Cost Management Term Paper Example | Topics and Well Written Essays - 2000 words

Cost Management - Term Paper Example Defense organization of the US government manages many production facilities that operate similar to industries. The chief strategies employed by Defense Department are to reduce permanent positions for staff and workers, outsource some of the jobs and depend more on temporary workers. Authors argue that the organizations have to strike a balance while reducing fixed costs permanently. Elaborating further, they argue that Honda Motor Company reduced permanent engineering staff, which was dedicated to the design functions during 1980s; however, that went against the company when its competitors came out with new designs in automobiles. This eventually resulted into the reduced market share for Honda impacting its profitability. Honda had a great difficulty to catch up with new innovative features that competitors released time to time in the market place. Thus, a strategy to reduce fixed cost may appear lucrative in the beginning but could be detrimental to the future growth. Currentl y, similar situation exists in the Defense Department of the government. ... The impact of fixed cost is huge in any organization. Higher fixed cost compels firms to operate at higher levels of operations and sales volume to meet those fixed costs. That is why in difficult market conditions, the firms with higher fixed costs are often found in trouble. The firms with higher operating leverages are always at risk during unpredictable sales environment. Moreover, sales volatility is rampant in the industries where technology has been changing rapidly. In these kinds of industries, it becomes important to assess fixed-cost involvement and possible sales volume that are achievable. No wonder that many large sized computer firms reduced their fixed-cost commitment in recent years. IBM reduced their permanent staff by 100,000 between 1990 and 1994. Not only that the company outsourced many of its parts and products in these years; that reduced the requirement on plant and machinery to a great extent. This further reduced fixed-cost burden on the company. That is ho w IBM could adapt to changing market environment and survive. That surely is a good strategy in unpredictable and difficult market situation (Ciccotello & Green 1995). Exercising Caution in Reducing Operating Leverage Contrary to this, many private firms have been operating in the industries where market demand of their products is quite steady and predictable. With the predictable sales volume, fixed-cost commitment is easy to make and it makes absolutely no sense to reduce permanent staff compromising the future business prospects and efficiency factors. Authors further emphasize that reducing permanent employees is an expensive preposition and once removed they are very costly

Envirnmental issues Essay Example | Topics and Well Written Essays - 500 words

Envirnmental issues - Essay Example It is a threat to the environment because it has led to an increase in the temperature of the world which has been accompanied by other ecological alterations (Houghton 2004). Global warming as the name indicates is a worldwide problem which has been explained by Sir David King who is the chief scientific adviser of the UK government in the following words, â€Å"Climate change is a far greater threat to the world than international terrorism† (BBC, 2004). Global warming is basically a rise in the temperature of the world. The increased release of carbon dioxide into the atmosphere has been identified as a major reason for global warming. This results due to the increased usage of motor vehicles which have been linked with emissions of carbon in the atmosphere. Furthermore, increased industrialization has also resulted in an increase in the release of these gases into the atmosphere. Deforestation accompanied with the forest fires are also major reasons for the rise in the global temperature across the world (Chemical & Engineering News, 2005; Desonie, 2008). Strict regulations are essential for all the contributors of global warming. It has been seen that laws have been passed with regard to controlling the emission of gases from the motor vehicles. Research is underway for the creation of ways that limit the passage of gases into the atmosphere. Permafrost is one such substance which limits the release of the emissions into the atmosphere. But its efficiency is also reducing. The best method to control global warming is to limit the release of gases into the atmosphere and hence this would limit the raise in the temperature of the world (Bhargava 2004; Desonie, 2008; Tesar, 1991). The issue of global warming needs to be tackled as it is an issue of concern. It can lead to severe effects for the environment of the world. The increased temperature across the globe can result in the melting of glaciers which would