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Analysis of Business Strategies and Quality Cost Management in ABC Company

A business analysis focusing on strategic management and quality cost management practices in ABC Company.

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    Analysis of Business Strategies and Quality Cost Management in ABC Company Question #2 The ABC Company manufactures widgets. It competes and plans to grow by selling high - quality widgets at low prices and by delivering them to customers quickly. There are many other companies in the industry producing similar widgets. ABC believes it needs to continuously improve its manufacturing and delivery processes and that having satisfied employees are both critical to its long - term success. a) Based on this information, what type of strategy to you believe ABC is pursuing? Be sure to back up your claim with specific evidence. b) List and justify eight metrics (2 in each of the Balanced Scorecard perspectives) that you believe ABC should include in its Balanced Scorecard. c) ABC calculates the following figures: 2011 operating income $1,850,000 2012 operating income $2,013,000 Growth component $85,000 Price - recovery component ($72,000) Productivity component $150,000 In addition, the market for widgets did not grow in 2012, input process did not change in 2012, and ABC reduced its selling price in 2012. Based on this information, do you believe ABC’s increase in operating income in 2012 is consistent with the strategy you identified in part a? Be sure to justify your answer with specific information. a)ABC is pursuing penetration pricing policy. As the product of the ABC is not new, and it is already present in the market, ABC is giving the same product at a lower price in order to penetrate the market. Since the ABC believes in long term success it can gradually increase the price of the product later on. b) Customer perspective : New products, responsive supply Internal perspective: Technological capability, manufacturing excellence Innovation & learning: Technology leadership, product focus Financial perspective: Survive, succeed

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