Can someone please help me with this question.
Nike is an oregon based company that focuses on the design, development and worldwide marketing of high Quality footwear, apparel, equipment and accessory products. Nike is the largest seller of athletic footwear and athletic apparel in the world. The company sells its product to approximately 19,700 retail accounts in the US through a mix of independent distributors, licenses, and subsidiaries, in approximately 110 countries around the world. Virtually, all of the company's footwear products are produced outside North America, while apparel products are produced both in North America and abroad.
1. Identify one decision that Nike managers make in each of the six value chain functions.
2. For each decision in the above question, identify one piece of accounting information that would aid the managers decision.
To answer the question, let's break down the six value chain functions and discuss a decision that Nike managers make in each function, as well as the corresponding accounting information that would aid their decision-making process:
1. Research and Development:
One decision Nike managers make in this function is determining which new products to design and develop. They evaluate market trends, customer preferences, and technological advancements to decide on specific product lines, features, and innovations. To aid in this decision, managers would rely on accounting information such as market research data, consumer surveys, and cost analysis to assess the potential profitability and feasibility of new product ideas.
2. Design:
In the design function, Nike managers decide on the aesthetics, functionality, and performance characteristics of their products. They collaborate with designers, engineers, and product development teams to ensure the creation of appealing and innovative designs. Accounting information that would assist in this decision may include the cost of materials, production capabilities, and customer feedback on previous designs.
3. Manufacturing and Production:
In this function, managers make decisions regarding manufacturing processes, sourcing suppliers, and optimizing production efficiency. They determine the most cost-effective and reliable methods to produce Nike's footwear, apparel, equipment, and accessories. Relevant accounting information for these decisions includes tracking production costs, monitoring supplier performance, and analyzing production capacity utilization.
4. Marketing and Sales:
Nike managers in this function make decisions on marketing strategies, pricing, distribution channels, and promotional activities to effectively reach target customers and drive sales. They analyze market segments, competition, and consumer behavior to develop appropriate marketing campaigns. Accounting information that aids in these decisions includes sales revenue data, advertising expenses, market research expenditure, and pricing analysis.
5. Distribution and Logistics:
In the distribution and logistics function, managers decide on the best methods for transporting and delivering Nike products to customers. They optimize the supply chain, select distribution partners, and manage inventory levels to ensure timely availability of products. Accounting information that supports these decisions includes logistics costs, transportation expenses, inventory turnover rates, and order fulfillment metrics.
6. Customer Service and Support:
In this function, managers make decisions on customer service policies, warranty programs, and after-sales support. They aim to enhance customer satisfaction and loyalty by addressing customer queries, handling product returns, and providing efficient support channels. Accounting information that would be helpful in these decisions includes data on customer complaints, warranty claims, average response time, and customer satisfaction surveys.
By utilizing relevant accounting information in each value chain function, Nike managers can make informed decisions that align with their strategic goals, improve operational effectiveness, and enhance customer value.