Buacc2613 Management Accounting- Competitive Position Assessment Answers

• What is it and what benefits does it provide?

• What are they and what benefits do they provide?

• What is it and what benefits does it provide?

• What is it and what benefits does it provide?

•  What is it and what benefits does it provide? 

• What is it and what benefits does it provide?

• What is it and what benefits does it provide?

• What is it and what benefits does it provide?

• What is it and what benefits does it provide?

• What is it and what benefits does it provide? 

• What is it and what benefits does it provide?

• What is it and what benefits does it provide?

Answers     

1. Porters Five forces of competitive position analysis has been mainly defined for the companies working in the industry and helps in assessing the strength of the company in terms of its competitiveness and the standing of the company in the market. With this aim, following five forces have been defined by the Porter:

• New Entrants– The industry which is profitable will always have the new entrants and the inclusion of them will bring down the profit line.
• Buyer Price force –It enables for making the assessment as to how far the buyer will be able to bring the price down.
• Supplier Price force- It enables for making the assessment as to how far the supplier will be able to bring the price at higher level.
• Substitute of Products or Services– It will make the customers shift from one supplier to another.
• Enmity among the competitors– The competitors will always have an endeavor to reduce the attractiveness to market for their competitors.     

It helps the company to assess the situation and to take decision as to whether to involve in new line of product or whether to enter the new type of industry or whether to develop the new strategies or whether to go for an expansion (CGMA, 2013)

Reference

• Employee- It helps the company to evaluate the performance of each and every employee keeping in view the consideration of the management of the company regarding the achievement of the organizational goals. It also helps in monitoring the performance of the work if after evaluation it is disclosed that the particular employee is not functioning in accordance with the desired goals (Weber, 2015).    
• Corrective Action – It helps in identifying the correction action that shall be taken by the management of the company in order to achieve the organizational goals and to be competitive in the market world.    

Reference

Reference

Anand G, (2011),"Benchmarking the benchmarking models", Benchmarking: An International  Journal, Vol. 15 Iss 3 pp. 257-291

4. The performance prism is the framework which considered as the second generation framework which will help in creating the value of the business. The performance prism lays down the focus on the stakeholders of the organization instead of focusing on the strategies of the company. The value to the strategies has been given in the earlier generation framework. It consists of the five phases:

• Identifying the stakeholders and their needs
• Strategies required for the above needs
• Processes required for execution of the strategies
• Capabilities required to complete the processes
• Requirements from the stakeholder to maintain the same position (CGMA, 2013)

It helps in developing the strategies, processes and the different evaluation criteria which will help the company to meet the needs of the desired stakeholders of the company. Also by reciprocating the relationship with the shareholders the company will be able to meet the individual need of the stakeholder and helps in assessing the total risks of the business.

Reference

CGMA, (2013),"The Performance Prism", available on  https://www.cgma.org/resources/tools/essential-tools/performance-prism.html accessed on 25/05/2017

5. Lean management is defined as function of the management which aims at continuous improvement of the processes, functions and the operations of the company in order to achieve the progress in the manner as prescribed by the company in their organizational objectives. It is thus is the method to run the company which supports the fact of having the continuous improvement which entails that there is the long term approach and the short term motives of the company are met along with the running functional approach to long term benefit (Womack, 2014). Following are the benefits of the lean management:

• It helps in knowing the defaults or deficiencies in the working on regular basis
• It helps in maintaining the long term standing of the company in the market
• It helps in providing the organization with the improved processes and the functions which the organization can link with the achievement of their organizational objectives.

Reference

• How much resources have been used to prevent occurrence of the poor quality product.
• How much resources have been used to inform the quality of the products or services
• How much resources have been used to prevent those that have been caused from the internal as well as the external failures (Duffy, 2013).

The cost of quality helps in identifying the area where the quality can be improved and also helps in managing the four type of costs namely – prevention, appraisal, internal failure and external failure.  

Reference

Duffy G, (2013), “Cost of Quality”, available on https://asq.org/learn-about-quality/cost-of -quality/overview/overview.html accessed on 25/05/2017.

7. Total quality management is the technique of the management whereby every individual or employees or officers of the company are liable to maintain the standards of all the work related to each and every function of the organization. It thus lays down that the each person shall have to maintain the high standards of the company in order to have the system of total quality improvement and management in the company.

It provides the following benefits:

• It aims at the objective of right first time which means that the functions and operations of the company shall be conducted right in the first time and thus improving the working of the company
• It provides the satisfaction to the customer by providing good quality products and services.
• It entails that the products or services so delivered shall meet the expectation of the customer and the users of the products.

Reference

• Helps in continuous improvement of all the functions of the company and thereby creating the good quality products or services for the customers
• Helps in meeting the set benchmark or the targets as defined by the management of the company depending up on the industry in which the company operates.    

Reference

• The rate of having the defects on the manufactured product will be low.
• It will help in retaining the customers and attracting more and more customers from the market.
• It will help in creating the reputation of the company in the market as the company will in future have the zero defect rate and the achievement.

Reference

• It helps in monitoring all the activities of the company
• It helps in creating the value to the products or services
• It helps in satisfying the customer and analyzing as to what improvements still can be done.

Reference

CGMA, (2013), “Value Chain Analysis”, available on https://www.cgma.org/resources/tools/essential-tools/value-chain-analysis.html accessed on 24/05/2017.

11. Customer relationship management is the technique used by the organization to develop and maintain the relationship with the customer of the company and to ensure that the customers have been receiving the good quality product and services as desired by them. And sometimes the deficiencies were also come to known by the company (CGMA, 2013). Following are the benefits:

• It helps in retaining the customers for long
• It helps in taking the improvement techniques where the company came to know of the fact of  deficiencies noticed by the customers in the product
• It help to build the reputation in the market
• It helps to increase the customer base of the company.
• It helps the company to be well informed of each and every situation.   

Reference

CGMA, (2013), “Customer Relationship Management”, available on https://www.cgma.org/resources/tools/essential-tools/customer -relationship-management.html accessed on 24/05/2017.

12. ISO 9000 is the standard which defines the qualities that the company has to maintain and ensure in regard to the products, services and every function that is performed by the company (Rayner, 2011).  It defines that how the management shall operate its functions and shall strive to ensure that the all the functions of the company relating to designing of the product, creation of the product, selling off the product and services meet the desired standards which have been predetermined. Following are the benefits:

• It helps in achieving the efficiency in the business and the customer satisfaction
• It helps in diverting all the efforts towards the achievement of organizational goals.   

Reference

Rayner, P, (2011), "BS 5750/ISO 9000: The Experience of Small and Medium-Sized Firms." International Journal of Quality and Reliability Management. Vol. 8, no. 6,