Learning and spillovers , Managerial Accounting

Assignment Help:

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.


Related Discussions:- Learning and spillovers

Preparation of comparative balance sheet, Problem From the following ba...

Problem From the following balance sheets of Dramas Ltd., compute the trend percentages using 31st December 2005 as the base year. Assets & Liabilities

Determine the price sensitivity, Price sensitivity Nagle has identified...

Price sensitivity Nagle has identified nine factors that contribute to price sensitivity and has also presents various methods or techniques to measure it. The factors that con

What are the disadvantages of ratio analysis, Disadvantages of ratio analys...

Disadvantages of ratio analysis 1) False results: ratios are based upon the financial statement. In case financial ratio is incorrect or the data upon which ratios are based

Incremental budgeting, the suitability of incremental budgeting to a stable...

the suitability of incremental budgeting to a stable and static environment

Determine the current ratio - liquidity ratios, Current ratio Meaning:...

Current ratio Meaning: this ratio establishes a relationship among current assets and current liabilities. Objective: the objective of computing these ratios is to calcu

Provision for contingencies, After determining the amount of working capita...

After determining the amount of working capital as in above, a specific amount say 5 percent or 10 percent may be added to cover contingencies. This is to be noted that facts depen

College accounting contemporary approach, question 3.5A Trial balance shee...

question 3.5A Trial balance sheet,income statement, owner''s equity and balance sheet

Incremental analysis, What nonfinancial factors should management consider ...

What nonfinancial factors should management consider in making its decision on whether to accept or reject a special order?

Implied interest rate, Suppose the spot price of gold is $1700 per ounce. T...

Suppose the spot price of gold is $1700 per ounce. The futures price for delivery in six months is $1712, while the futures price for delivery in one year is $1720. The interest ra

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd