Contribution Margin and Break Even Analysis

Many factors come into play in determining business success. One of them is the financial factor. For a company to set financial goals it is crucial that its management know in detail the products or services they sale or provide. This is the analysis of two different scenarios at Aunt Connie's Cookies Simulation (University of Phoenix, 2011) and the financial performance of Jamestown Electric Supply Company (Heiter, et. al. 2008). During both analysis I applied concepts like fixed and variable costs, contribution margin, break-even point, indifference point, and operating leverage. Aunt Connie's Cookies Scenario Simulation  The Aunt Connie's brand grew successfully producing Lemon Creme and Mint cookies. Maria Villanueva is the current chief executive officer of this family-owned company (University of Phoenix, 2011). She faces critical decisions to make because both the lemon creme and mint cookies prices increased and sales volume decreased. Maria should apply several accounting concepts to reach her goal of increasing sales and revenue for the company. Some opportunities and challenges lined up for Aunt Connie's Cookies like large bulk orders and the buyout of a competitor's factory (University of Phoenix, 2011). A confectioner commissioned Aunt Connie's Cookies to fill a bulk order of one million packages of the Real Mint cookies delivered in one month's time. The stipulations of the order weights greatly on the company as the confectioner will only pay $1. 20 per package, which is much cheaper than the mass market selling at $1. 50 per packet. Rejecting the order may seem foolish as Aunt Connie's Cookies has the capacity to produce the order, and could be missing out on a good opportunity if she declines to fill the order (University of Phoenix, 2011). In deciding which cookie's production to reduce, Maria took into account the concepts of contribution margin, unit contribution margin, and operating profits. This decision was necessary to create sufficient capacity to accommodate the mint cookies bulk order. The contribution margin is the amount of money that remians from the revenue obtained after sales to pay for fixed expenses and to contribute to the operating profits after deducting variable expenses. Alternatively, the unit contribution margin of each unit sales, in this case each pack of cookies adds to profit. Finally, operating profit is the profit earned from a company's core business operations, also known as earnings before interest and tax (EBIT). Maria calculated the contribution margin and the unit contribution margin for each type of cookie, determined to reduce the production of lemon creme cookies and to increase the production capacity for the bulk order of real mint cookies. Maria can sell mint cookies at $1. 20 per package, below the selling price of $1. 50 because the real mint cookies provide a greater total contribution margin and that the lemon cream cookies provides a greater unit contribution margin. Maria knew that Aunt Connie's Cookies should produce more of the cookies with the greater contribution margin per unit to maximize the shop's operating profit. If the scenario changed, and the bulk order was for lemon cookies, Maria would have to turn over the order to the confectioner. The unit contribution margin for the lemon cookies is smaller and Maria would have to increase the production capacity to make the same operating profit as for the mint cookies, to the point of going beyond the factory's production capacity. Maria faced the opportunity to buy a peanut butter cookie plant. She could use this plant to make more lemon creme cookies because the near-term demand exceeded 600,000 packs. The challenge for Maria is to make a decision about going forward or not with this business (University of Phoenix, 2011). If the new plant has a break-even volume of creme cookies of 650,000 packs, Maria must ensure that Aunt Connie's Cookie shop sales the same amount of packs or more. If the business sales less, it will make a loss, if it sells more, it will be a profit. The break-even point in volume is the point where the plant's fixed expenses are covered. In the case that Maria considers Aunt Connie's Cookie shop cannot sell that much, she may ensure viability of the plant by (1) trying to reduce the fixed costs (e. g. renegotiating rent, reducing telephone bills, insurance, etc. ), (2) trying to reduce variable costs (e. g. purchasing at lower cost the ingredients used to make cookies), or (3) increasing the selling price of the cookies. Any of these strategies can reduce the break-even point in volume. In the worst of the scenarios, Maria should not buy the peanut butter cookie plant. Key Learning Points. During the simulation I applied several concepts such as contribution margin, break-even point, fixed and variable costs, indifference point, and operating leverage. All these concepts interrelate and form part of the cost volume profit analysis tool. The application of these concepts by managers help organizations attain good financial performance. Cost volume profit analysis (CVP analysis) is a powerful tool that can help managers in understanding better the relationship that exists among the cost, the volume, and the profit in a business. Managers can make good business decision if they concentrate in trying to understand the interaction that exists among (1) the prices of product or services, (2) the level of activity, (3) the volume of product , (4) the variable cost per unit, (4) the total fixed costs and (5) and the mixture of the product or services. Business decision may be about changes to company's pricing policy, selection of a marketing strategy to use, choosing which products to manufacture or services to provide, and even about the acquision of new companies. The break-even point (BEP) is one element of CVP analysis. BEP is the level of output at which the profit is zero. Break even analysis helps managers determine how far sales can decline before their companies start to lose money. The indifference point is the volume at which costs for both labor-intensive operations and equipment intensive operations are equal. When volumes increase, revenues increase. However, the presence of lower variable costs per unit in equipment-intensive operations ensures that the operating profits increase more significantly when compared to labor-intensive operations. Equipment-intensive operations have higher fixed costs and lower variable costs per until when compared to labor -intensive operations. Jamestown Electric Supply Company. Jamestown Electric Supply Company has been in business for 45 years. The company designs, manufactures, and delivers electrical supplies in various forms to different type of businesses. Jamestown invested heavily in research and development of automotive electronic technology to provide its customers with modern functionality, safety, and performance. Jamestown products have outstanding features that create competitive advantage to commodities that customers regard as standard features on all automobiles. Jamestown has hundreds of diverse contracts with different divisions and plants of each of the major automobile manufacturers. Most of the contracts show good gross profit margin on sales, but others do not show acceptable bottom-line profits or show no profit. Although Jamestown's sales, continue to rise, profit declined in the period under analysis from 2003 to 2007 as showed on Exhibit One. Jamestown top managers believe that if sales growth remained positive, the problems with the profit would resolve. Warehousing and shipping managers think that customer service expenses are out of control and causing significant cost increases for the company. Jamestown customer services include overnight delivery of electronic component products, just-in-time inventory deliveries to client's plants, warehousing of client parts, special part support services, and many other customer services designed to gain and maintain clients. Exhibit One. Jamestown Electric Supply Company Income Statements for 2003 to 2007. Electric Supply Company financial performance is in jeopardy and top management have to change its customer service policy and marketing strategy after carefully analyzing the information obtained after performing a CVP analysis. The focus of the analysis should be in understanding the relationship between product price, volume, per unit variable cost, and the mix of products sold by Jamestown Electric. Calculating the contribution margin on the products which Jamestown Electric sales will allow management to know more in detail how much each unit sale will contribute to the company profit. Calculating the break-even point will provide information about which products do not bring either profit or loss, and about how far sales can decrease before Jamestown Electric starts to lose money. James Electric product cost structure has a higher percentage of variable costs than in fixed costs, which involves less operating leverage or risk. One of he options management should consider is to closely monitor the variable expenses incurred by customer service in order to increase the company profits. Jamestown Electrical Supply Company management will definitely benefit from setting a regular schedule to analyze contribution margins either monthly or quarterly to track product margin performance more accurately. Conclusion Managers can help their organizations achieve a good financial performance when they apply basic accounting concepts in their business strategic plans. Knowing the existing relationship between these concepts contribute to ensure their organization's financial success.

Honeywell International Success Essay

This paper introduces the reader to Honeywell International Inc. Honeywell is a world leader in the application of lean manufacturing and its Six Sigma Plus processes. With the use of carefully monitored cost standards, net present value in investment decisions, and the transparency of the company’s financial statements are all methods that Honeywell has successfully implemented and utilized to reach and maintain their status as a world-wide competitor. The company has continued its growth, despite the market downturn that began in 2007, and continues to prove its resilience and pioneering spirit by continually improving their product lines, globally expanding their market, and, monitoring and maintaining financial stability. Its forward thinking and willingness to take risk will provide Honeywell the capacity to maintain its role as a major competitor and contributor to the growth and recovery of our economy. Table of Contents Page Abstract2 Company Overview4 Six Sigma and Lean Manufacturing8 The Use of Standard Costs11 The Use of Net Present Value14 Summary15 References18 Honeywell International Inc. is an American based advanced-technology company that manufactures aerospace and automotive products; residential, commercial, and industrial control systems; specialty chemicals and plastics; and engineered materials. Its assent into history can be traced back to 1885, spanning 125 years of history. Honeywell International is a $38 billion diversified technology and manufacturing leader, with 132,000 employees in over 100 countries and it a Fortune 75 Company. It is a diverse and global-wide organization and is a leading supplier of avionics and electronics, consumable hardware, engine controls, environmental controls, landing systems, power systems, propulsion engines, aerospace services and space products, and systems for the aerospace industry, as well as Original Equipment Manufacturers (OEMs) of commercial, regional, business and military aircraft and spacecraft. Today, its main competitors in the aerospace defense product and service industry are BorgWarner Inc. , Johnson Controls Inc. and United Technologies Corp. State-of-the-art technology, world known brands and global solutions have placed Honeywell in the unique position as one of the premier worldwide suppliers in the aerospace industry, offering solutions of systems, products and services to the largest aerospace and airline companies in the industry. Throughout their 125 years in business, Honeywell has helped revolutionize the aerospace industry with its dedication to research and development and its enthusiasm to advance technology in their various markets. Honeywell’s reliable and efficient aerospace services and support programs deliver the right level of engineering expertise, maintenance services and asset availability solutions to simplify operations while keeping systems and equipment at peak operational performance. It has proven to be successful in its quest for growth and global expansion from the time of inception. Their quest to acquire and expand began in 1927; the original company, Minneapolis Heat Regulator Company, and Honeywell Heating Specialty Co. merged to form the Minneapolis-Honeywell Regulator Co. From the merger, the name Honeywell was adopted and has remained the same since. In the course of its acquisitions, Honeywell purchased other businesses whose focus was in the controls area; among those acquisitions, was Brown Instrument Co. who was a wide-reaching leader in the field of industrial controls and indicators. This acquisition further increased their already successful market to a wider range of customers, as Minneapolis-Honeywell Regulator Co. had already established an overseas trading agreement with Japanese distributors such as Yamatake Trading Company. It was no surprise that, in 1934, Honeywell pursued and eventually acquired Time-O-Stat Controls Corporation. With the acquisition of Time-O-Stat, Honeywell further expanded its global presence, establishing offices in Toronto, Canada and The Netherlands; a few years later, they had offices in London and Stockholm. By 1941, Honeywell had expanded into markets in Chile, Panama, Trinidad, New Zealand, Argentina, and South Africa. By 1972, it operated 25 wholly-owned subsidiaries, 142 branch offices, and joint ventures in five countries outside the U. S. True to its reputation as a risk taker, Honeywell ventured into the computer industry. This venture was brief and by 1991 Honeywell was on longer in the computer business. Even though the venture was short lived, it proved to be of great value; Honeywell used the knowledge gained from their digital computer experience and applied it to the traditional field of automation control, integrating sensors, and activators. In 1986, Honeywell purchased Sperry Aerospace, and markedly enhanced its position in the aerospace industry. Edson Spencer, Honeywell chairman and chief executive officer, said the purchase was among the most important his company had made, †It is an outstanding opportunity for Honeywell that positions us for the long term in a market that is expected to have significant growth for the next 10 years – commercial and military aviation† (Arnold, 2012). This purchase made Honeywell the world’s leading integrator of avionics systems, incorporation flight controls, space vehicles, and the first FAA-certified wind shear warning system. It continued to expand, and by 1993, the company continued its world-wide expansion by opening affiliates in Abu Dhabi, China, Oman, Romania, and the Ukraine. In a span of 26 years, Honeywell had operations in 95 countries through 83 wholly-owned subsidiaries and 13 joint ventures. One of the most noted and discussed mergers occurred in 1999 when AlliedSignal, a diverse manufacturer, bought Honeywell for $13. 8 billion in stock. AlliedSignal kept the Honeywell name, merging offices, and closed its Morristown, New Jersey headquarters. The merger resulted in a major restructuring for Honeywell which added to its product line and services. The deal created a company with $25 billion in annual sales and a market capitalization in excess of $45 billion. The merger gave the combined company the marketing edge, providing their airline customers to take advantage of new technology that would boost cost savings for both parties. In an unexpected turn, the early part of 2001 brought difficulties for Honeywell when the European Commission rejected the purchase of Honeywell by General Electric (GE). In October 2001, Honeywell and GE, the largest corporation in the world and the number one producer of jet engines, announced the intent to embark on one of the largest industrial mergers in history. The plan was for GE to acquire Honeywell, the largest worldwide supplier of non-engine aerospace equipment. During negotiations it was anticipated that there would be no antitrust problem; as GE and Honeywell were not competitors and not part of the same supply chain. The merger was intended to bring together complementary products that were component parts of large jet aircraft. The deal would have been the largest industrial merger in history. Instead, it became recognized as the first, and so far only, merger between US companies to be derailed solely by the European anti-trust authorities, while being cleared by the US Department of Justice (DoJ). On July 3, 2001, in an unprecedented act, the EU officially rejected the planned $42 billion acquisition of Honeywell International Inc. , by GE. The merger was denied by the EU after concluding that the merger would create or strengthen dominant positions on several markets and that the remedies proposed by G.E. were insufficient to resolve the competition concerns resulting from the proposed acquisition of Honeywell. †The merger between G. E. and Honeywell, as it was notified, would have severely reduced competition in the aerospace industry and resulted ultimately in higher prices for customers, particularly airlines† (Pellegrini, 2001). Despite the fact that the GE buyout failure was a stumbling block, Honeywell used the experience to strengthen its core businesses by continuing to develop and introduce new products. The company started an aggressive acquisition strategy with the goal to increase revenues and decrease cost in a strategy that, â€Å"†¦divested small, underperforming operations, reduced the number of suppliers, and streamlined operations in small ways elsewhere† Honeywell History, n. a. ) The results paid off for Honeywell, as they continued to win a large percentage of their contract bids, sales were ahead of budget, and the rate of turnover in managers did not significantly increase from the same period in the prior year, and customer satisfaction was up. Honeywell faced some challenges after the GE debacle, however, by making changes it displayed that tenacity, hard work and a willingness to take risk, can result in huge payoffs. Honeywell continued to streamline and improve their lean manufacturing processes, i. e. Six Sigma Plus, implement and ensure compliance of the company code of conduct and maintain its dominance as a government contractor. Honeywell began its Six Sigma process and concept of self-managed teams in 1995 to â€Å"drive data-based decision making, ensure quality levels, and improve customer satisfaction† (Crager, 2007). Through training, leadership, and senior management support, Honeywell successfully developed their Six Sigma program. In late 2001 Honeywell combined the concepts of lean manufacturing and Six Sigma in a program called Six Sigma Plus to create a more robust program. The program was designed to align improvement objectives directly with business needs by integrating top talent and generating bottom-line results. Six Sigma Plus is an overall strategy to accelerate improvements in all processes, products and services, and reduce the punitive cost of poor quality through elimination of waste and reduction of defects and variations. One of the ultimate aims documented in the Six Sigma Plus strategy is providing maximum value to customers by applying a logical and structured approach to all business processes. One of the pluses of Six Sigma is that it empowered employees, allowing them to make decisions that impacted how their unit or line was performing. This provided Honeywell an excellent tool that is a highly respected measure of excellence. (M. Calderon, personal communication, May 1, 2012) Honeywell took the basic concept of Six Sigma and created its own version which is known as Six Sigma Plus. It is currently used across all businesses and brands to drive growth and productivity. â€Å"The standard operates by providing a measurement of how effective the organization is in eliminating defects and variations from processes. To meet its requirements, a process must operate at 3. 4 defects or less per million opportunities. This equates to 99. 9997% error free† (Six Sigma Plus, n. d. ). Conscious application of the Six Sigma methodology to all business processes delivers greater value to its customers and makes Honeywell a more desirable business partner. The implementation of lean manufacturing processes has enabled Honeywell to maintain tight controls in all aspects of the managerial accounting processes. With the use of managerial accounting, Honeywell has ensured that their productions and service is well planned and controlled. With the budget cuts facing government, private sector job loss, and tightened markets, it is impressive that Honeywell has continued to maintain its sales growth in the United States. The diversity of Honeywell’s world-wide enterprise, exemplifies the importance of a creative corporate marketing approach. Honeywell consists of unique business units, with each, offering a variety of products and services. Strategies and implementation of those strategies must be developed and executed at the corporate, business unit, and product levels. Overall, strategy and long-term planning are guided by the company’s vision and stated mission. At the business level, planning begins with an examination of the current situation, including technological changes and competitive effects. By using this type of analysis, Honeywell is better equipped to address and identify threats and new business opportunities. Decisions to pursue new opportunities are followed by establishing a set of objectives, often stated in terms of market share, sales volume, or profitability. Subsequently, business and marketing strategies are developed to achieve those objectives. Effective execution of strategy in implementation must then occur for objectives to be realized. Effective financial statement analysis will be a primary indicator that indicates the progress and demonstrates whether company goals are being met. Honeywell has been a leader in their industry in planning and control and have used financial analysis in depth to evaluate and control their growth and profitability. It continues to be effective in identifying opportunities to improve the organization’s efficiency and in developing strategic plans to realize those opportunities. By using a diversity of analytical tools Honeywell is better prepared in making operating decisions, such as how and where products are to be manufactured and serviced, whether insourcing or outsourcing is more equitable, and whether to expand and the area to expand to. Timely and accurate financial statement preparation is critical to the success or failure of a business. The financial officer, owner, partner or members management team of a business must review the business financial statements and have a good understanding of them. Financial statements are critical to Honeywell’s ability to make solid, informed decisions. Such decisions are needed in order for Honeywell to meet one of its primary goals, which is to realize a high rate of return on their investments. The measurement and success of this initiative is arrived at by measuring it against other industry averages. This information helps Honeywell understand that current initiatives do show a market response. In view of the fact that the industry average can be general in nature the industry average should be used as a guide. A failure to use the data appropriately can mislead investors and have a disastrous affect on Honeywell’s reputation and marketability. Achieving their strategic plan will not only involve Honeywell’s internal planning and controlling, but it will also involve the support of creditors and investors. Both are key players in providing capital needs to support new initiatives and milestones; the use of financial statements in this process will no doubt be the backbone of the decision making process. It is difficult to know the health and direction of a company if financial statements are not reviewed in a timely manner. In its pursuit of investors, or the success in the results of an external audit, the financial statements are the ultimate representation of company’s financial position. In general accounting practices, Honeywell uses process costing for its furnace thermostats (home products division) and job costing for customized aerospace contracting products. When thinking in terms of standard costs and whether they would be beneficial, one factor to consider is the fact that Honeywell is a world-wide producer with operations in many countries outside of the United States (US). There are ramifications when doing business overseas as well as doing business in the US and each scenario has its own benefits and consequences that are unique to specified circumstances. Honeywell, like their competitors has migrated to low cost countries because of the labor rate differential. The move to overseas production creates additional concerns and dynamics. World-class manufacturing in today’s competitive environment demands more than a single-minded focus on eliminating defects. Since the introduction of Six Sigma and Lean tools to their operations over a decade ago, Honeywell has delivered significant results for customers in terms of the quality, delivery and value of our products and services. To achieve competitive advantage in today’s environment, Honeywell has continued to build on its Six Sigma and Lean foundation, and identify new ways to differentiate themselves. Benchmark companies such as Toyota and Nissan use Six Sigma and Lean tools. Like Honeywell, they also have a disciplined management system that standardizes work and engage employees in improving work processes. In doing this, organizations have achieved tremendous performance improvements. The Honeywell Operating System is a comprehensive, integrated approach to managing their organization. It is characterized by a consistent focus on results for the benefit of our customers, not on the use of specific tools. The objective is to simplify and standardize processes everywhere, to remove variation across operations, and to drive significant and sustainable improvements in safety, quality, delivery and cost. Employees are encouraged use tools such as Six Sigma, in achieving a common purpose: global wide use of an operating system that consistently yields excellent results for the customers and the company. Implementing standardized cost standards is not an easy task and it will take time. Honeywell maintains that standardization will evolve to fit different business environments and changing customer needs and will become an essential part of the process that will bind their company across business and geographic boundaries. Honeywell’s workforce consists of residents of the country they are in to satisfy requirements imposed by foreign nations. It is almost mandatory to have overseas operations to reduce labor and material costs; however, these operations come with high risk. Foreign workers are not always equipped with the necessary skills to perform the manufacturing duties required by a highly technical company. The expense of employing and developing such a workforce can create additional costs. In determining what the additional costs, standard costs prove beneficial because they would provide Honeywell the ability to budget costs with a great understanding and degree of confidence. A standard cost system allows a company to factor in methods that would absorb the periods in which higher costs are identified due to foreign employment development and when costs are low or minimal due to workforce stabilization. In its foreign production, Honeywell will have to set attainable standards in order maintain its performing baseline. Another factor in foreign operations is the volatile condition of the world. The United States is not always welcomed in other countries. It is not uncommon for a common protest to turn into a major world crisis. Such examples are those of the uprisings in Israel and Libya. Honeywell hosts operations in Israel, where relations between the government and the general population are volatile and unpredictable. In addition, we have seen several instances where regimes have changed power and attitudes toward the US in a matter of days. Standard costing is paramount as an aide for monitoring and managing the risk of unpredictability. It is a healthy practice that can protect Honeywell from severe monetary damage if a foreign tragedy should affect the business. The information obtained from standard costing aides Honeywell against the volatility of today’s markets and the strategy of its competitors. Honeywell is continuously improving its processes, products and management style to maintain their competitive edge. To be competitive, Honeywell will continue to use their standard cost system to help them execute planning and control of their strategic priorities. Tracking costs will also help Honeywell identify weakness and variances in their production system. Undetected problems in the areas of materials and labor can eventually raise variance to a point of hindering Honeywell from maintaining their core competencies. Consequently, today’s market provides no room for error, but every opportunity for a competitor to gain the lead. In many respects, some of the rationale that goes into using standard costs also applies to formulating the right strategy to gain a positive Net Present Value. Honeywell’s reach is global and therefore its investment opportunities are also global. Due to the unique factors involved with global markets, it is necessary for Honeywell to perform critical planning for investment decisions. Honeywell has a reputation as an organization that is willing to take risks to make money. It has done that by acquiring other business or expanding its existing facilities for future business. Such expansions are expensive and these expansions require additional staff which adds to the cost of investment. Large expenditures are a challenge to control the net present value (NPV) and require clear identification of cost and risks in order to be a success. Strategic moves, such as partnering with the national government, can leverage the way to a positive NPV. In this approach, there are tradeoff between the corporation and the government in which both interests can be mutually met. Corporation’s like Honeywell utilize these paths in order to reduce investment costs and have accurate projections for calculating and incorporating NPV baselines. Because of the ongoing activity of many investments occurring at one time, it is critical that Honeywell has complete knowledge of their NPV and ensure profitable investments are achieved. Failing to do this can result in major losses, especially when an unplanned shortfall occurs. Although the investment sounds promising, it is critical that NPV is properly measured. It is also advisable from an NPV and program management position that Honeywell phase its investment into NPV milestones which help determine if they should move forward to the next phase of the investment. This process would provide a safeguard while allowing the innovation to prove itself. While the actual rate of return (IRR) that  a given project ends up generating will often differ from its estimated IRR rate, a project with a substantially higher IRR value than other available options would still provide a much better chance of strong growth. IRRs can also be compared against prevailing rates of return in the securities market. If a firm can’t find any projects with IRRs greater than the returns that can be generated in the financial markets, it may simply choose to invest its retained earnings into the market. The need for Honeywell to practice continuous NPV drills in a market with circumstances such as those faced in China by US companies, is critical. While both countries maintain a civil business partnership, there is an unspoken adversarial relationship which creates instability. China is strategically positioning itself as a global power therefore, the relationship between both countries is precarious and any misstep by Honeywell could severely damage the existing business relationship. Another potential concern for Honeywell is that China is currently the largest lender to the US. At the point that China reaches the economic capacity to sustain its prosperity internally, we have to ask ourselves if they will request repayment by the US prior to maturity dates. As we have seen in several European countries, a request of that magnitude could destabilize an already fragile US economy. In consideration of this scenario, and other contributing factors, Honeywell should be careful in investment planning, and phase its activities so that the NPV is not contingent upon results that will take a long period to realize a return. In summary, Honeywell has proven itself as a world leader of technology. This corporation is known world-wide and is a household name. Honeywell leads the way in advanced switching and sensing technology in their home division, and its aerospace division. In spite of the GE failure, it has kept its mark on the global economy through market highs and lows and has maintained its dominant position in an extremely competitive industry. As a long-time survivor and global competitor on the world stage, Honeywell continues to make its mark in history by developing innovative safety products, driving the modernization of global air traffic management, revolutionizing combat technology and their commitment to improving operational efficiencies. Honeywell continues to display their dominance with its diversity and profitable risk taking ventures. Perhaps Honeywell’s greatest strength has been the fact that it has adapted to a world that is ever changing and has embraced the challenge that other companies find daunting. With the continued vision to improve processes for safety, quality and cost, reducing waste, and using integrated strategies Honeywell continues to be a standard for their industry. They continue to be innovative and competitive and have a strong commitment to bringing profitable products that their customers need and want. Due to the diversity and competitive market that Honeywell has chosen to operate in, it is of extreme importance that the company maintains sound financial practices that will support the moral fiber and marketability of the company. As Honeywell moves into the future I believe they will continue to perfect their processes to produce the right financial statements, useful in calculating their position in the market, and providing the best advice for investment decisions. The proper use of standard costs and net present value are an example of the critical tools that ensure Honeywell continues to thrive in today’s unknown global conditions. Also critical to the success of Honeywell is the continued utilization of strong and proper ethical practices as the company is well known, world-wide competitor and a representative of the American business ethics and values. Whether it is in the Middle Eastern or the Far East, Honeywell is known and recognized; such a position makes it important for Honeywell to be transparent in its fiscal disclosures. Sound financial practices are essential to Honeywell in order for the company to continue its success and market dominance. Primary emphasis on these practices will serve to maintain Honeywell’s status and help them make the most profitable investment decisions for their investors and the company. As recent as April 23, 2012, Honeywell declared a â€Å"regular quarterly dividend of $0. 3725 per share on the company’s outstanding common stock. The dividend is payable on June 8, 2012 to shareowners of record at the close of business on May 18, 2012† (Honeywell Declares Quarterly Dividend, 2012). If this is any indication, Honeywell will continue to be a viable global competitor and financial contributor to our financial and job market. Honeywell is an excellent example of an organization that is forward thinking and proactive. It has operated with a strong ethical code of conduct, strong financial discipline and an ever present focus on the future. This methodology and ideology will ensure their continued financial growth and market expansion. It is apparent that their cost standards, lean processes, and disciplined managerial financial management has enabled them to overcome obstacles, secure their position as a global competitor and a viable contender in today’s competitive, technology-oriented world.

Observation #7 Essay Example | Topics and Well Written Essays - 250 words

Observation #7 - Essay Example They were discussing new trends in hairstyles and makeup. I could sense that they were very formal with each other, as their gestures were showing. Their language was also very formal. They greeted each other with â€Å"Good day!† and departed with â€Å"Have a nice day!† kind of statements. I heard the conversation closely, and I did not hear even one slang or abusive word. I guessed that they were meeting for the first time, and that is why there were being so formal. 3. I observed a male and a female in the school setting of my younger brother. The male was a child’s father, and the female was the teacher. The man was complaining about her child’s progress, and was blaming the teacher for not paying attention. I could hear phrases like â€Å"You people don’t care†¦Ã¢â‚¬ , and â€Å"Is this your system?† The teacher was being apologetic, and was convincing the man that they were not at fault. I could sense this as I heard phrases like â€Å"Look Sir!† and â€Å"With due respect†¦Ã¢â‚¬  etc. The man’s language was aggressive; while, the teacher’s language was

Human Resources Essay Example | Topics and Well Written Essays - 1500 words

Human Resources - Essay Example Human resource and internal organizational variables Internal organizational variables include, size, strategy, technology and the business environment within the organisation, these variables have been identified in several studies as determinants of human resource practises (Jackson, Schuler & Werner, 2011, p124) Human resource management can be defined as the process of attracting, motivating and retaining a gifted pool of employees who work to support the realisation of the organisation’s goal and objectives (Lussier & Hendon, 2013, p 154). Effective human resource practises are becoming a necessity in the current organizational environment as the economies become ‘knowledge based’ and the challenge of finding and retaining highly qualified employees increases due to shortage of skilled labour. Determinants of internal human resource management practises in internal organisational environment The way organisations are run, either formally or informally will al so determine the how human resource activities are conducted. For instance in small businesses, human resource activities are more likely to be carried out in an informal and more flexible manner, while in large organisations, human resource activities will be more formal and rigid (Mathis & Jackson, 2011, p123). The size of the organisation will determine the level of sophistication in human resource with large organizations being more sophisticated than the smaller firms are. In small firms, executives are more likely not to get proper education; in addition, they are also less likely to have performance appraisals and bonuses that are present in large companies. The competitiveness of an organisation depends on the resources that help it to differentiate the company’s products from those of its rivals in the long run. Of great importance is the human resources, which are constrained by shortage of labour, which reduces a company’s potential for growth (Chen & Mohame d, 2008, p73). While some authors argue that long run, competitive advantage can be realised through human resources themselves and not the processes that were used to get the human resource (Guest, 2011, p12). Other authors argue that the human resources themselves can be seen as contributing to a firm’s competitive advantage; such practices include the potential to motivate employees, how organisations handle internal conflicts among other practises. Technology, which is the process for transforming the inputs in the organisations in to finished products usable by the consumers vary in many perspectives, which have an effect on human resource perspectives. For instance, the level of continuity in the manufacturing procedure, the level of knowledge that is required in using the technology, the predictability of tasks and the level of interdependence of various tasks within the course of manufacturing (CHUANG & Liao, 2010, p177). Using human capital theory to show the relatio nship between human resource and technology, firms that use modern and up to date technology are more likely to engage in selective hiring, inclusive training, performance appraisal and fair remuneration evaluation. Understanding the technology usage in organisations has the implication of helping human resource experts to determine the

Racial Discrimination in Criminal Justice System Essay

Racial Discrimination in Criminal Justice System - Essay Example The targeting of these groups by the police on the notion that they commit more crimes acts to deepen the alienation and hostility between the police and these communities. These complain of such groups not taken seriously not withstanding that they are a target of regular police hostility and violence. These kinds of racist behavior done trough the complete awareness and consideration by legislators on the history of racism, and the societal challenges brought about by racist treatment of people. The criminal justice system comprises of the courts, police and the correctional facilities. Discrimination usually occurs to individuals who belong to a group either marginalized or belonging to a group that with history of social stigmatization. These individuals have a higher likely hood of torture or undergoing human degrading treatment. The racial origins of a suspect form the basis of making decisions police arrests and police shootings. The race-based discrimination is the greatest c rime in the criminal justice system where the targeted individuals face more aggressive and punishments as compared to the total population. Looking at the United State of America, for example, the African Americans are a target of racial discrimination and face a much harsher punishment and treatment than the whites. Racial discrimination The aspect of racial profiling by the police brings out the vice of racial discrimination by the police. ... In trying to eradicate this practice, the police have tried to keep away from the habits the police force has recruited individuals from these communities into force in order to try and increase the confidence of these communities in the police force. The view among the public citizens is that the functioning of race as a basis of deciding on whom to stop and search is wrong. This position, however, challenged by a section especially in connection to terrorist attacks, and the use of race to form the basis of stop and search seems necessary. The effect of racial profiling is that the police do not get assistance by these communities’ especially in investigations and during community policing done by the police on these neighborhoods. Changes aimed at reducing racial disparity Although considerable efforts made to reduce instances of racial discrimination and increase trust in policing strategies among the communities the practice yet still exists. Scarman's recommendations The Scarman’s report of the Brixton disorders in 1981 extensively seen as of immense significance in development of practices of policing. The inquiry of the Scarman regarded additional necessity by the flare of rioting across the country in the same year. The fundamentally concern was about the failure by the police to deal with riots resulting from repressive policing methods, the failure of approval and the lack of capability in conflict resolution and public disorder. It is essential to note that much of the police reforms conducted during the 1980 s. In consideration to changes in discriminatory practices and policing, Scarman in concluding his report states that the allegations by a number of individuals who offered

Briefly outline the North and South divide in UK with the Essay

Briefly outline the North and South divide in UK with the representation of it in Brassed off - Essay Example ile attention is paid first to a variety of social, economic and political indicators of these persistent divisions and of the more complex mosaic of in equality that underlies them†. In the particular paper it is the country’s North-South divide that is going to be analyzed mainly through the film â€Å"Brassed off†. In fact, the North-South divide in England is not a recent phenomenon. This situation appeared in the country approximately in the beginning of 21st century. Doran et al. (2004, 1043) who studied the specific issue found that the North-South divide in England was mainly expressed through a significant differentiation in health services provided to the local populations. For this reason Doran et al. made a research using as a sample seven social classes in the areas under examination using as a criterion the health services available in the relevant regions and found that â€Å"the widest health gap between social classes, however, was in Scotland and London, adding another dimension to the policy debate on resource allocation and targets to tackle the health divide† (2004, 1043) The reasons for the existence of this phenomenon can be many. In accordance with the study of Morgan (2006) the political decisions taken by the parties throughout the years should be considered as the main causes of this situation. Referring especially to the Labour party Morgan supported that â€Å"one of the unintended consequences of devolution under New Labour is that it might make it more difficult to secure territorial justice between the nations and regions of the United Kingdom; centralized regional policy, the aim of which was to promote economic equity between the regions, has been replaced by a devolved regional policy that aims to promote an economic dividend within each region however in the unlikely event that devolution yields a uniform economic dividend in each region, the result does nothing to redress the territorial inequalities at the heart of the

Data Analysis Report Essay Example | Topics and Well Written Essays - 2000 words

Data Analysis Report - Essay Example Subjective norms refer to the beliefs about how other individuals in the society will perceive the particular behaviour whereas perceived behavioural control is characterized by the person’s perceptions with regards to their own ability in performing the specific behaviour. It has been considered that a more positive attitude and subjective norm along with a stronger behavioural control can significantly increase the person’s intentions of carrying out the behaviour (Fishbein and Ajzen, 1975). The application of the theory of reasoned action in various studies has shown the relevance of each of the variables as explained by the model. The findings of Ryu and SooCheong (2006) showed how subjective norms were insignificantly related to tourist intentions with regards to local cuisine whereas customer attitudes had a significant impact on behavioural intentions. Personal beliefs also had a positive impact on the intentions of customers. Therefore, it is of great importance that efficient strategies in marketing should be carried out, especially in yielding positive outcomes on tourist attitudes towards local cuisine. Bellman et al (2009) also found out that, among female shoppers, their attitudes along with subjective norms helped influence behavioural intentions when purchasing products. ... In order to measure the perceptions of customers regarding the quality of services, their expectations can be compared with the actual delivery of services. Five dimensions were proposed- reliability that refers to the employees’ ability of delivering consistent services; responsiveness that refers to the employees’ ability to provide timely assistance to their customers; empathy which is demonstrated through special care and attention for customers; assurance which is the ability of employees to establish trust and confidence among customers; and tangibles that refer to the physical surroundings and resources. It has been asserted that when customers are satisfied with services, they may perceive these to have high quality (Parasuraman et al 1985) or vice versa. Other researchers such as Bolton and Drew (1991) had been in agreement with this notion and asserted that customer satisfaction is associated with service quality, although there have been dissimilar views on t he relationship between these two concepts. Thus, it is of great importance that organisations and researchers alike be able to effectively identify the relationship between customer satisfaction and the dimensions of service quality. Customer loyalty has also been shown to be related to perceived service quality; this form of loyalty is characterized by the attitudes demonstrated by the customers regarding repeat purchases and patronization of product. Several service quality dimensions, such as empathy, responsiveness, and reliability have all been proven to influence loyalty among customers (Caruana, 2002; Ehigie, 2006; Ndubisi, 2006; Nguyen and LeBlanc, 2001). Yu Sum and Hui (2007) also concluded that perceptions of service quality can further be influenced by the price