2,3 - Cost Accounting as a Strategic Management Tool...

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Cost Accounting as a Strategic Management Tool Sessions 2 and 3 Commerce 354 Chamberlain Fall 2009
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Introduction A big activity that we accomplish in this course: Case Analysis---- Bridgeton, Seligram Destin Brass Kanthal A California Products Is this simply a torture device? Why would a course in managerial accounting be a good place to use case analyses? The answer to this question also provides a reason to be cognizant of “what firms do and why they do it” before completing a case write-up. The best way to get a handle on “what firms do and why they do it” is to read some of the strategy literature.
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What is strategy? According to Porter in “What is Strategy” (HBR 1996) “Strategy is the creation of a unique and valuable position, involving a different set of activities” (from competitors) Positions can be Variety-based: Jiffy Lube, Vanguard—All customers have some needs that are satisfied by these providers, but these providers only satisfy a subset of needs. Needs-based: IKEA—Tailored set of activities that satisfy the needs of a particular group. Access-based: Carmike (movie theaters tailored to small towns) However, finding the position is not sufficient. Firms need to perform activities differently than to rivals---otherwise a profitable position can be copied.
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How would you categorize the following firms in terms of Porter’s “positions.” Lululemon—Sells a yoga-inspired line of clothing primarily to women Is this position easy to replicate? Safeway—Sells a wide range of products (produce, housewares, processed food, etc) from a variety of locations. Is this position easy to replicate? Google—Matches buyers of products to sellers using by understanding the buyer’s needs through analysis characteristics that we reveal when we search on Google. Is this position easy to replicate?
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Does a Firm’s Strategy Result in a “Sustainable” Advantage? Porter suggests these five
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This note was uploaded on 09/24/2009 for the course ACCT 2294 taught by Professor Norwood during the Spring '08 term at Langara.

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2,3 - Cost Accounting as a Strategic Management Tool...

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