Target costing Case Study Example | Topics and Well Written Essays - 1000 words

Target costing - Case Study Example Thus the cost has never been a primary consideration for the company. But the changes which aroused the competitive environment of the company were cost competition and product innovation with its competitors. The invention of the new segment related to the sports utility vehicle and other market niches are the other factors of the competitive environment for Mercedes. Answer 2 The main changes that took place in the worldwide luxury automobiles were the introduction of the new products in the market which led to the rise in the competition of the company; partnering with the suppliers; reduction in the complexity of the system; new emphasis was being placed on the cost control of respective companies whereas Mercedes cost control was being led by engineers rather than accountants; the number of managerial level were being reduced which was still high with Mercedes; the concept of lead time were being introduced to tackle the costing of companies in an organised way but Mercedes lack ed accountants specifically assigned to look after the costing of the company. Answer 3 The factors based on which MB competes with the other automobile producers are pricing of the product ranging from mid to upper zone, quality and functionality of the product maintained at a very high level. The pricing of the product afore mentioned ranged as its target customer rangers from the higher middle class to the bourgeois of the society. Through this they are able to distinguish themselves as a luxury car which is also affordable by a section of the middle class of the society. This helps in expanding the customer base of the company. However, the quality and the functionality of the company are kept high for maintaining the world-class standard. Moreover, Mercedes does not produce the most expensive sports utility car unlike Land Rover. Furthermore, Mercedes does not strictly follow target costing as the cost control measure of the company so as to produce the lowest priced product in its class (Cooper 163). Answer 4 The product line expansion has occurred though its new expansion as the traditionally luxury-oriented manufacturer. The latest add-ons to the company are A-class, C-class, SLK, E-class and M-class. The recent introduction of the company includes off-road vehicles and new sports car. The C-class which is a mid-sized vehicle also referred to as the baby-Benz. The target costing of a company mainly comprises of three components namely, target cost which is obtained by subtracting target profit from the target selling price of the product of the company. So as to diminish the cost of the company it should focus on the customer group and comparable products both potential as well as existing. However the profit margin of the company depends on the critical volume of the company which is the production volume. Since Mercedes is an automobile manufacturing company, it is dependent on capital intensive structure which in turn is based on the NPV model. Furt hermore the NPV of the company is determined from the long-run profitability, cost of capital, sales volume by class and profitability across vehicle classes. Answer 5 The development of the index comprises of five steps namely, categorically ranking the consumer importance, target cost percentage by function group, categorising of the function group matrix, importance matrix and the target cost matrix. Development of the

Business plan for the Proposed AfroCare Restaurant in Allerton, Essay

Business plan for the Proposed AfroCare Restaurant in Allerton, Liverpool - Essay Example The researcher states that the name of the proposed Afro-Caribbean Restaurant shall be AfroCare Restaurant. It will be based in the Allerton borough approximately 4.8 kilometres from the city centre of Liverpool. AfroCare Restaurant will specialize in the preparation of Afro-Caribbean dishes including breakfast, lunch and dinner. Ideally, this business envisions a large market with mixed customer base incorporating mainly the British Afro-Caribbean community residing in the suburbs of Liverpool and its environs including the Hunt Cross and Calderstones Park. On the other hand AfroCare Restaurant will also incorporate a wide range of fast foods and customized drinks at affordable prices suitable for the vast majority of college students living around Allerton. While the business is set to roll out by the end of this year 2012, it looks forward to capture a market share of about 60% by the close of Year 1. The projection is based on the fact that there are no restaurants in Allerton wh ich have specialized in Afro-Caribbean dishes. However, it is prominently argued that the few that prepare Afro-Caribbean foods have recorded remarkable increase in customers and thus an improved attributable revenue performance. In terms of capacity, AfroCare Restaurant will be established in a spacious facility along the Allerton Road with an optimal sitting capacity of 200 heads. At full occupancy, the restaurant projects sales revenue of about  £9,000 per day. ?9,000 per day. This translates to an AfroCare annual return of ?3.24 million. If the business therefore realizes at least 60% customer base, it will manage an annual revenue performance of ?1,944,000 at the end of Year 1. To that end, the proponent of this venture has set aside a starting capital of ?300,000 with an estimated reinvestment rate of 10% on the cost of capital (Taylor and Brown, 2003). Thus, AfroCare Restaurant envisions the attainment of a full capacity by the second quarter of Year 2. The business and its Management Proper management is one of the core elements of every business especially when competition as a factor to consider. Guided by a realistic vision and SMART objective, the management of any enterprise defines the overall stricter and operational dynamics of the business as reiterated by (Toren and Adam, 2011). AfroCare Restaurant will basically be a sole proprietorship company with limited liability. As such, the manger will reserve exclusive authority of the operations of the business while taking into account the possibility of outsourced expertise in Food and Beverage Management in line with common practice in the modern world (Boone and Kurtz, D. (2010). With that in mind, AfroCare Restaurant endeavours to set an exceptional and unmatched standard in the provision of Afro-Caribbean dishes beyond the expectations of our customers. Therefore, its operations and service delivery shall always be inclined toward achieving the following vision and objectives. Vision Primari ly, a vision refers to the main goal that an organization seeks to achieve over a predetermined period of time. Whereas the vision governs the operational efforts of an enterprise, it keeps the business in focus at all times as postulated by (Liebig, 1994; Walters, 2011) The vision of AfroCare Restaurant is to be the best service provider of Afro-Caribbean foods across Liverpool and beyond. Mission According to Shane (2003), a mission refers to the basic philosophy on which the daily activities of an organization are

Characteristics of leadership

Characteristics of leadership Introduction The characteristics of leadership are examined in the context of business management. Leadership Shackleton (1995) defined leadership as the process in which an individual influences other group members towards the attainment of group or organisational goals. According to Torrington et al (2008) the leader may or may not be the nominal head of a group, implying that managers may or may not be leaders, and leaders may or may not be managers. Hollington (2006) argues that any individual may act as a manager at one stage and a leader at another time, depending on the situation. It should not be assumed that leadership is always a downward process, as there are times when employees or managers lead upwards. There is a degree of confusion between management and leadership, which is clarified by Northouse and Northouse (2009) who state that while management is concerned with the provision or order and consistency within organisations, the prime function of leadership is to drive change and development. Management seeks order and stability, whereas leadership aims to adapt behaviour and promote beneficial change. Qualities of leadership The understanding of leadership involves a blend of approaches according to Adair (2003). The combination of personal qualities (what you are), situational (what you know) and functional (what you do) all form a critical combination which distinguishes a leader. The attributes of a good leader are that they should possess most of the characteristics of the field they operate in. As an example, the leader of a law firm should typically have the characteristics of a good lawyer. More generic qualities are associated with leadership, such as enthusiasm, integrity, moral courage, warmth, and a combination of toughness and fairness. Both generic and typical qualities are necessary for recognition as a leader, supplemented with the natural authority which differentiates leadership from others. The increasing global competition in business has led to a focus on developing high-powered organisations which can differentiate themselves from the competition by the performance of their employees. According to Swart et al (2005) leadership had been identified as a key to the high-performance organisation. Leadership is seen as power to inspire, motivate and fill employees with the desire to change the organisation and to be the best. Leaders can act as change role models within the organisation. Building commitment to a common organisational purpose is essential to gaining competitive advantage and learning and development of employees plays a major part in delivering this. Dave Ulrich, whose work has had a profound influence on thinking within the human resources profession, has developed a framework for guidance of human resource professionals in developing commitment and common core values to organisations (Ulrich and Smallwood 2003). According to Harrison (2005) a key capability proposed in Ulrichs framework is leadership. Harrison relates that the latest human resource research findings show that there is an overwhelming need for effective leaders in the face of the radical change agenda facing the public and not-for-profit sectors of the economy or at the highly competitive environment in which all private sector organisations now operate. Leaders at corporate level are accountable for the results of the organisation and their brand has a major influence on shareholder confidence. At the line manager level leaders play a key role in communicating and enacting the organisations vision and in implementing the human resource strategies to raise employees commitment to it. Whether leadership characteristics can be developed within a person is the subject of debate. Price (2007) offers the following quote from Bennis (1990): I would argue that more leaders have been made by accident, circumstances, sheer grit, or will than by all the leadership courses put together. Price argues that whereas good leaders are comparatively easy to recognise when they are in positions of authority, developing people to achieve the necessary qualities is not so easy. Just as the nature of leadership is not fully understood, the appropriate methods of training and leadership are a matter of controversy. It is arguable that many supposed leadership training courses are actually teaching management skills rather than those of leadership. Training courses have concentrated on identifying the nature of leadership and the form in which the individual trainee wishes to adopt, which incorporates a range of options from being able to give orders to a more specialised form. Self0awa reness is often an optional training requirement for those who feel they lack identified leadership skills, by delivering a general boost in self-confidence. In each case the training depends of factors such as the participants level of seniority, or the organisational culture in which the individual operates. Clearly it would be inappropriate for a junior manager to adopt the manner of a managing director, or apply authoritarian forms of leadership in a business whole culture encourages wide participation in decision-making. Organisational strategy may be clearly stated and communicated, but the primary key to successful strategy implementation is leadership. Daft (2006) states that leadership is the ability to influence people to adopt the new behaviour needed for strategy implementation. An important part of implementing strategy is building consensus. People throughout the organisation must believe in the new strategy and have a strong commitment to achieving the vision and goals. Leadership means using persuasion, motivating employees, and shaping culture and values to support the new strategy. As an example Daft relates that CEO Sam Palasino of IBM used leadership to get people throughout the organisation aligned with the new e-business strategy. His actions included dismantling the executive committee that previously presided over strategic initiatives and replace it with committees made up of people from all over the company who now have a voice in strategy formulation and implementation. He inves ted considerable money in teaching managers at all levels how to lead rather than control their staff. He is also communicating with people all over the company, appealing to their sense of pride and motivating them to make IBM great once more by uniting behind the strategic vision, and facilitating the implementation of the strategy by making people feel they are participating, understand the strategy and therefore have more commitment to achieving it. Leadership in achieving successful strategy can be attributed to the drive and determination of a charismatic leader. Ruddock (2008) relates the Michael OLeary relentlessly drove change in what was a failing airline by concentrating on changing the publics perception of air travel as being somehow elevated above other forms of transport and turned the concept into one as commonplace as boarding a bus. The low-cost-no frills strategy was driven into every aspect of the airlines operation and OLearys considerable ability to generate publicity at every possible opportunity was utilised to the full. Every possible cost-saving action was taken, from negotiation of landing fees to relentless promotion of cheap flights with the lowering of passenger expectations of the service provided by such low costs. Ryanair, like many airlines today is suffering from the economic depression, but has up until recently been profitable and is still planning expansion at a time when many airlines are near collapse. This is in no small part due to the leadership qualities of Michael OLeary. The context in which leadership occurs is often a deciding factor in whether it is successful o not. The kind of leadership exercised will be related to the nature of the task and the people being led. It will also depend on the environment, and the actual leader. An analysis of the qualities of leadership in terms of intelligence, initiative, self-assurance and other characteristics is of limited value. The qualities required may be different in different circumstances, and it is important to take account of the variable leaders have to deal with, in particular, the task in hand, the group being led, and the leaders position relative to the group (Armstrong 2006). Leadership exists at different levels according to Adair (2006). There is the team level, where the leader is in charge of ten to fifteen people. The operational leader is responsible for a significant part of the business, such as a business unit, division or key functional department such as marketing. Operational leaders often have more than one team leader reporting to them. At the strategic level, the leader, often designated as the CEO, is leading the entire organisation. Strategic leadership is the art of leading a large body of people. The key to achieving sustainable business success is to have excellence in leadership at all three levels. Strategic, operational and team leaders need to work harmoniously together as the organisations leadership team. Cole (1997) relates that leadership is exercised against a background of the culture of the organisation. and this fact has important implications for the amount of power assigned to leaders as well as the styles that will be permitted. It does not follow that in any one organisation all leaders will adopt a less task-centred style than line managers, because their particular sub-cultures may be sufficiently different from the organisations as a whole. The sub-culture is a value-system of one part of an organisation which is a variance with the dominant value-system of the organisation as a whole. As an example, the research and development leader may be focussed on future product development while the marketing leader will aim to maximise market penetration. Conclusions Leadership appears to be characterised by many factors, some of which are inherent in the personality and actions of the individual, while others are dictated by circumstance, but are almost always accompanied by change in the circumstances of the organisation being led. Leadership is often confused with management, and the nature of leadership is not fully understood. References Adair, J. (2006) Leadership and Motivation, Kogan Page Limited, London, p 33. Adair, J. (2003) The Inspirational Leader, Kogan Page Limited, London, p 25. Armstrong, M. (2006), A Handbook of Human Resource Management Practice, 10th Edition, Kogan Page Limited, London, p 300. Bennis, W. (1990 Managing the Dream: Leadership in the 21st Century, Training: The Magazine of Human resource development 27 (5): 44-6. Cole, G.A. (1997), Personnel Management, 4th Edition, Letts Educational , London, p 57. Daft, R.L. (2006), The New Era of Management, Thomson South-Western, USA, p 292. Harrison, R. (2005), Learning and Development, 4th Edition, Chartered Institute of Personnel and Development, London, p 256. Hollington, S. (2006) How to Lead your Boss, People Management, Vol 12, no 24, 7 December, pp 44-5. Northouse, P.G, Northouse, P.G. (2009) Leadership: Theory and Practice, Edition 5, SAGE Publications, London, p 10. Price, A. (2007) Human Resource Management in a Business Context, 3rd Edition, Cengage Learning EMEA, London, p 531. Ruddock, A. ((2008), Michael OLeary: A Life in Full Flight, Penguin Books, London, p 194. Shackleton, V. (1995), Business Leadership, Routledge, London, p 2. Swart, J. Mann, C. Brown, S. Price, A. (2005) Human Resource Development, Elsevier Butterworth Heinemann, London, p 179. Torrington, D. Hall, L. Taylor, S. (2008), Human Resource Management, Seventh Edition, FT Prentice Hall, London, p 318. Ulrich, D. Smallwood, R. (2002), Why the Bottom Line Isnt: How to Build Value Through People and Organisations, John Wiley Sons, Inc., USA, p 43.

How much do we learn about Gatsbys character and how is it revealed Es

How much do we learn about Gatsby's character and how is it revealed to us? Throughout The Great Gatsby, Jay Gatsby appears to be motivated by the pursuit of wealth and a life with Daisy, but how does this show up his character? What we know about Gatsby is severely limited by the information that Carraway, who himself only meets Gatsby at the start of the novel, feeds to us. During the short summer, in which the book takes place, our information is limited by the format of the story i.e. the first person viewpoint limits what we know about Gatsby. We can tell through the way that he acts in his pursuit of Daisy that he is ultimately a shy, reclusive person who will try anything in order to meet his old love. But the first knowledge of when Gatsby first met Daisy at Camp Taylor, before he went to Europe, was at the beginning of the chapter in which he was killed. During this period, he was in the company of many rich and successful officers who all wanted to be with her. In going out with Daisy, Gatsby had proved that he could have a relationship with a person from a more privileged background than he had. The fact that he falsified his wealth in order to become acquainted with her shows that he is longing for a trophy of success that capturing Daisy's heart will bring him. The way that he asks Carraway to arrange a meeting between himself and Daisy is strong proof of this link. Soon it becomes apparent that Gatsby wishes his relationship to return to the state that it was before he left to fight in Europe during the war. This is demonstrated by the quote, 'Can't repeat the past? Why of course you can!'. These words from Gatsby demonstrate a very profound wish for his relationship with Daisy to be as i... ...e. As Carraway puts it, 'They were careless people, Tom and Daisy - they smashed up things and creatures and then retreated back into their money or their vast carelessness, or whatever it was that kept them together, and let other people clean up the mess they had made'. Such a strong statement fully shows how these people could have taken in Gatsby. Trying to hide business dealings cast doubt for the reader but for any man to go to all the trouble of arranging to meet his true love shows his romantic side. One thing that this novel shows to the reader is that although Carraway is told some details by Gatsby, what we know eventually turns into a great deal of information. I believe that Gatsby is overall a good person trying desperately to achieve the two things that his life has desired - Daisy and the pursuit of money, which were denied to him earlier.

How Thorpe Park markets Swarm Essay

One of the techniques used by Thorpe Park to market their rides is influencing buyer behaviour. Influencing buyer behaviour is when businesses change things around their product to try and get customers to purchase their product or service. For example Thorpe Park may lower their prices during the autumn because that is when their repeat purchase declines. This may encourage customers to go because Thorpe Park usually doesn’t sell their tickets at this price; they will also know that they are getting a good deal from this because Thorpe Park is actually worth more than that. Thorpe Park could also influence buyer behaviour through using celebrity endorsements by making the theme park look fun, cool and enjoyable place to go, by doing so they are building up their brand image as well. This may influence consumers and may draw them to the park because of the way Thorpe Park has presented themselves through their brand image. Another technique which Thorpe Park could use to market their product is brand building. Thorpe Park could build up their brand so that they can get more customers by using celebrity endorsements. For example they could give celebrities free tickets to Thorpe Park in exchange of them promoting and telling people how amazing the rides are etc. Once people hear and see how amazing Thorpe Park is, Thorpe Park will start to see more people coming to Thorpe Park. This will help them build up a good brand image because of the popularity of the celebrities. Thorpe Park could also use celebrities from well-known movies or programmes to influence buyer behaviour and create a certain brand image which allows Thorpe Park to have an effect on consumer’s choice. Evaluating the techniques I will be analysing the way Thorpe Park uses colours, sounds, duration, ability to target market, message and reference to product in their advert to build up their brand also influence buyer behaviour. I’ll be ranking in the order which I think Thorpe Park uses best in their advert. Colours 9/10 Sounds 8/10 Duration 10/10 Message 8/10 Ability to target market 7/10 Reference to product 7/10 1. Thorpe used colours really well in their advert, they made it link to their theme. They used dark/ greyish colours to create the mood and tension in their advert. This enabled the audience to watch it and question what’s going to happen next. It’s important for Thorpe Park to be successful in this area of the advert to have a successful campaign; if not the businesses advertisement wouldn’t be worthwhile and have no effect on the business by not increasing sales or visitors. 2. Ability to target market is would be no. 1 because they used young people a lot in their advert which is who they are aiming at. They also made the advert appeal to their audience. For example when the swarm goes through the billboard and boy is screaming it makes the ride look scary because it seems like you’re going to crash and seeing that adrenaline and scared look on his face may convince them enough to try out the Swarm ride. 3. Reference to product will be in second place because they’re main focus is to promote the ride and they need to give the audience a visual image of the ride so they know what they are going on. However others may say that’s not how Thorpe Park looks when you get because they’ve exaggerated the scenery to go with the theme of their advert. 4. Duration is just the right length because of Thorpe Parks target audience (teenagers/ young adults). The advert is short and to the point. If the advert was longer, the audience may not pay attention as they are easily distracted. However the beginning is a 5. The message is very clear to the audience. The message tells the audience that it is a thrilling but fine ride you don’t want to miss out on. It also gives you a bit of history on what the ride was based on (alien invasion). They delivered the message well to their audience so it doesn’t leave them guessing what was this about? 6. I think the music in the background worked well in certain areas. For example when he’s taken on the ride the rock music works well with it but I think near the end they should’ve brought back down to the tensed music in the beginning.

Best Buy Culture

Question – 1 Describe the culture of Best Buy Answer – 1 Best Buy culture has changed tremendously. The company’s culture was once to embrace long hours and sacrifice, now the culture is more relaxed. The employees are now really able to run their own schedule as well as their own work progress. Before the ROWE program was introduces to the Best Buy employees would have to work until they found a solution. That means staying at work all night and day if the job or situation requires it. For example the book talks about one employee that was given a plaque for staying up and at work for three days to right a report that was due. He made a sacrifice for his job that made him end up in the hospital. The ROWE program which stands for Results-Only Work Environment program is a way that employees can still work whether in the office, at home, or coffee shop as long as they finish the job. This program has changed the culture of Best Buy as well as the performance. Question – 2 discuss the approach to Organizational change that the ROWE program illustrate Answer – 2 Instead of launching a work-life balance program, Best Buy rethought the very concept of work. Under the Results-Only Work Environment program or ROWE, employees can work when and where they like, as long as they get the job done. The ROWE program is based on 13 principles and rules. The key ones include: * There are no work schedules in the traditional sense. * Every meeting is optional with a few key exceptions. * There is no focus on â€Å"how many hours did you work† * Work is not a place you go, it’s something you do. * As long as work is done, employees do whatever they want whenever they want. In brief ROWE is all about results. No results, no job. The public relations team has papers to make sure someone is always available in an emergency. Many teams realized that they need only one regular weekly meeting, so they eliminated the unproductive ones. By ROWE culture the employees feel happier about their work. They feel more ownership of their work. They feel clearer about what they are doing for the company. Question – 3 discuss the resistance, both organization and individual that the ROWE program had to overcome. Answer – 3 the corporate team led by CEO Brad Anderson, was initially skeptical about the ROWE program and whether it should be expanded. The managers at the Best Buy put up the most resistance. The Best Buy’s legal department has resisted the new way of working, partly because the in-house attorneys are worried that it will reduce their pay. When Thompson proposed extending flexibility to hourly workers, the managers resisted, arguing that â€Å"there are certain people that need to be managed differently than other people. Because we believe that administrative assistants need to be at their desks to serve their bosses. One of the corporate strategists has struggled to figure out how to prove him in new environment. Without children, she had an advantage. She could be the first one in and the last one out. She said she had all this panic and everything she knew about the success was suddenly changing. One of the legal attorney felt that she checks the emails on her day off. She was afraid that the ROWE will push more work into her downtime. Question – 4 discuss the sources of stress that are apparent in the case Answer – 4 Best Buy introduced the ROWE program to reduce stress and overwork in their employees at their headquarters. The program basically allows you to work from anywhere, any hours you choose, as long as the job gets done. The employees at Best Buy’s headquarters generally worked long hours until the ROWE program was introduced. Employee burnout and turnover was high. After the ROWE program’s implementation, productivity has increased and voluntary turnover has decreased. The Culture of Best Buy Prior to the implementation of ROWE at Best Buy, employee morale was low; the turnover rate was high, employees worked very long hours. â€Å"The company’s culture used to embrace long hours and sacrifice†. Employees spent a lot of time in impromptu meetings called by management. Employees were called upon to complete reports with little or no notice. Some employees stated they spent little time with their families and worked even when they were not physically in the office. The system at Best Buy before ROWE was work, work, and more work. Employees seemed to be working 24hrs a day. Now, with more control of their time, employees are more productive. They are able to decide when and where they want to work. The change has also helped them to confront some biases in the workplace. Deciding whether or not to extend the same benefit to hourly employees exposed how some managers felt. They resisted because of their belief that it was not for everyone, some people needed to be held to the old system. Question – 5 discuss whether or not the organizational culture has helped with the change Answer- 5 the ROWE experiment started quietly. While the sample size was fewer than 300 employees, the early results were promising. Turnover in the first three month of employment fell from 14 percent to zero. Job satisfaction rose 10 percent and team –performance scores rose 13 percent. The results from and reactions to ROWE has been encouraging. Productivity increased an average of 35 percent within six to nine months in the units that implemented ROWE. The voluntary turnover has dropped between 52 percent and 90 percent in three Best Buy divisions that have implemented ROWE. As Thompson stated â€Å"the employees feel happier about the work. †They see Rowe as a benefit that’s almost more important than any other. They talk about it as if to say, someone else could offer me more money but I wouldn’t go because I now have control over my time. Ultimately for Best Buy, the new approach to work is about staying competitive, not just helping its employees. Reference- Integrating cases from the Organizational Behavior book [page no – 553]