Different information needs Julie Martinez_ manager of the new

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					Different information needs: Julie Martinez, manager of the new retail outlet of Super
Printing, is pondering the management challenges in her new position. Super Printing is a
long-established printing company in a major metropolitan area. The new Super outlet,
located at the edge of the parking lot for Western Business School, represents Super's
attempt to break into the rapidly growing business for retail digital imaging.
The Super retail store provides a range of copying and digital imaging services for the
business school's student, faculty, and administrators, plus other retail customers. Super's
primary products are black-and-white copies of documents. Variation exists even in this
basic product, however, chased machine that prints colors, sizes, and quality. Super
recently purchased a machine that prints color copies from digits input. Color copies also
can be produced in a variety of sizes, paper quality, and paper types, including
transparencies for overhead projection and photographic-quality reproductions. Other
printing products include business cards, laminated luggage tags, and name badges for
conferences, executive programs, and students.
In addition to physical printing, the Super center provides fax services by which
individuals can both receive and transmit documents. When incoming faxes are received,
a store employee calls the recipient, who stops at the outlet to pick up the document. The
center also has several personal computers, both Windows-based and Macintosh, that
students rent by the hour for basic computer processing, internet access, e-mail, and
preparing presentations and resumes. Each computer is connected to Supper's black-and-
white and color printers, enabling students to produce paper copies of their presentations
and resumes.
Super has other machines that assemble printed pages into bound documents. Two
different binding types are available. The store also sells a limited selection of office
supplies, including paper, envelopes, paper clips, glue, binders, tabs, pens, pencils, and
marking pens.
Currently about five employees (including Julie) work at the retail outlet during prime
hours (8:00 A.M. to 5:00 P.M.)With two to four people working the evening shift
(5:00P.M. to midnight) when walk-in business is much slower. The number of people
working during the evening hours is determined by the anticipated backlog of
reproduction work that will be performed during these hours.
Prices for the various products and services have been set on the basic of those of
competitors, such as FedEx Kinko's and staples. Julie receives a daily report on total
sales, broken down by cash sales, credit card sales, and credit to various programs at the
business school; however, she currently does not have a report on expenses such as labor,
materials, and equipment for each line of business (black-and-white and color printing,
computer service, document preparation, fax service, and sales of office supplies). Thus,
Julie is unsure whether each line of business is profitable. Julie is also unsure how
efficiently the business is run.
Further, the different business lines require different quantities and type of capital :
equipment such as copying and printing machines, computer, and facsimile machines;
physical capital such as office space; and the different inventories of paper types, color,
grades and sizes, and office supplies.
If the pilot store that Julie is operating is successful, then the parent company will likely
try to open many similar outlets near schools and universities throughout the metropolitan
area. For this purpose, the parent company wants to know which business lines are the
most profitable, including the cost of capital and space required, so that these lines can be
featured at each retail outlet. If some business lines are not profitable, then Super
probably will not offer those services at newly opened stores unless they are necessary to
build retail traffic.
Identify the management accounting information needs for the following:

A. An employee desiring to help serve customers more efficiently and effectively.

An employee desiring to serve customers efficiently and effectively would be
interested in the time it takes to perform specified tasks and the quality of the work
performed. If standard times exist for routine jobs that Super Printing performs,
the employee can compare actual and standard times to determine potential areas of
improvement. Information on actual time to perform jobs can be reported per job
or per day. Information on time and resources needed to perform nonroutine jobs
can be collected as they occur, to provide input to future pricing and staffing
decisions. Assessment of the quality of the work performed should include feedback
on whether each customer’s instructions were met, and whether the output was high
quality. This feedback can be obtained through formal or informal feedback each
time a customer picks up a job, or through formal written feedback, such as
comment cards. Information on the frequency and reasons for rework or customer
dissatisfaction with the output should help the employee in continuous improvement
efforts.

B. Julie Martinez, the manager of the pilot retail outlet

The retail outlet (store) manager will want to monitor overall outlet profitability.
This starts with subtracting all operating expenses and purchasing costs from store
revenues, but this is much too aggregate to be very useful. The manager will want
information on operational control (quality, timeliness, and efficiency), product and
customer costs, and financial and nonfinancial performance measurements at the
store level. For example, the manager will want day-to-day feedback about the
efficiency and productivity of the various machines (copies per hour); machine
availability and downtime; product defects, rework, customer returns, and defective
merchandise; and response times to customer requests. He or she will want activity-
based information about product cost and profitability (black-and-white copying,
color copying, facsimile services, document preparation, computer rental, and
supplies), and profitability by major customer type (the business school’s MBA and
executive programs, faculty research, school administration, and other institutional
accounts). The manager can use such information in making pricing decisions for
services and customers, including volume discounts or surcharges for orders with
special requirements and services. The information about the most profitable
product lines and customer segments will help direct marketing efforts and
spending on equipment, space, and inventory to their most profitable uses. To
monitor sales trends, the store manager could collect information about sales by
hour of day, day of week, and month of year to guide decisions about which hours
the store should be open, and also to staff the store appropriately for predictable
fluctuating demands. Possible nonfinancial strategic measures for the outlet include
market share and satisfaction for targeted customers; time, quality, and cost of
internal processes; new products and services to offer, and employee skills and
motivation.

C. The president of Super Printing

The president of Super Printing would look at profitability, perhaps monthly, for
every outlet (store) in the chain. The president would want operating statistics that
would enable him or her to compare the profitability and operating performance of
service or product lines across all stores. This internal benchmarking information
suggests opportunities for improvement that can be shared across stores.
Competitive information could include market share of Super Printing relative to
their competitors. Competitive pricing information on key products and services
would also be valued. The president should also have established information
mechanisms by which consumer complaints (and satisfaction) are directed to his or
her attention.

				
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