Armco History and Performance Measures Armco‚ Inc. produced stainless‚ electrical‚ carbon steels and steel products. Armco‚ Inc.‚ along with the help of other companies Armco‚ “produced coated‚ high strength and low-carbon flat rolled steel and oil field machinery and equipment” (Merchant & Van der Stede‚ 2012). In 1990‚ Armco was the sixth largest steel manufacturer in the United States. Armco’s Midwestern Steel division generated $550 million dollars in sales in 1990. Within Armco‚ the Kansas
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Case 25-2: Armco Inc.: Midwestern Steel Division* Note: This case is unchanged from the Twelfth Edition. Approach The Armco case was designed to illustrate a performance measurement system with measures cascading from strategic priorities down to the lowest organization levels. The system is not tightly linked with incentive compensation‚ although that is being discussed. Still‚ the focus on measured results promises to change managerial behaviors significantly. The case is particularly interesting
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Case assignment Armco‚ Inc.: Midwestern Steel Division Case Analysis What was wrong with the Midwestern Steel Division’s old system? Within the division‚ The Kansas City Works was by far the largest entity. The manufacturing areas of the Kansas City Works were divided into five responsibility centers. Each responsibility center was comprised of one or more cost centers. The managers and superiors were evaluated in terms of cost control and safety. The key cost performance measure was
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Case Study: Armco‚ Inc.: Midwestern Steel Division What do you think was the problem with the implementation of the new performance measurement system? In January 1991‚ Top management of the Kansas City Works of Armco’s Midwestern Steel division began implementing its new performance measurement system. It was designed to give better management focus on the things‚ which are most important. The new system included less data’s: it allows managers to focus on the 5-6 more important which cause
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Armco‚ Inc.: Midwestern Steel Division Case Background Armco‚ Inc was producer of stainless‚ electrical‚ carbon steels‚ and steel products from United States. It was the sixth largest steel manufacturer in the United States in 1990. Kansas City Works was by far the company’s largest entity in the Armco’s Midwestern Steel Division‚ contributing around $250M in sales from $550M of Armco’s steel division net sales in 1990. The Kansas City Works produced two primary products: grinding media and
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Case 1‚ Armco Inc. – Midwestern Steel Division Armco Inc is a steel manufacturer that used to be the sixth largest in its industry in United States in 1990. The Kansas City Works within its Midwestern Steel Division was hit by the decline in the business in the US steel industry. The firm produces grinding media and carbon wire rod. The first one has been successful in the industry with its great durability compared to the competitors. Carbon wire rods on the other hand were non profitable and covered
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Questions to consider: 1. How would you characterize Steel Works’ products? What about Steel Works’ customers? 2. What does the coefficient of variation tell us? Can you determine the coefficient of variation for the product lines? 3. How much inventory has Steel Works been holding? How much should they have been holding? SPECIALTY PRODUCTS DIVISION Customer Characteristics Steel Works has a large number of customers for its specialty products - 130 customers for some 120 products. However
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SAC PRESIDENT’S LETTER 25 by 25 is not 625 We‚ doctors‚ nurses‚ cardiology technicians and other professions related with cardiology have hopes and projects for our personal‚ institutional and society lives. Yet‚ we sometimes feel confused when we think about the population. What can we do to improve public health? We can all contribute and work together with our Society. During the past year‚ we have launched the 25 by 25 Program. 25 by 25 is the project of the Argentine Society of Cardiology and
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1. Activity Based Costing benefits businesses that are more complex in nature. In this case‚ Greetings. INC has added a new product line‚ Wall Decor‚ which permits them to grow without expanding their physical stores; however‚ they have significantly raised their overhead costs by multiplying their cost drivers. Not to mention the fact that they have incorporated a largely automated system into their product line‚ which we know calls for an ABC system. The main reason to move to ABC though‚ would
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for the U.S. hotel lodging industry include headline unemployment‚ mostly due to declining business and conference travel. There was relatively unchanged real GDP‚ and due to the housing crisis and recession in our economy‚ rampant foreclosures. 2. The Good Hotel brand‚ I feel‚ did well in its strategy implementation efforts. They went to a strategy designed to inspire “good in us all”. One that was good for the plant and socially conscious with a “lighthearted twist”. Going “green” is definitely
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