Management in Accounting Profitable business

Management in Accounting

Profitable business operations in the 21st century are a function of management’s ability to forecast the external operating environment to better navigate via available internal resources. Given the growth in emerging markets and the threat of rising inflation and rising inflation rates, Chief Executives are required to consider the NPV of dollars used today to generate future cash flow.

Don't use plagiarized sources. Get Your Custom Essay on
Management in Accounting Profitable business
Just from $9/Page
Order Essay

Additionally, such projects are more profitable when cost constraints are adhered to and subsequent cost management practices necessary to adhere to cost constraints are implemented and managed appropriately. The area of cost control is rather broad and opaque to the layman. Cost control in retail is a more defined and narrowed parameter of the nature of industry expectation to the requirements of constraints within retail.

Cost Management is the process of implementing or actualizing cost control either through direct or indirect means. Heyman (1975) is still relevant in the modern discussion of cost control. According to Heyman, an organization’s management is the critical component to acknowledging the requirement to control expenses. He cites the following areas for improvement, Payroll, Performance, Costs, Rent, Advertising, Electronic Data-Processing, Communications, and Supplies (Heyman, 1975).

Additionally, the suggestion is if costs are out-of-line, then to line-item each cost into an expense item to determine where savings can be identified and cost saving measures or cost control measures may be implemented. A cost control executive should be appointed whom is solely in autonomous control and final say of decisions regarding cost containment and expenditures.

Trozzi (1974) has identified the cost reduction process as the highest priority with such urgency central to the organization’s ability to meet the demands extended by a comprehensive cost reduction process. Trozzi suggests that a ‘champion is named by the executive management. A champion is a designated steward appointed to oversee a targeted process with a clear set of goals. The champion is responsible to management and the entire organization such that the ability to effectuate cost-control is inherent to the power within the position and such that the employees of the organization are better able to perform their jobs due to the intervention of the appointed champion (Trozzi, 1974)

The champion is able to convey the attitude of cost control and containment procedures to key staff and management throughout the organization as a means to adopt to specified cost reduction techniques often associated with Six Sigma and Kaizen. The successful cost reduction program is a function of the organization’s ability to analyze corporate data and identify where waste reduction will have the greatest net benefit on impacting short- and long-term profit goals (Trozzi, 1974)

Cost reduction techniques are linked to increases in profit growth and certainly revenue growth. According to Bannon (2001) the Mattel Corporation was able to control costs with such success as to double the revenue growth experienced at the industry average of 2% to 3%. The average growth rate of 2% to 3% indicates that profits before cost reduction measures are implemented are approximately where the industry average is.

The Mattel Corporation is a relatively large toy company and is the owner of a large market share in the retail toy industry, and therefore is expected to be around 3% prior to the cost reduction processes and innovative cost reduction management imbued by Mr. Robert Eckert (Bannon, 2001) Mattel’s ability to reduce cost or expenditures is inherent of the ability to see how to do a process differently, or with more care toward a lower cost per unit.

Companies have a number of means to reduce costs, from changing vendors in the supply chain to process change management and human resources cost management. Mattel decided to repackage its product in a manner consistent with cost control. Innovations such as multi-lingual packaging allows for lower production and raw material costs while enabling greater leverage with product shipment to more competitive markets in mid season. (Bannon, 2001)

Organizations that are able to control production and raw material costs will ensure a stream of profitability for the organization and its stakeholders. This is true due to the nature o microeconomic theory and the cost, price, and revenue curves for average, marginal, and total cost. Production costs are generally associated to processes in the supply chain and the manufacturing process of producing x units of product. The packaging for the product is a separate process from the manufacturing of the actual product, which is the toy for Mattel.

The price and revenue curves are going to be higher than the cost curve in the long-run however, this may not be true in the short-run when the company is expected to be highly leveraged if in the new phase or in the growth/expansion phase. Companies will decide to take the say $10 million needed to reduce cost per unit and produce the next production phase of the process, and invest this amount at an interest rate higher than the rate paid to finance the 10 million borrowed from a creditor or bank.

Rethinking the procurement of raw materials is also critical to cost containment and expense reduction. This main issue to cost control is inherently responsible for companies increasing costs due to either unpreparedness to address such increases or due to an insidious desire to take advantage of a higher raw material cost environment to pass the cost onto the consumer reflective in the consumer price index CPI rather the producer price index PPI.

The manner corporations are able to hedge against higher raw material costs is to buy the futures of the corresponding raw materials or those materials, which are highly correlated to the price movements of the underlying raw materials used in the manufacturing process.

The design and removal process (Bannon, 2001) as implemented by Eckert at Mattel is a direct method to obtain process management results. Logistical improvements to enhance the design process was critical to reducing manufacturing time and reducing time to scrap, or removal of a potential project due to violating cost constraints.

This ability to relocate critical staff to better discuss the cost and manufacturing process enables a cohesive and functioning team capable of identifying cost measures on manufacturing processes but to also give the go-ahead to scrap a project if it appears to perhaps be unprofitable or marginally unprofitable, or realizing decreasing marginal returns prior to the break-even.

Work-force cuts are also critical to lean operations, a function in cost containment and control. The human element is often lost upon corporate decision-making bodies, as the bottom line is the most important and most integral part of the business operations and will always seek by decision-makers to be maximized. Organizations have relied on layoffs and attrition to reduce workforce staff and therefore working capital obligations in the short-term.

In the case of Mattel cost reduction cave via a 4% workforce reduction (Bannon, 2001), which equated to approximately 1,300 jobs. This refocus from long-term revenue growth to the bottom line is what propels the stock price in the short-run. Chief Executives are inherently paid to raise the stock price and that means short-term decisions necessary to raise the stock price. Long-term decisions that will raise the stock price at a point in the future will not raise the stock price in the short-run and therefore, may not raise the stock price during the CEO’s tenure.

Eckert is also borrowing from other companies in his industry. Chief Information Officer Joe Eckroth (Bannon, 2001) implemented what he terms as “bullet train,” which was used at his previous employer of the GE Company. By relying on several metrics including categories of travelling and printing materials (Bannon, 2001), Mattel is forecasting to reduce costs by $1 million per year simply by focusing on such processes as catalog production and centralizing production and the paper procurement process (Bannon, 2001).

This approach is certainly not uncommon and is relatively the modern approach to cost reduction. The process is ostensibly that of Design, Manage, Analyze, Improve, Control, which is the Six Sigma module to process redesign. By identifying processes specific to cost items on the income statement, the organization or the champion within the organization can determine a methodology to best reduce the costs associated with each process.

The process instituted by GE is designed to produce consistent earnings rather strong revenue growth (Bannon, 2001). The supply chain is inherently contingent on the ability to timely ship product to overseas markets where the demand is peaking. Executives will always seek to reduce the lag time between product demand in one market and the production and supply in a market other than the demand market. Mitigation of costs is achieved through planning and communications with logistics suppliers to best determine when supplies will be ready for shipment and the methodology needed to reduce total time.

The idea of focus groups as implemented at Mattel by Eckert (Bannon, 2001) is a modus to reduce costs and process design flaws by determining interest among consumers of the product for the product in question and whether the product is something the consumer will like to purchase. Process redesign is central to cost control. The notion of focus groups as a means to reduce costs and enhance process control is notable for its two-pronged approach.

Focus groups (Bannon, 2001) also enable manufacturers to identify early in the process whether a product will be a hit among the consumer base or if it is expected to flop. The earlier the product is identified to flop, the better the savings for the company and potential for greater profits through the pipeline of alternative toys used in the focus group process.

Other measures pertinent to the cost control process include securing an earlier production schedule (Bannon, 2001) and utilizing a smaller number of molds or casts necessary to manufacture the facsimile toy product. “The difference is important, since molds can cost as much as $100,000 each. Says Mr. Bousquette. “For 30 years, the company has been talking about doing this,” he says, referring to the change in production schedules, “and now we’ve done it in the past 18 months.” (Bannon, 2001)

The aforementioned example is a prime use of process redesign. The lucid nature of the change in production scheduling is an understanding to the profitability cycle inherent in the design and manufacturing of the product. Understanding the yield in the profitability curve is essential to operating profitably when facing production cycle and logistic constraints.

Zero-based budgeting (Landers, 1989) is an alternative to incremental budgeting and is viewed as a method to review individualized overhead activities to assess for efficiency and relevance to business needs (Landers, 1989). The most clear manner to obtain results using zero-based budgeting is to determine the total contribution of the itemized budget activity as the contribution pertains to business needs and requirements.

Cost reduction comes via the ranking of fundamental activities to nonfundamental activities. The fundamental activities are identified and assessed for lean processes, which removes all unnecessary activity associated withthe activity. Nonfundamental activities “are separated and ranked against each other. Once the benefits are ranked, costs can be ranked and a cost-benefit matrix developed.” (Landers, 1989)

The cost-benefit matrix (Landers, 1989) enables the costs to be ranked in order against each other for easy comparison. Such comparisons enable a clear and present context on which to analyze costs for removal and the decisions needed to remove costs without reducing revenue streams.


Bannon L. New Playbook: Taking Cues from GE, Mattel’s CEO Wants Toy Maker to Grow Up – the Former Cheese Whiz Puts Financial Discipline Ahead of Marketing Flash – but is Barbie Unpredictable? Wall Street Journal. (Eastern Edition). New York, NY.: Nov 14, 2001. Pg a.1

HEYMAN, S. (1975). Expense control for retail companies. Retail Business Review, 44(2), 2. Retrieved from

Landers, B. (1989). Overhead cost management in retailing. International Journal of Retail & Distribution Management,17(3), 14. Retrieved from

Trozzi, M. (1974). Managing the Cost Reduction Process. Retail Business Review 42.9 (Jun/Jul) 14. Retrieved from

Get Professional Assignment Help Cheaply

Buy Custom Essay

Are you busy and do not have time to handle your assignment? Are you scared that your paper will not make the grade? Do you have responsibilities that may hinder you from turning in your assignment on time? Are you tired and can barely handle your assignment? Are your grades inconsistent?

Whichever your reason is, it is valid! You can get professional academic help from our service at affordable rates. We have a team of professional academic writers who can handle all your assignments.

Why Choose Our Academic Writing Service?

  • Plagiarism free papers
  • Timely delivery
  • Any deadline
  • Skilled, Experienced Native English Writers
  • Subject-relevant academic writer
  • Adherence to paper instructions
  • Ability to tackle bulk assignments
  • Reasonable prices
  • 24/7 Customer Support
  • Get superb grades consistently

Online Academic Help With Different Subjects


Students barely have time to read. We got you! Have your literature essay or book review written without having the hassle of reading the book. You can get your literature paper custom-written for you by our literature specialists.


Do you struggle with finance? No need to torture yourself if finance is not your cup of tea. You can order your finance paper from our academic writing service and get 100% original work from competent finance experts.

Computer science

Computer science is a tough subject. Fortunately, our computer science experts are up to the match. No need to stress and have sleepless nights. Our academic writers will tackle all your computer science assignments and deliver them on time. Let us handle all your python, java, ruby, JavaScript, php , C+ assignments!


While psychology may be an interesting subject, you may lack sufficient time to handle your assignments. Don’t despair; by using our academic writing service, you can be assured of perfect grades. Moreover, your grades will be consistent.


Engineering is quite a demanding subject. Students face a lot of pressure and barely have enough time to do what they love to do. Our academic writing service got you covered! Our engineering specialists follow the paper instructions and ensure timely delivery of the paper.


In the nursing course, you may have difficulties with literature reviews, annotated bibliographies, critical essays, and other assignments. Our nursing assignment writers will offer you professional nursing paper help at low prices.


Truth be told, sociology papers can be quite exhausting. Our academic writing service relieves you of fatigue, pressure, and stress. You can relax and have peace of mind as our academic writers handle your sociology assignment.


We take pride in having some of the best business writers in the industry. Our business writers have a lot of experience in the field. They are reliable, and you can be assured of a high-grade paper. They are able to handle business papers of any subject, length, deadline, and difficulty!


We boast of having some of the most experienced statistics experts in the industry. Our statistics experts have diverse skills, expertise, and knowledge to handle any kind of assignment. They have access to all kinds of software to get your assignment done.


Writing a law essay may prove to be an insurmountable obstacle, especially when you need to know the peculiarities of the legislative framework. Take advantage of our top-notch law specialists and get superb grades and 100% satisfaction.

What discipline/subjects do you deal in?

We have highlighted some of the most popular subjects we handle above. Those are just a tip of the iceberg. We deal in all academic disciplines since our writers are as diverse. They have been drawn from across all disciplines, and orders are assigned to those writers believed to be the best in the field. In a nutshell, there is no task we cannot handle; all you need to do is place your order with us. As long as your instructions are clear, just trust we shall deliver irrespective of the discipline.

Are your writers competent enough to handle my paper?

Our essay writers are graduates with bachelor's, masters, Ph.D., and doctorate degrees in various subjects. The minimum requirement to be an essay writer with our essay writing service is to have a college degree. All our academic writers have a minimum of two years of academic writing. We have a stringent recruitment process to ensure that we get only the most competent essay writers in the industry. We also ensure that the writers are handsomely compensated for their value. The majority of our writers are native English speakers. As such, the fluency of language and grammar is impeccable.

What if I don’t like the paper?

There is a very low likelihood that you won’t like the paper.

Reasons being:

  • When assigning your order, we match the paper’s discipline with the writer’s field/specialization. Since all our writers are graduates, we match the paper’s subject with the field the writer studied. For instance, if it’s a nursing paper, only a nursing graduate and writer will handle it. Furthermore, all our writers have academic writing experience and top-notch research skills.
  • We have a quality assurance that reviews the paper before it gets to you. As such, we ensure that you get a paper that meets the required standard and will most definitely make the grade.

In the event that you don’t like your paper:

  • The writer will revise the paper up to your pleasing. You have unlimited revisions. You simply need to highlight what specifically you don’t like about the paper, and the writer will make the amendments. The paper will be revised until you are satisfied. Revisions are free of charge
  • We will have a different writer write the paper from scratch.
  • Last resort, if the above does not work, we will refund your money.

Will the professor find out I didn’t write the paper myself?

Not at all. All papers are written from scratch. There is no way your tutor or instructor will realize that you did not write the paper yourself. In fact, we recommend using our assignment help services for consistent results.

What if the paper is plagiarized?

We check all papers for plagiarism before we submit them. We use powerful plagiarism checking software such as SafeAssign, LopesWrite, and Turnitin. We also upload the plagiarism report so that you can review it. We understand that plagiarism is academic suicide. We would not take the risk of submitting plagiarized work and jeopardize your academic journey. Furthermore, we do not sell or use prewritten papers, and each paper is written from scratch.

When will I get my paper?

You determine when you get the paper by setting the deadline when placing the order. All papers are delivered within the deadline. We are well aware that we operate in a time-sensitive industry. As such, we have laid out strategies to ensure that the client receives the paper on time and they never miss the deadline. We understand that papers that are submitted late have some points deducted. We do not want you to miss any points due to late submission. We work on beating deadlines by huge margins in order to ensure that you have ample time to review the paper before you submit it.

Will anyone find out that I used your services?

We have a privacy and confidentiality policy that guides our work. We NEVER share any customer information with third parties. Noone will ever know that you used our assignment help services. It’s only between you and us. We are bound by our policies to protect the customer’s identity and information. All your information, such as your names, phone number, email, order information, and so on, are protected. We have robust security systems that ensure that your data is protected. Hacking our systems is close to impossible, and it has never happened.

How our Assignment Help Service Works

1. Place an order

You fill all the paper instructions in the order form. Make sure you include all the helpful materials so that our academic writers can deliver the perfect paper. It will also help to eliminate unnecessary revisions.

2. Pay for the order

Proceed to pay for the paper so that it can be assigned to one of our expert academic writers. The paper subject is matched with the writer’s area of specialization.

3. Track the progress

You communicate with the writer and know about the progress of the paper. The client can ask the writer for drafts of the paper. The client can upload extra material and include additional instructions from the lecturer. Receive a paper.

4. Download the paper

The paper is sent to your email and uploaded to your personal account. You also get a plagiarism report attached to your paper.

smile and order essay GET A PERFECT SCORE!!! smile and order essay Buy Custom Essay

Place your order
(550 words)

Approximate price: $22

Calculate the price of your order

550 words
We'll send you the first draft for approval by September 11, 2018 at 10:52 AM
Total price:
The price is based on these factors:
Academic level
Number of pages
Basic features
  • Free title page and bibliography
  • Unlimited revisions
  • Plagiarism-free guarantee
  • Money-back guarantee
  • 24/7 support
On-demand options
  • Writer’s samples
  • Part-by-part delivery
  • Overnight delivery
  • Copies of used sources
  • Expert Proofreading
Paper format
  • 275 words per page
  • 12 pt Arial/Times New Roman
  • Double line spacing
  • Any citation style (APA, MLA, Chicago/Turabian, Harvard)

Our guarantees

Delivering a high-quality product at a reasonable price is not enough anymore.
That’s why we have developed 5 beneficial guarantees that will make your experience with our service enjoyable, easy, and safe.

Money-back guarantee

You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.

Read more

Zero-plagiarism guarantee

Each paper is composed from scratch, according to your instructions. It is then checked by our plagiarism-detection software. There is no gap where plagiarism could squeeze in.

Read more

Free-revision policy

Thanks to our free revisions, there is no way for you to be unsatisfied. We will work on your paper until you are completely happy with the result.

Read more

Privacy policy

Your email is safe, as we store it according to international data protection rules. Your bank details are secure, as we use only reliable payment systems.

Read more

Fair-cooperation guarantee

By sending us your money, you buy the service we provide. Check out our terms and conditions if you prefer business talks to be laid out in official language.

Read more
error: Content is protected !!
Open chat
Need assignment help? You can contact our live agent via WhatsApp using +1 718 717 2861

Feel free to ask questions, clarifications, or discounts available when placing an order.
  +1 718 717 2861           + 44 161 818 7126           [email protected]
  +1 718 717 2861         [email protected]