Tag: Analysis

  • Tesla Supply Chain Management Case Study Evaluation Essay

    Tesla Supply Chain Management Case Study Evaluation Essay

    Case Study of Tesla Supply Chain Management Evaluation Analysis with Essay; Throughout the years, supply chain management has grown to be a significant element of any business to increase; and maintain its competitiveness and customer satisfaction. For companies today, it is critical to commit to the efficiency of the supply chain operation; as well as to develop and implement strategies for improving efficiency and quality. An efficient and optimized supply chain management plan can make a world of a difference in any business, especially in the automobile industry.

    Here is the article to explain, the Tesla Supply Chain Management Case Study Evaluation Analysis with Essay!

    This is especially true for Tesla Inc., an American automotive company based in California; which lacks the necessary relationship with its narrow supplier base. As a result, Tesla would greatly benefit from a more efficient supply chain management to meet production demands and yield expected profits.

    Industry and Customer Value;

    In today’s market, automobiles represent the largest manufacturing industry in the United States; with manufacturers and suppliers in the automobile industry generating billions of dollars each year. According to Auto Alliance, “auto manufacturing drives $953 billion in the economy each year through the designing, building, and selling of vehicles. Beyond manufacturing, the industry is also dependent on other companies supplying parts, components and materials, retail services, and vehicle maintenance.

    At the top of the U.S. automaker rankings based on sales for 2018, is General Motors with 2,150,320 followed by Toyota’s 1,920,026, Ford Motor Company, FCA, Nissan Motor Co., Honda, Hyundai Kia Auto Group, Subaru Co., Volkswagen, BMW, and Daimler. Although Tesla, also formerly known as Tesla Motors, Inc., ranks amongst the top for innovation and environmental considerations, the company ranks 13thth in automaker rankings and 21st in sales. Despite the challenges in production, Tesla’s $56 billion market capitalization is greater; than many of the well-established automakers in the industry; and, thus, Tesla’s ambition for innovation has resulted in a steady stream of aggressive investors.

    In 2003;

    Tesla existed incorporated as a business that focused on designing, developing, manufacturing, and selling fully electric vehicles. As a production plan and goal for the company, Tesla’s CEO, Elon Musk, envisions the company building 500,000 cars per year by 2018, and one million cars per year by 2020. To accomplish production goals, the Company continues to expand its product and production strategies; through its corporate structure and global operations that enable production needs.

    Unfortunately, Tesla has struggled with production and maintaining a sustained supply chain management, resulting in reduced production, delivery delays, customer dissatisfaction, and lost revenue.

    In 2018;

    The industry revenues for Tesla were $4.5 billion in Q1, compared to $7.2 in the fourth quarter. Meanwhile, for the first quarter of 2019, Tesla reported a loss of $702 million, or $4.10 a share, after lower than expected delivery volumes, costs, and pricing adjustments to its vehicles. Although Tesla has many major competitors in the automobile industry, product preorders reflect a substantial demand for Tesla products. It should note, however, that the risk to consider is that the demand is for the brand and not cars.

    Tesla’s customer base exists focused on millennials who give significance to environmentally friendly initiatives, are tech-savvy, and desire inexpensive luxury cars. Tesla’s story of “saving the planet” with vehicle innovation has created a respectable customer experience, patience to inventors, and profits to the Company. Nevertheless, Tesla faces the challenges and pressure of mass production; while trying to stay ahead of their major competitors, such as Chevrolet Volt EV and Hyundai Ioniq EV.

    Challenges;

    With hundreds of suppliers across the U.S., Europe, and Asia, Tesla faces challenges in its supply chain. Specifically, challenges related to vehicle’s battery design, and manufacturing automation. A bottleneck Tesla has is the sourcing of raw materials, especially cobalt, the essential metal used in the battery cells derived from the Democratic Republic of Congo. Not only does the sourcing of cobalt create risks of spikes in pricing; but it also creates gaps in supply and production.

    Other key manufacturing suppliers for Tesla’s include AGC Automotive (windshields), Brembo (brakes), Fisher Dynamics (power seats), Inteva Products (instrument panel), Modine Manufacturing Co. (battery chiller), Sika (acoustic dampers), Stabilus (liftgate gas spring), and ZF Lenksysteme (power steering mechanism) amongst others. With as many suppliers as Tesla depends on, it is critical for Tesla to establish long-term relationships with suppliers as Tesla mostly works on make-to-order (MTO), and highly relies on its suppliers.

    Network Design;

    Typically, when selecting suppliers, third-party logistics (3PL) firms, distribution centers, and retail stores, considerations exist given to cost, location, quality, and value; however, Tesla has done business a little differently without full success. While skipping traditional manufacturing steps, Tesla designs manufacture, sells, and services their cars through a vertically integrated supply chain. Tesla’s specialized supply chain focuses on reconfiguring; their Fremont Factory to integrate high levels of robotics automation into various manufacturing processes.

    Tesla’s intense usage of automated robotics and integrated supply chain is the major source of value creation for Tesla. The vertically integrated automation system allows Tesla to incorporate the smaller and generally outsourced subsystems into; their manufacturing process to allow for quicker turnaround and shorter product improvement cycles. More importantly, it allows for manufacturing flexibility, process control, and increased tesla supply chain coordination and management. Meanwhile, Tesla’s outbound logistics include warehousing and distribution of their vehicles after manufacturing and assembly operations.

    Tesla SWOT Analysis;

    While Tesla appears to be a very successful and innovative company a SWOT analysis can provide a deeper insight as to what strengths, weaknesses, opportunities, and threats the company face that can ultimately lead to greater success or even the company’s demise.

    Tesla Strengths;

    Tesla exists considered a very successful company. This success can exist attributed to the numerous strengths or advantages Tesla possesses. These include the niche or specific section of the market that Tesla has selected to target. This stood accomplished by being the first to sell automated cars. They were able to not only succeed in the sales of greener cars; but, were able to accomplish their greater vision of revolutionizing the driving experience.

    Additionally, Tesla has not only focused on electric cars but, has established a recognizable brand name. Tesla has also been able to develop and use cutting-edge technology that has allowed them to create their innovative products. Furthermore, the company also has existed granted government funding. They can obtain billions of dollars for energy management projects under the US Department of energy.

    Tesla Weaknesses;

    The company also however suffers from many weaknesses. One of these weaknesses is that Tesla has acquired major debt. Despite government funding, Tesla has spent a great portion of its funding towards research and development. Additionally, the company has expanded greatly over the past few years causing even greater debt. Their limited profits and huge debt could lead to difficulty in repaying loans resulting in a more net loss in the future. Furthermore, the company only has one manufacturing plant that has a capacity of 500,000. Making the company limited to this figure and unable to target higher volumes. Additionally, many customers are apprehensive about purchasing these highly expensive futuristic products.

    Tesla Opportunities;

    Opportunities for the company are that there is a preference for new technology. New technologies such as green vehicles could help show consumers that newer and greener technology is a good investment. Moreover, Tesla has started to expand to parts of western and northern Europe. Along with parts of Asia including China. There exist also government incentives associated with purchasing electric cars. Tesla also purchased the rights from the company Solar city. This will increase the company’s capabilities in energy storage.

    Moreover, analysts say that by 2040 54% of all cars sold on the planet will be electric. France’s minister claims that there will be a ban on all fossil fuel usage by 2040. Volvo has also claimed that it will stop the sale of all gas-only vehicles by 2019. A future of mainly electric cars serves as a huge opportunity for Tesla. This is a result of Tesla already being a widely recognizable brand and leader in this type of technology.

    Tesla Threats;

    Threats that exist associated with Tesla include an increase in the price of raw materials. This can negatively affect the company because materials such as graphite, steel, aluminum, and lithium are subject to global supply and demand. The costs of raw materials increasing cause pressure to increase the prices of Tesla products to make up for the loss in profits associated with the raw material prices increase. Additionally, government regulations can delay production and sales. Tesla may have also been too good at convincing his competition that electronification was the future. GM was able to release its Chevy Bolt months before Tesla’s Model 3.

    In short;

    Tesla owns it all. To meet order demands, however, Tesla needs to optimize the tesla supply chain network (SCN), management by identifying three top criteria that focus on supply and product manufacturing flow where the value stream of the product includes the raw materials, components, and sub-assemblies, never stop in the production process. These criteria include speed and agile processes for suppliers that can provide faster tooling lead times, raw materials, and parts, as well as having the technological collaboration with the digital supply chain the company promotes to push out updates to existing customers. Furthermore, supply chain coordination strategies, product flows, information flows, and risks mitigation is also critical factors Tesla must consider when selecting suppliers. Supplier relationship management is critical to producing products on time and on budget while reducing the impacts on manufacturing flow management.

    Case Study of Tesla Supply Chain Management Evaluation Analysis with Essay Image
    Case Study of Tesla Supply Chain Management Evaluation Analysis with Essay; Image by Blomst from Pixabay.
  • Data Visualization for Analysis of Digital Marketing

    Data Visualization for Analysis of Digital Marketing

    Data Visualization Digital Marketing Campaigns Analysis; Currently, data is the new engine of business operations. The more data you generate from your business operations, the more you understand your consumers’ preferences and consumers. Also, data helps you create perfect targets relevant to the customer’s needs.

    Gaining this kind of knowledge can cause a major difference in the current business industry and the digital marketing landscape, creative agency tivbranding.com. When setting up a digital marketing campaign, you need to involve data visualization analysis to align your efforts with the business goals.

    However, many business owners do not understand the act of digital marketing campaign analysis using data visualization. This limits the chances of their marketing efforts to yield fruits in the long run.

    The Impact of Data Visualization in Digital Marketing;

    Marketing is an art and science part of the business that requires an open mind keen on details to generate the desired results. Data acts as a backup of your marketing strategy, ensuring that everything is working as planned.

    Using a series of digital marketing tools such as Facebook Ads, Google ads, and social media marketing platforms offers a wealth of data that is important for the business’s success. The data offers an exceptional strategy that gives a path for the company’s growth.

    The data you generate from the business operations can answer simple questions that enable you to understand the way forward. You need to evaluate some of the social media channels that your customers use most.

    Also, think about increasing the number of sales recorded and reducing the budget required. Note that the answers you get for these questions primarily depend on the kind of data you have at your disposal.

    But why is data visualization important in digital marketing? Let’s have a clear glimpse of how visualization impacts marketing efforts across industries!

    Data Distillation;

    In digital marketing, data sets play a crucial role with a combination of keywords targeting a specific audience. The amount of data generated from daily activities depends on the size of your business website.

    Data visualization aids in distilling through the data to bring out a clear image in the form of a graph or chart that you can easily comprehend. This is contrary to using a spreadsheet that you will spend hours perusing through to understand the ultimate goal.

    When you are focused on dealing with things such as decreasing your PPC spending. You need to utilize the data generated from the keyword you are using. Begin by comparing the PPC traffic depending on specific keywords and their organic search rankings.

    When you use a spreadsheet to evaluate the organic ranking of your keywords and the amount of money you have spent on them. You will experience challenges when distilling the data to identify useful opportunities that you can utilize.

    Using a graph to present the same data on the spreadsheet summarizes the entire thing by determining the keywords that have the opportunity to minimize PPC spending. This will help you divert your focus to attain your goal.

    Analyzing business website traffic requires some basic skills that will help you keep moving. You can use heat maps, scatter plots, and sunburst charts in excel or Google Sheets. Any other type of data visualization to generate reliable results that the company can use.

    Using this type of analysis gives you the freedom to enjoy its simple nature and generate compelling insights and the content you can use to generate insights valuable to its growth. You get to learn how consumers behave while interacting on different platforms.

    Besides, this analysis aids you in figuring out your potential customers depending on their behavior and preference. This includes the number of products the consumers purchase after watching an advertisement video and after reading an article regarding the products and services.

    This gives you a conclusion about what works better for your business between video and content advertisement. The website data also indicates other popular websites that have secured a good number of consumers.

    Using this information, you will get it easier to develop a strategy to boost traffic on your site with tools. Such as social media marketing, Google ads, and many more.

    The combination of analytics and digital marketing aids in the identification of trends in customer interaction with digital properties. By doing analytics, you get to understand how users consume the content displayed on the business website.

    Marketing professionals base their decisions on the trends and patterns generated by data analytics. Data visualization helps make the patterns and trends clear for the respective authority to comprehend the message.

    Sometimes, you might realize that the sales you record from paid search have decreased over a certain period while the traffic from paid search has increased. At this point, you will automatically want to find out what is happening.

    By visualizing the trends and traffic on the sales recorded. You will be better positioned to uncover vital information about why this is happening. This is meant to help you adjust the strategy and tactics depending on the data generated from the visualization process.

    Advancement of the Customer Support Panel;

    The customer support panel plays a key role in the daily operations of any given company across the industries. To streamline operations at this point, you can use data visualization to evaluate all the incoming customer requests and identify some of the main challenges.

    Visualizing the customer support data will identify the channel that your customers prefer due to convenience issues. Also, you will learn the most common issues and develop a way of helping them navigate through the challenge.

    Data visualization sheds light on all corners of the customer support team to ensure that customers get the help they deserve. In addition, you will learn if there is a need to invest more in the system to enhance efficiency. The customer support panel will make it easier to solve challenges and enhance smooth operations.

    Conclusion;

    The above-discussed are some of the ways that data visualization can impact the success of your digital marketing campaigns. However, ensure that you implement the visualization strategy appropriately to get reliable data.

    Data Visualization for Analysis of Digital Marketing Campaigns Image
    Data Visualization for Analysis of Digital Marketing Campaigns.
  • 4 Analysis of Leadership Theories Models Management Essay

    4 Analysis of Leadership Theories Models Management Essay

    4 Analysis of Leadership Theories and Models on Management Essay; This article journal is related to the analysis of Leadership Theories. In this post, four theories will discuss; there is leader-member exchange theory (LMX), path-goal theory, transactional-transformational theory, and the full-range leadership theory (FRLT).

    Here is the article to explain, the 4 Analysis of Leadership Theories and Models on Management Essay!

    Before we started to discuss the analysis of Leadership Theories and Models; the writer felt that is often difficult to separate leadership theories and models. He also informed that the reason for this study of “theory” and “model” will use interchangeably except; there is a very clear difference between them.

    Firstly, the journal discusses the leader-member exchange theory. Leader-Member Exchange Theory also called LMX or Vertical Dyad Linkage Theory; describes how leaders in groups maintain their position through a series of tacit exchange agreements with their members. A leader’s approach stands addressed by the theories to the business environment and the follower’s perception of a leader’s performance. The direct relationship between a leader and a follower and the theoretical context for their interactions is the dyadic relationship. So that, there is 3 quality of the leader-follower interaction that stood determined by the LMX; such as locus of control, need for power, and self-esteem.

    Theories and Models part 01;

    A size of how a person knows his control over his life and environment is the locus of control. A person feels a sense of control over his life and activities calls has a high internal locus of control. This type of person also positively correlated with job satisfaction. The need for power is that employees who understand that need by asking for feedback on performance; compete more visibility jobs and leadership opportunities at their work and career. Another is self-esteem, employees have a sense of their value to the company; which typically manifests as more job satisfaction and more emotional resilience.

    Besides that, the path-goal theory of leadership existed developed to describe the way that leaders encourage; and support their followers in achieving the goals; they have been set by making the path that they should take clear and easy. Path-goal theory describes a leader’s activity in leading followers within the context of the organization’s environment in a highly structured environment followers do not need a good deal of guidance to perform their works. Unless in an unstructured environment they may need more.

    Theories and Models part 02;

    Another is the core of the transactional-transformational theory revolves around the alignment of personal and organizational goals; which the theory states benefits both the leader and the follower. The transactional-transformational theory comprises four transformational components, the four I’s such as idealized influence, intellectual stimulation, individualized consideration, and inspirational motivation, and three transactional components such as contingent reward, passive management by exception, and active management by exception.

    Lastly is the full-range leadership theory (FRLT). An extension of transformational leadership theory to nine dimensions of leader behavior calls FRLT. The emotional part of leadership isolate by idealized influence and is a view of the follower’s emotional engagement with the leader. According to the writer, the full-range leadership theory is also closely associated with the multifactor leadership questionnaire.

    Theories and Models part 03;

    From this journal, the measure of the success of a theory is based on several reasons; that is all the theories are considered in a business environment where success link to measurable business criteria. Success has much meaning, but here will mean that there is a good fit between the leader’s behavior and the theory. The writer especially remembers this does not necessarily mean that a theories’ success implies a leader’s success; because some of the measures will be negatively related to leader performance.

    Each of the theories under consideration has explained modes of leader behavior, considering both the leader’s effect on followers and the interaction between leader and follower. A leader-member exchange scale assesses the degree to which leaders and followers have mutual respect for one another’s capabilities, feel a deepening sense of mutual trust, and have a strong sense of obligation to one another. Another way to analyze is the dimensions of measurement for LMX focus on the follower and his/her job satisfaction and feeling of control.

    Theories and Models part 04;

    Transformational leadership defines as a leadership approach that creates valuable; and positive change in the followers with the end goal of developing followers into leaders. A transformational leader focuses on “transforming” others to help each other, to look out for each other, to be encouraging and harmonious, and to look out for the organization as a whole. With this leadership, the leader enhances the motivation, morale, and performance of his followers through a variety of mechanisms. These include connecting the follower’s sense of identity and self to the mission and the collective identity of the organization; being a role model for followers that inspires them; challenging followers to take greater ownership for their work, and understanding the strengths and weaknesses of followers; so the leader can align followers with tasks that optimize their performance.

    An example, Sagie and Koslowski (1994) state that employees involved in tactical decision making, participation in decisions making, feel more empowered and involve in the company in future pay and assignment. A person who is practicing active management by exception calls a transactional leader; who can use a path-goal and leader-member exchange. The factor for this is the outcome, the transactional leader sees as the total output of the exchange; and, the transformational leader sees as a stage in the growth of the follower. In an action to motive a follower, the transactional leader appeals to both the follower’s intellect and emotions. He will use the best approach at his disposal to move followers forward in achieving his vision.

    Theories and Models part 05;

    In addition, a leader has a full toolkit of capabilities to control his relationship with subordinates given by the full-range leadership theory. According to this journal, the full-range leadership theory can explain most leadership activity simply; and leadership-member exchange theory directly addresses the varying relationship between leaders and their subordinates in a context. But since this happens at a higher level, the leadership-member exchange does not address the dissemination of vision. Besides, the ability of a leader to direct the activities of subordinates had been addressed by the path-goal theory.

    Based on these, the writer feels that transactional-transformational theory is more complete than the prior two theories. The reason for his feeling is it includes their activities, by implication, and expands on the basis for leader actions. Otherwise, this leader also retains the ability to function in a transactional mode in more stable situations. The superior to transactional-transformational theory is full-range leadership theory; which is an attempt to complete them with the addition of components. Humphreys (2001) found that transformational leaders were more likely to grasp the implication of technology adoption than transactional leaders.

    Theories and Models part 06;

    Leaders can grow in many ways like educational environments, extending their knowledge of leadership and the world around them. A leader can temper his decisions with wisdom although some would contend that philosophy is useless. Leadership theories are relatively recent phenomena that have been advanced by the sudden interest in historical leaders and the desire to identify the characteristics and behaviors that these leaders exhibited. By understanding the characteristics of the leader, their successes and failures, as well as the political and work environment they faced, the modern-day worker can hope to replicate this success. All lie in a multi-dimensional continuum existed considered by the leadership theories that consider the emotional, intellectual, physical, and value structure of leaders and followers.

    Charismatic leadership is leadership based on the leader’s ability to communicate and behave in ways that reach followers in a basic, emotional way, to inspire and motivate. It’s difficult to identify the characteristics that make a leader “charismatic”, but they certainly include the ability to communicate on a very powerful emotional level, and probably include some personality traits. Developing “charisma” is difficult, if not impossible for many people, but luckily charismatic leadership is not essential to be an effective leader. Many other characteristics involve leading effectively; and, there is significant evidence to indicate that it simply is not necessary to have this elusive charisma to lead others well.

    Theories and Models final part;

    Finally, the writer’s conclusion is between these four theories it appears that none of them are counterproductive. He felt that a leader can pursue them in a balanced manner and expect reasonable results. So the full-range leadership theory is the most complete of the theories. The reason is it includes too many activities.

    4 Analysis of Leadership Theories and Models on Management Essay Image
    4 Analysis of Leadership Theories and Models on Management Essay; Image by Mohamed Hassan from Pixabay.

    References; The Analysis Of Leadership Theories Management Essay. Retrieved from https://www.ukessays.com/essays/management/the-analysis-of-leadership-theories-management-essay.php?vref=1

  • WBS CPA PERT GANTT Charts Differences Define with Discuss

    WBS CPA PERT GANTT Charts Differences Define with Discuss

    We discuss four types of financial analyst charts WBS, CPA, PERT, and GANTT with their differences and define; Any good financial analyst knows the importance of effectively communicating results; which largely comes down to knowing the different types of charts and graphs and when and how to use them. When using numbers and statistical data it is pertinent to have a visual to bring meaning to it. Data render useless if no one understands the meaning behind it. Charts and graphs help to bring the data to life. And they are practical for individual use as well as for businesses.

    Define and discuss financial analyst charts WBS, CPA, PERT charts, and GANTT charts. Describe the role of each in determining scope, budgets, and schedules? What are the advantages and disadvantages of each? Can they use together? What concerns might a PM have in basing decisions on these charts?

    There are several different types of charts and graphs. Common ones include pie charts, line graphs, histograms, bar graphs, and Venn diagrams. However, each of these is useful for very different things. With such a variety to choose from; it can be challenging to decide which to use for a specific set of data. How can you decide which is the best type of chart or graph to use?

    What does means Charts and Graphs?

    The collection of data is vital for many aspects of life. Graphs and charts present data with visual cues to help readers understand it at a glance. They convey what the data means. Armed with an accurate understanding of the information, readers can take proper action.

    Graphs and charts organize, compare, and highlight important aspects or trends. They also help others remember the data in ways words and numbers never could. But charts and graphs are not the same. Each is useful in its way to display different types of data.

    Deciding which chart or graph to use to display data depends on the end goal. What is the key point readers should learn from this data? After deciding what the purpose of the data is; it is easier to choose the chart or graph that will be most effective.

    What is the Difference Between Charts and Graphs?

    Many people use the words “chart” and “graph” interchangeably. Both charts and graphs display data clearly and concisely and help others to understand it. But charts and graphs have different uses and purposes.

    A graph is a mathematical diagram. It displays any relationship or connection there might be between numerical data. The data displayed in graphs represent by lines, dots, and curves. Graphs are often used to display long-term trends.

    A chart is a picture, diagram, or table that organizes a large amount of data. In general, charts use to display current data and to make decisions or predictions. The following Define and discuss Work Breakdown Structure project charts, Critical Path Analysis project charts, PERT project charts, and GANTT project charts below are;

    WBS (Work breakdown structure) project charts;

    WBS (Work breakdown structure) is a chart that describes the work elements of a project and shows their relationships with each other and also with the entire project. The WBS outwardly outlines the scope into reasonable pieces that a project team can comprehend; as every level of the WBS offers additional detail and definition. The WBS delivers to the PM and the team the ability to divide a high-level scope statement into minor, better reasonable pieces of effort, named work packages needed to complete the project.

    As the project is implemented, precise segments of the WBS can follow to distinguish project cost execution and recognize problems and issue areas in the project organization. WBS defines scope as a manageable block that the project manager can understand; because each level of WBS provides a definition and detailed information of the project. From the cost viewpoint, WBS is also assigned to specific departments for work. These departmental or cost accounts are also defined in the organizational breakdown structure and allocate the budget to create definite deliverables.

    If the project schedule details, then there is a need to determine the projects under a work package that need to complete within a certain period and also within a certain level of effort. When a project is running late, referring to the WBS will rapidly pinpoint the main deliverables affected by a late sub-deliverable or a fizzling work package.

    Advantages and Disadvantages of WBS (Work breakdown structure) project charts;

    The WBS advantages include boosting productivity, easier monitoring of work definitions, coherent delegation, progressive work management, constant improvement of processes, risk management, training systems, planning evaluation. WBS disadvantages include having a loss of tasks to perform at a single go, requiring active management of interfaces; increased work burdens on management and management functions like planning, organizing, monitoring, and review; potential demarcation problems. PMs must decide the exact amount of information to incorporate in the work breakdown structure. Excessively and the project turns out to be too bureaucratic. Not enough and the project lacks meaning.

    CPA (Critical path analysis) project charts;

    CPA (Critical path analysis) is a project management tool that uses network analysis to help project managers handle complex and time-sensitive operations. It acts as the basis both for the preparation of a resource planning and schedule. During the management of a project, it allows monitoring of the achievement of project goals. Critical path analysis also helps in identifying where action needs to take to get a project back on course. Critical path analysis uses it in reorganizing the project before initiation and as it progresses. CPA aids in keeping the project’s completion on track and makes certain that deliverables finish on time.

    A critical path consists of a set of dependent tasks (each dependent on the preceding one), which together take the longest time to complete; therefore it can use in determining scope, budgets, and schedules. CPA identifies and outlines the non-critical and critical tasks in connection to a work plan or business procedure and the quantity of float related to every activity to avert process bottlenecks schedule postponements. The CPA evaluates specific projects that should complete, assesses where the parallel activities can occur, find the fastest time to finish the project, determines resource requirements, classify the action sequences, as well as enables task scheduling.

    Element of Critical Path Analysis project charts;

    Critical Path Analysis is a vital element in diminishing project timelines and monitoring expenses to avoid surpassing the budget. With Critical Path Analysis complex activities may be impossible to represent accurately on a network for the PM. The project may still require management as external factors may change. Critical Path Analysis relies on estimates for the expected duration of activities; and, if these are inaccurate the whole process may invalidate.

    PERT (Program Evaluation Review Technique) project charts;

    A PERT (Program Evaluation Review Technique) chart is a project management instrument utilized to plan, arrange, and manage jobs within a project. A PERT chart displays a graphic design of a project as a network diagram comprising numbered nodes indicating events, or milestones in the project connected by marked paths indicating tasks in the project. The arrows’ direction on the lines specifies the order of tasks.

    The PERT chart is best used to illustrate task dependencies as it presents a graphic illustration of a project as a network diagram consisting of numbered nodes representing events, or milestones in the project linked by labeled vectors representing tasks in the project. PERT can utilize in determining scope, budgets, and schedules. Charts are usually drawn on ruled paper with the horizontal axis indicating period divisions in days, weeks, or months. Plans broke down into smaller parts.

    PERT chart provides a graphical representation of a project’s timeline, and it permits the tasks in a particular project to examine. PERT charts are usually preferable to Gantt charts because they identify task dependencies clearly and better; however, they are often more difficult to interpret. The Program Evaluation Review Technique analysis necessitates a thorough study of project undertakings and commentaries from numerous individuals from dissimilar organizations. Furthermore, PERT is a complex technique that’s performed over an expanded time. The labor-intensive nature of the PERT method can make PERT charts expensive to support for a PM.

    GANTT project charts;

    GANTT charts tools use in project management and show activities (tasks or events) displayed against time. Alongside the topmost of the chart is an appropriate timescale, and on the left side is a list of the undertakings. Gantt charts are generally utilized for monitoring project schedules. For this, it is suitable to have the capacity to demonstrate extra information about the different phases or tasks of the project; for instance how the tasks connect, what resources are being utilized for every task, how far each task has advanced.

    Gantt chart consists of a horizontal bar for each task connecting the period start and period ending columns; and, it can utilize in determining scope, budgets, and schedules. The way to break a project to complete it in a specific period is then the Gantt chart did. This focuses on analyzing the scope of the project based on its results or deliverables. Once you have identified the details, you should develop a list of the tasks that you want to finish to produce desired results. These projects will have durations and dependencies and thus they can schedule. When the logic defines once as well as the project’s budget calculate, results can view in the Gantt chart.

    Aspects of Gantt project charts;

    Gantt charts help in working out practical aspects of a project, such as the minimum time it will take to deliver, and which tasks need to complete before others can start. However, it’s best not to show the dependencies on the Gantt chart, especially if there are a large number of tasks and complex dependencies between them. Gantt chart’s limitation is that it relies upon an already constructed and complete work breakdown structure. As such, should major tasks be missing from the work breakdown structure, or should a major milestone be missing, the Gantt chart will not tell PM. The PM will thus be attempting to create the work breakdown structure and at the same time constructing the Gantt chart. This can result in the risk of having to recreate the entire project schedule if something is left out or the duration does not estimate properly.

    Differences between Analysis of WBS, CPA, PERT, and GANTT project charts;

    Work Breakdown Structure, Critical Path Analysis, PERT charts, and GANTT charts use together. PMs typically use PERT charts, Gantt charts, as well as other visuals to arrange projects, organize resources, as well as to gain a good understanding of their projects. The prime minister must be furious as well as put their opinions together. It has been proving to be a great medium of communication. Planners and Thinkers can convey their ideas, fears, and doubts to another level on one level.

    Most importantly, it becomes a suitable tool for assessing the performance of the individuals as well as the groups. When deciding on the specific details of a work package, the project manager should careful not to get details. If CPA is not clear and stable, CPM may be difficult to monitor or manage as well as it becomes ineffective. It cannot handle the sudden changes in an implementation plan. So the project manager should pay attention to all these things.

    WBS CPA PERT GANTT Charts Differences Define with Discuss Image
    WBS CPA PERT GANTT Charts Differences Define with Discuss; Image by Elf-Moondance from Pixabay.

    Post Reference and Retrieved from https://www.ukessays.com/essays/project-management/skills-and-role-of-a-project-manager.php?vref=1, and https://wpdatatables.com/types-of-charts/

  • Why is Data Analytics Important in Healthcare? Explain

    Why is Data Analytics Important in Healthcare? Explain

    Why is Important to Data Analytics in Healthcare? Are you familiar with data analysis? This data analysis enables the industry to extract any information from existing models and contexts to make better decisions. There are many benefits that businesses can derive from using these statistics. Google Analytics help makes sense in real-time or in historical data, so you can make predictions to increase your chances of success. As the healthcare industry uses data analytics, it will benefit its business by improving the quality of patient care, increasing operational efficiency, and preventing disease.

    Here is the article to explain, Why is Important to Data Analytics in Healthcare?

    Every company wants to know how they can improve their business, whether it’s saving money or treating patients. Using analytics can improve operational efficiency. The ERP system allows them to collect all the information they want to include in their statistics. The analysis allows companies to identify gaps that cause them to work dysfunctionally. With an ERP system, companies can achieve their goal of reducing costs. The healthcare industry faces several challenges, such as the inability to process the information collected daily, increased costs of care, a shortage of patients, medical payments, and a lack of specialized staff.

    The ERP system will also be able to increase the functionality of facilities, simplify their business processes, ensure the quality of maintenance services and finance them, such as control and control. Health care reform will depend on the savings generated from the data collected for their patients. The overall aim of this analysis is to contain costs and effectively provide quality healthcare. The analysis allows companies to understand which doctors are more expensive than others. They also make recommendations to reduce these costs, e.g. B. what services, insurance, etc. are more expensive. This analysis intends to promote healthy behavior and reduce healthcare costs.

    Big data analysis enables companies to manage financial risk. There are challenges in determining patient outcomes and making payment decisions, lower cost recovery, unpaid patient bills, and inadequate billing. This forecast analysis will be able to control cash flow and predict which payments may not pay in the future. Improving the operational efficiency of analytics also includes helping prevent fraud and abuse. There are fraudulent activities that can occur in healthcare such as miscalculations, wasteful diagnostic tests, false claims, and so on. The analysis identifies patterns that lead to health insurance fraud and compliance.

    Prognostic Analysis;

    The prognostic analysis incorporates patient information to support prognostic results. The analyst can collect all the information about the patient and find any model. You can then turn that information into actionable insights and work towards achieving better health outcomes. With this information and model results, they must search for disease outbreaks, provide treatment, and respond to emergencies. With this analysis too, it makes sense to find prevention techniques, drugs, and vaccines against diseases.

    A few years ago it was difficult to prevent disease due to lack of up-to-date data, but the healthcare industry has mastered the challenge with analysis and epidemics are now observable. There is also the benefit of reducing deaths from the disease by checking where ambulances should deploy. Another benefit of prognostic analysis is that it allows healthcare professionals to identify patients who may develop a disease or have certain health risks. Health organizations will be able to identify patients who are at high risk of developing serious illnesses and provide them with better outcomes so that they do not face long-term health problems.

    Example;

    For example, the analyst can look at the results and determine when a person might develop diabetes along the way. They can develop special health programs to serve the interests of patients for better health. The analysis can predict whether a patient will readmit due to relapse or side effects and suggest how this can prevent. Health services will also be able to prevent substance abuse such as opioids. Analysts can examine the model and identify any risk factors that predict whether a person is at risk for harassment. The use of big data analytics also allows healthcare managers to review outcomes in patients in different demographics and identify what factors might be preventing patients from receiving treatment. Everyone wants to find a cure and stop the spread of disease, but it can be an enigma when tried. You have to learn hidden patterns and secrets.

    Analysis can gather information promptly;

    It can be very difficult for anyone to learn, make mistakes, and take a long time. The analysis can gather information promptly and make various recommendations based on the patterns and secrets found. Everyone wants a cure from cancer or the ability to anticipate a disease that may strike them in the future. So why not use some software that can prevent an outbreak and try to prevent your patient’s illness along the way or find a cure for something that afflicts millions of people around the world.

    Patient care is the most important aspect of any doctor. We all know that doctors do their job, care for their patients, and want to see them heal. Therefore, with analysis, doctors can evaluate its performance based on the analysis that shows its shortcomings. Everyone is human, and sometimes we tend not to realize our mistakes until they point out. Some doctors don’t know they are underperforming or don’t think they are losing performance until they gave statistics that show they can do better.

    Their statistics;

    Therefore, statistical evidence and analysis allow the possibility to prove through the data alone that they do not have the best treatment. Since healthcare workers work for the same goal of providing the best care for patients; this analysis allows them to take advantage of that goal. With the data collected, it is possible to make predictions about how each patient will benefit. This analysis was used to explore different opportunities for improvement and to offer innovative ways to deal with longstanding challenges faced by clinicians. Since doctors put their patients first, this information should be important in improving the quality of their patient care. So why not use technology that provides deeper insight into their performance and make recommendations on how to improve their performance for the benefit of the patient.

    Data Analysis is unnecessary;

    Some doctors believe that data analysis is unnecessary. They believe that they don’t need sophisticated statistics to improve their performance. I have met doctors who believe they are perfect or can learn from their mistakes. Managers feel they can avoid mistakes and learn from challenges to enhance their professional development and improve service. Doctors and health officials also believe that the government is trying to tell them how to do their jobs. This is what they feel because as a doctor; it is the government that decides whether to fulfill the requirements or not and must report it. If they report, they need to ensure that they follow the rules set by the government.

    The Health government continues to change requirements and implementation expect. That is why analysts and analysts are there to help these doctors keep up with the changes made by the government. If a doctor needs to report and doesn’t meet the reporting requirements; that doctor could receive a 9% penalty under a Medicare Part B claim. Analysts want to help these doctors accept the penalty and instead get them to cancel the sentence or perhaps receive a pay adjustment based on their performance. The analyst also wanted to point out that data analysis offers an opportunity to improve the quality of patient care by making various recommendations and highlighting performance gaps. We know doctors care about their patients, but sometimes it’s hard to keep up with changes in the industry.

    Data analytics help to improve their performance;

    You can work your hardest, but sometimes everyone needs a little help to improve their performance. Learning from the mistakes you made in the past is not enough; How many mistakes would you like to make in a patient’s life before you realize that some things are out of your control? In any field of health care such as cancer specialists, surgeons, pediatricians, etc.; it can be agreed that mistakes can occur frequently. Everyone makes mistakes, but if you have the opportunity to use software that gives your patients an extraordinary opportunity to diagnose early, why not want to use the software? If you can avoid unnecessary expense, pain, and time for the patient; why should you maintain the same behavior that does not provide the best outcome for patient care?

    Most importantly;

    The healthcare industry is constantly changing. Instead of learning from mistakes or getting lost in change, healthcare professionals have the opportunity to use data analysis. By analyzing data, many health care benefits are possible. Some examples of its benefits include the ability to improve the quality of patient care, increase operational efficiency, and prevent disease. Don’t miss the opportunity to use analytics to examine models that will save your patients from long-term illness; the opportunity to reduce costs and improve their operations; and, the opportunity to show others where there are gaps in their performance that; they can be patient with their progress and avoid punishment.

    Why is Data Analytics Important in Healthcare Explain Image
    Why is Data Analytics Important in Healthcare? Explain; Image by Chokniti Khongchum from Pixabay.
  • What are the major factors affecting Production Process analysis Decisions?

    What are the major factors affecting Production Process analysis Decisions?

    The major factors affecting Production Process analysis Decisions is explaining in the 6 points of; 1) Nature of product/service demand, 2) Degree of Vertical Integration, 3) Product/Service and Volume Flexibility, 4) Degree of Automation, 5) Level of product/service quality, and 6) Degree of Customer Contact. Among the factors affecting production process analysis are the nature of product/service demand, degree of vertical integration, product/service and volume flexibility, degree of automation, level of product/service quality, and degree of customer contact.

    Here are the answers – What are the major factors affecting Production Process analysis Decisions? Discussion.

    What is process analysis? Process Analysis can understand as the rational breakdown of the production process into different phases, that turns input into the output. It refers to the full-fledged analysis of the business process. Which incorporates a series of logically linked routine activities. That uses the resources of the organization, to transform an object, to achieve and maintain the process excellence. The following questions and answer – What are the major factors affecting Production Process analysis Decisions? below are;

    Nature of product/service demand:

    Production systems exist to produce products/services of the kind that customers want, when they want them, and at a cost that allows the firm to be profitable. The place to start in analyzing production systems, therefore, is the demand for products and services. Of particular importance are the patterns of demand.

    Patterns of Product/Service Demand;

    First, production processes must have adequate capacity to produce the volume of the products/services that customers want. Forecasting methods help to estimate customer demand for products/services. These forecasts can then use to estimate the amount of production capacity needed in each future period. Seasonality, growth trends, and other patterns of demand, therefore, are important determinants of the production capacity necessary to satisfy demand.

    Seasonality is an important consideration in planning the appropriate type of production process for a product/service. For example, if a product’s demand exhibits great variation from season to season, the production processes and inventory policies must design to allow the delivery of sufficient quantities of products or services during peak demand seasons, and yet still be able to produce products economically in slack demand seasons.

    Similarly, the growth trends of product/service demand have important implications for analyzing production processes. For example, if a service expects to show strong sales growth over five years, provision must make for designing production processes whose capacity can expand to keep pace with demand.

    Some types of processes can more easily expand than others, and the choice of the type of production process will affect by the forecast growth trends of product/service demand. As with seasonality and growth patterns, random fluctuations and cyclical patterns will also have an impact on production process designs. Also, the overall volume of the demand and the prices that can charge for the products/services will affect the type and characteristics of the production processes.

    Degree of Vertical Integration:

    One of the first issues to resolve when developing production processing designs is determining how much of a product/service the company will produce and how much will buy from suppliers. Vertical integration is the amount of the production and distribution chain, from suppliers of components to the delivery of finished products/ services to customers, that is brought under the ownership of a company.

    There are two types of vertical integration, forward and backward. Forward integration means expanding ownership of the production and distribution chain forward towards the market. Backward integration means expanding ownership of the production and distribution chain backward towards the sources of supply.

    Generally, there are three stages of production: component, subassembly, and final assembly.

    For most manufacturers of finished products-such as Ford, Telco, and Maruti that assemble automobiles-the major issue of vertical integration is whether they should enter into supply contracts with suppliers of subassemblies and components, or backward integrate to produce subassemblies and components themselves. On the other hand, firms that are primarily subassembly suppliers. The major issues of vertical integration are whether they should forward integrate and assemble and market their finished products. In either case, the issue of whether to integrate vertically brings both opportunities and risks.

    The amount of vertical integration that is right for a particular firm in one industry could be inappropriate for another firm in a different industry. For companies that would forward integrate towards the market. The predominant factor in such decisions is the ability of the company to market the products.

    It should be clear from points that the decision whether to make products (backward integrate by bringing production of subassemblies and components in-house) or buy them from suppliers is not simple.

    The points of Contention in a Decision Situation:
    • Cost of making or producing subassemblies or components in-house versus buying them from suppliers.
    • The amount of investment necessary to produce subassemblies or components in- house.
    • The availability of funds to support the necessary expansion of production capacity.
    • Effect on return on assets if the production of subassemblies or components undertakes.
    • The present technological capabilities of the company to produce subassemblies or components.
    • The need to develop technological capabilities to produce subassemblies or components to secure future competitive position.
    • Availability of excellent suppliers who are willing to enter into long-term supply relationships, particularly those who can provide high-quality subassemblies and components at low prices. Who are well enough funded to ensure continuity of an adequate supply? And, who can work with the company to continuously improve product and component designs and manufacturing processes?
    • Amount of market share held by the company.

    Product/Service and Volume Flexibility:

    Flexibility means being able to respond fast to customer’s needs. Flexibility is of two forms, product/ service flexibility, and volume flexibility. Product/service flexibility means the ability of the production system to quickly change from producing one product/ service to producing another. Volume flexibility means the ability to quickly increase or reduce the volume of products/services produced. Both of these forms of the flexibility of production systems are determined in large part when the production processes are designed.

    Product/service flexibility requires when business strategies call for many custom-designed products/services each with rather small volumes or when new products must introduce quickly. In such cases, production processes must ordinarily plan and design to include general-purpose equipment and versatile employees. Who can easily change from one product/service to another? The concept of a flexible workforce involves training and cross-training workers in many types of jobs. Although training costs increase, the payoff is work that is perhaps more interesting for workers and a workforce. That can quickly shift from job to job and other products/services with little loss in productivity.

    Volume flexibility:

    Volume flexibility needs when demand is subject to peaks and valleys. And, when it is impractical to inventory products in anticipation of customer demand. In these cases, production processes must design with production capacities that can be quickly and inexpensively expand and contract. Manufacturing operations are ordinarily capital-intensive, which simply means that the predominant resource used is capital rather than labor.

    Thus in the presence of variable product demand, capital equipment in production processes must design with production capacities that are near the peak levels of demand. This translates into either increased capital investment in buildings and equipment or the use of outside subcontractors and some provision for quickly expanding and contracting the workforce. Over time, layoffs or the recall of workers from layoffs, use of temporary or part-time workers on short notice, and permanent overstaffing are options commonly used to achieve the volume flexibility of employees.

    Degree of Automation:

    A key issue in analyzing production processes is determining how much automation to integrate into the production system. Because automated equipment is very expensive and managing the integration of automation into existing or new operations is difficult, automation projects are not undertaken lightly.

    Historically, the discussion of how much automation to use in factories and services has centered on the cost savings from substituting machine effort for labor. Today, automation affects far more than the costs of production; in fact, for many companies automation is seen as basic to their ability to become or remain competitive.

    Automation can reduce labor and related costs, but in many applications. The huge investment required by automation projects cannot justify labor savings alone. Increasingly, it is the other benefits of automation that motivate companies to invest in automation. The need to quickly produce products/services of high quality. And, the ability to quickly change production to other products/services are the key factors that support many of to day’s automation projects.

    The degree of automation appropriate for the production of a product/service must drive by the operations strategies of the firm. If those strategies call for high quality, product flexibility, and fast production of products/services. Automation can be an important element of operations strategy.

    Level of product/service quality:

    In today’s competitive environment, product quality has become the chief weapon in the battle for world markets of mass-produced products. The choice of the production process is certainly affected by the desired level of product quality. At every step of process design, product quality enters into most of the major decisions.

    For many firms, the issue of how much product quality required is directly related to the degree of automation-integrated into the production process. Automated machines can produce products of incredible uniformity. And with proper management, maintenance, and attention, products of superior quality can produce with automated production processes at low production costs.

    What are the major factors affecting Production Process analysis Decisions
    What are the major factors affecting Production Process analysis Decisions? #Pixabay.

    Degree of Customer Contact:

    For most services and some manufacturers, customers are an active part of the processes of producing and delivering products and services. The extent to which customers become involved in the production systems has important implications for the production processes. There is a wide range of degrees of the interaction of customers with the production system.

    For example, at one extreme are barbershops, hair salons, and medical clinics. Here the customer becomes an active part of the production, and the service is performed on the customer. In these cases, the customer is the central focus of the design of production processes. Every element of the equipment, employee training, and buildings must design with the customer in mind.

    Also, courteous attention and comfortable surroundings must provide to receive, hold, process, and release customers. In such systems, service quality, speed of performing the service, and reduced costs can improve with automated equipment. As long as the fundamental nature of the service does not materially affect.

    At the other extreme of customer involvement, the design of production processes affects little because of interaction with customers. Examples of this type of service are fast-food restaurants or backroom operations at banks. In these operations, services are highly standardized, the production volume of services is high, and cost, price, and speed of delivery tend to be predominant in operations strategies.

    Note: Maybe you learn and understand the questions – What are the major factors affecting the production process analysis decisions? If you are not getting your answers them comments below.

  • Utility Analysis; Meaning, Definition, Features, and Concept

    Utility Analysis; Meaning, Definition, Features, and Concept

    Understand utility analysis and its significance in consumer behavior. Learn about cardinal utility, its assumptions, features, and concept. Utility Analysis; The Cardinal Approach or Utility Analysis to the theory of consumer behavior is based upon the concept of utility. This article is to explain Utility Analysis Meaning, Definition, Assumptions, Features, and Concept. It assumes that utility is capable of measurement. It can add, subtract, multiply, and so on. Cardinal utility analysis is the oldest theory of demand which provides an explanation of consumer’s demand for a product and derives the law of demand which establishes an inverse relationship between price and quantity demanded of a product.

    Utility Analysis or Cardinal Approach; Meaning, Definition, Assumptions, Features, and Concept.

    Recently, cardinal utility approach to the theory of demand has been subjected to severe criticisms and as a result, some alternative theories, namely, Indifference Curve Analysis, Samuelson’s Revealed Preference Theory, and Hicks’ Logical Weak Ordering Theory have been propounded.

    According to this approach, the utility can be measured in cardinal numbers, like 1,2,3,4, etc. Fisher has used the term “Util” as a measure of utility. Thus in terms of cardinal approach, it can be said that one gets from a cup of tea 5 utils, from a cup of coffee 10 utils, and a Rasgulla 15 utils worth of utility.

    Meaning and definition of Utility Analysis:

    The term utility in Economics is used to denote that quality in a good or service by which our wants are satisfied. In, other words utility is defined as the want satisfying power of a commodity.

    According to Mrs. Robinson,

    “Utility is the quality of commodities that makes individuals want to buy them.”

    According to Hibdon,

    “Utility is the quality of a good to satisfy a want.”

    Assumptions of Utility Analysis:

    Cardinal utility analysis of demand is based upon certain important assumptions. Before explaining how cardinal utility analysis explains consumer’s equilibrium regarding the demand for a good, it is essential to describe the basic assumptions on which the whole utility analysis rests. As we shall see later, cardinal utility analysis has been criticized because of its unrealistic assumptions.

    The utility analysis is based on a set of following assumptions:

    • The utility analysis is based on the cardinal concept which assumes that utility is measurable and additive like weights and lengths of goods.
    • Cardinal or Utility is measurable in terms of money.
    • The marginal utility of money is assumed to be constant
    • The consumer is rational who measures, calculates, chooses and compares the utilities of different units of the various commodities and aims at the maximization of utility.
    • He has full knowledge of the availability of commodities and their technical qualities.
    • He possesses perfect knowledge of the choice of commodities open to him and his choices are certain.
    • They know the exact prices of various commodities and their utilities are not influencing by variations in their prices.
    • There are no substitutes.

    Features of Utility Analysis:

    The utility analysis has the following main features;

    • Subjective.
    • Relative.
    • Usefulness, and.
    • Morality.

    Now, explain each one;

    The utility is Subjective:

    The utility is subjective because it deals with the mental satisfaction of a man. A commodity may have different utility for different persons. Cigarette has utility for a smoker but for a person who does not smoke, the cigarette has no utility. Utility, therefore, is subjective.

    The utility is Relative:

    The utility of a good never remains the same. It varies with time and place. The fan has utility in the summer but not during the winter season.

    Utility and usefulness:

    A commodity having utility need not be useful. Cigarette and liquor are harmful to health, but if they satisfy the want of an addict then they have utility for him.

    Utility and Morality:

    The utility is independent of morality. Use of liquor or opium may not be proper from the moral point of views. But as these intoxicants satisfy wants of the drunkards and opium eaters, they have utility for them.

    Concept of Utility Analysis:

    There are three concepts of utility analysis;

    1. Initial.
    2. Total, and.
    3. Marginal.

    Now, explain them;

    Initial Utility:

    The utility derived from the first unit of a commodity calls initial utility. Utility derived from the first piece of bread calls initial utility. Thus, the initial utility is the utility obtained from the consumption of the first unit of a commodity. It is always positive.

    Total Utility:

    Total utility is the sum of utility derived from different units of a commodity consumed by a household.

    According to Leftwitch,

    “Total utility refers to the entire amount of satisfaction obtained from consuming various quantities of a commodity.”

    Supposing a consumer four units of apple. If the consumer gets 10 utils from the consumption of first apple, 8 utils from the second, 6 utils from third, and 4 utils from the fourth apple, then the total utility will be 10+8+6+4 = 28.

    Accordingly, the total utility can calculate as:

    TU = MU1 + MU2 + MU3 +                                       + MUn

    or 

    TU = EMU

    Here TU = Total utility and MU1, MU2, MU3, +                       MUn =

    The Marginal Utility derived from the first, second, third………………….and nth unit.

    Marginal Utility:

    The Marginal Utility is the utility derived from the additional unit of a commodity consumed. The change that takes place in the total utility by the consumption of an additional unit of a commodity calls marginal utility.

    According to Chapman,

    “Marginal utility is the addition made to total utility by consuming one more unit of commodity.”

    Supposing a consumer gets 10 utils from the consumption of one mango and 18 utils from two mangoes, then. the marginal utility of second .mango will be 18-10=8 utils.

    The marginal utility can measure with the help of the following formula MUnth = TUn – TUn-1

    Here;

    • MUnth = Marginal utility of nth unit.
    • TUn = Total utility of “n” units, and.
    • TUn-1 = Total utility of n-1 units.
    Types of Marginal utility:

    The following marginal utility can be; positive marginal utility, zero marginal utility, or negative marginal utility.

    1. Positive: If by consuming additional units of a commodity, total utility goes on increasing, marginal utility will be positive.
    2. Zero: If the consumption of an additional unit of a commodity causes no change in total utility, the marginal utility will be zero.
    3. Negative: If the consumption of an additional unit of a commodity causes falls in total utility, the marginal utility will be negative.
  • A Case Study is explained Dell SWOT Analysis

    A Case Study is explained Dell SWOT Analysis

    Dell SWOT Analysis; This case study is explained their SWOT Analysis and Marketing Opportunities for Dell. Dell is an American multinational computer technology company based in Round Rock, Texas, United States, that develops, sells, repairs, and supports computers and related products and services. In 1983, 18-year-old Michael Dell left college to work full-time for the company he founded as a freshman, providing hard-drive upgrades to corporate customers.

    This Case Study is explained, what is the Dell SWOT Analysis?

    In a year’s time, Dell’s venture had $6 million in annual sales. In 1985, Dell changed his strategy to begin offering built-to-order computers. That year, the company generated $70 million in sales. Five years later, revenues had climbed to $500 million, and by the end of 2000, Dell’s revenues had topped an astounding $25 billion. Dell Social Business Strategy for Case Study!

    The meteoric rise of Dell Computers was largely due to innovations in supply chain and manufacturing, but also due to the implementation of a novel distribution strategy. By carefully analyzing and making strategic changes in the personal computer value chain, and by seizing on emerging market trends, Dell Inc. grew to dominate the PC market in less time than it takes many companies to launch their first product.

    Dell SWOT Analysis:

    The following swot Analysis of Dell below are;

    Strengths:

    First Dell SWOT Analysis of Strengths; According to Dell.com, Dell incorporation announces itself as the world’s leading computer company. Dell is the World’s largest PC maker. Started with the capital of $1000 as in the current stage it has collected $2.478billion net income in 2009. For the last couple of years, Dell has taken its position as a market leader. Dell’s brands are one of the well known and renowned brands in the World. Dell avoids the intermediaries and supplies product directly to the end users. It uses Customer Relationship Management approaches with information and technology to collect data on its loyal customers.

    So that a customer selects a particular PC model, then it goes for to add items according to customer’s choice and upgrades until the PC is fitted out to the customer’s own specification. The components which are used to make a computer ready are made by suppliers, never by Dell. PC’s are fitted by using comparatively cheap labor. You can even keep track of your delivery by contacting customer services. When the goods became ready it will reach among the customer by courier.

    Weaknesses:

    Second Dell SWOT Analysis of Weaknesses; Dell has huge varieties of products and components made by different suppliers and different countries. So sometimes it faces unexpected problems caused by the different component which is used for the products. It is a minor case which happened in 2004. Dell had to recall 4.4 million laptop adaptors because of a fear that they could overheat, causing electric shocks or fires. The main weak point of Dell is that it doesn’t manufacture the product.

    It depends upon other manufacturer and it buys the product from the supplier and assembles the product as per customer’s choice and desires. So dependability is the main weak point we find in a case study of dell incorporation. Dell buys its component from the selected hi-tech component manufacturer. So sometimes the manufacturer or supplier who supplies for Dell stop manufacturing, Dell has to bear the huge loss on its overall sales.

    Opportunities:

    Third Dell SWOT Analysis of Opportunities; When Michael Dell was replaced by the post of the chief executive officer by Kevin Rollins in 2004 the company had got new blood, management, vision, and new strategy. That could lead the organization into a new even more profitable period. Dell is chasing the diversification strategy by developing a lot of new products to its range.

    It also provides multiple facilities to its customer such as three in one, two in one, for example, getting computer peripherals when buying a Dell PC. It also produces non-computing goods such as iPod and other electronic brands. Therefore the non-computing goods of Dell compete against others.

    Pursuing a diversification strategy Dell can find out new markets and customers in order to sell its mass products. Dell develops low-cost price customers in order to sell its retailers all over the world. The produced PCs are unbranded and they should not be known as being Dell when the customer makes the purchase. Rebranding and rebadging for retailers, although a departure for Dell, gives the company new market segments to attack with the associated marketing costs.

    Threats:

    Finally Dell SWOT Analysis of Threats; The biggest threat for Dell incorporation is the competition in the existing global PC market. Well reputed companies like IBM, COMPAQ also adopting the same kind of marketing strategies, so in the current global market of PC compete with the same kind of product is an emerging challenge for dell incorporation.

    As with all profitable brands, retaliation from competitors and new entrants to the market poses potential threats. Dell sources from Far Eastern nations where labor costs remain low. But there is nothing stopping competitors doing the same – even sourcing the same or similar components from the same or similar suppliers. Remember, Dell is a PC maker, not a PC manufacturer.

    Dell’s commitment to customer value, to our team, to being direct, to operating responsibly and, ultimately, to winning continues to differentiate us from other companies. The Background section provides critical information and history of Dell’s business world. Economic factors; The recession slows down consumer spending and disposable income reduces. Dell Inc. addresses these issues in many ways. It manages weaknesses and threats to create a positive outcome.

    Marketing Opportunities for Dell:

    When Michael Dell was replaced by the post of the chief executive officer by Kevin Rollins in 2004 the company had got new blood, new management, vision, and strategy. That could lead the organization into a new even more profitable period. Marketing opportunities for dell could be a new market overseas with a new product.

    Dell can grab the market by researching on changing the perception of customer towards technological product. Dell is chasing the diversification strategy by developing a lot of new products to its range. It also provides multiple facilities to its customer such as three in one, two in one, for example, getting computer peripherals when buying a Dell PC.

    It also produces non-computing goods such as iPod and other electronic brands. Therefore the non-computing goods or Dell compete against others. Pursuing a diversification strategy Dell can find out new markets and customers in order to sell its mass products.

    Case Study is explained Dell Swot Analysis
    Case Study is explained Dell SWOT Analysis, #Pixabay.

    Mission and Strategies of Dell:

    Dell’s mission is “To the most successful computer company in the world at delivering the best customer experience in markets we serve. In doing so, Dell will meet customer expectations of the highest quality, leading technology, competitive pricing, individual and company accountability, best in class service and support, flexible customization capability, superior corporate citizenship, financial stability”.

    Dell’s own corporate website defines its global strategy as, “Our global strategy is to be the premier provider of products and services including those that customer requires to build their information technology and Internet infrastructures”.

  • How to Analysis of Capitalism in India?

    How to Analysis of Capitalism in India?

    What is Capitalism? In the capitalist economic system, all farms, factories and other means of production are the property of private individuals and firms. In the words of Loucks, “Capitalism is a system of economic organization featured by private ownership and use for private profit of man-made and nature-made capital”. So, what is the question we are going to discuss; How to Analysis of Capitalism in India?

    Here are explained; Capitalism in India: first Features, Growth, Process, and finally Social.

    Definition; According to Wright, “Capitalism is a system in which, on average, much of the greater portion of economic life and particularly of net new investment is carried on by private (i.e. non-government) units under conditions of active and substantially free competition and avowedly at the least, under the incentive of hope for profit”.

    The Features of Capitalism:

    In the broadest sense, capitalism may be defined as the economic system making the widest use of capital in the process of production. In the technical sense, capitalism may be defined as the economic system of production in which capital goods are owned privately by individuals or corporations.

    The principal features of capitalism are discussed below; key points.

    • Private Property.
    • Profit Motive.
    • Price Mechanism.
    • Role of the State.
    • Market Economy.
    • Consumer Sovereignty.
    • Freedom of Enterprise.
    • Large Scale Production, and.
    • Competition.

    The following are the economic bases of capitalism, now explain each below:

    Private Property:

    Capitalism thrives on the institution of private property. It means that the owner of a firm or factory or mine may use it in any manner he likes. He may hire it to anybody, sell it, or lease it at will in accordance with the prevalent laws of the country. The state’s role is confined to the protection of the institution of private property through laws.” The institution of private property induces its owner to work hard, to organize his business efficiently and to produce more, thereby benefiting not only himself but also the community at large. All this is actuated by the profit motive.

    Profit Motive:

    The main motive behind the working of the capitalist system is the profit motive. The decisions of businessmen, farmers, producers, including that of wage-earners are based on the profit motive. The profit motive is synonymous with the desire for personal gain. It is this attitude of acquisitiveness which lies behind individual initiative and enterprise in a capitalist economy.

    Price Mechanism:

    Under capitalism, the price mechanism operates automatically without any direction and control by the central authorities. It is the profit motive which determines production. Profit being the difference between outlay and receipt, the size of profit depends upon prices. The larger the difference between prices and costs, the higher is the profit. Again, the higher the prices, the greater are the efforts of the producers to produce the varied quantities and types of products. It is the consumers’ choices which determine what to produce, how much to produce, and how to produce. Thus capitalism is a system of mutual exchanges where the price-profit mechanism plays a crucial role.

    Role of the State:

    During the 19th century, the role of the state was confined to the maintenance of law and order, protection from external aggression, and provision for educational and public health facilities. This policy of laissez-faire—of non-intervention in economic affairs by the state—has been abandoned in capitalist economies of the West after the Second World War. Now the state has important tasks to fulfill. They are monetary and fiscal measures to maintain aggregate demand; anti-monopoly measures and nationalized monopoly corporations; and measures for the satisfaction of communal wants such as public health, public parks, roads, bridges, museums, zoos, education, flood control, etc.

    Market Economy:

    Under capitalism, there is no governmental control over the forces of production, distribution, and exchange. It is controlled by the forces operating in the market. There is no price control or regulated distribution by the government. The economy operates freely under the law of demand and supply. The capitalist economy is a liberalized or market economy.

    Consumer’s Sovereignty:

    Under capitalism, ‘the consumer is the king.’ It means freedom of choice by consumers. The consumers are free to buy any number of goods they want. Producers try to produce a variety of goods to meet the tastes and preferences of consumers. This also implies freedom of production whereby producers are at liberty to produce a vast variety of commodities in order to satisfy the consumer who acts like a ‘king’ in making a choice out of them with his given money income. These twin freedoms of consumption and production are essential for the smooth functioning of the capitalist system.

    Freedom of Enterprise:

    Freedom of enterprise means that there is the free choice of occupation for an entrepreneur, a capitalist, and a laborer. But this freedom is subject to their ability and training, legal restrictions, and existing market conditions. Subject to these limitations, an entrepreneur is free to set up any industry, a capitalist can invest his capital in any industry or trade he likes, and a person is free to choose any occupation he prefers. It is on account of the presence of this important feature of freedom of enterprise that a capitalist economy is also called a free enterprise economy.

    Large Scale Production:

    It is another important feature of capitalism. Capitalism arose as a result of the industrial revolution which made large-scale production possible. The installation of gigantic plants and division of labor increased production. More production means wider use of capital and led to more profits.

    Competition:

    Competition is one of the most important features of a capitalist economy. It implies the existence of a large number of buyers and sellers in the market who are motivated by self-interest but cannot influence market decisions by their individual actions. It is competition among buyers and sellers that determine the production, consumption, and distribution of goods and services. There being sufficient price flexibility under capitalism, prices adjust themselves to changes in demand, in production techniques, and in the supply of factors of production. Changes in prices, in turn, bring adjustments in production, factor demand, and individual incomes.

    How to the Growth of Capitalism in India?

    In primitive societies the usual system of exchanging goods vas barter system. At that time the idea of profit did not exist, ‘people accumulated goods not for making a profit during the days of scarcity but to gain prestige. The system of trading often consisted if giving and mutual rendering of services. Economic factors such as wages, investment; interest and profit were practically unknown preliterate societies. During the early Middle Ages, trade and commerce were little more advanced than they had been among the primitive peoples.

    While at first conducted largely on a barter basis, trading came gradually more and more to involve money as a medium of exchange. This gave a fillip to the development of trade and commerce which gave importance to money, gold, silver, and tokens thereof. Money is not property, it is a symbol of property; it has a profound influence on the uses to which productive properties are put. According to Simmel, the establishment of the institution of money in the economic system of modern western society has had far-reaching effects upon almost every phase of life.

    It resulted in greater freedom for both the employer and employee and for both the seller and buyer of goods and services since it makes for the depersonalized relationship between the two parties in a transaction. Simmel maintains that the institution of money has radically changed our whole philosophy of life. It has made us pecuniary in our attitudes so that everything is evaluated in terms of money, and as social contacts have become depersonalized, human relations have become superficial and cold.

    In the early part of the modern period, the economic activities were generally regulated by the governing powers. It was an economic reflection of the growing unification of European peoples under strong monarchical Governments. The interest of the secular rulers lay in internal unification and this necessarily meant economic as well as political integration. The mercantilist ideology dominated the period. The economic activities of the people were politically regulated to increase the profits of the king and to fill his treasury with wealth.

    The nation was looked upon by the mercantilist as an economic organization engaged in the making of profit. The ownership and use of productive properties were minutely regulated by mercantilist’s law. Then came the Industrial Revolution which changed the techniques of production. The policy of mercantilism also had failed to bring about the welfare of the people. To secure maximum production of usual goods the new do “trine of ‘Laissez-faire’ was propounded.

    The doctrine preached non- interference in economic matters. According to this doctrine, if individuals pursue their own interest, unhampered by restriction; they will achieve the greatest happiness of the greatest number. Its advocates, Adam Smith, J.S. Mill, Spencer, and Sumner contended that Government should remove all legal restrictions on trade, on production, on the exchange of wealth and on the accumulation of property.

    Adam Smith enunciated four principles:
    • The doctrine of self-interest.
    • Laissez-faire policy.
    • The theory of competition, and.
    • Profit motive.

    Upon these principles and in response to the changing techniques of production brought about by the Industrial Revolution, a new system of property ownership and ‘production’, capitalism developed. The Industrial Revolution replaced factories in place of households. In factories, the work was divided up into little pieces, each worker doing a little piece. Production increased. Large plants in -course of time were set.

    Corporations owning large plants came into being. All these developments of mass production, the division of labor, specialization, and exchange were accompanied by capitalism. In this new system of production and exchange, the ownership of productive properties was both individualized and divested of all social responsibility.

    The Property became private and was freed from all obligations to the state, church, family and other institutions. The owners of the factory were free to do as they pleased. Profit was the main motive for them. They were under no obligation to produce goods if they believed that they could not make the profit. The mode of production was profit-oriented and the Governments in adherence to the doctrine of Laissez-faire supported the owners in this right.

    How to understand Capitalism as a Process?

    With the growth of the capitalist system there was:

    • Extreme polarization of classes.
    • Pauperization.
    • Alienation.
    • Dehumanization of Labor.
    • The dictatorship of the proletariat, and.
    • Shift from Capitalism to Socialism.

    Marx’s sociology of capital in capitalist societies is not applicable to so many capitalist societies. This is the” case particularly with the Asiatic societies which do not show any class conflict in-spite of social stratification.

    In the words of Raymond Aron,

    “For one thing the Marxist conception of capitalist society and of society, in general, is sociological but this sociology is related to philosophy, and a number of interpretative difficulties arise from the relation of philosophy to sociology.”

    Hence Marx’s predictions about the downfall of capitalism have not come true everywhere. His idea of constant pauperization of Labour is wrong so far as Western societies are concerned. Neither is there any proof of Proletaization. The claim of the destruction of capitalism is inevitable is far from being scientific.

    How to Analysis of Capitalism in India
    How to Analysis of Capitalism in India? Old Two Rupees Coin, Image credit from #Pixabay.

    What do the Social Consequences of Capitalism?

    Capitalism or economic development has brought in some good consequences which are as follows:

    • Economic Progress: Capitalism has led men to exploit the natural resources more and more. The people exert themselves utmost for earning money. This had led to many inventions in the field of industry, agriculture, and business which have contributed to economic progress.
    • Exchange of Culture: Capitalism has led to international trade and exchange of know-how. People in different countries have come nearer to each other. The development of the means of transport and communication has facilitated contacts among the peoples of the world thereby leading to exchange of ideas and culture.
    • High Standard of Living: Capitalism is the product of industrialization. Industrialization has increased production. Now men do not have to toil for bread as they used to do in the primitive days. The necessities of life are easily available.
    • The progress of Civilization: Capitalism was instrumental in inventing new machines and increasing the production of material goods. Man is to-day more civilized than his ancestors.
    • Lessening of Racial Differences: Capitalism has also led to the lessening of differences based on race, creed, caste, and nationality. In the factory, the workers and officials belonging to different castes co-operate with one another and work shoulder to shoulder. Inter-mixing of castes is the off-shoot of capitalism.

    But in spite of the above good consequences capitalism has proved a curse instead of a blessing.

    Its bad effects are the following:
    • Imbalance in Social System: Capitalism has led to an imbalance in the social system. It has failed to adjust itself to the welfare of society. It has widened the gap between the haves and have-not’s and created insatiable greed for wealth among the people. It has changed the very outlook of human beings. Wealth has become an important criterion of status.
    • Artificiality: Capitalism has transformed modern culture into mere artificiality. Today there is a false courtesy. One does not find gentility and human touch. One can see false prestige, mere artificiality, and sheer advertisement even in art and literature, nothing to speak of diet, dress, and speech etc. Life today has become artificial.
    • Greed for Wealth: Capitalism is based on greed for wealth It has raised wealth to the pedestal of deity. Wealth has become the be-all and end-all of human life. The modern man is mad after wealth. He wants to earn more and more wealth by any means. The idea for morality does not enter into the means of earning. It has thus led to moral degeneration.
    • Destruction of Human Values: In a capitalist order, everything has come to be measured in terms of wealth. All values of human life such as love, sympathy, benevolence, love, and affection are evaluated in terms of silver coins. Every person wants to get the maximum. The sole criterion is wealth, not value.
    • Materialism: Capitalism manifests materialism in its extreme form. Religion and spirituality lose their force. Religion becomes the opium of people. Religion becomes hypocrisy. The big capitalists save lacs of rupees by way of tax through contribution to fictitious charitable institutions. While people are short of goods, the capitalists hoard them to soar the prices.
    • Emphasis on Sex: Capitalist culture lays emphasis on sex. Marriage has become a mere agreement for the satisfaction of sex hunger. The capitalists advertise their goods through the display of sex instincts. Literature and movies are based on sexual passion. Pre-marital and extra-marital sexual relations are on the increase. Man is lacking in self-control.

    It has led to the moral degeneration of man. Obviously, capitalism has failed to bring about the moral development of man. It is injurious both to society and the individual. In short, it has proved a curse to humanity instead of a blessing. Karl Marx was its bitter critic.

  • What is Working Capital? Analysis, with Management

    What is Working Capital? Analysis, with Management

    Working Capital – Its meaning is basically an indicator of an organization’s short-term financial position and is also a measure of its overall efficiency. They obtain by subtracting the current liabilities from the current assets. It is a financial metric which represents operating liquidity available to a business, organization, or other entity, including governmental entities. Along with fixed assets such as plants and equipment, they consider a part of operating capital. So, what is the question going to learn; What is Working Capital? Analysis, with Management.

    Here explains; Working Capital, Its meaning, definition, Analysis, with Management.

    Working capital meaning, also known as net-working-capital, is the difference between a company’s current assets, like cash, accounts receivable, and inventories of raw materials and finished goods, and its current liabilities, like accounts payable. Capital is another word for money and it is the money available to fund a company’s day-to-day operations essentially, what you have to work with. In financial speak, it is the difference between current assets and current liabilities.

    Current assets are the money you have in the bank as well as any assets you can quickly convert to cash if you needed it. Current liabilities are debts that you will repay within the year. So, it is what’s leftover when you subtract your current liabilities from what you have in the bank. In broader terms, It is also a gauge of a company’s financial health. The larger the difference between what you own and what you owe short-term, the healthier the business. Unless, of course, what you owe far exceeds what you own. Then you have negative working capital and are close to being out of business.

    It can calculate as – Working capital Formula:

    Working Capital = Current Assets – Current Liabilities

    What is the meaning of working capital? Also called net working capital, a liquidity ratio measures a company’s ability to pay off its current liabilities with its current assets. It calculates by subtracting current liabilities from current assets.

    Working capital Definition: They can understand as the capital needed by the firm to finance current assets. It is the amount of a company’s current assets minus the number of its current liabilities. They represent the funds available to the enterprise to finance regular operations, i.e. day to day business activities, effectively. It helps gauge the company’s operating liquidity, i.e. how efficiently the company can cover the short-term debt with short-term assets. Current Assets represent those assets that can easily transform into cash within one year. On the other hand, current liabilities refer to those obligations which are to pay within an accounting year.

    Sources of Working Capital:

    The sources for working capital can either be long-term, short-term, or even spontaneous. Spontaneous working capital majorly derives from trade credit including notes payable and bills payable while short-term capital sources include dividend or tax provisions, cash credit, public deposits, trade deposits, short-term loans, bills discounting, inter-corporate loans, and also commercial paper. For the long-term, capital sources include long-term loans, provision for depreciation, retained profits, debentures, and share capital. These are major working capital sources for organizations based on their requirements.

    Here are some additional factors to consider:
    • The types of current assets and how quickly they can convert to cash. If the majority of the company’s current assets are cash and cash equivalents and marketable investments, a smaller amount of capital may be sufficient. However, if the current assets include slow-moving inventory items, a greater amount of capital will be needed.
    • The nature of the company’s sales and how customers pay. If a company has very consistent sales via the Internet and its customers pay with credit cards at the time they place the order, a small amount of capital may be sufficient. On the other hand, for a company in an industry where the credit terms are net 60 days and its suppliers must be paid in 30 days; the company will need a greater amount of capital.
    • The existence of an approved credit line and no borrowing. An approved credit line and no borrowing allow a company to operate comfortably with a small amount of capital.
    • How accounting principles apply. Some companies are conservative in their accounting policies. For instance, they might have a significant credit balance in their allowance for doubtful accounts and will dispose of slow-moving inventory items. Other companies might not provide for doubtful accounts and keep slow-moving inventory items at their full cost.

    Types of Working Capital:

    There are several types of working capital based on the balance sheet or operating cycle view. The balance sheet view classifies working capitals into the net (current liabilities subtracted from current assets featuring in the company’s balance sheet) and gross working capital (current assets in the balance sheet).

    On the other hand, the operating cycle view classifies working capitals into temporary (the difference between net & permanent capital) and permanent (fixed assets) capital. Temporary capital can further break down into reserve and regular capital as well. These are the types of working capital depending on the view that chose. Two types of Working Capital;

    First types, Value;
    • Gross Capital: It denotes the company’s overall investment in the current assets.
    • Net Capital: It implies the surplus of current assets over current liabilities. A positive net capital shows the company’s ability to cover short-term liabilities; whereas a negative net capital indicates the company’s inability to fulfill short-term obligations.
    Second types, Time;
    • Temporary Capital: Otherwise know as variable capital; it is that portion of capital which needs by the firm along with the permanent capital, to fulfill short-term capital needs that emerge out of fluctuation in the sales volume.
    • Permanent Capital: The minimum amount of capital that a company holds to carry on the operations without any interruption, calls permanent capital.

    Other types of working capital include Initial working capital and Regular working capital. The capital requires by the promoters to initiate the business knows as initial working capital. On the other hand, regular it is one that requires the firm to carry on its operations effectively.

    What is Working Capital Analysis?

    It is one of the most difficult financial concepts to understand for the small-business owner. In fact, the term means a lot of different things to a lot of different people. By definition, it is the amount by which current assets exceed current liabilities. The working capital analysis uses to determine the liquidity and sufficiency of current assets in comparison to current liabilities, you definitely understand their meaning also. This information needs to determine whether an organization needs additional long-term funding for its operations, or whether it should plan to shift excess cash into longer-term investment vehicles.

    However, if you simply run this calculation each period to try to analyze working capital; you won’t accomplish much in figuring out what your working capital needs are and how to meet them. A useful tool for the small-business owner is the operating cycle. The operating cycle analyzes the accounts receivable, inventory, and accounts payable cycles in terms of days. In other words, accounts receivable analyze by the average number of days it takes to collect an account. Inventory analyze by the average number of days it takes to turn over the sale of a product. Accounts payable analyze by the average number of days it takes to pay a supplier invoice.

    Explains the analysis:

    The first part of the working capital analysis is to examine the timelines within which current liabilities are due for payment. This can most easily discern by examining an aged accounts payable report, which divides payables into 30-day time buckets. By revising the format of this report to show smaller time buckets; it is possible to determine cash needs for much shorter time intervals. The timing of other obligations, such as accrued liabilities, can then be layered on top of this analysis to provide a detailed view of exactly when obligations must pay.

    Next, engage in the same analysis for accounts receivable, using the aged accounts receivable report, and also with short-term time buckets. The outcome of this analysis will need to revise for those customers that have a history of paying late so that the report reveals a more accurate assessment of probable incoming cash flows.

    A further step is to examine any investments to see if there are any restrictions on how quickly they can be sold off and converted into cash. Finally, review the inventory asset in detail to estimate how long it will be before this asset can be converted into finished goods, sold, and cash received from customers. The period required to convert inventory into cash may be so long that this asset is irrelevant from the perspective of being able to pay for current liabilities.

    What is Working Capital Management?

    Above the meaning of working capital, you understand them; It is nothing but the difference between current assets and current liabilities. In other words, skilled executive capital management means ensuring adequate liquidity in the business; be able to meet short-term expenses and debt. Working Capital Management a strategy adopt by business managers to monitor the working capital of the business. It is a fundamental concept that calculates and assesses a company’s financial and operational health.

    There is a strategy adopted by business managers to monitor the capital (that means current assets and current liabilities) by the business managers. It is a fundamental concept that calculates and assesses a company’s financial and operational health. Working capital management deals with controlling the proposed free credit period for account capital management; believe that the effective implementation of the credit policy remains the optimum stock and cash level.

    It speeds up the company’s capital cycle and makes the situation of liquidity easier. Managers also try and extend the available credit from the payment of the account and thus take advantage of the business credit; which is generally considered to be free working capital for a certain period. It is an easily understood concept that can be linked to a person’s home. It seems that a person collects cash from his income and how he is planning to spend on his needs.

    Important area:

    Working capital management is a very important area of business when selling mid-market businesses. Effective working capital management means that the business owner will keep their level as low as possible; while still there will be enough funds to run the business. At the point of sale, a buyer will look at historical levels to set non-cash working capital in a reasonable amount to leave the acquisition after the business.

    Sellers will usually be able to extract extra cash from the business before the sale. If the average non-cash is maintained at a low level on the historical level, buyers will usually ask for the comparative level. The same is true if the inefficient level of working capital is maintained at a higher level. On sale, the level will have a direct impact on the total cash earnings received by the vendors.

    What is Working Capital Analysis with Management
    What is Working Capital? Analysis, with Management. Formula!