ACC 220 Lecture Notes - Lecture 1: Total Quality Management, Vertical Integration, Management Accounting
Document Summary
Business is constantly changing uses, methods, users. Tqm - large scale change can only go on for so long, but small scale change on a constant basis is manageable (10% increase in sales per year vs 1% increase in sales per month) Need: reliable, accurate, real-time product cost data. Old methods: product costing & process costing. Successful pursuit of either strategy requires an understanding of the firm"s value chain. Design > develop > produce > market > deliver > service. Vertically-integrated value chain: carnegie us steel, all production, all mining, all delivery, all marketing, everything. Called a vertical monopoly, so socially destructive it"s illegal. Modern pharmaceutical companies are marketers, not producers, developers, designers. In managing the value chain, a managerial accountant must understand and measure many functions of the business (fin and non-fin) Modern approaches to value-chain analysis may include: Time to market (design, implementation, and production cycles)
