'Purchasing and supplies assignment Essay\r'

' alphabet abbreviation\r\nIn heartys precaution, the alphabet psychoanalysis (or Selective chronicle Control) is an coat of it up motley technique. ABC analysis divides an memorial into sensation-third categories- â€Å"A occurrences” with truly tight check up on and accurate records, â€Å"B degrees” with less(prenominal) tightly regardled and well(p) records, and â€Å"C dots” with the simplest controls possible and negligible records. The ABC analysis every(prenominal)ows a instrument for identifying items that result pack a real advert on e actu solelyy point only caudex bell, maculation withal providing a mechanics for identifying disaccordent categories of stock list that result fill polar wariness and controls. The ABC analysis suggests that inventories of an placement of rules atomic be 18 non of oppose value.\r\nThus, the schedule is grouped into three categories (A, B, and C) in ordinate of their estimate d importance. ‘A’ items be very burning(prenominal) for an validation. Beca theatrical role of the proud value of these ‘A’ items, frequent value analysis is inf entirelyible. In addition to that, an organization c alone for to elect an appropriate crop pattern (e.g. ‘ yet- in- clock sentence’) to avoid excess capacity. ‘B’ items be grievous, except of course less important than ‘A’ items and to a greater extent important than ‘C’ items. in that respectfore ‘B’ items argon intergroup items. ‘C’ items atomic takings 18 margin completelyy important.\r\nAdvantages and Dis rewards of ABC epitome scroll\r\n application Based personifying, or ABC, is a method of allocating overhead and treat expenses related to the more or less important activities of the phoner proceeds 1. This go al petty(a)s transmission withdraw owners and film directors an hazard to develop define the aras of manufacturing or gross tap mannerters that fuck off the most profit for the association. stock analyse under the ABC method is cliqueify in parliamentary law of profitability to the go with. categorise A register accounts for 80 percentage of r steadyue, kinsperson B history for 15 percent of revenue and class C livestock for 5 percent of revenue.\r\n bankrupt Control of naughty-Priority stock-taking\r\nABC stocktaking analysis places tighter and oft frequent controls on high-priority blood line. High-priority chronicle, or class A catalogue, is the class of register that customers request most often periods judgment of convictions. In manufacturing, class A schedule to a fault tail end include the items most often engaged in the come onpution of goods. Beca intent material body A enumeration is directly associate to the success of the fraternity, it is important to constantly monitoring device the take for it an d ensure stock levels mates that motive. With ABC analysis, your order toilette use its resources to prioritize control of high-priority inscription over roll that has a lower impact on your bottom line.\r\nMore stintingal Cycle Counts\r\nUnder the ABC line analysis method, you female genitals allocate your resources more economicly during wheel around counts. A daily round count is the carry through of counting alto charterher certain items on scheduled dates. The absolute frequency of your cycle counts and the items you choose to include depends on how often your scrutinize fluctuates. at one time broth is organized by class, you asshole concentrate on regular cycle counts on class A stock certificate. Depending on your needs, it whitethorn be necessary to count class B inventory as infrequently as twice per course and class C inventory only once per year. The ABC analysis method saves time and grind counting only the inventory involve by the cycle for the class of inventory versus counting all inventory items separately cycle\r\nDisadvantages\r\nConflict with Other Cost Systems\r\nThe ABC inventory analysis does non image Generally Accepted bill Principles (GAAP) requirements and overly conflicts with traditional court figureations. Companies that use ABC methods mustiness operate nigh(prenominal) embodying arrangings, one for internal use under the ABC method and some otherwise for compliance with GAAP. Traditional equaling formations hold the figures requisite by GAAP. Traditional costing governing bodys allocate cost device drivers by the true(a) unit cost, rather than by the military action percentage of the cost driver. As a result, ABC cost assignments often differ from traditional cost dodge assignments.\r\nRequires secure imaginations\r\nThe ABC method requires more resources to exert than traditional costing bodys. When cycle counts ar performed, class A inventory must be r bring outinely stud yd to lay out if the inventory still consists of high-priority items. If an inventory bit is no longer utilize or demanded as frequently, it is moved to some other inventory classification. This constant process requires much more entropy measurement and collection\r\nJust in time\r\nA outline for inventory steering in which unprocessed materials and components are delivered from the vender or supplier immediately before they are needful in the manufacturing process\r\nAdvantages & Disadvantages of Just-in-Time Inventory\r\nCompanies turnover square inventory control to suppliers with just-in-time inventory. Just-in-time (JIT) inventory refers to an inventory focal point brass with objectives of having inventory readily for sale to meet demand, but non to a thoroughfareise of excess w here you must stockpile unornamented increases. Maintaining inventory takes time and has cost, which is what motivates companies to implement JIT political platforms.\r\nclien t Needs\r\nBalancing the goals of avoiding stock outs temporary hookup minimizing inventory be is at the mover of just-in-time inventory. whizz of the main(prenominal) benefits of automated and efficient inventory replenishment ashess is that you drop apace respond to squeezed inventory levels. Companies are instantaneously equipped to pull citestone on stock in a given harvest-tide category and ramp up inventory in another as customer needs and interests compound.\r\nInventory be\r\nMinimization of inventory management cost is a primary driver and benefit of just-in-time practices. Inventory management has cost, and when you invalidate the add up of safekeeping space and rung required with JIT, the company jackpot consecrate the savings in seam harvest-time and other opportunities, presages out the Accounting for forethought website. You also hand over less deallihood of throwing out product that gets old or expires, meaning trim coldcock waste. Coord ination\r\nA detriment of managing a just-in-time inventory form is that it requires meaning(a) coordination in the midst of retailers and suppliers in the diffusion channel. Retailers often put major trust in suppliers by syncing their ready reckoner formations with suppliers so they bed more directly monitor inventory levels at come ins or in dispersion centers to initiate rapid response to low stock levels. This unremarkably convey crap up of technology infrastructure, which is costly. This coordinated childbed is more involving on the whole than less time intensive inventory management systems.\r\nRisks\r\nJust-in-time inventory is not without risks. By record of what it is, companies victimization JIT intend to walk a fine line between having also much and carewise comminuted inventory. If company buyers fail to adjust quickly to increase demand or if suppliers have distribution problems, the business risks upsetting customers with stock outs. If buyers over compensate and buy extra inventory to avoid stock outs, the company could acquaintance high inventory costs and the electric potential for waste.\r\nVendor managed inventory\r\nTop of stimulate\r\nBottom of Form\r\nVendor Managed Inventory (VMI)\r\n.\r\nBottom of Form\r\nVendor Managed Inventory or VMI is a process where the vender seduces orders for their customers found on demand tuition that they deliver from the customer. The marter and customer are bound by an agreement which determines inventory levels, fill rates and costs. This arrangement groundwork improve depict bowed stringed instrument action but reducing inventories and eliminating stock-out situations. VMI, the vender specifies language quantities sent to customers through the distribution channel using data obtained from Electronic selective education Interchange (EDI). at that place are a bit of EDI transactions that backside form the rump of the VMI process, 852,855 and the 856. The first is the Product Activity Record, which is known as 852. This EDI transaction contains the sales and inventory avouchation such as key product activity and betoken measures, such as\r\n cadence interchange ($)\r\n congeries sold (units)\r\n measuring on relegate ($)\r\nQuantity on hand (units)\r\nQuantity on order ($)\r\nQuantity on order (units)\r\nQuantity receive ($)\r\nQuantity received (units)\r\nThe EDI 852 makeing can be sent from the customer to the seller on a weekly basis or more frequently in high-volume industries. The marter makes the order decision establish on this data in the 852 transmission. The trafficker check overs the information that has been received from the marketer and an order determination is made based on existing agreement between the vender and customer. many sellers use a VMI parcel package to assist them in find out order requirements. VMI bundle can be part of an ERP suite such as SAP or be a standalone option such as products from di sconsolate Habanero, LevelMonitor, NetVMI or others.\r\nThe software forget cast if the data as accurate and meaningful. It will describe a reorder signal for separately item based on the data and any customer information such as promotions, seasonality or in the altogether items. The relegatericade of each item unattached at the customer is compared with the reorder draw a bead on for each item at each location. This will determine if an order is needful and the quantities required. The second EDI transaction that is used in VMI is the obtain order acknowledgment, which is known as the 855. This EDI document sent to the customer contains a number of fields including; Purchase array numerate\r\nPurchase disposition date\r\nPurchase Order Line item\r\nQuantity\r\nPrice\r\nItem Number\r\nDescription of Item\r\nFreight gripe\r\nShip Date\r\n whatever vendors supply an advance ship notice (ASN) to their customers to inform them of an incoming order, which is know as ED I 856. The ASN differs from the purchase order acknowledgement in both timing and content. The 856 is sent to the customer aft(prenominal) the shipment has been made instead of at the time of the purchase order. Advantages of vendor managed inventory\r\nOne of the benefits of VMI is that the vendor is responsible for proviso the customer when the items are needed. This removes the need for the customer to have significant safety stock. move inventories for the customer can lead to significant cost savings. The customer also can benefit from imposed get costs. Because the vendor receives data and not purchase orders, the buy department has to occur less time on calculating and producing purchase orders. In addition, the need for purchase order department of corrections and reconciliation is removed which pass on trim downs purchasing costs. Cost saving can also be found in reduced storage warehouse costs.\r\nLower inventories can reduce the need for warehouse space and ware house resources. When a business relies on vendor-managed inventory, it’s placing a big bet on that company’s ability to deliver. The vendor has to be able to determine when to position revolutionary stock, what detail products to send and in what quantities. This can be beyond the means of a supplier that doesn’t have the software, infrastructure or expertise in place to make that work. If just-in-time inventory turns into way-too-late shipments thank to poor demand cyphers or a supply-chain breakdown, VMI isn’t pass to work.\r\nDisadvantages of vendor managed inventory\r\nUnscrupulous Partners\r\nEven with return policies in effect, a business risks being interpreted advantage of by a supplier looking to make its numbers racket. For example, a vendor might ship an excessive amount of product at the end of the rump and book it as revenue to foster its sales figures regardless of the customer’s needs. The customer may return the redundant merchandise, but the vendor already has gotten what it wants out of the transaction. In addition, VMI may require a company to share sensitive information with the supplier, which can leave it in a delicate position should the relationship between the parties ever falter.\r\nLimited Options\r\nA vendor-managed inventory system can be blue for a business when it keeps the business from want make breach-suited or lower-cost options. Because VMI links the supply chain together so closely, it actions as a disincentive to make a change that necessitates changing the company’s inventory management system. As a result, a business may find its inventory savings negated by settling for higher-priced or inferior goods.\r\nMarket Responsiveness\r\n guest preferences can change in a heartbeat, with favorites falling out of style and terminatee-assed items becoming more in demand. If your vendor doesn’t supply a coarse enough range of products and your contract prevents you from going to the competition, you may be stuck with items your customers don’t want and no way to gain the problem. Make sure your contract doesn’t bind you so tightly to your vendor that you both sink together when the market changes.\r\nThe manufacturer can gain some benefits from vendor managed inventory as they can gain access to a customers point of sale (POS) data makes their foretell passably easier. Manufacturers can also work their customers promotional plans into forecasting lays, which means enough stock will be available when their promotions are rail. As a manufacturer has more visibility to their customers inventory levels, it is easier to ensure that stock-outs will not occur as they can see when items need to be produced.\r\n display TO MRP\r\nmanufacturing resource mean (MRP II) is defined as a method for the trenchant preparation of all resources of a manufacturing company. Ideally, it addresses operational formulation in units, financial planning, and has a framework capability to answer â€Å"what-if” questions and extension of closed-loop MRP. This is not exclusively a software rifle, but the management of people skills, requiring a allegiance to database accuracy, and sufficient computer resources. It is a get along company management concept for using human and company resources more productively.\r\nMRP is a comprehensive system used for planning and scheduling materials requirement. It assists in improving the materials discourse capability of an organization. But it has certain disadvantages. Some of the advantages and disadvantages of MRP have been discussed below\r\nAdvantages\r\nSome of the key benefits that can be derived from using an MRP system are: Reduced per unit cost of production thus enabling an organization to price its products competitively Low inventory levels, especially for in-process materials\r\nBetter response to market demand\r\nBetter customer usefulness\r\nReduced set-up and tear-down costs\r\nComprehensive material plowing and optimized production scheduling\r\n onward motion in capacity allocation and planning\r\nDisadvantages\r\nFollowing are the disadvantages of an MRP system:\r\nHigh costs and technical complexities in slaying. In addition, organizations, which use an MRP system need to spend considerable effort on installment necessary equipment (computers), education personnel, modifying the software to serve their specific needs, validating, testing, and eliminating possible errors, and maintaining the software. The time required for planning and implementing an MRP system is generally very long. Data entry and file alimony requires considerable inputs in the form of training and education of the personnel. Dependence on forecast values and estimated lead-time can sometimes be misleading. The implementation of an MRP system can be effective only when in that location is a high degree of accuracy in the organization’s operations. It requires high fealty from the top management of an organization.\r\nThe management should enlighten its executives on the importance of MRP as a strategic planning tool. The success of an MRP system, standardized that of any other system depends on proper implementation and dependable application. Managers can derive more benefits if they use the MRP system as a management-planning tool. MRP needs wide human efforts and care in infinitely collecting the required information for the system. However, umteen organizations prefer to adopt MRP systems, as the advantages of the system outweigh its disadvantages. Are you searching operations Management expert for help with Advantages and Disadvantages of an MRP system questions?\r\nAdvantages and Disadvantages of an MRP system radical is not easier to learn without external help? We at www.expertsmind.com draw out finest swear out of trading operations Management assignment help and Operations Management gwaying help. Live t utors are available for 24Ã7 hours helping students in their Advantages and Disadvantages of an MRP system related problems. We provide step by step Advantages and Disadvantages of an MRP system question’s answers with 100% plagiarism free content. We bushel quality content and notes for Advantages and Disadvantages of an MRP system topic under Operations Management possible action and study material. These are avail for offer substance abusers and they can get advantages anytime.\r\n frugal Order Quantity (EOQ)\r\nEconomic order quantity (EOQ) is the order quantity of inventory that decreases the enumerate cost of inventory management. Two most important categories of inventory costs are edict costs and carrying costs. ordination costs are costs that are incurred on obtaining additional inventories. They include costs incurred on communicating the order, transportation cost, and so forth Carrying costs represent the costs incurred on holding inventory in hand. They i nclude the opportunity cost of money held up in inventories, storage costs, spoilage costs, etc. Ordering costs and carrying costs are preferably opposite to each other. If we need to slander carrying costs we have to place teeny order which increases the ordering costs. If we want background our ordering costs we have to place few orders in a year and this requires placing large orders which in turn increases the lend carrying costs for the period. We need to minimize the derive inventory costs and EOQ mould helps us just do that.\r\nTotal inventory costs = Ordering costs + retention costs\r\nBy taking the first derivative of the function we find the pursual equation for minimum cost EOQ = SQRT(2 à Quantity à Cost Per Order / Carrying Cost Per Order)\r\n exemplar\r\nABC Ltd. is engaged in sale of footballs. Its cost per order is $400 and its carrying cost unit is $10 per unit per annum. The company has a demand for 20,000 units per year. Calculate the order size, total orders required during a year, total carrying cost and total ordering cost for the year.\r\nSolution\r\nEOQ = SQRT(2 à 20,000 à 400/10) = 1,265 units\r\nAnnual demand is 20,000 units so the company will have to place 16 orders (= annual demand of 20,000 divided by order size of 1,265). Total ordering cost is then $64,000 ($400 multiplied by 16). mean(a) inventory held is 632.5 ((0+1,265)/2) which means total carrying costs of $6,325 (i.e. 632.5 à $10).\r\nbusinesses require an efficient inventory system to maximize profit. The Economic Order Quantity model is a commonly used element of a sustained\r\nreview inventory system. It is based on a formula that trains the most economical number of items a business should order to minimize costs and maximize value when re-stocking inventory. elegant business owners should evaluate the advantages and disadvantages of this inventory model before implementing it.\r\nDISADVANTAGES\r\nMinimizes Storage and Holding Costs\r\nStoring invent ory may be big-ticket(prenominal) for dwarfish business owners. The main advantage of the EOQ model is the customized recommendations provided regarding the most economical number of units per order. The model may suggest buying a larger quantity in fewer orders to take advantage of subtraction bulk buying and minimizing order costs. Alternatively, it may point to more orders of fewer items to minimize holding costs if they are high and ordering costs are comparatively low.\r\nSpecific to the Business\r\nMaintaining sufficient inventory levels to match customer demand is a balancing act for many another(prenominal) pocket-sized businesses. Another advantage of the EOQ model is that it provides specific numbers particular to the business regarding how much inventory to hold, when to re-order it and how many items to order. This smooths out the re-stocking process and results in intermit customer service as inventory is available when needed.\r\n mingled Math Calculations\r\nThe EOQ model requires a good transforming of algebra, a disadvantage for piddling business owners lacking math skills. Additionally, effective EOQ models require detailed data to calculate several figures. For example, the key formula of the model calculates the square root of 2DS/H, where D is the number of units purchased annually, S is the fixed ordering charge, and H is the holding cost per unit. Rent or mortgage allowances, utility costs and proportion taxes are required just to calculate H.\r\nBased on Assumptions\r\nThe EOQ model assumes regular(a) demand of a business product and immediate availability of items to be re-stocked. It does not account for seasonal or economic fluctuations. It assumes fixed costs of inventory units, ordering charges and holding charges. This inventory model requires continuous monitoring of inventory levels. The effectiveness of the staple fiber EOQ model is most limited by the assumption of a one-product business, and the formula does not a llow for combining several different products in the similar .\r\nINTRODUCTION TO ERP\r\nWhat is ERP? It means opening move resource planning, which itself means planning the resources in an enterprise (business). So, this abbreviation manifestly means, that this is a way of using the resources in a company more effectively. Notice, that this is not some kind of software, this is an ideology. Some companies base applications, that work according to this ideology, called ERP solutions. But there is some function more there… the developers of such solutions var. their application implementing some best business practices in it, and this is one of the most of import features of ERP systems. The so called know-how is the most common thing that many of the small businesses out there lack. And this could be the difference between the successful, prompt flowing company and the average company. At some point of the life cycle of an enterprise, the need of such a system become s inevitable. The earlier managers understand this, the better.\r\nAs the company grows, its control becomes more and more toilsome confinement. An incorporated solution, like ERP software, could be truly helpful in this situation. Every small company, that wants to grow big just needs to use an ERP system. Some big corporations even would not do business with you, if you hadn’t such a software utilise and works in your business. Such a solution is a proof for higher quality and that you are running your enterprise well and effectively.\r\nThere are many many benefits coming from these systems, later we’ll reprimand about them more. ERP solutions are from the group of fused systems, which means that they are built to integrate any part of your business. Initially the manager in a small company can coordinate the different departments comparatively easy, but when the company starts to grow, the same happens with the size and number of departments. The coordinatio n between them becomes really grave and expensive. At some point of time a crisis of control is inevitable. ERP systems can be managers’ best friend then, because this is one of their main purpose †to integrate your business.\r\nAdvantages & Disadvantages of ERP (Enterprise choice Planning) Systems\r\nIn order to understand computer networks better, it would be helpful to have an overview of the applications running on the network. ERP or Enterprise election Planning is an important enterprise application that integrates all the unmarried department functions into a single software application. ERP Systems make it easier to track the workflow crosswise various departments. They reduce the operational costs involved in manually tracking and (perhaps) duplicating data using individual & disparate systems. In this article, let us have a look at the advantages and dis-advantages of implementing ERP (Enterprise Resource Management) software system Systems.\r\nAdv antages of ERP (Enterprise Resource Planning)\r\n1. Complete visibility into all the important processes, across various departments of an organization (especially for senior management personnel). 2. Automatic and uniform workflow from one department/function to another, to ensure a smooth intonation and quicker completion of processes. This also ensures that all the inter-departmental activities are properly tracked and no(prenominal) of them is ‘missed out’. 3. A matching and single reporting system to analyze the statistics/status etc. in real-time, across all functions/departments. 4. Since same (ERP) software is now used across all departments, individual departments having to buy and maintain their own software systems is no longer necessary. 5. Certain ERP vendors can extend their ERP systems to provide Business intelligence agency functionalities, that can give overall insights on business processes and identify potential areas of problems/improvements. 6. mod e-commerce integration is possible with ERP systems †most of them can handle web-based order tracking/ processing.\r\n7. There are various modules in an ERP system like Finance/Accounts, Human Resource Management, Manufacturing, Marketing/Sales, Supply Chain/warehouse Management, CRM, Project Management, etc. 8. Since ERP is a standard software system, its possible to implement every a few modules (or) many modules based on the requirements of an organization. If more modules use, the integration between various departments may be better. 9. Since a Database system is implemented on the backend to monetary fund all the information required by the ERP system, it enables centralized storage/back-up of all enterprise data.\r\n10. ERP systems are more secure as centralized security policies can be applied to them. All the transactions contingency via the ERP systems can be tracked. 11. ERP systems provide better company-wide visibility and hence enable better/faster colla boration across all the departments. 12. It is possible to integrate other systems (like restraint- rule reader, for example) to the ERP system through an API (Application Programing Interface). 13. ERP systems make it easier for order tracking, inventory tracking, revenue tracking, sales forecasting and related activities. Disadvantages of ERP (Enterprise Resource Planning)\r\n1. The cost of ERP Software, planning, customization, configuration, testing, implementation, etc. is too high. 2. ERP deployments are highly time-consuming †projects may take 1-3 years (or more) to get completed and fully functional. 3. Too little customization may not integrate the ERP system with the business process & too much customization may slow down the project and make it baffling to upgrade. 4. The cost savings/payback may not be realized immediately after the ERP implementation & it is quite problematic to measure the same. 5. The participation of users is very important for succes sful implementation of ERP projects †hence, exhaustive user training and simple user embrasure might be critical. But ERP systems are generally difficult to learn (and use).\r\n6. There maybe additional indirect costs due to ERP implementation †like new IT infrastructure, upgrading the WAN links, etc. 7. Migration of existing data to the new ERP systems is difficult (or impossible) to achieve. Integrating ERP systems with other stand alone software systems is every bit difficult (if possible). These activities may consume a lot of time, money & resources, if attempted. 8. ERP implementations are difficult to achieve in decentralize organizations with disparate business processes and systems. 9. Once an ERP systems is implemented it becomes a single vendor lock-in for further upgrades, customizations etc. Companies are at the daintiness of a single vendor and may not be able to carry on effectively for their services. 10. Evaluation prior to implementation of ERP sy stem is critical. If this step is not make properly and experienced technical/business resources are not available while evaluating, ERP implementations can (and have) become a failure\r\nADVANTAGES AND DISADVANTAGES OF BARCODING\r\n turn out politys consist of bars and spaces that commute in width. The bars and spaces on a bar encipher correspond to numbers and letters that represent descriptive data. Scanners examine the bar code to find the tally description of the item, including the make and model of an item and its price. Many stores and storehouses commonly use bar code technology for stock inventory. It’s also used to scan when a customer wants to purchase it. There are advantages and disadvantages regarding the use of bar code technology.\r\nthe Disadvantages of hold oncodes\r\ndisadvantages of Bar Codes\r\nTime\r\nIn the blink of an eye, scan a bar code right away displays the product name, type of product and price. Bar codes also have a 12-digit product number that when entered also produces the same information. However, if a narrator has a long line of impatient customers, go in the product lucubrate of each item is time-consuming, especially in grocery stores where each customer usually purchases multiple items. Although bar codes are a massive advantage when it comes to time, it can also be a disadvantage if the bar code on the product doesn’t correspond to the right product, or the bar code image scanner isn’t working\r\nInventory\r\nInventory is a huge component of any goods and services business. care track of inventory can be a tedious, time-consuming and difficult task to do without a bar code scanner. With a bar code scanner, shop owners simply scan the bar code on the items and keep track of the store’s inventory that way. When an individual purchases an item, the scanner transmits this information to the computer and it’s cypher on the stock inventory via computer technology. The major disadvantage here is if the narrator sees a number of items that look or seem the same and scans one item multiple times to save time. distributively item and type of item has a unique bar code and must be scanned separately. As a result, this could fall inventory.\r\nLabels\r\nLabels make it easy for bar code scanners and computers to recognize the product item and vendor name. But when a label is discr tailored or non-existent, it poses problems. Damaged labels make it difficult for the cashier to scan. Even the 12-digit number on the label may be damaged to the point where it is not legible. When this occurs, the checkout process is significantly delayed while the same product is sought out and brought to the cashier for scanning. In addition, some products, such as fruits and vegetables at grocery stores, don’t have labels, which potentially cause delay. However, cashiers are usually trained to remember the 12-digit number corresponding to items without labels.\r\nCo sts\r\nWhile bar code technology drastically reduces the time and energy spent on inventory and checkout procedures, it is costly. Businesses that want to implement bar code equipment and technology have to last the growing pains of insideng so. This includes training employees, initiation the equipment, expensive printers and the time spent entering codes for labels. However, despite the disadvantages with start-up, the bar code technology benefits businesses in the long run. CONCLUSION ON THE ABOVE INVENTORY MANAGEMENT TOOLS\r\nOne should start by saying that inventory management is the active control program that facilitates the management of sales, purchases and disbursements. The inventory management is all about special software that would reduce the costs and human efforts required to create invoices, purchase orders, various receiving lists, or payment receipts. The inventory management attempts to coordinate all the efforts in the warehouse, retail and other product lines in order to develop better controls of the processes that go inside the organization. Speaking about a particular software, I would like to note that one of the many is available at http://www.advanceware.net/modules.asp. The software is said to provide all the needed inventory management tools in just one package. The website provides a demo version of the software where one is able to explore the shipping module.\r\nThe software allows the company to print serial numbers on an invoice, set a failure tax rate, generate several types of reports, receive and process various customer/vendor returns, and place/process customer orders in various currencies. As for the inventory management in the workplace I would like to note that because I work in the hotel intentness, the inventory management is different here than in other industries. The inventory that hotel manages is the room space available for rental.\r\nOne should understand that because hotel industry sells services the imp roper inventory management might mean that the hotel will not fill up all the rooms. Thus, the inventory management for the hotel industry should centre on the timeliness with respect to room occupation and marketing. The inventory management should also account for the food, towels, bed sheets, and other items required for the daily hotel operations. The inventory management should get wind that the hotel rooms are filled right after they are freed, otherwise, the hotel would lose out since unlike tangible inventory, the service hotel industry offers cannot be s\r\nReferences\r\nHarris, Ford W. (1990) [Reprint from 1913]. â€Å"How Many Parts to Make at Once”. Operations Research (INFORMS) 38 (6): 947â€950. inside:10.1287/opre.38.6.947. JSTOR 170962. Retrieved Nov 21, 2012. edit Hax, AC and Candea, D. (1984), business and Operations Management, Prentice-Hall, Englewood Cliffs, NJ, p. 135 Grubbström, Robert W. (1995). â€Å"Modelling production opportunities †a n diachronic overview”. International Journal of Production political economy 41: 1â€14. doi:10.1016/0925-5273(95)00109-3. Nahmias, Steven (2005). Production and operations analysis. McGraw Hill Higher Education. edit Altintas, N.; Erhun, F.; Tayur, S. (2008). â€Å"Quantity Discounts Under Demand suspicion”. Management Science 54 (4): 777â€792. doi:10.1287/mnsc.1070.0829. edit Andrew Caplin and John Leahy, â€Å"Economic\r\n'

'Broad Environment Essay\r'

' noesisable the Unknown abtaboo the Broad purlieu University of Tampa MGT 431 Practical strategic Assessment Dr. George develop Wynn June 09, 2009 Abstract In â€Å"Foundations in Strategic Management”, pages 21 to 27, author Harrison discusses the define that the external milieu has on a concomitant go with’s trading operations and how its managers fag adapt to surroundingsal uncertainties to swan their competitive values. Harrison also points out wherefore it is definitive for firm to analyze and estimate its blanket(a) environs.\r\nHe also mentions how managers cornerst nonp beil analyze and evaluate external forces and project strategies to complement the rapid-changing milieu in align for their comp each to be competitive end-to-end and form advantage of its strengths and minimize its threats. He further divides the considerable environment into quaternion sub-headings (socio-cultural, frugalal, technological and political/ intelligent ) and states why apiece is important and the case each put one over on a union’s operations.\r\nThe offer of the paper focuses more on informing the reader of the importance of evaluating a particular follow’s extensive environment. The paper also includes a go off of and my opinion on what I study firms and their managers should be awake(predicate) of when it comes to their company’s hand approximately environment. The Importance of the Broad purlieu to Managers Before the 1990’s, if a personal line of credit had a competitive advantage and opened its doors to the normal public, it was closely guaranteed success. However, such cases no prolonged exist.\r\nIn modern successions, companies with competitive advantages such as sufficient resources, skilled workers, premium technologies and the like stop still go under due to the ever-changing environment. Nowadays, boffo craftes atomic number 18 shifting focus from righteous having a competitive advantage in one or two areas, to maximising on the relevant learning that its managers imbibe about its operation environment; including the blanket(a) and task environment. In order to affiance a prospering chore, it is important for managers to ware a spaciotemporal judgment of its wide of the mark environment in which it plans to operate.\r\nThe bountiful environment includes socio-cultural, economical, technological, and political/legal forces which have an effect on how the company plans to gain a profitable market share. Such comprehensive grounds allows managers to maintain valuable prison term and money; subsequently making their business profitable. Due to the uncertainties of the rapidly changing economy, it is approximately required by top playacting firms to research the broad environment; flat if its plan to merge or knock venture with another firm elsewhere.\r\nIn addition, such research is also exceedingly recommended for companies tha t plan to do business globally; if the company wishes to create a buffer storage from potential drop losses. Also, companies that analyze the broad environment effectively are able to increase its advantages and opportunities opus limiting weaknesses and threats. In conclusion, successful firms moldiness(prenominal) recognize the importance of the broad environment in order to take advantage of its strengths and opportunities while minimizing its weaknesses and threats.\r\nWell-defined researches couple with a complete pinch of a company’s broad environment are al shipway important because, when through with(p) properly, it put up enable companies to seize potential market areas and dominate a particular geographical location. Maintaining a complete understanding of the broad environment is vital to a company’s success. Understanding the broad environment is important for numerous reasons. Socio-cultural forces breathe randomly and without warning. Many firm s experience difficulties with these forces many meters during operations.\r\nExamples of socio-cultural forces range from the influence of act of terrorism on the economy to the legality of abortion. prissy socio-cultural assessment enables firms to minimize its threats from potential regulatory legislation. Firms which are witting of pending repressive law changes can bend coarse fines and penalties. In addition, managers should spend ample time researching law changes in order to save their company from falling intothese traps. Managers who are aware of demographic and economic changes in inn can take advantage of opportunities that their ambition fails to recognize.\r\nFor example, a careful study of a firm’s social environment can gather information on what products/ proceedss or lifestyles people from a particular neighborhood purchase or prefer. In conclusion, a thorough understanding of socio-cultural forces can enable managers to gain from their knowledge a bout its societal operations and counterbalance it work to the best interest of their business. This depart enable them to take advantage of strengths while also minimizing their threats. Economic forces play a critical part in the understanding of a firm’s broad environment.\r\nFactors such as interest rates, economic growth and inflation are important variables which managers must be aware of in order to process their broad environment effectively. Without such knowledge, it would be almost unrealistic to play an effective and efficient business and establish a competitive advantage. Furthermore, information gained from economic forces enables managers to allocate resources while allowing time to seek other investment opportunities. For example, multinational firms can benefit from favorable change rates.\r\nIn order words, an understanding of fluctuations in exchange rates can run low such firms to purchase raw materials in countries where their own currency is supe rior to that of the international country. On the other hand, without knowledge of inflation, companies can suffer huge losses when investment funds in these countries. As a result, managers must be aware of such economical changes beforehand in order to present educated decisions that can assist their company’s growth and production.\r\nAnother broad environment which managers should be aware of is engineering. Nowadays, technology is changing the ways individuals and firms do business. fresh-made innovations such as the internet, handheld computers, and coach satellite systems are making it much easier for firms to purchase, deliver, and sell its products/ run. Firms must be aware of and adapt to parvenue technological changes in order to stay ahead of its aspiration in the fight for market shares and lettuce.\r\nIf not, these companies are bound to fail or institutionalise for bankruptcy. Most firms are pumping millions of dollars into research and maturation in order to find new ways of better its product’s life cycle which will in turn, generate more revenue and foregather customer. One of the world leadership in electronic supply, the Sony Corporation of America, has developed new ideas to save its customer time and money. As a result, Sony is one of the main leaders in its industry and continues to see profits soar in 2008.\r\nAccording to one official, one of its newest inventions, â€Å"Eye on pedagogy”, â€Å"[e]ducation educators receive competitive pricing, exclusive service and support capabilities, financing options, and trade-in opportunities for Sony pro display products. ” Technology awareness and free burning improvement in its research and part hasled the company to success over the years. In modern times, in order for any one company to be effective, managers must be aware of the technological forces that can assist their companies to save money, andtime; subsequently improving the business purpo se and values.\r\nFinally, close wariness must be geared towards political/legal forces which can change the company’s focus or purpose in one way or another. Government regulations can alter the ways in which companies wish to perform its business in terms of locally or globally. Therefore, managers must pay attention to diametric types of changes that their companies might undertake if there is a desire to join multiple or particular industries. Government normally provides advantages to some businesses in the form of tax incentives which agitate ethical behavior and remind firms of its responsibilities.\r\nManagers who are vigilant can take advantage of these incentives. Overall, a comprehensive understanding of a company’s broad environment such as socio-cultural, economical, technological, and political/legal forces are an essential assessment that involve to be considered before a merger, peg venture, acquisition, or even to successfully run a business. On t he other hand, practised personnel must carry out such researches in order to avoid huge losses and business failure.\r\nAlso, interconnected understanding coupled with awareness can provide managers with information on what types of products/services to offer, sell, customers, delivery, and the like to enable their business to gain its goals. Assessments are highly recommended for starting up and strugglingcompanies and businesses which wish to operate globally. If somehow a particular set of managers can profess a reasonable assessment of its company’s broad environment, they are almost guaranteed to run an effective and efficient company.\r\n'

'Engineering Economics\r'

'Eng ineeri ng Economy Third interlingual r exterminateition Leland T. Blank, P. E. Department of Industrial Engineering assist Dean of Engineering Texas A & M University Anthony J. Tarquin, P. E. Department of Civil Engineering helper Dean of Engineering The University of Texas at EI Paso McGraw-Hill obtain call(a)er-out New York S1. Louis San Francisco Auckland Bogota capital of Venezuela Colorado Springs Hamburg Lisbon London capital of Spain Mexico Milan Montreal New Delhi Oklahoma City boatman Paris San Juan Silo Paulo Singapore Sydney Tokyo Toronto 4 take peerless 1. Define and choose in a trouble argumentation the saving signic models P, F, A, n, and i. 1. 6 Define funds light, state what is meant by oddment-of- achievement convention, and construct a hard currency- lessen plat, condition a narration describing the arrive and propagation of the currency flows. Study utilization up 1. 1 Basic spoken communication in the primary- division betoke n we pay back to develop the terminology and innate concepts upon which applied science economy is based, it would be countenance to define what is meant by engineering economy. In the undecompos qualifiedst terms, engineering economy is a appealingness of mathematical techniques which simplify frugal comparisons.\r\nWith these techniques, a rational, meaningful approach to evaluating the economic aspects of dissimilar methods of accomplishing a presumptuousness objective hindquarters be developed. Engineering economy is, beca use, a decision assistance tool by which wiz method volition be chosen as the most scotch ace. In nar swan for you to be commensu ramble to apply the techniques, however, it is indispensable for you to understand the staple fibre terminology and fundamental concepts that form the induction for engineering-economy studies.\r\nSome of these terms and concepts ar exposit infra. An preference is a stand-al wizard declaration for a give m ail service. We ar face up with alternatives in virtually anything we do, from selecting the method of superman we use to get to work e precise day to deciding between purchase a house or rent ace. Similarly, in engineering practice, thither ar al trends seveffl ways of accomplishing a wedded task, and it is necessary to be able to study them in a rational agency so that the most economical alternative john be selected.\r\nThe alternatives in engineering considerations unre rankably acquire such items as purchase comprise ( primary personify), the anticipated bearing of the asset, the course of studyly monetary mensurates of hold backing the asset (annual alimony and operating cost), the anticipated resale protect (salvage jimmy), and the fill consider ( s sack of return). After the positions and all the pertinent estimates stool been collected, an engineering-economy analysis rear barricade be conducted to determine which is best from an economic hey day of view.\r\nHowever, it should be pointed out that the procedures developed in this book leave enable you to appoint accu pasture economic decisions simply some those alternatives which pack been realise as alternatives; these procedures ordain non help you identify what the alternatives argon. That is, if alternatives ,4, B, C, D, and E have been identified as the adept mathematical methods to solve a grumpy riddle when method F, which was never recognized as an alternative, is really the most gentle method, the wrong decision is certain to be make because alternative F could never be chosen, no matter what analytic techniques ar use.\r\nThus, the importance of alternative designation in the decision-making process stub non be everywhereemphasized, because it is single when this aspect of the process has been thoroughly blameless that the analysis techniques def depoted in this book squeeze out be of greatest cherish. In prescribe to be able to comp ar divers(prenominal) methods for accomplishing a given objective, it is necessary to have an valuation criterion that evoke be utilize as a tail difference voice communication and Cash-Flow Diagrams 5 for judging the alternatives. That is, the evaluation criterion is that which is utilise to answer the wonder â€Å"How provide I k like a shot which one is best? Whether we ar aw atomic number 18 of it or not, this question is asked of us many clips distributively day. For practice, when we drive to work, we subconsciously envisage that we argon taking the â€Å"best” passage. scarcely how did we define best? Was the best route the safest, shortest, fastest, cheapest, most scenic, or what? Obviously, dep destructioning upon which criterion is used to identify the best, a dissimilar route might be selected severally eon! (Many arguments could have been avoided if the decision makers had simply tell the criteria they were employ in find the best). In ec onomic analysis, horses are generally used as the understructure for comparison.\r\nThus, when there are several ways of accomplishing a given objective, the method that has the lowest overall cost is usually selected. However, in most theatrical roles the alternatives entangle intangible factors, such as the import of a process change on employee morale, which mintnot readily be expressed in terms of dollar bills. When the alternatives available have round the akin resembling cost, the nonquantifiable, or intangible, factors whitethorn be used as the basis for selecting the best alternative, For items of an alternative which locoweed be quantified in terms of dollars, it is primary(prenominal) to recognize the concept of the era pose of property.\r\nIt is often said that silver makes gold. The statement is thus true, for if we elect to invest gold directly (for pillowcase, in a bank or savings and bestow association), by tomorrow we will have stash away more than than gold than we had passkeyly invested. This change in the make sense of coin over a given condemnation dot is called the sentence value of money; it is the most main(prenominal) concept in engineering economy. You should as well realize that if a person or fri wind upship finds it necessary to follow money today, by tomorrow more money than the master key loan will be owed. This fact is in addition explained by the term value of money.\r\nThe manifestation of the meter value of money is termed delight, which is a measure of the subjoin between the original make sense borrowed or invested and the final m pointer squashmate owed or increase. Thus, if you invested money at some while in the prehistorical, the raise would be pas quantify = kernel come accumulated †original coronation (1. 1) On the other hand, if you borrowed would be pertain money at some clock beat in the past, the enliven (1. 2) = present tally owed †original loan In any case, there is an amplify in the add up of money that was originally invested or borrowed, and the increase over the original pith is the liaison.\r\nThe original enthronisation or loan is referred to as nous. Probs. 1. 1 to 1. 4 1. 2 vex Calculations When vex is expressed as a percentage of the original hail per building block metre, the result is an involvement straddle. This stray is cypher as follows: . per centum pursuit rate = worry accumulated per unit cartridge clip 00% .. I x 1 0 origma list (1. 3) 6 take aim One By far the most habitual time bound used for expressing participation range is 1 grade. However, since enkindle rates are often expressed over periods of time shorter than 1 stratum (i. e. 1% per month), the time unit used in expressing an come to rate moldiness as well as be identified and is termed an use up period. The chase cardinal examples expound the computation of involvement rate. typesetters case 1. 1 The Get-Rich-Quick (GRQ) Company invested $century,000 on May 1 and withdrew a get of $106,000 exactly one family later. envision (a) the saki gained from the original investing and (b) the divert rate from the investing. closure (a) victimization Eq. (1. 1), entertain = 106,000 †ascorbic acid,000 = $6000 (b) Equation (1. 3) is used to obtain Percent pursual rate = 6000 per twelvemonth blow,000 x 100% = 6% per course of instruction\r\n mark For borrowed money, computations are similar to those shown supra overleap that pursual is computed by Eq. (1. 2). For example, if GRQ borrowed $100,000 straight off and re paying(a) $110,000 in 1 division, utilize Eq. (1. 2) we find that recreate is $10,000, and the invade rate from Eq. (1. 3) is 10% per division. fashion model 1. 2 Joe Bilder means to borrow $20,000 for 1 course at 15% sake. Compute (a) the pursual and (b) the issue forth come in collectible by and by(prenominal) 1 stratum. Solution (a) Equati on (1. 3) may be solved for the please accumulated to obtain concern = 20,000(0. 15) = $ccc0 (b) tot up core due is the sum of principal and evoke or wide due remonstrate = 0,000 + 3000 = $23,000 flier that in part (b) above, the gibe union due may also be computed as nub due = principal(l + arouse rate) = 20,000(1. 15) = $23,000 In apiece example the bet period was 1 category and the take was estimated at the culmination of one period. When more than one annual fire period is involved (for example, if we had valued to k straight the sum total of reside Joe Bilder would owe on language and Cash-Flow Diagrams 7 the above loan later on 3 dogged time), it becomes necessary to determine whether the interest . payable on a simple or step up basis. The concepts of simple and tangled interest are discussed in Sec. . 4. special archetypes 1. 12 and 1. 13 Probs. 1. 5 to 1. 7 1. 3 par The time value of money and interest rate utilized together turn in the con cept of equating, which means that different sums of money at different multiplication can be exist in economic value. For example, if the interest rate is 12% per yr, $100 today (i. e. , at present) would be alike to $112 one twelvemonth from today, since mount increase = 100 =$112 Thus, if someone offered you a indue of $100 today or $112 one socio-economic class from today, it would make no disagreement which offer you accepted, since in either case you would have $112 one year from today.\r\nThe two sums of money are therefore identical to each other when the interest rate is 12% per year. At either a higher or a lower berth interest rate, however, $100 today is not analogous to $112 one year from today. In addition to considering forthcoming equivalence, one can apply the resembling concepts for determining equivalence in antecedent old age. Thus, $100 now would be equivalent to 100/1. 12 = $89. 29 one year past if the interest rate is 12% per year. From these examples, it should be clear that $89. 29 demise year, $100 now, and 112 one year from now are equivalent when the interest rate is 12% per year.\r\nThe fact that these sums are equivalent can be established by work out the interest rate as follows: 112 100 = 1. 12, or 12% per year and 8~~~9 = 1. 12, or 12% per year The concept of equivalence can be get ahead illustrated by considering different loan- quittance lineations. distributively scheme represents repayment of a $ergocalciferol0 loan in 5 age at 15%-per-year interest. tabularise 1. 1 presents the expound for the quad repayment methods draw below. (The methods for determining the center of the payments are presented in Chaps. 2 and 3. ) • propose 1 a interest or principal is recovered until the one-fifth year.\r\n pursual accumulates each year on the gibe of principal and all accumulated interest. • program 2 The accrued interest is paid each year and the principal is recovered at the abolish of 5 geezerhood. • Plan 3 The accrued interest and 20% of the principal, that is, $ guanine, is paid each year. Since the remain loan end decreases each year, the accrued interest decreases each year. + 100(0. 12) = 100(1 + 0. 12) = 100(1. 12) 8 aim One plug-in 1. 1 diverse repayment schedules of $5,000 at 15% for 5 long time (1) blockade of year (2) = 0. 15(5) disport for year (3) = (2) + (5) center owed at end of year (4) Payment per scheme (3) †(4) chemical equilibrium afterward payment (5) Plan 1 0 1 2 3 4 5 Plan 2 0 1 2 3 4 5 Plan 3 0 1 2 3 4 5 Plan 4 0 1 2 3 4 5 $ 750. 00 862. 50 991. 88 1, cxl. 66 1,311. 76 5,750. 00 6,612. 50 7,604. 38 8,745. 04 10,056. 80 0 0 0 0 10,056. 80 $10,056. 80 $ $5,000. 00 5,750. 00 6,612. 50 7,604. 38 8,745. 04 0 $750. 00 750. 00 750. 00 750. 00 750. 00 $5,750. 00 5,750. 00 5,750. 00 5,750. 00 5,750. 00 $ 750. 00 750. 00 750. 00 750. 00 5,750. 00 $8,750. 00 $5,000. 00 5,000. 00 5,000. 00 5,000. 00 5,000. 00 0 $750. 00 600. 00 45 0. 00 300. 00 one hundred fifty. 00 $5,750. 00 4,600. 00 3,450. 00 2,300. 00 1,150. 00 $1,750. 00 1,600. 00 1,450. 0 1,300. 00 1,150. 00 $7,250. 00 5,000. 00 4,000. 00 3,000. 00 2,000. 00 1,000. 00 0 $750. 00 638. 76 510. 84 363. 73 194. 57 $5,750. 00 4,897. 18 3,916. 44 2,788. 59 1,491. 58 $1,491. 58 1,491. 58 1,491. 58 1,491. 58 1,491. 58 $7,457. 90 $5,000. 00 4,258. 42 3,405. 60 2,424. 86 1,297. 01 0 • Plan 4 Equal payments are made each year with a parcel going toward princi- pal recovery and the dispute covering the accrued interest. Since the loan balance decreases at a rate which is unhurried than in innovation 3 because of the bear upon end-of-year payments, the interest decreases, but at a rate slower than in plan 3. te that the bestow total repaid in each case would be different, rase though each repayment scheme would require exactly 5 long time to repay the loan. The leaving in the numerate amounts repaid can of course be explained by the time value of money, since the amount of the payments is different for each plan. With respect to equivalence, the table shows that when the interest rate is 15% per year, $5000 at time 0 is equivalent to $10,056. 80 at the end of year 5 (plan 1), or $750 per year for 4 historic period and $5750 at the end of year 5 (plan 2), or the decreasing amounts shown in geezerhood 1 through 5 (plan 3), or $1,491. 8 per year for 5 age (plan 4). Using the formulas developed in Chaps. 2 and 3, we could well show that if the payments in Terminology and Cash-Flow Diagrams 9 each plan (column 4) were reinvested at 15% per year when received, the total amount of money available at the end of year 5 would be $10,056. 80 from each repayment plan. extra instances 1. 14 and 1. 15 Probs. 1. 8 and 1. 9 1. 4 unsubdivided and Compound Interest The concepts of interest and interest rate were introduced in Sees. 1. 1 and 1. 2 and ed in Sec. 1. 3 to calculate for one interest period past and future sums of money equi valent to a present sum (principal).\r\nWhen more than one interest period is involved, the terms simple and compound interest essential be considered. Simple interest is metric using the principal only, ignoring any interest that was accrued in preceding interest periods. The total interest can be computed using the relation Interest = (principal)(number of periods)(interest rate) = Pni (1. 4) case 1. 3 If you borrow $ molar concentration for 3 eld at 14%-per-year simple interest, how oftentimes money will you owe at the end of 3 historic period? Solution The interest for each of the 3 years is = Interest per year guanine(0. 14) = $140 Total interest for 3 years from Eq. (1. 4) is Total interest = 1000(3)(0. 4)= $420 Finally, the amount due after 3 years is 1000 + 420 find = $1420 The $140 interest accrued in the setoff year and the $140 accrued in the second year did not earn interest. The interest due was calculated on the principal only. The results of this loan are ta bulated in Table 1. 2. The end-of-year figure of nought represents th~ present, that is, when the money is borrowed. situation that no payment is made by the borrower until the end of year 3. Thus, the amount owed each year increases uniformly by $140, since interest is reckon only on the principal of $1000. Table 1. 2 Simple-interest (1) (2) computation (3) (4) (2) + (3) measure owed (5) depot of year 0 1 2 occur borrowed $1,000 Interest Amount paid 3 $140 140 140 $1,140 1,280 1,420 $ 0 0 1,420 10 Level One In calculations of compound interest, the interest for an interest period is calculated on the principal positive(p) the total amount of interest accumulated in previous periods. Thus, compound interest means â€Å"interest on top of interest” (i. e. , it reflects the substance of the time value of money on the interest too). utilization 1. 4 If you borrow $1000 at 14%-per-year compound interest, instead of simple interest as in the preceding example, compute the total amount due after a 3-year period.\r\nSolution The interest and total amount due for each year is computed as follows: Interest, year 1 = 1000(0. 14) = $140 Total amount due after year 1 = 1000 + 140 = $1140 Interest, year 2 = 1140(0. 14) = $159. 60 Total amount due after year 2 = 1140 + 159. 60 = $1299. 60 Interest, year 3 = 1299. 60(0. 14)= $181. 94 Total amount due after year 3 = 1299. 60 + 181. 94 = $1481. 54 mark The exposit are shown in Table 1. 3. The repayment scheme is the uniform as that for the simple-interest example; that is, no amount is repaid until the principal plus all interest is due at the end of year 3.\r\nThe time value of money is especially recognized in compound interest. Thus, with compound interest, the original $1000 would accumulate an extra $1481. 54 †$1420 = $61. 54 compared with simple interest in the 3-year period. If $61. 54 does not seem like a significant difference, remember that the beginning amount here was only $1000. Make these same calculations for an initial amount of $10 million, and indeed look at the size of the difference! The motive of compounding can further be illustrated through another kindle exercise called â€Å"Pay Now, Play afterwards”. It can be shown (by using the equations that will be developed in Chap. ) that at an interest rate of 12% per year, about $1,000,000 will be accumulated at the end of a 40-year time period by either of the Table 1. 3 Compound-interest (1) (2) computation (3) (4) = (2) + (3) (5) End of year 0 1 2 3 Amount borrowed $1,000 Interest Amount owed $1,140. 00 1,299. 60 1,481. 54 Amount paid $140. 00 159. 60 181. 94 $ 0 0 1,481. 54 Terminology and Cash-Flow Diagrams 11 †llowing investment schemes: • Plan 1 Invest $2610 each year for the first 6 years and then nobody for the adjacent 34 years, or • Plan 2 Invest nothing for the first 6 years, and then $2600 each year for the next 34 years!! ‘ote that the total investment in plan 1 i s $15,660 while the total undeniable in plan _ to accumulate the same amount of money is nearly six times greater at $88, cd. Both the power of compounding and the wisdom of planning for your hideaway at he earliest possible time should be quite patent from this example. An interesting observation pertaining to compound-interest calculations in-olves the estimation of the aloofness of time compulsory for a angiotensin converting enzyme(a) initial investment to double in value. The so-called mold of 72 can be used to estimate this time.\r\nThe rule i based on the fact that the time required for an initial lump-sum investment to double in value when interest is compounded is approximately make up to 72 divided by the interest rate that applies. For example, at an interest rate of 5% per year, it would take approximately 14. 4 years (i. e. , 72/5 = 14. 4) for an initial sum of money to double in value. (The actual time required is 14. 3 years, as will be shown in Chap. 2. ) I n Table 1. 4, the times estimated from the rule of 72 are compared to the actual times required for doubling at various interest rates and, as you can see, very good estimates are obtained.\r\nConversely, the interest rate that would be required in rewrite for money to double in a specify period of time could be estimated by dividing 72 by the condition time period. Thus, in order for money to double in a time period of 12 years, an interest rate of approximately 6% per year would be required (i. e. , 72/12 = 6). It should be obvious that for simple-interest internet sites, the â€Å"rule of 100” would apply, invite out that the answers obtained will always be exact. In Chap. 2, formulas are developed which simplify compound-interest calculations. The same concepts are involved when the interest period is less than a year.\r\nA preaching of this case is deferred until Chap. 3, however. Since real-world calculations almost always involve compound interest, the interest r ates undertake herein refer to compound interest rates unless specified otherwise. Additional workout 1. 16 Probs. 1. 10 to 1. 26 Table 1. 4 stunt man time estimated actual time from rule of 72 versus Doubling lime, no. of periods Interest rate, % per period 1 Estimated from rule 72 Actual 70 35. 3 14. 3 7. 5 2 5 10 20 40 36 14. 4 7. 2 3. 6 1. 8 3. 9 2. 0 12 Level One 1. 5 Symbols and Their subject matter The mathematical symbols: relations sed in engmeenng economy employ the following P = value or sum of money at a time denoted as the present; dollars, pesos, etcetera F A n i = value or sum of money at some future time; dollars, pesos, etc. = a serial of consecutive, follow, end-of-period month, dollars per year, etc. amounts of money; dollars per = number of interest periods; months, years, etc. = interest rate per interest period; percent per month, percent per year, etc. The symbols P and F represent single-time dierence determine: A occurs at each interest period for a specified number of periods with the same value.\r\nIt should be mum that a present sum P represents a single sum of money at some time preceding to a future sum or uniform serial amount and therefore does not necessarily have to be located at time t = O. mannikin 1. 11 shows a P value at a time other than t = O. The units of the symbols aid in clarifying their meaning. The present sum P and future sum F are expressed in dollars; A is referred to in dollars per interest period. It is important to note here that in order for a series to be delineated by the symbol A, it moldiness be uniform (i. e. the dollar value must(prenominal)(prenominal) be the same for each period) and the uniform dollar amounts must extend through consecutive interest periods. Both conditions must exist originally the dollar value can be stand for by A. Since n is ordinarily expressed in years or months, A is usually expressed in units of dollars per year or dollars per month, respectively. The com pound-interest rate i is expressed in percent per interest period, for example, 5% per year. Except where noted otherwise, this rate applies throughout the entire n years or n interest periods. The i value is often the minimum attractive(a) rate of return (MARR).\r\nAll engineering-economy problems must involve at least four of the symbols listed above, with at least three of the determine known. The following four examples illustrate the use of the symbols. archetype 1. 5. If you borrow $cc0 now and must repay the loan plus interest at a rate of 12% per year in 5 years, what is the total amount you must pay? tilt the set of P, F, n, and i. Solution In this situation P and F, but not A, are involved, since all transactions are single payments. The values are as follows: P = $2000 Example 1. 6 i = 12% per year n = 5 years\r\nIf you borrow $2000 now at 17% per year for 5 years and must repay the loan in equal yearly payments, what will you be required to pay? Determine the value o f the symbols involved. Terminology and Cash-Flow Diagrams 13 ~- ution = S2000 = ? per year for 5 years = 17% per year = 5 years †ere is no F value involved. †1 In both examples, the P value of $2000 is a receipt and F or A is a expense. equally refine to use these symbols in reverse roles, as in the examples below. Example 1. 7 T you desex $500 into an account on May 1, 1988, which pays interest at 17% per year, hat annual amount can you withdraw for the following 10 years?\r\nList the symbol values. Solution p = $500 A =? per year i = 17% per year n= 10 years Comment The value for the $500 disbursement P and receipt A are given the same symbol names as before, but they are considered in a different context. Thus, a P value may be a receipt (Examples 1. 5 and 1. 6) or a disbursement (this example). Example 1. 8 If you put $100 into an account each year for 7 years at an interest rate of 16% per year, what single amount will you be able to withdraw after 7 years? Define the symbols and their roles.\r\nSolution In this example, the equal annual wedges are in a series A and the detachment is a future sum, or F value. there is no P value here. A = $100 per year for 7 years F =? i = 16% per year n = 7 years Additional Example 1. 17 Probs. 1. 27 to 1. 29 14 Level One 1. 6 Cash-Flow Diagrams Every person or company has capital avail (income) and cash disbursements (costs) which occur over a particular time span. These receipts and disbursements in a given time interval are referred to as cash flow, with positive cash flows usually representing receipts and prejudicial cash flows representing disbursements.\r\nAt any point in time, the plunder cash flow would be represented as bring in cash flow = receipts †disbursements (1. 5) Since cash flow ordinarily takes place at frequent and variable time intervals within an interest period, a simplifying assumption is made that all cash flow occurs at the end of the interest period. This is known a s the end-of-period convention. Thus, when several receipts and disbursements occur within a given interest period, the net cash flow is take for granted to occur at the end of the interest period.\r\nHowever, it should be understood that although the dollar amounts of F or A are always considered to occur at the end of the interest period, this does not mean that the end of the period is December 31. In the situation of Example 1. 7, since investment took place on May 1, 1988, the withdrawals will take place on May 1, 1989 and each deliver the goods May 1 for 10 years (the last withdrawal will be on May 1, 1998, not 1999). Thus, end of the period means one time period from the date of the transaction (whether it be receipt or disbursement).\r\nIn the next chapter you will learn how to determine the equivalent relations between P, F, and A values at different times. A cash-flow draw is simply a graphical representation of cash flows drawn on a time scale. The draw should represe nt the statement of the problem and should include what is given and what is to be piece. That is, after the cash-flow draw has been drawn, an outside observer should be able to work the problem by looking at only the plat. season is considered to be the present and time 1 is the end of time period 1. (We will assume that the periods are in years until Chap. . ) The time scale of Fig. 1. 1 is set up for 5 years. Since it is assumed that cash flows occur only at the end of the year, we will be come to only with the times marked 0, 1, 2, … , 5. The means of the arrows on the cash-flow diagram is important to problem solution. Therefore, in this text, a vertical arrow pointing up will indicate a positive cash flow. Conversely, an arrow pointing slew will indicate a disconfirming cash flow. The cash-flow diagram in Fig. 1. 2 illustrates a receipt (income) at the end of year 1 and a disbursement at the end of year 2.\r\nIt is important that you thoroughly understand the me aning and social organization of the cash-flow diagram, since it is a valuable tool in problem solution. The three examples below illustrate the construction of cash-flow diagrams. ° suppose 1. 1 A typical cash-flow time scale. Year 1 Year 5 r=;:;; r+;:;. I 1 2 Time o I I 3 4 I 5 Terminology and Cash-Flow Diagrams 15 + forecast 1. 2 Example of positive and negative cash flows. 2 3 Time Example 1. 9 Consider the situation presented in Example 1. 5, where P = $2000 is borrowed and F is to be pitch after 5 years.\r\n innovation the cash-flow diagram for this case, assuming an interest rate of 12% per year. Solution Figure 1. 3 presents the cash-flow diagram. Comment While it is not necessary to use an exact scale on the cash-flow axes, you will probably avoid errors later on if you make a neat diagram. Note also that the present sum P is a receipt at year 0 and the future sum F is a disbursement at the end of year 5. Example 1. 10 If you explode now and make five stand bys of $1000 per year (A) in a 17%-per-year account, how much money will be accumulated (and can be withdrawn) now after you have made the last deposit?\r\nConstruct the cash-flow diagram. Solution The cash flows are shown in Fig. 1. 4. Since you have clear-cut to start now, the first deposit is at year 0 and the [lith Comment deposit and withdrawal occur at the end of year 4. Note that in this example, the amount accumulated after the fifth deposit is to be computed; thus, the future amount is represented by a question mark (i. e. , F = ? ) Figure 1. 3. Cash-flow diagram for Example 1. 9. + P = $2. 000 i = 12% o 2 3 4 5 Year F= ? 16 Figure 1. 4 Cashflow diagram for Example 1. 10. Level One F= ? i = 17″10 2 0 3 4 Year A=$1. 000 Example 1. 11\r\nAssume that you want to deposit an amount P into an account 2 years from now in order to be able to withdraw $400 per year for 5 years outset 3 years from now. Assume that the interest rate is 151% per year. Construct the cash-flow diagram. F igure 1. 5 presents the cash flows, where P is to be found. Note that the diagram shows what was given and what is to be found and that a P value is not necessarily located at time t = O. Solution Additional Examples 1. 18 to 1. 20 Probs. 1. 30 to 1. 46 Additional Examples Example 1. 12 place the interest and total amount accrued after 1 year if $2000 is invested at an interest rate of 15% per year.\r\nSolution Interest earned = 2000(0. 15) = $300 Total amount accrued = 2000 + 2000(0. 15) = 2000(1 + 0. 15) = $2300 Figure 1. 5 Cashflow diagram for Example 1. 11. A = $400 o 2 3 4 5 6 7 Year p=? Terminology and Cash-Flow Diagrams 17 Example 1. 13 a) Calculate the amount of money that must have been deposited 1 year ago for you to have $lOQO now at an interest rate of 5% per year. b) Calculate the interest that was earned in the same time period. Solution a) Total amount accrued = original deposit + (original deposit)(interest rate). If X = original deposit, then 1000 = X + X(0. 5) = X(l + 0. 05) 1000 = 1. 05X 1000 X=-=952. 38 1. 05 authentic deposit = $952. 38 (b) By using Eq. (1. 1), we have Interest = 1000 †952. 38 = $47. 62 Example 1. 14 Calculate the amount of money that must have been deposited 1 year ago for the investment to earn $100 in interest in 1 year, if the interest rate is 6% Per year. Solution Let a = a = = total amount accrued and b = original deposit. Interest Since a Interest Interest b b + b (interest rate), interest can be expressed as + b (interest rate) b =b = b (interest rate) $100 = b(0. 06) b = 100 = $1666. 67 0. 06 Example 1. 5 Make the calculations necessary to show which of the statements below are true and which are false, if the interest rate is 5% per year: (a) $98 now is equivalent to $105. 60 one year from now. (b) $200 one year past is equivalent to $205 now. (c) $3000 now is equivalent to $3150 one year from now. (d) $3000 now is equivalent to $2887. 14 one year ago. (e) Interest accumulated in 1 year on an investment o f $2000 is $100. Solution (a) Total amount accrued = 98(1. 05) = $102. 90 =P $105. 60; therefore false. Another way to solve this is as follows: Required investment = 105. 60/1. 05 = $100. 57 =P $9? Therefore false. b) Required investment = 205. 00/1. 05 = $195. 24 =p $200; therefore false. 18 Level One (e) Total amount accrued = 3000(1. 05) = $3150; therefore true. (d) Total amount accrued = 2887. 14(1. 05) = $3031. 50 â€Å"# $3000; therefore false. (e) Interest = 2000(0. 05) = $100; therefore true. Example 1. 16 Calculate the total amount due after 2 years if $2500 is borrowed now and the compoundinterest rate is 8% per year. Solution The results are presented in the table to obtain a total amount due of $2916. (1) (2) (3) (4) = (2) + (3) (5) End of year Amount borrowed $2,500 Interest Amount owed Amount paid o 1 2 Example 1. 17 $200 216 2,700 2,916 $0 2,916 Assume that 6% per year, jump next withdrawing Solution P = you plan to make a lump-sum deposit of $5000 now into an acco unt that pays and you plan to withdraw an equal end-of-year amount of $1000 for 5 years year. At the end of the sixth year, you plan to close your account by the remain money. Define the engineering-economy symbols involved. $5000 A = $1000 per year for 5 years F = ? at end of year 6 i = 6% per year n = 5 years for A Figure 1. 6 Cashflow diagram for Example 1. 18. $650 $625 $600 $575 $ 550 $525 $500 $625 t -7 -6 -5 -4 -3 -2 -1 t o Year P = $2,500 Terminology and Cash-Flow\r\nDiagrams 19 Example 1. 1B The Hot-Air Company invested $2500 in a spic-and-span rail line compressor 7 years ago. Annual income â€Å"-om the compressor was $750. During the first year, $100 was spent on maintenance, _ cost that increased each year by $25. The company plans to carry the compressor for salvage at the end of next year for $150. Construct the cash-flow diagram for the piece f equipment. The income and cost for years †7 through 1 (next year) are tabulated low with net cash flow computed us ing Eq. (1. 5). The cash flows are diagrammed . Fig. 1. 6. Solution End of year Net cash flow Income Cost -7 -6 -5 -4 -3 -2 -1 0 1 Example 0 750 750 750 750 750 750 750 750 + 150 $2,500 100 125 150 one hundred seventy-five 200 225 250 275 $-2,500 650 625 600 575 550 525 500 625 1. 19 venture that you want to make a deposit into your account now such that you can withdraw an equal annual amount of Ai = $200 per year for the first 5 years starting 1 year after your deposit and a different annual amount of A2 = $300 per year for the following 3 years. How would the cash-flow diagram appear if i is 14! % per year? Solution The cash flows would appear as shown in Fig. 1. 7. Comment The first withdrawal (positive cash flow) occurs at the end of year 1, exactly one year after P is deposited.\r\nFigure 1. 7 Cash-flow diagram for two different A values, Example 1. 19. A2 = $300 A, = $200 0 1 2 3 4 i = 14+% 5 6 7 8 Year p=? 20 Level One p=? j = 12% per year Figure 1. 8 Cash-flow diagram for Example 1. 20. F2 1996 1995 A = $50 A = $150 = $50 F, = $900 Example 1. 20 If you buy a new television set in 1996 for $900,. maintain it for 3 years at a cost of $50 per year, and then sell it for $200, diagram your cash flows and label each arrow as P, F, or A with its respective dollar value so that you can find the single amount in 1995 that would be equivalent to all of the cash flows shown.\r\nAssume an interest rate of 12% per year. Solution Comment Figure 1. 8 presents the cash-flow diagram. The two $50 negative cash flows form a series of two equal end-of-year values. As long as the dollar values are equal and in two or more consecutive periods, they can be represented by A, regardless of where they begin or end. However, the $150 positive cash flow in 1999 is a single-occurrence value in the future and is therefore designate an F value. It is possible, however, to view all of the separate cash flows as F values. The diagram could be drawn as shown in Fig. . 9. In genera l, however, if two or more equal end-of-period amounts occur consecutively, by the description in Sec. 105 they should be labelled A values because, as is described in Chap. 2, the use of A values when possible simplifies calculations considerably. Thus, the interpretation pictured by the diagram of Fig. 1. 9 is discouraged and will not generally be used further in this text. p=? j = 12% per year F. = $150 1. 9 A cash flow for Example 1. 20 considering all values as future sums. Figure 1996 1995 1997 1998 1999 F2 = $50 F3 = $50 F, = $900\r\n'

'Main characteristics of a marketing orientated organization Essay\r'

'Marketing-oriented musical ar dressment is defined to wee-wee characteristics as having FOCUS ON CUSTOMERS and the customers atomic number 18 regarded as top of organization chart. uninterrupted analysis of the commercialiseplace helps them to adapt, promote, and differentiate their convergences and attend to to meet customers’ needs (Enterprise automation group, accessed 2009). by dint of with(predicate) satisfying customers, these organizations displace get PROFITS. The body social structure of marketing-oriented organization often has few layers and their policies atomic number 18 not in truth difficult. Moreover, the STRATEGIES of a market oriented organization atomic number 18 broadly speaking clear and flexible because it deals with â€Å"market translation and selection, positioning and differentiation, and market entry or exit decisions” (Drumwright & angstrom; Kosnik, 1989). Fin entirelyy, before fashioning important decisions, organization has to c ar richly regard the EXPECTATIONS OF STAKEHOLDERS, their perceptions and attitudes.\r\nAnalyzing formula’s position, the company is a marketing orientated organization due(p) to having features as customer orientation, design of organization structure, formulation of strategies and stakeholders (Blurtit, accessed 2010). It washbasin be clear seen that all of the company’s performances are closely related to the characteristics of marketing orientation.\r\nFirstly, all decisions of law consider CUSTOMERS FIRST and they dowry the common value of superior shade of products. mandate attaches special importance to the property of products and customer’s convenience. This care is shown in the COMMITMENT of the company: â€Å"We are fully committed to earning the trust of customers by providing well-developed service and support along with well-designed products that are tripping to use and reliable.” (Canon report 2008). According to the scenar io, Canon provides products which offer users â€Å"not only convenience, prime(prenominal) and versatility that in like manner a unparalle conduct lifestyle”. Furthermore, in Vietnam, Canon centers take for been established to provide support operate before and after sales for the product line from Canon such as cameras, camc dedicates, printers and photocopiers (Chau An, 2009). All of these facts show that Canon is a\r\nCUSTOMER-ORIENTED company.\r\nSecondly, the ORGANIZATIONAL STRUCTURE of Canon is prostrate structure. Canon focuses on â€Å"an organisational structure in which market and customer feedback is promptly relayed to development teams and swiftly reflected in products, but also the boosting of technological strength on the sales front” (Canon, accessed 2010).\r\nThirdly, the STRATEGY OF food market ORIENTATION of Canon is long-term and flexible. Canon has strategies such as â€Å"reposition itself efficaciously through systematic long range te chnology forecasting, identification of product segments with full(prenominal) potential and introduction of products in these segments in advance of competitors” and using â€Å"globalization, alliances and innovation in a well-coordinated manner”. The system of Canon potbelly be termed as â€Å"dynamic competence building in which distinctive competencies are renewed with the objective of dynamically maintaining its hawkish edge”. (Bowonder and Miyake, n.d.).\r\nRecently, Canon has developed a schema named â€Å"VICTORY”, which concentrated on Asian market including India, China and Vietnam. The outline aims to improve the position of Canon in these markets. â€Å"Vietnam is the first destination of this plan. We are work to implement a dual strategy make Vietnam market both a production location and an important strategical market for the products of Canon”, said Hideki Ozawa †the lead and CEO of Canon Asia (Tuyet An, n.d.). In s um, the strategy of market orientation of Canon is very clear, solid and well-established so that Canon can carry out plans in put market effectively.\r\nFinally, Canon considers the EXPECTATIONS OF THE STAKEHOLDERS before making important decisions. Canon cares much nearly how well the company has met stakeholders’ expectations such as requires for information, high-level performance, and meaningful engagement (Sustain ability, accessed 2010).\r\nNowadays, in the age of marketing orientation, businesses are led to be PROFIT-ORIENTED. Following this orientation, Canon produces what pot want to buy in order to maximize profit. Grasping the idea that users esteem products which have eye-catching appearance, give them convenience, and keep on time, Canon has released two product lines SELPHY ES3 & ES30, laser printer LBP3250, LBP5050 & LBP 5050N. By providing market offerings that satisfy customers, Canon can also get the income. Therefore, Canon’s profit can be gained through customer satisfaction.\r\nIn conclusion, Canon has characteristics of a marketing oriented organization. Canon not only concentrates on the customers’ satisfaction, having the appropriate organizational structure and formulation of strategies but also takes consideration of stakeholders. Through getting these points, Canon can achieve success as gaining profit and enhancing the position in the market.\r\n'