All businesses large or small are all vulnerable to risks, challenges and other unforeseen situations which may affect the businesses’ financial condition, reputation or its daily operations. This creates the need for a contingency plan (Chinn, n.d). A contingency plan is a course of action that a business or company could take in case of occurrence of an unexpected situation such as the death of the CEO, financial crisis, fire, flood, network failure among other occurrences that could happen to the business (Britton, 2016). This is a form of a proactive strategy.
Contingency plans are very crucial since it helps in ensuring the continuity of the business through securing the company assets and managing a given crisis as fast as possible. Most of the organizations and companies develop a variety of contingency plans to ensure all potential threats and risks to the business are properly researched and their solutions put in place to combat the damage that might be caused (Britton, 2016). The Leadership of the company has the responsibility to ensure a contingency plan is put in place by funding the development of the plan, testing if it works and lastly maintaining it. In the case of AZZ Pty Ltd, a contingency plan would ensure the sale of the printers, electronics and services offered in the store continue even after a situation happens. This could include assigning workers other responsibilities and employment of temporary employees at the time of the crisis.
Product costing refers to the process of allocating cost to products based on the expenses involved in the production or initial buying price. It is true that accurate costing is an important process for manufacturers and distributors since the cost determines the profit margin in a business (Melanie, 2017). A business will operate in the dark if it fails to gather the right cost information. Accountants in a business have to trace the expenses incurred through product cost analysis in order to make accurate costing of products in a business. With an accurate cost information, a business is able to run efficiently and also it is able to make optimal choices.
Inability to gather accurate information on the cost and the expenditures by the company greatly influence the success of the business (Melanie, 2017). To be competitive in the market, AZZ Pty Ltd is required to know the accurate figure of what it spends on acquisition every product. This helps it to make relevant product costs that are acceptable to the customers and competitive to other businesses offering the same products. The price of a product must be placed within the perceived cost by the customer (Martin, 2014). If a product cost is inaccurate, which means it is higher than the perceived product value by the customer, the consumers might not buy the product which means less profit to the company. In our case, AZZ is aiming to increase its service sales by 10% which creates the need for accurate costing to maintain customers and attract new ones.
Performance measurement refers to the process of assessing or evaluating the outcomes and the results of a given business. It involves the collection of information, analysis, and reporting of the outcomes or the progress of a given business using Key Performance Indicators(KPIs). AZZ Pty Ltd should regularly use KPIs to gauge how each store and department is doing in the business. It is also important since it provides a basis for improving the processes that are not doing well balancing them with those that are performing well.
Information provided through performance measurement is crucial since it helps in making better budgeting decisions that control the processes in the business. It is also important to measure performance in order to understand the strategies that your company should apply (Strategy Management Group, 2018). KPI are those figures that matter in your business. For instance, measuring the number of Printers, furniture, electricals sold per day, the number of dollars the shop made and also the amount of cash being used due to mistakes made at AZZ. All transactions at AZZ should be tracked and recorded according to the things that matter most, those areas doing great and those that are not. For instance, tracking the averages per day/month/year, business totals sales for both services and products.
Performance measurement (PM) is based on the following principles. First, it is to expose the business weakness. PM must be able to expose the weaknesses in the processes involved in your business with an aim of improving them (Moore, 2018). If a business wants to succeed, it must measure its losses and manage them. Weaknesses can be measured by analyzing the cost of production, maintenance cost and also time management. The other principle is founded on balancing the lagging and the leading measures. Lag measures inform you if you are getting the right results by measuring the outcomes or results got. Lead measures help in telling what might happen before it happens by prediction. This means that the things done in a business have to be balanced with the results or the outcome (Barr, n.d). This helps in reviewing the things you do in order to get the right results (Moore, 2018). Other principles involve building the right behavior (that which better business performance), building integrity among other principles. The principles should be based on the foundation of SMART goals. KPIs can be used to create SMART goals which means they are Specific, measurable, achievable, realistic and timely. Our goal at AZZ is to increase service sales by 10% in the next 12 months. This percentage should be made SMART by analyzing the records of how the business has been doing in the past year
An operational plan is a document that contains the description of the business and the strategy put in place to achieve success. The plan is a step by step guide on how to run the business on daily basis for a given period of time (Mace, 2014). The operation plan answers the what, when and how in the business. The methods to use in the operation plan include developing a strong strategic plan, focusing on the goals and objectives to be achieved on a daily and long-term basis, Using the leading measures which predict the future and also ensure effective communication which is important for success (Andrews, n.d). Communication involves holding meetings on a daily, weekly and monthly basis depending on the issues.
At AZZ Pty Ltd, the operation plan is aimed at achieving the strategic goal which is to increase sales by 10%. This will be achieved by meeting objectives including improving the quality of services and products, improving the technology base at the stores, ensuring the system and the processes at the store are improves and also increasing efficiency. Services at AZZ will also be expanded to include graphic design and delivery services. The store managers at AZZ will have the responsibility to develop and implement the operation plan.
Productivity refers to the measure of efficiency and effectiveness of a person, a system or a business in changing the inputs into outputs at a cost. In other terms, productivity is also referred to as the output per unit of labor and investment ratio (MBN, 2018). Productivity is determined by a number o factors which include the quality of machinery or technology used in production, the skills and worker experience, the management and leadership factors among others.
Budgeting process, on the other hand, refers to the way in which a business or a company makes its budget (Hamilton, 2010). A budget is a financial allocation of fund to different activities and processes in a company. A budgeting process is done by a team of accounts and finance committee in conjunction with the senior management. A budgeting process should be documented with each task, deadlines, and responsibilities well stated. A successful budgeting process should ensure the income from the business is budgeted before the expenses. For instance, at AZZ stores, budgeting will involve defining every task with its estimated cost to achieve it. This includes acquisition of more products, training employees to promote expertise, widening the service base. For instance, delivering products to customers will need a truck/van, starting a graphic design service will need some capital.
Productivity is measured in different ways. For Instance, in a factory set up, productivity can be measured by dividing the total output by the number of employees (dividing the number of cars assembled by the number of employees in a factory will give the total number of cars assembled per day). Productivity in terms of income in a business is measured by calculating the ratio of the value of output and input value. The basic formula is Productivity= Output/Input. Inputs include labor cost, capital investment, and other incurred costs. The output is the number of items produced.
Contacting the candidate(s) for a job have some rules that are aimed at ensuring the reputation of the company and the individual is maintained. It is important to do some research on the candidates before contacting them. This can be done by reading their resumes and refer to them while communicating. This will show that you have taken time to read their resumes. The most popular ways of contacting a prospective candidate include the use of a phone call, most of the applicants for a job leave their phone numbers on their resume or application letter. The other method is by use of hiring emails. The email should be able to inform the candidates about the job information in order to help them make an informed decision. The other popular way involves sending a letter of acceptance to the candidate.
Resource usage refers to the process of utilizing the materials and other inputs in order to convert them into products or services. Resource usage can be improved by managing them effectively. This helps in achieving high outputs from the same resources. Resource usage can also be improved through monitoring of the processes in a company to reduce wastage. Resource efficiency, on the other hand, refers to the process of getting more value from the materials and other inputs in a way that reduces the impacts on the environment. It involves the use of available resources in a sustainable manner (European Commission, 2017). This can be achieved by saving on resources. This means deriving the most output using the minimum input. Saving also helps in eliminating wastage of resources.
Resource inefficiency can also be eliminated by recycling waste produced by the organization, improving the storage of materials, conserving energy and also reduction of risks that could lead to wastage of resources.
References
Andrews, B. (n.d) Developing an operations Plan: 5 Key elements. Retrieved on October 8, 2018, from https://www.bigskyassociates.com/blog/developing-an-operations-plan-5-key-elements
Barr, S. (n.d) Seven Principles for Performance Measurement: What is excellent performance measurement really based on? Samford Queensland. Retrieved on October 8, 2018, from https://staceybarr.com/downloads/SevenPrinciplesforPerformanceMeasurement.pdf
Britton, C. (2016) What Is A Business Contingency Plan & How to Create One. https://www.rockdovesolutions.com/blog/what-is-a-business-contingency-plan-how-to-create-one
Chinn, D. (n.d.). The Purpose of Contingency Planning. Small Business – Chron.com. Retrieved on October 8, 2018, from https://smallbusiness.chron.com/purpose-contingency-planning-24864.html
European Commission. (2017) Resource Efficiency. Retrieved on October 8, 2018, from https://ec.europa.eu/environment/resource_efficiency/
Hamilton, E.F. (2010) The Budgeting Process. Retrieved on October 8, 2018, from https://www.nonprofitaccountingbasics.org/reporting-operations/budgeting-process
Martin. (2014). Understanding the Marketing Mix Concept – 4Ps. Retrieved on October 8, 2018, from https://www.cleverism.com/understanding-marketing-mix-concept-4ps/
MBN. (2018) What is productivity? Definition and meaning. Retrieved on October 8, 2018, from https://marketbusinessnews.com/financial-glossary/productivity-definition-meaning/
Melanie. (2017) Why Accurate Costing is Vital for Success. Retrieved on October 8, 2018, from https://www.unleashedsoftware.com/blog/accurate-costing-vital
Strategy Management Group. (2018) Top Ten Reasons for a Performance Measurement System. Retrieved on October 8, 2018, from https://www.balancedscorecard.org/BSC-Basics/Articles-Videos/Why-Manage-Performance
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