The third case study for CMA (Final) - Group 3 students-

Paper 15- Business Strategy and Strategic Cost Management

CASE STUDY 3

Identification of Core Competence of Educational Institution

In a small town called Vellore in South Indian State of Tamilnadu, there is now one famous deemed university called the Vellore Institute of Technology (VIT). Its founder, Mr. Viswanathan, has adopted a unique model of building formidable Core Competencies. He has made huge investments in creating world-class infrastructure, which has attracted the best minds as students not only from various parts of India but also from other countries of the world, including developed countries like Canada and several African nations. What has really mattered is that the quality of teaching has improved, as VIT has been able to conduct very regularly, has opened up many vistas of knowledge and opened up many doors, in the international arena, through very innovative tie-ups with foreign universities. In fact, VIT is just one example of a deemed university that has made India proud. Since, it supplies high quality information technology professionals to all companies. The campus recruitments are one hundred per cent. This has made it a very formidable learning centre in India.

There are few tests useful for identifying a core competence. Does it fit to VIT?

Answer:

There are few tests useful for identifying a core competence. A core competence should; 

(i) Provide access to a wide variety of markets. 

(ii) Contribute significantly to the end-product benefits. 

(iii) Be difficult for competitors to imitate; and 

(iv) It should be valuable.

Source: Suggested Answers - December 2013 by ICAI

Here is the second case study for CMA (Final) - Group 3 students-

Paper 15- Business Strategy and Strategic Cost Management

CASE STUDY 2

A Case Study on Strategic Intent

Fastfix is a small company operating in a single city. Its business is repairing laptops. It has earned a good name for its fair charges and speedy delivery. For the next five years, the environment offers the following information: Many school students are being given laptops by the school themselves and this trend is likely to continue for another five years. College students and coaching centres provide new laptops to all the students during the admission. The fees are inclusive of these costs. Tablets are first replacing laptops in certain market segments and models are changing every six months. If there are major repairs, richer people discard the products and go in for new products or newer versions. However, there are rural markets and certain parts of urban markets which will still be interested in the low cost repaired and re-sold products. Considering the above case of Fastfix it will limit its operations to only one city. 

You are required to give: 

(i) A vision statement; 

(ii) A mission statement; 

(iii) Does SWOT analysis exist?

(iv) Some parameters that could be used in such the above situation relating to the financial and growth perspectives in a Balance Score Card (BSC). 

Answers:

(i) Vision Statement: Our Company intends to provide the best quality of repairs to laptops in the fastest possible time anywhere in the city with the most reasonable changes to customers. 

(ii) Mission Statement: We deliver at customers‟ doorstep their fully functional laptops with minimum down times for customers while ensuring:

(a) Timely delivery as promised: 

(b) Reasonable charges: 

(c) Good quality of services; 

(d) Replacement of parts by genuine parts based on genuine needs; 

(e) Pick up of faulty laptops; and

(f) Offer stand by laptops as per customer requests.

(iii) SWOT Analysis:

(a) Strengths: Access to standard parts that normally fail in laptops, network of trained employees who have thorough job knowledge, available loyal customers, less time in delivery and perfect commitment. 

(b) Weakness: Going beyond the scope of faults recognized by the customers, often leading to cost over runs while preventing future repairs calls. 

(c) Opportunities: Branches may be opened in schools/colleges/big coaching centres. Business can be extended to sale of reworked computers in ready and going markets, preventing maintenance services, annual maintenance contracts, upgrades and compatibility addition with new peripherals, etc. 

(d) Threats: Unless tablet markets also are created to, there is a threat to long term survival. Threats from one stop shops for repairing all types of mobiles /computers /laptop /tablets/ iphones/smart phones, etc. Threats of obsolescence resulting in non-availability of spares. 

(iv) Balance Score Cards (BSC): 

(a) Financial perspective: Revenue from repairs, average job order cost, total spares purchases, delivery costs, (revenue per jobless variable cost per job) as a % of revenue par job, debtors management (target nil), etc. 

(b) Learning/innovation/growth perspectives: Number of employees trained, number of new products repaired, number of new spares used, machinery used for cleaning/servicing, new logistics management, service call tracking, repair status on-line tracking, etc.

Source: Suggested Answers - December 2013 by ICAI

Here is a case study for CMA (Final) Group 3 students-

Paper 15 - Business Strategy and Strategic Cost Management

CASE STUDY 1

Business intelligence in aviation industry

A Case of Business Intelligence in Aviation- the entire matrix of India’s aviation industry has been challenged ever since no-frills airlines made air travel affordable for the country’s growing middle class. Given that Low Cost Carriers (LCC) is the future of air travels in India. LCC are practically non-existent in now-a-days. What is the reason behind such sorry state of affairs among airlines? The answer lies in ‘pricing’. Experts say that Indian LCC have not been able to price their tickets right and at one point even brought their fares close to that of Full Service Carriers (FSC).

According to global standards, the average cost per passenger for LCCs should be $ 35 lower than that of FSCs. But this is contingent on better utilization of aircraft through faster turnarounds i.e. the time taken between landing and the next flight. This is where technology initiatives such as Corporate Performance Management using Business Intelligence (BI) tools can come very handy.

(i) What is ‘Business Intelligence’?

(ii) How to create a ‘Business Intelligence Strategy’ in aviation industry?

(iii)How ‘Business Intelligence’can  enhance the overall decision-making process in Low Cost Airlines Carriers.

Answers:

(i) The term “Business Intelligence (BI)” represents the tools and systems that play a key role in the strategic planning process of the corporation. These systems allow a company to gather, store access and analyze corporate data to aid in decision-making. Generally these systems will illustrate BI in the areas of customer profiling, customer support, market research, market segmentation, product profitability, statistical analysis and inventory and distribution analysis to make a few.

(ii)BI can help here on two counts by utilizing the data held within the organization, trusting that it is reasonably clean and accurate:

(a)   Establishing early warning systems and detection of trends

(b)   Finding relevant patterns and insight

So a BI strategy needs to:

(a)   Be aligned to support the business strategy and goals

(b)   Provide the information the business needs to be an effective job

(c)   Make best and cost effective use of the BI technology and best practices available in terms of implementation speed and development.

(iii)The BI tools can serve to provide self-service querying and reporting facilities, dashboards and like to analyze the performance of the airlines in depth and enhance the overall decision making process in the organization. BI can help capture information such as:

(a)    Average landing per day in each serviced location.

(b)    Average flight duration between two destinations

(c)    Average seat capacity utilization during different times of the day

(d)   Average turnaround time of aircraft.

Source: Suggested Answers - December 2013 by ICAI.

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