Discuss about the Case Study of accounting in Business for Blue Moon.
The study mainly helps in evaluating the new business strategy, which could help Blue Moon Pty Ltd to increase its competitive edge and profitability. In addition, the study effectively provides relevant information regarding the implementation of new strategy, which might help the company to improve its overall productivity. Moreover, the novice effectively identifies four different factors, which might help the company to increase their overall competitive edge in the market. In addition, the study also helps in identifying the tools and techniques, which might help the company to improve its Management accounting system.
The new business strategy depicted by the Rob Inglis mainly states that the company needs to improve its current approach towards marketing, production and purchases. This implementation of new strategy might mainly help the company to improve its competitive edge and increase its depleting market share. Verbeke (2013) stated that companies with adequate marketing strategy with high quality products are able to attract potential customers and increase their overall profitability. On the other hand, Hoejmose et al. (2013) criticizes that higher administrative expenses might reduce the overall net profit of the company and affect it overall cash reserves. In addition, the strategy of the company is depicted as follows.
After the evaluation of the case study certain success factors for the new strategy could be effectively pinpointed, which might help the Blue Moon Company in their future endeavors. In addition, the identified strategies might eventually help the company to increase its overall productivity and attain sustainability. Fearne and Hughes (2013) stated that with adequate success factors companies are able to improve their overall operational capability, which might help in reducing their cost of production. On the other hand, Mellor et al. (2014) criticizes that without adequate strategy adoption companies are not able to maintain stability and consistency in their growth structure. Moreover, the key success factors for Blue Moon Company are as follows.
The overall new strategy mainly focuses on limited products, which might help the production system of Blue Moon Company to decrease its overall completion time. In addition, skilled production system might help the company to fulfill the requirements of customer quickly and increase its competitive edge against its peers. Liu et al. (2013) stated that low time-consuming production facility mainly helps the company to fulfill the job requirements as demanded by clients. On the other hand, Leung (2013) criticizes that without adequate demand for companies products reduction in completion time might block essential working capital and hamper their production capability.
The change in current organizational culture might also help the Blue Moon Company to increase its overall product quality, which might help in retaining and attracting more customers. Increased product quality of the company without adequate research might raise inventories and block essential capital of the company (Ambec et al. 2013). In addition, improvements in quality might help the company to increase its competitive level, which in turn might help in raising its customer base. Moreover, adoption of new technology might also help the company to decrease its overall cost of production and completion time.
The changes in sub contractors with low quality production might also help the company to increase its product quality and raise their brand awareness. In addition, the support from sub contactors with quality products might help the company to accomplish its required production needs. Acien et al. (2012) mentioned that adequate strategies help the company to reduce cost of production, which might depict an effective financial report. On the other hand, Ross (2013) criticizes that some companies use unethical balance sheet to inflate their financial statement and attract potential investors.
The current changes proposed in the new strategy regarding the distributional approach mainly help to improve their overall sales techniques used by distributors. This improved sales technique might help Blue moon to improve their revenue and customer base. Luengo et al. (2013) stated that improvement in sales techniques might help in attracting potential investors, which might increase their loyal customer base.
The overall implementation of different types of tools and techniques might eventually help Blue Moon company to reduce its overall production cost. Moreover, with the help of strategic planning the company is able reduce risks and identify opportunities, which could increase its profitability. Moreover, with the help of overhead cost allocation, flexible budgeting, variance analysis, CVP analysis, target costing and capital budgeting techniques might help in supporting its production needs. McNeil et al. (2015) stated that identified cost analysis mainly help companies to implement adequate zero-based budgeting method to reduce its production cost.
In addition, with the help of adequate budgeting system Blue Moon Company could effectively assign relative fund to its different production system, which might help in reducing excess expenditure and cost of production. Van et al. (2013) argued that decrease in production budget allocation might reduce the flow of raw materials and in turn increase finished product completion time.
Strategic planning:
With the help of adequate strategic planning, companies are able to identify strength, weakness, opportunities and threats, which might affects its overall demand of its products. In addition, the velation of porter’s five forces might also help in depicting the power of suppliers, customers and competitors in the market. Effective strategic evaluation might help Blue Moon Company to identify opportunities, which could generate higher revenues.
Flexible Budgeting:
In addition, with the help of flexible budgeting companies are able to adjust their budget to support changing production requirements of the company. Moreover, Flexible budgeting system could be used by Blue Moon Compony to support its short-term production system. Strumickas and Valanciene (2015) argued that flexible budgeting system does not help companies to detect adequate variance, which might help in detecting the efficiency of its budgeting team.
The implementation of overhead cost allocation might help the company to adjust the actual cost, which is used by the production system. This accuracy in identification of cost mainly helps companies to compute adequate finances report (Goetsch and Davis 2014). Moreover, Blue Moon could use the overhead cost allocation to improve its financial report.
Companies to analyse the efficiency of its budgeting team mainly use variance analysis. In addition, Blue Moon could use the variance analysis to detect the changes required in their budgeting process to support its future endeavours. During an economic crisis, variance analysis mainly loses its friction and depicts wrong budgeting valuation (Verbeke 2013).
CVP Analysis:
In addition, CVP analyses mainly help companies to detect the changes in operating income due to the changing volume and cost of production. Moreover, Blue Moon could use the CVP analysis to determine the overall operating income, which could be incurred due to the changing activities of the company. Fearne and Hughes (2013) stated that CVP analysis mainly helps in depicting the overall variable cost per unit and help companies to make adequate production decisions. Target Costing or Cost-Plus Pricing:
Companies that reply on production cost to determine the overall profit percentage of its finished products mainly use this method (Leung 2013). In addition, Blue Moon Company could use Cost-Plus Pricing to portray the overall selling price for its products. Moreover, any changes in production cost could reduce selling price and help increase demand of its products.
The use of capital budgeting techniques mainly helps in depicting the overall future income, which could be generated from investment. NOP, Payback period, ARR, profitability Index mainly help companies to identify the best investment opportunity, which could be in turn raise their overall future cash inflows (Ambec et al. 2013). This technique could not be used by Blue Moon, as there is no sufficient investment plan of the company.
Conclusion:
The overall report mainly helps in evaluating the significant changes in production system, which might be conducted by Blue Moon to support its future endeavours. In addition, adequate techniques like sstrategic planning, flegible budgeting, overhead cost allocation, CVP Analysis, and target costing or cost-plus pricing. Lastly, the novice effectively provides adequate explanation for the identified tools and techniques, which might be used in the management information system of Blue Moon Pty Ltd.
Reference:
Acién, F.G., Fernández, J.M., Magán, J.J. and Molina, E., 2012. Production cost of a real microalgae production plant and strategies to reduce it.Biotechnology advances, 30(6), pp.1344-1353.
Ambec, S., Cohen, M.A., Elgie, S. and Lanoie, P., 2013. The Porter hypothesis at 20: can environmental regulation enhance innovation and competitiveness?. Review of Environmental Economics and Policy, 7(1), pp.2-22.
Fearne, A. and Hughes, D., 2013. Success factors in the fresh produce supply chain. British food journal.
Goetsch, D.L. and Davis, S.B., 2014. Quality management for organizational excellence. pearson.
Hoejmose, S., Brammer, S. and Millington, A., 2013. An empirical examination of the relationship between business strategy and socially responsible supply chain management. International Journal of Operations & Production Management, 33(5), pp.589-621.
Leung, M., 2013. Highly-Skilled Chinese as New Development Actors in Africa? Knowledge Transfer and Production Through Chinese Engagement with Zambia. Knowledge Transfer and Production Through Chinese Engagement with Zambia (April 14, 2013).
Liu, C., Yang, N., Li, W., Lian, J., Evans, S. and Yin, Y., 2013. Training and assignment of multi-skilled workers for implementing seru production systems. The International Journal of Advanced Manufacturing Technology,69(5-8), pp.937-959.
Luengo-Fernandez, R., Leal, J., Gray, A. and Sullivan, R., 2013. Economic burden of cancer across the European Union: a population-based cost analysis. The lancet oncology, 14(12), pp.1165-1174.
McNeil, A.J., Frey, R. and Embrechts, P., 2015. Quantitative risk management: Concepts, techniques and tools. Princeton university press.
Mellor, S., Hao, L. and Zhang, D., 2014. Additive manufacturing: A framework for implementation. International Journal of Production Economics, 149, pp.194-201.
Ross, D.F., 2013. Competing through supply chain management: creating market-winning strategies through supply chain partnerships. Springer Science & Business Media.
Strumickas, M. and Valanciene, L., 2015. Research of management accounting changes in Lithuanian business organizations. Engineering Economics, 63(4).
Van Deventer, D.R., Imai, K. and Mesler, M., 2013. Advanced financial risk management: tools and techniques for integrated credit risk and interest rate risk management. John Wiley & Sons.
Verbeke, A., 2013. International business strategy. Cambridge University Press.
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