Subject: PRESTIGE MOBILE PHONE COMPANY:
AN INSTANCE ANALYSIS
Point of View: Management Consultant
I. Problems and Problems:
в– In 1999, the population Service Commission payment encouraged every public resources to: 1 . seek fresh sources of earnings and profits since going towards deregulation; and 2 . To reduce the need for rate increases.
в– Reputation Telephone Company. realized that a centralized services that could strategy, control, and account for its operations can benefit themselves and other businesses in the region.
в– Utilize the current telephone brake lines and sell extra computer period not needed by the telephone organization.
в– Respect Data Services performed data processing for the product company and sold laptop services to other companies and organizations.
в– Daniel Rowe, President of Prestige Phone believed that the profitable supplementary would lessen pressure for telephone level increases.
в– Leslie Bradley, Supervisor of Respect Data Services presumed that offered more time, the subsidiary is yet to see profit, but Daniel Rowe felt actions was important to reduce the drain in company resources.
II. Statement with the Problem:
1 . The summary effects of Functions of Prestige Data Services for the 1st quarter of 1997 revealed a net loss which will opted leading management to appraise what alternative courses of action needs to be undertaken to boost the performance of the subsidiary and prevent the closure.
Sixth is v. Objectives
1 . To analyze the results of operations as they have been reported, and to understand the origin and nature of receipts, revenues, expenditures and expenses.
2 . To produce an understanding from the economics of any business and also to use that understanding to forecast the change in income which would occur if various alternate courses of actions were picked by management.
3. To understand the importance of the manner in which cost info is reported, and the method by which accounting and reporting systems can be used to spotlight the elements which are important to management as well as for the evaluation of the procedures.
III. Aspects of Consideration:
Based on the documents and explications presented, the following areas are to be considered:
1 . The best management with the Prestige Cell phone Company is definitely considering option courses of action which might be taken up improve the functionality of a fresh subsidiary, Prestige Data Services.
2 . It was originally conceived as being a mechanism through which high and non-regulated comes back could be accustomed to augment the gains of Prestige Telephone Business, while at the same time providing computer solutions to that organization.
three or more. The subsidiary's performance have not lived up to objectives. Nevertheless, following two years of operation, Respect Data Services has succeeded in coming on collection with providers needed by the parent company and is offering excess several hours of capacity to outside consumers at an elevating rate.
some. $82, 1000 was the optimum average month to month service demand by the subsidiary to Reputation Telephone Company.
5. Start up problems in 2000:
в– Late tools deliveries
в– Personnel required higher salaries
в– Customers were difficult to find
6. Salary of Prestige Telephone experienced dropped towards the lowest revenue in several years
six. Reassessment of Prestige Data Services was needed to reduce the drain on the business services
almost eight. The synopsis of computer utilization (Exhibit 1) of Prestige Data Services;
9. The Summary results of operations of Reputation Data Services (Exhibit 2);
twelve. Service provided to commercial buyers was 24/day on trips and 8 hours in Saturdays;
11. Routine maintenance of computers was provided by another contractor who also took the computer off-line to get eight hours each week pertaining to testing and upkeep.
MIRE. Definition of Conditions...