the personnel-related issues that often present significant problems to HR professionals is the need to identify and recruit qualified and competent workers. Some of the organization’s employees seem to be incompetent, thereby highlighting the fact the firm’s HR has not been active in the identification and recruitment or appropriate workers (Ferndale, Paauwe & Boselie, 2010). For instance, consumers have been noted to present complaints concerning the aspect of rudeness on the part of the company’s staff. This rudeness is linked to issue of inflexibility of the firm’s staff when handling complex account-related matters. In addition, the aspect of incompetency on the part of the firm’s employees is evidenced by all of them giving similar responses to consumers when called upon. As such, it is clear that UNiCall’s HR department lack suitable mechanisms of identifying and hiring competent workers who can address consumers’ problems in various ways. Moreover, UniCall’s HR department also faces the problem of

UniCall’s HR department also faces training-related issues. Prior to the opening of UniCall, UniBank focused on the provision of financial and personal banking services to small businesses and individual consumers. UniBank decided to venture into the telephone banking sector following the increasing commercial success of organizations that operate in the field of direct line banking. As a result, UniBank opened UniCall, and redeployed some its works to the new business, UniCall. Employees that were redeployed in UniCall lacked skills that were required to handle issues in this business, thereby subjecting the firm to its current problems. For instance, some of the company’s staff members face problems using the computer system. These employees cannot manage to retrieve accurate information concerning simple enquiries. Besides, they cannot retrieve accurate information concerning the durations taken by interrogations. Moreover, these workers face problems handling the firm’s monitoring systems, which measure the duration and number of various types of call. As such, the inquiries that are related to direct debit arrangements and standing orders take an extra of 50% of the time required for them to be completed. In addition, some of the redeployed workers are not satisfied with their job as they argue that it is too impersonal.

It is also clear that the management of UniCall’s HR department is facing issues handling their employees in that they seem to embrace the transactional form of leadership. This form of leadership seems to emphasize on intense supervision and directive measures as seen in the case of UniCall. As result, most employees in this organization are not empowered to execute even simple operation on their own as they have to receive directives from the call center. Moreover, the aspect of constant surveillance has led to resentment on the part of employees, which in turn has made them develop informal ways of executing their duties (Anca-Ioana, 2013). Moreover, the firm’s management has not established appropriate systems that can be employed in motivating employees and recognizing workers’ skills. This deficiency has led to discontentment on the part of younger employees who are inclined towards seeking employment in other firms in the industry. In addition, these employees argue that the firm’s pay structure does not take their skills into consideration, thereby subjecting the company’s HR to compensation issues.

HRM Interventions for Improvement of Business Performance

Addressing HRM issues is significant in ensuring that businesses lay robust foundations for organizational growth. UniCall’s HR department should focus on suitable ways of addressing the personnel, training, compensation challenges that it is facing.

The Company’s HR department should engage in active search of sources of potential employees. This undertaking will help the HR department end the problem of incompetency on the part of its employees. Some of the sources of potential workers are employee referrals, recruiters, networks and associations, headhunters, and temporary agencies (Armstrong, 2009). Moreover, the company’s HR department should involve in an active running of advertisements on job websites and newspapers in order to attract competent workers. The firm’s HR should also focus on developing a suitable action plan, which is aimed at attracting competent workers.

UniCall’s HR should implement reward-based programmes, which should be directed to employees and managers. Reward-based trainings have been noted to be suitable motivators to employees. These training should focus on equipping workers with adequate technological skills that are required to handle the company’s computer systems and other technology-based activities. Furthermore, the HR should also conduct a separate training on its supervisors and managers on aspects of good leadership, which is vital in creating suitable leader-employee relationships (Shaw, Park & Kem, 2013). This undertaking is significant in ensuring that employees and managers/supervisor communicate in a suitable way. As a result, employees can manage to present issues affecting them to the management, which in turn can end issues such as informal execution of operations on the part of workers with the aim of pleasing the management.

The company’s HR should also ensure that its managers are trained on the aspect of reward-based management, which will ensure that they implement a performance appraisal system in the firm (Shaw, Park & Kem, 2013). As a result, this undertaking will help identify the skills of all workers. Lastly, the company’s HR department should review its payment structure to provide for benefits and allowance for certain talents.

Reference List

Anca-Ioana, M., 2013. “New Approaches of the Concepts of Human Resources, Human Resource Management and Strategic Human Resource Management,” Annals of the University of Oradea Economic Science, 22(1), pp. 1520-1525.

Armstrong, M 2009, Armstrong’s Handbook Of Human Resource Management Practice, London: Kogan Page.

Ferndale, E., Paauwe, J & Boselie, P. 2010. “An Exploratory Study of Governance in the Intra-Firm Human Resources Supply Chain,” Human Resource Management, 49(5), pp. 849-868.

Shaw, D., Park, T & Kem, E. 2013. “A Resource-Based Perspective on Human Capital Losses, HRM Investments and Organizational Performance,” Strategic Management Journal, 34(5), pp. 572-589.

Marie, H. 2012. “Strategic Human Resource Management in Context: A Historical and Global Perspective,” Academy of Management.

We can write this or a similar paper for you! Simply fill the order form!