Ask Financial Management Expert

Assignment1:

Write a 525- to 700-word summary on the ways in which restructuring a health care plan can produce real financial returns.

Assignment 2

Consider and apply your knowledge of the costs and the benefits of changes and how these may boost productivity.

1. Queen City Treating is a metal treating company that hardens prefabricated metal products for automobile accessories, including seat belt buckles, wheel rims, radiator caps, and other items. The company is experiencing some serious cost problems. Foreign competition, which uses better technology and has different cost structures, is taking away some of Queen City's customers by offering lower prices. As a result, Queen City is scrutinizing all of its costs. The CFO has concluded that one area that needs revamping is the high labor cost of the senior workers. The company is considering a voluntary buyout of these workers, in which they would be offered a financial incentive to leave the company before their normal retirement age. Company statistics indicate that 30 percent of the workforce has over 25 years of service and is earning the top rate of pay. The total wage difference among the highest and lowest paid production workers is about $8 per hour, and the company utilizes about two million labor production hours per year. Management believes that replacing these more senior and higher paid workers with persons at lower rates of pay would significantly improve the costs and productivity of the business.

a. From a labor economics standpoint, are older workers more expensive? What factors would you use to assess this issue?

b. If more senior employees leave the company, could there be a reduction in productivity? How would you calculate productivity? If there is a reduction, how long would it persist? What steps might be taken to mitigate this problem?

c. Are there viable alternatives to the voluntary buyout that would achieve the desired cost reduction? What is a range of possible solutions? How would you measure their effectiveness?

d. Describe in some detail the optimal plan design to encourage voluntary separation of the senior employees.

e. How would you determine the likelihood of your plan succeeding? How would you define success and how would you measure it?

f. What assessments would you make in choosing a method to reorganize and restaff the company after the reduction plan is implemented?

2. Wal-Mart has been expanding its construction of super centers, which include major food sections encompassing general grocery items, health and beauty aids, perishable produce, meat, seafood, frozen food, and deli items. The company is nonunion with labor costs at about 7.5 percent of sales versus its organized competitors' 13 percent. This, in part, allows Wal-Mart to offer prices anywhere from 6 to 10 percent below its supermarket competitors. Price sensitivity in the business is important and an overall price difference above 2 percent will cause loss of market share. You work for one of the organized companies and your CEO has directed you to begin an initiative to reduce your wage and benefit costs to be in line with Wal-Mart's levels. You know that negotiating lower wages and benefits with your unions will be a difficult task. While you have not abandoned that idea, you have decided to take a broader approach to reducing overall costs and enabling your company to offer prices that meet Wal-Mart's.

a. Describe a range of possible solutions that does not necessarily involve reducing the level of benefits and wages, but might serve to reduce the ratio of labor costs to sales and would be consistent with the overall business strategy of building sales and profits through top service, competitive prices, and great product variety.

b. What analytical steps, metrics, and assessments would you apply to each?

c. Are there possible total reward solutions that might help to attain your objective? Briefly identify them and explain.

d. How would you measure and evaluate each?

e. Select a comprehensive plan that you believe will enable your company to be price competitive without changing the level of benefits and wages.

3. Your company designs and makes electronic counting and control devices for manufacturers. It employs 300 people in the Midwest and has been in business on a privately owned basis for nine years. The industry is competitive, and your company must preserve an edge in getting new products to market faster than others, maintaining a high-quality product, offering good and sustained service to its customers, and selling at a competitive price. The company offers a privately insured health care plan, among other benefits and rewards, for all employees and their dependents. It is a traditional indemnity plan design and the cost as a percentage of total employee compensation has increased from 16 percent to 25 percent over the last two years. There is no cost to the employees for their health care. Your competitors are sponsoring much less expensive plans. Your CEO has asked you for a complete review of the health care plan and to create a design that is in line with the business strategy, is cost-effective, provides employees with choice and quality, and helps recruit and retain employees.

a. What analytical, research, data collection, and assessment steps would you undertake to fulfill this assignment? Explain in detail.

b. Can you link your health care plan to a potential increase in productivity? How? How would you measure?

c. With respect to quality, how would you make sure this element remains an integral part of your plan? How would you measure it?

d. Identify an optimal plan design, including all of its major design features that you would recommend to the CEO. What factors would you use in measuring its value to the company?

Financial Management, Finance

  • Category:- Financial Management
  • Reference No.:- M92285662

Have any Question?


Related Questions in Financial Management

Assignment problems1 on the day harry was born his parents

Assignment Problems 1. On the day Harry was born, his parents put $1600 into an investment account that promises to pay a fixed interest rate of 5 percent per year. How much money will Harry have in this account when he ...

1 activities of a company that require the spending of cash

1) Activities of a company that require the spending of cash are known as: A) Uses of cash. B) Cash on hand. C) Cash receipts. D) Sources of cash. E) Cash collections. 2) Relationships determined from a firm's financial ...

Module discussion forumto prepare for this discussion

Module : Discussion Forum To prepare for this discussion, review "Basics of Speechwriting" and "Basics of Giving a Speech" in textbook Chapter 15. Then watch this video of Apple founder and CEO Steve Jobs giving the 2005 ...

Launching a new product linefor this portfolio project

Launching a New Product Line For this Portfolio Project Option, you will act as an employee in a large company that develops and distributes men's and women's personal care products. The company has developed a new produ ...

Question 1 discuss valuing bonds and how interest rates

Question : 1) Discuss valuing bonds and how interest rates affect their value. Also consider the importance of the yield-to-maturity (YTM). 2) Discuss common stocks and preferred stocks. Also, which common stock valuatio ...

Introductionlast week you determined the root causes of the

Introduction Last week, you determined the root cause(s) of the problem you are trying to resolve for your final paper. As a reminder, the decision you are working on is the one that you selected in week two. This week, ...

You have owned and operated a successful brick-and-mortar

You have owned and operated a successful brick-and-mortar business for several years. Due to increased competition from other retailers, you have decided to expand your operations to sell your products via the Internet. ...

You will be conducting an interview with a market research

You will be conducting an interview with a market research professional or a company representative. Use the results of your research to make specific recommendations on how market research can be applied to the Marketpl ...

Question 1 what is marketing research what are the two

Question 1: What is marketing research? What are the two primary types of research? Question 2: What factors influence marketing research? Question 3: The role of statistics in business decision-making? Assignment : Sele ...

Chapter 74 for commercial banks what is meant by a managed

Chapter 7 4. For commercial banks, what is meant by a managed liability? What role do liquid assets play on the balance sheet of commercial banks? What role do money market instruments play in the asset and liability man ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Why might a bank avoid the use of interest rate swaps even

Why might a bank avoid the use of interest rate swaps, even when the institution is exposed to significant interest rate

Describe the difference between zero coupon bonds and

Describe the difference between zero coupon bonds and coupon bonds. Under what conditions will a coupon bond sell at a p

Compute the present value of an annuity of 880 per year

Compute the present value of an annuity of $ 880 per year for 16 years, given a discount rate of 6 percent per annum. As

Compute the present value of an 1150 payment made in ten

Compute the present value of an $1,150 payment made in ten years when the discount rate is 12 percent. (Do not round int

Compute the present value of an annuity of 699 per year

Compute the present value of an annuity of $ 699 per year for 19 years, given a discount rate of 6 percent per annum. As