Toyotas Management Philosophy

Toyotas Management Philosophy The Toyota Way describes the 14 principles that form the foundation of this uniquely successful management style. Using profiles of a diverse group of organizations, from a variety of industries, it demonstrates how this model of success can be applied in any organization, to improve the quality, efficiency, and speed of any business process, including sales, product development, marketing, logistics, and management. This blueprint of Toyotas management philosophy offers managers in blue-collar, white-collar, manufacturing, or service environments specific tools and methods for becoming the best in their industries on cost, quality, and service.   Principle 1: Management decisions should be based on a long-term philosophy, even is short-term financial goals may suffer. Principle 2: Create constant process flow to bring predicaments to the surface. Principle 3: Employ pull systems to evade overproduction. Principle 4: Balance out the workload (heijunka)-work similar to the tortoise, not the hare. Principle 5: Construct a culture of ending fix problems, to get excellence right the first time. Principle 6: Consistent tasks are the basis for continuous development as well as employee empowerment. Principle 7: Make use of visual control so that no problems are concealed. Principle 8: Employ only reliable, carefully tested technology that complements your people along with processes. Principle 9: Grow leaders who systematically understand the work, comprehend the philosophy, and train others with it. Principle 10: Increase exceptional people with teams who go along the companys philosophy. Principle 11: Value your extended set of connections of partners and suppliers by testing them and helping them develop. Principle 12: See for yourself to meticulously appreciate the circumstances (genchi genbutsu). Principle 13: Formulate decisions little by little by consensus, thoroughly considering all options: put into practice decisions quickly (nemawashi). Principle 14: Grow to be a learning organization through persistent reflection (hansei) and nonstop improvement (kaizen). While Jim Collins describes in his book, Good to Great his concepts of people and leaders. Level 5 Leadership the Level 5 Leaders are not the types which are charismatic and media. Chances are youve by no means heard of them. They are seen as humble, self-effacing as well as more concerned about the success of the company than their individual accomplishment. First Who, Then What Through a bus analogy, Collins argues that great companies first get talented people on the bus, then settle on where to drive it. As stated by to Collins, the right people are your largely important asset. Confront the Brutal Facts but Yet Never Lose Faith Those Good to Great companies continue unwavering faith that they can as well as will prevail in the end, in spite of of the difficulties, and all at once have the discipline to deal with the most brutal truths of their current reality no matter what that might be. The Hedgehog Concept also known as Simplicity within the Three Circles The Good-to-Great companies do what they be able to do best (as opposed to what they desire to do best), what they are deeply zealous about, and they center on what guides their economic engine. A Culture of Discipline containing a disciplined culture is the other extreme of having a controlled one. Hierarchy, bureaucracy, if not excessive control is not needed. Technology No one in the Good To Great executives position technology as their top 5 drivers. No one of them jumped on the .com bandwagon due to panic. All of them took a careful approach as to how technology can be of great help to them to do what they do well much more. There are so many genuine insights seen in this book. Understand that Collins has no intention to be revolutionary. He is simply reporting data. The proposition is if you could model these significant factors, your company could as well reach the level of vastness. The 5th Level Leader 5th Level Leaders contain a combination of strong will plus personal humility. The 5th Level Leader shows an unwavering resolution and sets the benchmark for building great companies. In equilibrium, he demonstrates a forceful modesty, relies on inspired standards in addition to channels ambition keen on the company, and not into the character. Comparing the two, they are similar in some ways. Collins and Liker both understand how to develop its own business. One of their similarities is their concept of people running the business. They see very good people running the operations to sales as one of their asset. However, there are some differences on how the two authors value business. In his book, Good To Great, Jim Collins describes the business strategies of both successful and unsuccessful firms. Successful CEOs evolve innovative, wealth-creating plans that are long-lived, accommodate flexibility and change, and are firmly rooted in providing genuine value to customers. The unsuccessful CEOs tend to employ quick fix strategies doomed to be short-lived. In his book, The Toyota Way, Jeffrey K. Liker describes Toyotas preeminent form of lean manufacturing the Toyota Production System (TPS). Liker acknowledges that firms can boost productivity in the short term by implementing TPS tools. But long-term sustainability critically depends on what he terms the Toyota Way, which is Toyotas management commitment to invest in its people and promote a continuous-improvement culture. Liker contends that if a company does not understand the culture behind TPS, even though it has all the tools and techniques of TPS in place, the real work of implementing lean has just begun. Essentially, TPS is about applying the principles of the Toyota Way so that workers are contributing to the improvement of the system and of themselves. The Toyota Way encourages, supports, and demands employee involvement, for it is people who carry the system to life by means of working, communicating, resolving issues, also growing together. Thus, it is a culture even more than a set of efficiency and improvement techniques. Based on the authors 20 years of studying Toyota, he offers 14 principles that constitute the Toyota Way and form the basis of the culture behind TPS. For ease of understanding, he divides these principles into the four categories-Philosophy, Process, People/Partners, and Problem Solving-that correlate to the four high-level principles (genchi genbutsu, kaizen, respect, and teamwork) explained in Toyotas own internal Toyota Way training document. The idea of understanding that drives action is one way to put it. Good to great companies worked to understand at a deep level what made their company work, and by continually looking for new answers to the question, they developed the momentum to breakthrough into greatness Their leaders understood success was not about themselves as a person, but about the success of their company. They understood that the right people in the right seats on the bus make all the difference. They understood the importance of finding the truth and acting on it in the form of facing the brutal facts of reality, while maintaining unwavering faith that they would succeed. They understood that tapping passion, extraordinary competence, and the key economic driver builds progressive momentum. They understood the discipline of staying focused on the essentials and stopping the distractions. They understood technology is best used to accelerate momentum, not to create it. Finally, they understood that greatness comes from sustained commitment to disciplined people, disciplined thinking, and disciplined action that creates breakthrough momentum. Such understanding requires the integrated whole of the principles illustrated in this book. The challenge to all is to embody these principles, and by so doing, to live them out in everyday actions and interactions. By so doing, greatness, or even further greatness, awaits.

Electronic Portfolio’s :: Essays Papers

Electronic Portfolio’s Electronic portfolios or E-folios for short are becoming essential tools, not only for the technology industry, but also for students, job-seekers, and even employers. E-folio’s are a great way to express literally anything that you want. This is the reason why e-folios are so unique and mainly why they have the ability to be so versatile. But, what exactly is an e-folio, and how is it created? I will go over these questions and why e-folios should be used whenever possible. Electronic portfolios are selective and purposeful collections of work, designed to showcase knowledge, skills, achievement, and growth over time (Casey). They are made available on the World Wide Web for easy access. These portfolios tend to focus on the creator’s previous work and their own reflections of each piece. The purpose of an e-folio is basically to provide documentation and credibility to the creator’s abilities (Ramey). Electronic portfolios represent a learning history as well as a reference of the creator’s capabilities (Casey). The first step in creating an e-folio is figuring out what needs to be included (Moody). Although, you can add anything to an e-folio, keep the same theme throughout. For example, you’re not going to want obscene college pictures floating around your e-folio if you are trying to make it apart of your job resume. What is the best way to organize an e-folio? Sandy Boyd of the Instructional Program at the University of Houston says, â€Å"There is no single correct answer,† (Boyd). The second step is just that, trying to figure out what type of e-folio creator you are. If you are a job candidate with no prior job experience, then your e-folio should highlight skills learned in college, training received for the particular job, and any internships or co-op experiences (Moody). Also, any communication skills or significant social responsibilities that stand out would be more than relevant for your e-folio (Moody). If you are an experienced job candidate, th en your e-folio should emphasize previous job training, performances and experiences (Moody). Any licensures, certifications, as well as, previous job projects should definitely be included (Moody).

How a Simple Gesture of Courtesy Can Change Humanity Essay

Basically, Courtesy is simply defined as showing of politeness towards other people. However, if you think about it further, this word means so much more as it can make huge changes in our lives, our nation, and the entire humanity. Nowadays, it is quite significant that we show kindness to other people, not just the ones we personally get to be acquainted with but especially those individuals we don’t know. Being civil towards each other only means that we respect each other’s opinions, way of thinking, and actions. We all know that each and every one of us are uniquely created and we have to understand those differences because we can all grow and learn from each other if we only take the time to make realizations out of these everyday actions. One good paradigm is our school community here at LPU in Manila. We have to face the reality that there can be times when we cannot contain ourselves from making a fuss out of class misunderstanding with our professors/classmates; or the never ending school violations that we get from the school guards; waiting in queue for long lines during enrollment, paying for our school fees, or merely waiting for our turn to be served food at the cafeteria; and asking for some mercy from our terror professors who finds it rather fun to see us having a difficult time accomplishing their subject requirements. These are those â€Å"some things† that can make our temper soar rocket high. At one point, before making not-so-good reactions, have we asked ourselves about how we should deal with all these? Have we thought of showing courtesy even if we feel that we’re being violated of our rights on those sometimes? I personally think that showing act of politeness can turn dreadful situations into something better. We can define ourselves with how we usually act when no one is watching. Good thoughts toward others are very important not because it can make you look excellent and ideal, but it can personally and eventually professionally hone you into a good citizen of this country. Showing that you appreciate your professors through studying well on their class can make them feel that they’re doing their jobs precisely. If we take a closer look at how these educators passionately share their knowledge with us, we’ll all realize that their profession is priceless. We should know the fact that they serve as our second parents and we must give them equal respect that we give our real ones. As a student of this university, I would have to say that courtesy doesn’t just end with showing acts of politeness and kindness inside the school premises. We should exhibit courtesy everywhere we go and with whomever we meet. Our real lives actually start when we leave school and face the sometimes unfair and harsh reality of the world. I know for sure that if we only give out courtesy not just from our minds but also from our hearts, we can change this country’s state and become one of the best from around the globe. We cannot just leave our country’s success to the government. Because again, courtesy plays a huge part into making a country stand out. Being a good citizen is not about becoming a politician that can guide this country and its people. We can be our simple selves and yet make a huge difference by doing our part. We can show courteousness through abiding law; helping out other Filipinos; supporting our government’s projects; having a warm heart for less fortunate; sharing our knowledge through hard work; and being honest, just and fair. Filipinos are known to be hard working, respectful, kind, and humble. If we keep on improving not just because we want to be successful but also to become better persons each day, the whole world can perceive how simple courtesy can make everything better. The whole world needs courtesy just like it needs love. Courteousness is one of the significant factors that can make an individual, a nation, and humanity exceptional. Courtesy starts with us. It is given and should not be asked for.

Ethics and Beneficence - 1020 Words

There are so many ethical ideal that I have learned from this subject, got honesty, forgiveness, justice, etc. However, I think that the greatest ethical ideal that I have learned is beneficence. In normal word, beneficence is meaning the action to do benefit and promote the good to other people. While in the language of a principle or rule of beneficence refers to a normative statement of a moral obligation to act for the benefit of other, helping them to further their important and legitimate interests, often by preventing or removing possible harms. I will choose beneficence is because there are many people in this world they need the help from other, although it is only a small thing but when we help them this is also can count as†¦show more content†¦The category of medical benefits cannot for him include items such as providing fertility controls, performing purely cosmetic surgery, or actively helping a patient to affect a merciful death by active hastening of death. This characterization of the ends of medicine allows Pellegrino to limit severely what counts as a medical benefit for patients: Benefit in medicine is limited to healing and related activities such as caring for and preventing injury or disease. There are several problems that can we seen in business ethics. â€Å"Discussions of the role of the corporation in society and the very purpose of a corporation as a social institution are examples. It is not disputed that the purpose of a for-profit corporation is to make a profit for stockholder, but there has been an intense debate about whether maximizing stockholder profits is the sole legitimate purpose of corporations† as Milton Friedman and other have argued and whether beneficent corporate conduct is justifiable. This question is normative, but there is also the question of moral psychology raised by Smith: â€Å"Does beneficence have any place in the world of business?† An example is found in public utilities’ program to help customers pay for electricity, gas, oil, phone service, and the like. This attitude not only won’t increase the company profits but reduce. In fact, this is a corporate form of charity. The money is taken directlyShow MoreR elatedPrinciples Of Ethics : Respect For Autonomy, Beneficence, Non Maleficence And Justice1450 Words   |  6 Pagesso will preserve her life which should be the uttermost purpose and outcome of any treatment. Ethical Aspects There are four principles of ethics: Respect for autonomy, Beneficence, Non maleficence and Justice. This four principles offers comprehensive thought of the ethical issues in clinical settings (Beauchamp and Childress 2001 cited in UK Clinical ethics Network 2011). Respect for Autonomy Cambridge (2016) defines autonomy as the ability to make a decision without any influence from any individualRead MoreEthics And Human Decision Making977 Words   |  4 Pagesplans are the ethics of obtaining such research or plans. Though what is meant when people discuss the ethics of research. Ethics is a series of principles that help guide more human moral behavior. So in short when ethics is discussed about research it is talking about the moral and human decision making when doing research. Though how do we question if something is ethical or not? This question is answered by the six principles of ethics, Respect for Autonomy, Nonmaleficence, Beneficence, Justice,Read MorePrinciples of beneficence and non-maleficence750 Words   |  4 Pagestreatment of disease, injury and other physical and mental impairments_. _TORT_ : A civil wrong committed against a person or property, excluding breach of contract. BENEFICENCE AND NON-MALEFICENCE As the principles of beneficence and non-maleficence are closely related, they are discussed together in this section. Beneficence involves balancing the benefits of treatment against the risks and costs involved, whereas non-maleficence means avoiding the causation of harm. As many treatments involveRead MoreEthical Healthcare Issues Essay1193 Words   |  5 PagesHealthcare Issues Paper Wanda Douglas Health Law and Ethics/HCS 545 October 17, 2011 Nancy Moody Ethical Healthcare Issues Paper In today’s health care industry providing quality patient care and avoiding harm are the foundations of ethical practices. However, many health care professionals are not meeting the guidelines or expectations of the American College of Healthcare Executives (ACHE) or obeying the organizations code of ethics policies, especially with the use of electronic medicalRead MoreMany In The Healthcare Profession Today Are Challenged816 Words   |  4 Pagescare. Most healthcare givers would, but what about those who are providing care in a government interrogation area? In this summarization; two valuable principles, beneficence and nonmaleficence will be discussed. Also, an in-depth analyzation of a case study of a military doctor whose ethics will may be tested. Keywords: Beneficence, Nonmaleficence Key Characteristics This case analysis is about Dr. McHale, a psychiatrist in the United States Army. Dr. McHale is also a commissioned officer whoRead MoreThe Ethics Of Group Counseling885 Words   |  4 PagesEthics in Group Counseling According to the American Counseling Association (ACA, 2014) Code of Ethics, ethical principles are based on a set of values that include autonomy, nonmaleficence, beneficence, justice, fidelity, and veracity. These ethics apply to all types of counseling, including both group and individual therapy; however, different aspects of these ethical guidelines must be considered based on the therapeutic approach. This paper will identify several of these ethical issues asRead MoreEthical Healthcare Issues There are questions about transplant allocation in regards to the four900 Words   |  4 Pagesregards to the four major ethical principles in medical ethics: beneficence, autonomy, nonmaleficence and justice. Beneficence is the â€Å"obligation of healthcare providers to help people† that are in need, autonomy is the â€Å"right of patients to make choices† in regards to their healthcare, nonmaleficence, is the â€Å"duty of the healthcare providers to do no harm†, and justice is the â€Å"concept of treating everyone in a fair manner† (Medical Ethics the Rationing of Health Care: Introduction, n.d., p.Read MoreEthics Of The American Counseling Association880 Words   |  4 PagesAccording to the American Counseling Association (ACA, 2014) Code of Ethics, ethical principles are based on a set of values that include autonomy, nonmaleficence, beneficence, justice, fidelity, and veracity. These ethics apply to all types of counseling including both gro up and individual therapy; however, different aspects of these ethical guidelines must be considered based on the therapeutic approach. This paper will identify several of these ethical issues as they relate specifically to groupRead MoreCode Of Ethics For Nurses1614 Words   |  7 PagesCode of Ethics for Nurses The American Nurses Association (ANA) established the code of ethics for nurses to serve as a foundation for practice and nursing standards. Nurses that enter the field are educated on the code of ethics and its provisions that make up the balanced foundation that is used to this day. The code of ethics is to be honored by every nurse, and every nurse should know their ethical obligation to their patients (American Nurses Association [ANA], 2015). This approach encompassesRead More2. There Are Numerous Principles Of Medical Ethics That1503 Words   |  7 Pages2 There are numerous principles of medical ethics that are important to consider in ethical arguments and situations. In the theory of principilism, health care professionals base their ethical practice on four principles: autonomy, beneficence, nonmaleficence, and justice. These are all thought to be important principles that should be considered when examining a case involving medical ethics. While it is of the greatest benefit for components of each of these principles to play a part in deciding

Mbazappos the Company That Is Powered by Customer Service

The Company That is Powered to WOW Founded in 1999, Zappos started as site that only sold shoes. The idea for the site came to founder Nick Swinmurn in his quest to find the right shoe. Swinmurn couldn’t find exactly what he was looking for in the different stores he visited. The stores either didn’t have his size or the right style and color. After spending hours searching and getting no where he went home shoeless. Swinmurn attempted to shop online for the shoes he wanted. He couldn’t believe there wasn’t a site that offered a huge variety of shoes. This inspired him to create a site that he envisioned that had a big selection of different size, styles and colors of name brand shoes (â€Å"In The Beginning - Let There Be Shoes†, n.d.).†¦show more content†¦Hsieh creates and allows fun to take the stress that comes with customer service positions. Even though Zappos doesn’t have the typical working environment, a leader should still stress the important in taking the job seriously to ensure customer retention and great service. If there was decline in the demand of the products Zappos offered occurred at this very moment I think the culture will change just a little. I foresee the leaders of the company trying to hold on to the original culture but the stress of the decline impacting the fun and free work atmosphere. Some leaders will begin to focus solely on the operations of the company and the how to continue to make the company profitable (Schermerhorn, Osborn, Uhi-Bien, Hunt, 2012) .Slowly they will all become transactional Leaders rather than transformational leaders focusing on money and not people. The employee would provide wow service and have fun. All that would slowly phase out once the stress from the leaders trickle down to the other staff members. These actions will eventually result in the sales declining and the company being in a bad place financially. If the company response quickly to the decline in the demand the culture c ould continue to provide expectable wow service to the customer and a great working environment to the employees. In order for this occur the company would have to keep open communication among the leaders and the employees. Zappos would need

The Raven And American Romanticism Essay - 1292 Words

Kaylee Parker Kevin Stagg American Literature September 15, 2016 The Raven and American Romanticism The anonymous storyteller is busy reading a book when he hears somebody knock at his door. A faint thought comes to him that perhaps it was a guest, and he finds it better to let him in the following day because he was meditating over the demise of Lenore, his lover (Prince and Allan 4). Surprisingly, when he decides to open the door, he comes to nothing new except a sound echoing Lenore a reverberation from his thoughts. Coming back to his room, he again hears a knock and simply imagines that it was presumably the strong wind blowing from outside. A raven enters and expeditiously roosts upon a bust of Pallas over his entryway (Prince and Allan 3). The persona asks the bird of its name, the raven reacts, Nevermore. This left the narrator disturbed. Even though the poet employs several literary elements like symbolism, tone, and themes, the romanticism across the poem rekindles the overall atmosphere of the nineteenth century in America. The raven is one of the most revered literary pieces of Poe. The stylistic features and diverse dramatic qualities of the poem are appealing to the targeted audience. The repetitive use of the terms nothing more and nevermore build a fundamental internal rhyme scheme of a unique refrain. In the name Lenore and the word nevermore, Poe stresses the vowel O, which achieves a an atmosphere of loneliness and a tone of melancholic despondency (HamerShow MoreRelatedThe Raven and Romanticism Essay509 Words   |  3 PagesThe era of Romanticism spans from the late 1700s to the mid 1800s following the French Revolution; therefore, Romanticism encompasses characteristics of the human mind in addition to the particular time in history when these qualities became dominant in culture. Romanticism depicts an artistic movement which emerged from reaction against dominant attitudes and approaches of the 18th century. Romanticism established realism in literature through creativity, innovation, explorationRead MoreEssay on The Romantic Side of Edgar Allan Poe 1061 Words   |  5 Pageshas a trace of romanticism in it. Romanticism started around the 1800’s as a contradiction to rationalism. Rationalism was a thinking that attempted to use rational thinking and reason to solve the problems being faces at its time. Romanticism is basically the opposite of those thoughts. Romanticism is described as, a revolt against Rationalism that affected literature and the other arts, beginning in the late eighteenth century.(Elements of Literature, Page 1179). Romanticism bases its problemRead MoreThe Raven A Man By Edgar Allan Poe1737 Words   |  7 PagesRomanticism has dated back since the 1780’s, the literature behind Romanticism is full with emotion, passion and wildness. The characters in these passages are very distinguished, they are also iconic. The stories are usually set a unknown place for example in a cast le or in the woods, or they are set in a known place where something is out of the ordinary. There is something supernatural going on within the passage of writing. There are many thing that happen in the story that doesn’t happen inRead MoreIn The Years Before Abraham Lincoln Was Elected The Sixteenth1535 Words   |  7 Pagesan era that emphasized individualism, emotion, and nature. This era was called the â€Å"Romantic era†, or â€Å"Romanticism† as it is known today. Partially due to the Industrial Revolution, men and women had become intrigued by the advances in political structures and the rationalization of nature. This led to the rise of not only advancement in scientific endeavors and political evolution, Romanticism helped give birth to some of the greatest literary writers who have ever lived. From famous poets (likeRead MoreNature s Influence On The Development Of Literature1236 Words   |  5 PagesNature’s Influence on the Development of Literature Romanticism is a movement in the artistic world that originated from the eighteenth century with emphasis on inspiration and naturalness. The Romantic Movement’s beginning may be drawn back to the events of folklore and popular art which emerged as a result of the German Grimm brothers, Jakob and Wilhelm collecting tales and other academic professionals like Joseph Addison and Richard Steele, whose writings catered to clarity, it was time to departRead MoreAnalysis Of Edgar Allan Poe s The Raven1232 Words   |  5 Pages Edgar Allan Poe: The Raven Literature is a very powerful tool that is used to make a huge impact on society or in someone’s perspective. As complex as the world, literature can appear in many forms using unique vernacular that expresses human endeavors. In some cases, social reform is Transcendentalism is an American literary, philosophical movement, promoting the idea of independent progress. The central idea is the optimistic viewpoint of humanity. People, men and women equally, have knowledgeRead MoreThe Value Of Literature Courses1428 Words   |  6 Pagesnotice between American literature and literature from other parts of the world? (This question is based on your observations. A stronger argument can be made if you write in third person.) Literature from around the world is different and reflects thoughts, theories, attitudes, beliefs, and ideals that are relative to the time and culture. American literature, for example, has evolved over time as authors were writing about what was happening at the time. In particular, American Romanticism showed readersRead MoreEdgar Allan Poe Biography. By. Alyssa Marshall.1260 Words   |  6 PagesEra†, many of his stories genres are horror like â€Å" The Masque of The Red Death†, mystery such as â€Å" The Fall of The House of Usher†, lost love as in â€Å" The Raven†, and obsession such as â€Å" The Pit and The Pendulum†. Edgar’s poems and short stories are influenced by tragedies that happened through out his lifetime. Poe influenced not only American literature but literature around the world. He also influenced writers around the world such as Sir Conan Doyle, Fyodor Dostoevsky are just a few writers heRead MoreAnalysis Of Edgar Alla n Poe s The Raven And The Fall Of The House Of Usher 896 Words   |  4 PagesPoe is an extremely well known American writer and is famous for his horrific and mysterious works such as, â€Å"The Raven† and â€Å"The Fall of the House of Usher.† Poe was born in 1809 in Boston, Massachusetts in an era that seems to have many dark and ominous writers and pieces of literature originating from that time period. Poe is said to have launched the interest in many of the detective type stories that we read from modern day writers. â€Å"In the early 1800s, romanticism was the dominant literary modeRead MoreLiterary Romanticism : Literary Realism852 Words   |  4 PagesLiterary Romanticism in Contrast to Literary Realism Romanticism is a movement in the arts and literature that originated in the late 18th century, emphasizing inspiration, subjectivity, and the primacy of the individual. This particular movement focused on imagination and the interpretation of imagination by the individual. Romanticism primarily used symbolism to represent a much broader meaning than the object itself. In contrast, Realism attempts to describe life without idealization or romantic

Manufacturing of Business Product

Question: Discuss about the Report for Manufacturing of Business Product. Answer: 1. Fixed manufacturing overheads refer to those costs which are indirect in nature but related to the manufacturing of the product. These are typically fixed in nature and hence do not vary as per the volume of the output produced. In the event that output is lesser, then the fixed manufacturing cost allocated to each item would increase. However, since these are essentially fixed, hence they are not related to the production activity actually been undertaken (Drury, 2008). There are essentially two methods to compute the income statement i.e. Absorption costing and variable costing. In case of absorption costing, the fixed manufacturing overheads are included in the product cost and not the period cost. Hence, the fixed manufacturing overheads are computed by dividing the total fixed manufacturing overheads by the total production level of the product. Thus, the contribution margin is computed by deduction of fixed manufacturing overheads. In case the production is higher than the demand, then this method ensures that some of the fixed manufacturing overheads is transferred to the inventory cost and deferred to the next period and hence provide a boost to the profits of the company (Bhimani et. al., 2008). In case of variable costing, the fixed manufacturing overheads are not included in the product cost but as period cost. As a result, the per unit fixed manufacturing overheads does not need to be computed. Also, the complete fixed manufacturing overheads would be accounted for in the income statement and no component would be deferred to the future through the medium of inventories. Hence, typically this would lead to a lower profit figure as compared with the absorption costing since all the fixed manufacturing overheads would be accounted for in the income statement (Seal, Garrison Noreen, 2012). Maria indeed has vested interest in the given case which is why she is insisting on overproducing the product so as to cause a huge inventory and by adhering to the absorption costing, she would shift a host of the fixed manufacturing costs in the future through huge inventory. Clearly, this is incorrect and hence the absorption costing must not be used for external reporting (Petty et. al., 2015). External Reporting With regards to reporting to external stakeholders, it is recommended that the variable costing would be the preferred method as this ensures that an accurate picture is presented to the shareholders with regards to the performance of the company and the various costs already incurred (Parrino Kidwell, 2011). Internal Reporting With regards to internal reporting the firm has got a choice between absorption costing and variable costing. While taking decisions regarding pricing, the absorption costing is the most suitable since it takes into consideration all the costs actually involved in production and hence lead to better accuracy with regards to costing of an individual product. However, in cases of evaluating an external contracts in case of idle demands, it is recommended that the company deploys the variable costing into account as the fixed manufacturing cost is not an incremental cost and hence quote to external parties should not include this (Bhimani et. al., 2008). 2. It is apparent that there are three market segments of Cinto namely General Supermarket, Pharmacy Chains and Pharmacist owned single stores. Gross margin = (Gross Profit/Total Revenue) *100 Gross margin (General Supermarket) = (108000/3708000)*100 = 2.91% Gross margin (Pharmacy Chains) = (150000/3150000)*100 = 4.76% Gross margin (Pharmacist owned single stores) = (180000/1980000)*100 = 9.09% The cost per activity for the given activities is summarised in the table below (Brigham Ehrhardt, 2013). ACTIVITY LEVEL Activity General Supermarket Pharmacy Chains Pharmacist owned single store Total activity Total cost ($) Cost driver rates ($) Orders Processed (Number) 140 360 1500 2000 80000 40 Line items orders (Number) 1960 4320 15000 21280 63840 3 Store Deliveries made (Number) 120 360 1000 1480 71000 47.97 Cartons shipped to stores (Number) 36000 24000 16000 76000 76000 1 Shelf Stocking (Hours) 360 180 100 640 10240 16 Cost driver rates = Total cost/Total activity level The allocation of the other operating costs based on the above cost driver rates is shown below (Drury, 2008). Activity General Supermarket Cost ($) Pharmacy Chains Cost ($) Pharmacist owned single store Cost ($) Orders Processed (Number) 5600 14400 60000 Line items orders (Number) 5880 12960 45000 Store Deliveries made (Number) 5,756.76 17,270.27 47,972.97 Cartons shipped to stores (Number) 36000 24000 16000 Shelf Stocking (Hours) 5760 2880 1600 Total operating costs ($) 58,996.76 71,510.27 170,572.97 Operating Profit (General Supermarket) = 108000 58996.76 = $ 49,003.24 Operating profit as a % of revenue (General Supermarket) = (49,003.24/3708000)*100 = 1.32% Operating Profit (Pharmacy Chains) = 150000 71510.27 = $ 74,489.73 Operating profit as a % of revenue (Pharmacy Chains) = (74,489.73/3150000)*100 = 2.36% Operating Profit (Pharmacist owned single store) = 180000 170572.97= $9,427.03 Operating profit as a % of revenue (Pharmacist owned single store) = (9427.03/1980000) *100 = 0.48% From the above calculations, it is apparent unlike the gross profit margin which is the highest for pharmacist owned single stores, the operating profit margin is the highest for pharmacy chains and lowest for the pharmacist owned single stores. Thus, it is imperative that the overhead costs must be allocated correctly so as to identify the actual profitability of the various segments (Brealey,Myers Allen, 2008). Based on activity based costing, profitability margins are in the following order. Pharmacy chains General Supermarkets Pharmacist owned single stores. 3. The manager of Hair Suite III would be the most effective as he/she is displaying the participative approach of management which enables the team to arrive at a sustainable and mutually agreeable solution. This is because the manager put forward the problem before the stylists and has worked out as a solution which resolves the problem without disturbing their current job timings or quality. In case of Hair Suite 1, the manager follows a authoritative management style where it is recommended that the time per customer would be reduced and also the breaks without having any discussion with the stylists as to whether their work would be adversely impacted by such a schedule. Similarly, in case of Hair Suite II, the manager does not discuss the problem or ask for a feedback on a suggestion but goes and straight away directs that the stylists need to work one hour more on a daily basis (Bhimani et. al., 2008). The stylists would be unhappy with the directive given by managers of Suite I and Suite II. This would be because there has been no discussion with the core problem and the likely solutions but instead a particular solution has been forced upon the stylists without taking their inputs and feasibility of the idea considering the impact of customer quality and stylists performance. If the stylists are unhappy, it may lead to lower productivity from the stylists and also customer satisfaction may be adversely impacted. The motivation levels of stylists may be impacted and hence they can potentially quit the saloon and look for an alternate location. Additionally, there could be increased disputes between the stylists and also the respective managers which would be counter-productive for all the possible stakeholders. In case the stylists are not willing to share their suite, then the potential alternative solutions could be as follows. The appointment timings can be customised especially for regular customers as the time required is typically known. Further, some rationalisation as per the services offered may be done which could accommodate incremental customer atleast on some days. Introduction of the rule that in one month, on one of the holidays, each person would have be serve a half day which could bring in incremental revenue. Providing flexibility to stylists that they should work overtime on some days in the week instead of everyday. The concept of stretch target can be applied in case of manager of Suite 1. This is because now a difficult target of servicing eight customers in the daily shift has been provided to each stylist and they are expected to meet this in order to successfully discharge their obligations (Seal, Garrison Noreen, 2012). This is different from the regular target of serving seven customers in a daily shift. It may be likely that due ot the ongoing nature of the stretch target, the customer service may be adversely impacted and also the stylist may feel fatigued due to a break of only five minutes between the sittings. Thus, it is highly likely that the stretched target given to the stylists cannot be met on a daily basis without compromising the quality and also increasing the potential of burn out on the part of the stylists. References Bhimani, A, Horngren, CT, Datar, SM Foster, G 2008, Management and Cost Accounting 4th eds., Prentice Hall/Financial Times, Harlow Brealey, R, Myers, S Allen, F 2008, Principles of Corporate Finance, 9th eds., McGraw Hill Publications, New York Brigham, EF Ehrhardt, MC 2013. Financial Management: Theory Practice, 14th eds., South-Western College Publications, New York Drury, C 2008, Management and Cost Accounting, 7th eds., Thomson Learning, London Parrino, R Kidwell, D 2011, Fundamentals of Corporate Finance, 3rd eds., Wiley Publications, London Petty, JW, Titman, S, Keown, AJ, Martin, P, Martin JD Burrow, M 2015, Financial Management: Principles and Applications, 6th eds., Pearson Australia, Sydney Seal, WB, Garrison, RH and Noreen, EW 2012, Management Accounting, 4th eds., McGraw -Hill Higher Education, Maidenhead