The Somerset Furniture Company was founded in 1957 in Randolph County, Virginia. It traditionally has manufactured large, medium-priced, ornate residential wood furniture such as bedroom cabinets and chests of draws, and dining and living room cabinets, tables, and chairs, at its primary manufacturing facility in Randolph County. It employed a marketing strategy of rapidly introducing new product lines every few years. Over time it developed a reputation for high-quality, affordable furniture for a growing U.S. market of homeowners during the last half of the twentieth century. The company was generally considered to be an innovator in furniture manufacturing processes and in applying QM principles to furniture manufacturing. However, in the mid-1990s, faced with increasing foreign competition, high labor rates, and diminishing profits, the Somerset Company contracted to outsource several of its furniture product lines to manufacturers in China, simultaneously reducing the size of its own domestic manufacturing facility and labor force. This initially proved to be very successful in reducing costs and increasing profits, and by 2000 Somerset had decided to close its entire manufacturing facility in the United States and outsource all of its manufacturing to suppliers in China. The company set up a global supply chain in which it arranges for shipments of wood from the United States and South America to manufacturing plants in China where the furniture products are produced by hand by Chinese laborers. The Chinese manufacturers are very good at copying the Somerset ornate furniture designs by hand without expensive machinery. The average labor rate for furniture manufacturing in the United States is between $9 and $20 per hour, whereas the average labor rate for furniture manufacturers in China is $2 per day. Finished furniture products are shipped by container ship from Hong Kong or Shanghai to Norfolk, Virginia, where the containers are then transported by truck to Somerset warehouses in Randolph County. Somerset supplies retail furniture stores from this location. All hardware is installed on the furniture at the retail stores in order to reduce the possibility of damage during transport.

The order processing and fulfillment system for Somerset includes a great deal of variability, as do all aspects of the company's global supply chain. The company processes orders weekly and biweekly. In the United States it takes between 12 and 25 days for the company to develop a purchase order and release it to its Chinese suppliers. This process includes developing a demand forecast, which may take from one to two weeks; converting the forecast to an order fulfillment schedule; and then developing a purchase order. Once the purchase order is processed overseas by the Chinese manufacturer, which may take 10 to 20 days depending on the number of changes made, the manufacturing process requires approximately 60 days. The foreign logistics process requires finished furniture items to be transported from the manufacturing plants to the Chinese ports, which can take up to several weeks depending on trucking availability and schedules. An additional 5 to 10 days are required to arrange for shipping containers and prepare the paperwork for shipping. However, shipments can then wait from one day to a week for enough available containers. There are often too few containers at the ports because large U.S. importers, like “Big W” discount stores in the United States, reserve all the available containers for their continual stream of overseas shipments. Once enough containers are secured, it requires three to six days to optimally load the containers. The furniture pieces often have odd dimensions that result in partially filled containers. Since 9/11, random security checks of containers can delay shipment another one to three weeks, and smaller companies like Somerset are more likely to be extensively checked than larger shippers like Big W, whom the port authorities don't want upset with delays. The trip overseas to Norfolk requires 28 days. Once in port, one to two weeks are required for a shipment to clear customs and to be loaded onto trucks for transport to Somerset's warehouse in Randolph County, which takes from one to three days. When a shipment arrives, it can take from one day up to a month to unload a trailer, depending on the urgency to fill store orders from the shipment.

Because of supply chain variability, shipments can be off schedule (i.e., delayed) by as much as 40%. The company prides itself on customer service and fears that late deliveries to its customers would harm its credibility and result in cancelled orders and lost customers. At the same time, keeping excess inventories on hand in its warehouses is very costly, and since Somerset redesigns its product lines so frequently a real problem of product obsolescence arises if products remain in inventory very long. Somerset has also been experiencing quality problems. The Chinese suppliers employ quality auditors who rotate among plants every few weeks to perform quality control tests and monitor the manufacturing process for several days before visiting another plant. However, store and individual customer complaints have forced Somerset to inspect virtually every piece of furniture it receives from overseas before forwarding it to stores. In some instances, customers have complained that tables and chairs creak noisily during use. Somerset subsequently discovered that the creaking was caused by humidity differences between the locations of the Chinese plants and the geographic areas in the United States where their furniture is sold. Replacement parts (like cabinet doors or table legs) are difficult to secure because the Chinese suppliers will only agree to provide replacement parts for the product lines currently in production. However, Somerset provides a one-year warranty on its furniture, which means that they often need parts for a product no longer being produced. Even when replacement parts were available, it took too long to get them from the supplier in order to provide timely customer service.

Provide a clear flowchart of all activities included in one complete purchase
“cycle”. The graphical representation must be self-explanatory. In other words, you
must use symbols and their labels/identification in the flowchart, so that NO
ADDITIONAL wording/explanations be necessary outside the flowchart. The time
or time-range for each step of the purchase cycle must also be found on the
flowchart.
2. Calculate the range of days (minimum to maximum) of the variable timeline for
product lead time in this case. Start with the initiation and development of the
purchase order and end when the product is received and warehoused. Itemize
activities with their variable times, and provide the range for the total lead time.
3. Out of the activities identified above, mark with an asterisk, or by using special font
(e.g., bold) those activities whose durations might be reduced with help from
international trade specialists, or trade logistics companies (please do not use any
coloured highlights)
4. Pinpoint at least 7 problems that are prevalent (typical, characteristic) when
manufacturing is outsourced to other countries and appear to be present in this
company’s global supply chain.
5. Highlight two issues that you found of special interest in this case and are not
directly related to the discussion questions above. In other words, DO NOT just
repeat a “problem” stated in the mini-case, but share the “insights” that you may
have gained from examining this real business story.

Federal Express (FedEx) was founded about 50 years ago. It handles on an average of 3 million package-tracking requests on a daily basis. To remain ahead of its competitors, FedEx strives on customer service by keeping a comprehensive website, FedEx.com. It increases customer service and reduces costs. For example, each request for information which can be retrieved from the website rather than by the call centre help FedEx to save an estimated $1.87. The costs for FedEx have been reduced from more than $1.36 billion per year to $21.6 million per year by customers using the website instead of the call centre calculating each package-tracking request costs Federal Express 3 cents. Another know-how that improved its customer service is Ship Manager, an application installed on customers’ sites so users can determine shipping charges, weigh packages, and print shipping labels. Customers can also tie their invoices, billing, accounting and inventory systems to the application, Ship Manager. Nevertheless, Federal Express still spend almost $326 million annually on its call centre to reduce customers’ annoyance when the website is down or when customers have difficulty using it. It uses CRM software called Clarify in its call centres to ensure customer service representatives’ job easier and to speed up response time. Answer the following questions:

a) What is the importance of technology to ensure high-quality customer service?

b) Can you estimate Federal Express’ annual savings from using information technology?

c) Can you give a few examples of information technologies used by Federal Express?

d) What is the role of the application ‘Ship Manager’?

e) Your overall observations and learning from the above case study.

Founded in 2018, MGMT Crypto Inc. is a fledgling cryptocurrency exchange looking to make a big name for itself in the “blue ocean” sea of opportunities promised by this emerging technology. Cryptocurrency exchanges are websites where you can buy, sell or exchange cryptocurrencies for other digital currency or traditional currency like US dollars or Euros. Basically, an exchange is where buyers and sellers conduct their business.

“Crypto-currencies have the potential to transform fundamental aspects of industry and society and make a considerable difference to the activities of government bodies and policy-making. They are perhaps the truest form of digital economy technology that has yet emerged – sitting at the crossroads of technology, economics, social sciences and business – where cryptography has managed to disrupt our established practices and notions of trust, identity and value. “

Exchanges come in a few flavours and the company is exploring the following structures:-Trading Platforms – These are websites that connect buyers and sellers and take a fee from each transaction.Direct Trading – These platforms offer direct person to person trading where individuals from different countries can exchange currency. Direct trading exchanges don’t have a fixed market price, instead, each seller sets their own exchange rate.Brokers – These are websites that anyone can visit to buy cryptocurrencies at a price set by the broker. Cryptocurrency brokers are similar to foreign exchange dealers.

The company has rented traditional office space in a small building, but expects the world to know it from its website and online presence in all its various forms e.g. blogs and social media.

Whatever its final form, MGMT Crypto Inc. will be a user centric online service, and by positioning itself as the hub in an emerging infrastructure, hopes to become the de facto exchange for several cryptocurrencies.

You got a lucky break and have been hired as a management intern by the new start-up. You instantly realize you need to do some research, as words and phrases like cryptocurrency, blue ocean, exchange, ATH, block chain, bitcoin, satoshi, ethereum etc. mean nothing to you. Your boss soon presents you with some historical data as well as a point-in-time dataset on currency trades for a subset of the more than 1500 cryptocurrencies in existence. As a new management intern, you are tasked with analysing the provided information and reporting your findings and possible recommendations at an upcoming meeting.

Cybercrimes, security breaches, election hacks and advertising blacklisting have been in the news recently and these are of concern to the company Also, remember that surge in Oct 2017 (Power BI)? Well recently, there has also been much volatility in the market with huge volumes moving between “fiat” and crypto currencies. Many start-ups, like your employer, have been trying to position themselves to ride the next wave of expected growth.Your company wishes to be the one leading the pack! This requires them to anticipate the true demand but also to know which products and likely to fail, but more importantly they have to decide on the final business model, and safeguard their electronic assets!

Still glowing from the praises for your earlier analysis, you have been given a new enormous responsibility. You are to assume the role of a functioning manager in the company, and report some findings and possible recommendations at the upcoming meeting.

REQUIRED                                                                                

Management Reporting

You need to research/analyse the above business models (don’t over think it, just the highlights), propose one to implement and also how the company will organize itself to handle security.

You are attending a number of routine meetings that are conducted online. You are to post questions and response with information related to your analysis. Posts can be conversational among managers asking and responding to questions. There is no requirement for groups to meet outside of the course for this discussion, as it is expected that the meetings/posts will proceed in a manner similar to messaging with acorporate collaboration tool.

1: Introduce yourself Identifying your Management Level and your Functional Area and your proposed company structure

My Management Level and Functional Area and proposed company structureis: Tactical Manager,Accounting and Finance, investigating Direct Trading.

2. Discuss your business structure

From the perspective of your department and management level, describe your business structure.

Suggest ONE contributing factor that may make yours the preferred structure.

Request information from TWO other departments that could assist in your investigation. Please specify both the TYPE, and specific CONTENTS of the report you are requesting (Unit 3 types of output)

3: Discuss the security implications

From the perspective of your department and management level, discuss the implications of a security breach in the company’s infrastructure (all forms - human, technology etc.)

Suggest ONE reason why such a breach could occur.

Critique TWO post made by group mates from other departments

4: Create the process diagram

DESIGN and DRAW a high level “as-is” process diagram depicting how a trade would be made, under your proposed structure. The diagram should be for the model you are supporting and should show the bands, process flows, roles and/or cross functional interactions required.

5: Summarise and make Recommendations

Summarise the information shared thus far, and discuss TWO findings about your analysis from your management level that can be used to decide on the final company structure. Make TWO recommendations to prevent security breaches.

Please assist in answering questions 2 - 5. Due at 12:00 p.m today, so would appreciate a quick yet thorough answer. Thank you.

LimeBike is a start-up founded in 2017 located in San Mateo, California. Its mission is to make shared bicycles accessible and affordable. The company has taken the basic idea of shared bicycles and eliminated the need to return the bike to a docking station, which may not be near the cyclist’s destination.

LimeBike charges $1 per 30 minutes of riding. Students receive a discounted rate of $0.50 per ride.

To use LimeBike, you first use the LimeBike app to locate one of the citrus-colored bikes near your location. Once you are at the bike, you scan the QR code on the bike or enter the bike’s plate number into the app to unlock the bike. When you are finished using the bike, you park the bike by a bike rack or post – anywhere that is legal and visible. Once you press down the back wheel lock, the trip is finalized and your payment is processed – all within the LimeBike app.

LimeBike operates the bicycle networks within cities, eliminating the need for cities to maintain the bikes or deal with other logistics. The shared bicycle network is not dependent on government funding, making it appealing to cities with tight budgets.

LimeBike just raised $12 million in funding from investors to expand its operations. It is set to begin operating in as-of-yet undisclosed cities in April or May of 2017.

You are one of the only accountants in LimeBike headquarter's office.

The company’s CEO, Toby Sun, has tasked you with forming the company's the company’s accounting policies.

For the discussion post, write an email to the company CEO and address all of the following typical company scenarios and whether each item should be expensed or capitalized at LimeBike:

The cost of customized bikes. This includes the bike's purchase price, shipping, assembly and sales tax.

Development costs of the smart phone app for locating, paying, and returning bikes. (Resource: Accounting for Software Development)

Salary of the salesperson who works to get cities to adopt the Lime Bike program.

Replacement tires for bikes.

Routine bike maintenance including chain lubrication, brake pad replacement, and drive train cleaning

Electricity and other utilities in administrative offices

Somewhere in your email, also address why this classification is important. Be sure to include how these decisions would impact the company’s balance sheet and income statement.

Ragan, Inc. was founded nineteen years ago by brother and sister Carrington and Genevieve Ragan. The

company manufactures and installs commercial heating, ventilation, and cooling (HVAC) units. Ragan,

Inc. has experienced rapid growth because of a proprietary technology that increases the energy

efficiency of its units. The company is equally split between the two siblings. The original partnership

agreement between them gave each 500,000 shares of stock. The company has since gone public. At

that time, the siblings retained their shares and 1,000,000 shares of new stock were issued.

The firm anticipates needing to raise a large amount of capital ($10 million) in the coming year to

facilitate further expansion and are evaluating several financing options. The first option is to issue

zero-coupon bonds that mature in 20 years. Similar zero-coupon bonds currently have a YTM of 4.5%.

The second option is to issue 4% coupon bonds that mature in 20 years. Similar bonds have a YTM of

4%. The third option is to issue preferred stock with a fixed dividend of $0.85 per share. These

preferred stock would have a required return of 7.5%. The firm currently has no preferred stock

outstanding. The fourth option is to issue common stock.

The stock is currently trading on the market for $20 per share. The firm most recently paid a dividend

on common stock of $0.50 and plans to increase that dividend by 25% per year for the next five years.

After that, the firm will level off at the industry average of 5% per year, indefinitely. Carrington and

Genevieve estimate the required return on the stock to be 15%.

1. The firm already has some public bonds outstanding. Those bondholders may not be

comfortable with the idea of issuing new bonds. How might the firm reassure existing

bondholders?

2. What additional (qualitative) considerations must be made with respect to issuing preferred

stock? How might existing shareholders feel about this?

3. Are there any additional factors you believe should be considered? If so, what are they and how

might they impact your recommendation?

Case M23 -- Excellence in Corporate Training

EXCEL Learning, Inc. was founded in 1988 by Dan Robinson, a renowned author and seminar speaker. Dan teamed up with Walt Irwin, also a corporate consultant with skills in business management. Dan developed his book and seminar topics into several marketable training products, which were packaged into 2 and 3 day workshops, including participant workbooks, trainer guides and PowerPoint presentations. Dan’s reputation in the corporate marketplace guaranteed initial acceptance of his training products by corporate clients.

Dan selected Walt, a former CEO, seminar client and old friend as a partner because they shared strong values of customer service and the influence that training can have on empowering one’s workforce. Walt’s role was to create a marketing plan, recruit trainers, and generally run the business. EXCEL launched its business with Walt as President and Dan as Senior Vice President, hiring 10 affiliate consultants as part-time, sub-contractors to deliver training seminars. In a week-long retreat, Walt and Dan oriented the new consultants to all training products and began scheduling seminars with groups from Dan’s client companies. Dan was pleased with Walt’s ability to articulate their shared vision of service and to strongly communicate the need for consistency in operating from this shared vision in all of their training services.

During the first year, Dan and the affiliates had a full schedule and the company was very successful. Walt and Dan wanted to keep the company small, so only a few new affiliates were added to handle additional clients. Walt handled all the scheduling, finances, and supervision of consultants in the field. Dan agreed that Walt would have complete control over hiring and managing client relations – this was made clear during the orientation and subsequent meetings with the consultants. Walt would have phone conversations with each consultant on a regular basis to initiate client contact and to debrief training events, often relating client comments on the consultants’ performance. Often, these conversations would be late in the evening, and usually Walt would have had a few glasses of wine before he made calls. In conversations with consultants, Dan heard about some of these conversations and was concerned. Cheryl, an accomplished trainer and old friend of Dan, related that Walt had been especially harsh with her about a recent training event and client complaint, insisting that she admit fault. She had since had a conversation with the client and the client was satisfied, even requested that she be the lead trainer for another group. As Dan co-trained with other affiliate consultants, he heard stories of similar, late evening conversations and an all-too-consistent pattern of intimidation with consultants. Some of the younger affiliates seemed to actually appreciate the “coaching,” (Rob Sites, for example, stated “Walt is tough, but he has helped me grow to become a better trainer. I appreciate that.” The more experienced consultants, however, were resenting the treatment. Even though the consultants were part-time affiliates and sub-contractors (working a maximum of 100 days per year), Dan wanted them to feel like partners in the business, with considerable control over exercising judgment with clients.

One evening, over dinner, Dan and Walt were discussing business plans and some overseas training requested by a corporate client. Walt recommended a team of consultants to follow Dan who would launch the training series. Dan confronted Walt about his manner with two of those consultants, who had mentioned their treatment from Walt. Walt at first blew off the concern, but then became angry as Dan discussed the potential of losing some of their best consultants. (Walt) “Do you want me to run the business or not? You know you are just too soft to manage these people. I know our clients and I know what they want from the consultants.” Dan agreed, sort of, but asked Walt to trust the consultants a little more. “You know some of our people are very experienced and the clients are not always right.”

Several weeks passed, the training in UK had gone well. Dan had launched the first day’s training and left Cheryl to lead the remaining sessions with two other consultants. Dan and Walt followed the training with a conference call with the VP of European Operations who was very pleased with the results. Then Dan received a call from Cheryl – she was in tears and was announcing her resignation. She had just finished a difficult conversation with Walt the night before where he had raked her over the coals for being too soft with the finance group in London. (Walt) “They didn’t hire us to hold their hands, you know, they hired us to kick butt! You really blew it. “ Dan begged her to calm down and he would talk to Walt. Cheryl said she would not reconsider and thanked Dan for his kindness.

1.      Analyze this case using models and principles from Organizational Behavior/Management. Describe the players, their styles/behaviors and relationships. Focus on management and leadership.

2.      What is your recommendation to Dan, the primary stakeholder and person responsible for the business? Include your rationale.

Federal Express (FedEx) was founded about 50 years ago. It handles on an average of 3 million package-tracking requests on a daily basis. To remain ahead of its competitors, FedEx strives on customer service by keeping a comprehensive website, FedEx.com. It increases customer service and reduces costs. For example, each request for information which can be retrieved from the website rather than by the call centre help FedEx to save an estimated $1.87. The costs for FedEx have been reduced from more than $1.36 billion per year to $21.6 million per year by customers using the website instead of the call centre calculating each package-tracking request costs Federal Express 3 cents. Another know-how that improved its customer service is Ship Manager, an application installed on customers’ sites so users can determine shipping charges, weigh packages, and print shipping labels. Customers can also tie their invoices, billing, accounting and inventory systems to the application, Ship Manager. Nevertheless, Federal Express still spend almost $326 million annually on its call centre to reduce customers’ annoyance when the website is down or when customers have difficulty using it. It uses CRM software called Clarify in its call centres to ensure customer service representatives’ job easier and to speed up response time. Answer the following questions: a) What is the importance of technology to ensure high-quality customer service? b) Can you estimate Federal Express’ annual savings from using information technology? c) Can you give a few examples of information technologies used by Federal Express? d) What is the role of the application ‘Ship Manager’? e) Your overall observations and learning from the above case study.

Federal Express (FedEx) was founded about 50 years ago. It handles on an average of 3 million package-tracking requests on a daily basis. To remain ahead of its competitors, FedEx strives on customer service by keeping a comprehensive website, FedEx.com. It increases customer service and reduces costs. For example, each request for information which can be retrieved from the website rather than by the call centre help FedEx to save an estimated $1.87. The costs for FedEx have been reduced from more than $1.36 billion per year to $21.6 million per year by customers using the website instead of the call centre calculating each package-tracking request costs Federal Express 3 cents.

Another know-how that improved its customer service is Ship Manager, an application installed on customers’ sites so users can determine shipping charges, weigh packages, and print shipping labels. Customers can also tie their invoices, billing, accounting and inventory systems to the application, Ship Manager.

Nevertheless, Federal Express still spend almost $326 million annually on its call centre to reduce customers’ annoyance when the website is down or when customers have difficulty using it. It uses CRM software called Clarify in its call centres to ensure customer service representatives’ job easier and to speed up response time.

Answer the following questions:

a)     What is the importance of technology to ensure high-quality customer service?

b)    Can you estimate Federal Express’ annual savings from using information technology?

c)     Can you give a few examples of information technologies used by Federal Express?

d)    What is the role of the application ‘Ship Manager’?

e)    Your overall observations and learning from the above case study.