Elite Auxiliaries is a choreography agency that also produces, markets, and sells its own custom equipment and videos. The company is a fairly new company based out of Jacksonville, Florida and its clientele spans the entire Southeast region of the Unites States. Looking at environmental factors that must be taken into consideration by company managers, factors relevant to the decision making process will be examined. Recommendations will be made to managers to decide if production should continue or discontinue as well as how to improve profitability to become more attractive to stockholders. The company’s environmental scan will help managers determine if the ...view middle of the document...
It will be considered a packaged good worth $32 and at least one is sold daily. Fixed inputs are constant and do not change regardless of the amount of quantity of output is produced (McGuigan, Moyer, and Harris, 2012, p. 234). Fixed inputs for EA include the choreographers who are filmed for DVD production, the equipment used to product the DVDs, such as cameras and editing software, and the storage facility to house the flag poles and silks. The main office, where the storage facility is located, is also a fixed input. Variable inputs are dependent on the quantity of output produced (McGuigan, Moyer, and Harris, 2012, p. 234). This would be the flag poles, silks, DVDs, and choreographers employed. Each worker and choreographer, on average, gets a base pay of $70 per day. The price of EA’s daily output is $32. Other variable inputs, such as rent and shipping expenses incurred, cost $2,000 per day. EA’s fixed cost is high enough so that its total costs exceed its total revenue. The marginal cost of the last unit is $30.
Environmental Scan Factors Relevant to the Decision Making Process
Current environmental scan factors that are relevant to the decision making process are the legalities of using contracted choreographers and purchasing equipment outside of a normally contracted vendor. For example, a school may be in a district where outside choreographers are not allowed to teach competition routines. Schools also may have to use a designated local merchant to purchase flag poles and silks rather than use outside vendors. Babatunde and Adebisi (2012) wrote:
The simplest way to conduct environmental scanning is through PEST Analysis. PEST is the acronym used for describing the Political, Economical, Social-Cultural, and Technological factors that affect the organization. The external environments consist of variables opportunities and threats that are outside the organization and not typically within the short-run control of the top management. The management of any organization has little or no influence on the external environment.
Using the PEST analysis, the political factors would be the rules regarding using choreographers and outside vendors. The economical factors would be if the school could afford the $32 product bundle or if the school needs to consider cheaper alternatives. A social-cultural factor could be the acceptance of a school using choreographers and customer equipment for competition, as do other schools in the same given district. Another could be the culture of all schools in a district using EA as its main supplier for choreographers and supplies. Technological factors would be the advanced recording methods and digital video software used to produce high quality DVDs as well as the software used to design the flags and have custom designs available for purchase.
Factors Having the Greatest Impact on Plant Operations and Management’s Decisions
The factors that would have the most impact on plant operations are...