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Learning and Spillovers
The cost of a value activity can decline over time due to learning that increases its efficiency. The methods by which learning can lower cost over time are many, and comprise such factors as layout changes, enhanced scheduling, labor efficiency enhancement, product design modifications that facilitate manufacturing, yield improvements, procedures that increase the utilization of assets, and better tailoring of raw materials to the process. Learning can also decrease the cost of retail outlets, constructing plants, or other facilities. Therefore the possibilities for learning in an activity are wider than learning by personnel to execute their functions more proficiently. The rate of learning varies broadly among value activities since each offers varying possibilities for learning enhancements. Learning is often the cumulation of many small improvements rather than major breakthroughs. The rate of learning might rise during slack periods whenever attention is focused on decreasing costs instead of meeting demand. Furthermore, learning tends to differ with the quantity of management attention dedicated to capturing it.
Learning can spill over from one firm in an industry to another, via mechanisms like consultants, suppliers, ex-employees, and reverse engineering of products. Where spillover of learning among firms is high in a value activity, the rate of learning might stem more from net industry learning than from the learning of one firm.
Q.Process of Pricing in maturity period? Maturing periods is the third stage in the life cycle of a product. If is a stage between growth period and decline period of sales. So
Western States Supply, Inc. (WSS), consists of three divisions—California, Northwest, and Southwest—that operate as if they were independent companies. Each division has its own sa
WHAT IS THE NPV OF ADOPTING THE LOCKBOX SYSTEM
What is cvp?
Ask question #MinimumYears Purchase Costs Running cost discount factor 8% Running cost Savings PVS 0 -7000 -7000 1 2000 0.926 1852 5556 3704 2 2500 0.857 2142.5 5999 3856.5
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What nonfinancial factors should management consider in making its decision on whether to accept or reject a special order?
Transfer Pricing Transfer pricing can contribute directly to the process of departmental performance measurement and indirectly to the measurement of product performance. A
Sales of Cool-Man air conditioners have increase steadily during the past five years: Year Sales 1 450 2 495 3 518 4 563 5 584 6 ?
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