CASE STUDY AIRTEX AVIATION

To change it and implement a new system, Ted Richards and Frank Edwards took few key decisions on: The decentralization of the decision process is a good way to facilitate it and help to develop relationship between stakeholders and staff. Data analysis There are a number of issues before Franck and Ted set up the decentralized control system, which will be analyzed now. Its autonomy is strengthened because managers can hire, fire and manage the salary schedule. So, there is a difficulty to understand how Sarah Arthur built the financial statement and to replace an employee with an important role in the functioning of Air Tex. One of the first steps is to identify Specific, Measurable, Acceptable, Realizable, and Timetable objectives at each level of the enterprise divisional and top level.

In the future, an incentive program more accurate can be developed to motivate and attract staff. Then, Ted felt a problem linked to the personnel work ambiance, their seriousness and more over their professionalism. Data analysis There are a number of issues before Franck and Ted set up the decentralized control system, which will be analyzed now. The decentralization of the decision process is a good way to facilitate it and help to develop relationship between stakeholders and staff. Finally, this new control system requires some additional costs, because each department can hire a new employee to deal with the Daily Department Report. The issues of autonomy, cost allocations and transfer pricing are those which have an important impact on Air Tex profitability and its strategic vision. Each department is responsible of its results, revenues and.

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Airtex Aviation – Cost Control Study Case

Because the firm is near of the bankruptcy, Ted and Franck design a new long term strategy which reduces costs, decentralizes management decision process; implements new management styles and defines clear way to growth and move in the aviation market.

Moral Each division is an autonomous profit center.

case study airtex aviation

The objective of the two partners was to look younger the management of Air Tex, to create a new control system provision support and information needed, and to lower xase power of the accountant Sarah Arthur.

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An effort must be made to strengthen the links with stakeholders, in the goal to be in position to negotiate with them. There is also an issue to implement the new accounting system, because Sarah Arthur decided to limit her work in the company and they hire aviatoon new accounting clerk without experience.

Airtex Aviation Case Study by Crazylittlemiao C on Prezi

However, some disadvantages and disturbances can result from the implementation of this new management control system. Ted and Frank qviation a problem when they take decisions of acquiring the company because of a lack of skills: So, an important information control is necessary to improve the reliability of Daily Department Reports. Other intention is to work sviation a cost control system, more efficient than easy to implement, in order to change the current financial situation of the firm.

So, there is a difficulty to understand how Sarah Arthur built the financial statement and to replace an employee with an important role in the functioning of Air Tex. There airte also to educate staff by creating seminars of information, and there is a contradiction because there is a need of money.

aviaiton This decision right is a variable to affect the moral of the managerial team and motivate them. We saw the different casse about the old management control system. First, the new control system aims at providing accurate financial information to each divisional manager in order to encourage managers to make all the decisions themselves, by creating a feedback of their operations.

Finally, this new control system requires some additional stuxy, because each department can hire a new employee to deal with the Daily Department Report. Data analysis There are a number of issues before Franck and Ted set up the decentralized control system, which will be analyzed now. There is a kind of contradiction because Air Tex tries to implement a new control system which is very costly, where as the firm is on the verge of bankruptcy.

The issue for Ted and Frank, future managers of Air Tex is to establish a growth over the long-term for the firm with a new strategic view.

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Its autonomy is strengthened because managers can hire, fire and manage the salary schedule. The problem statement can be summarized as follows:. First, we think that Ted and Frank need to improve their knowledge about the plane sector.

There is a static hierarchy, without possibility of evolution. The goal is to make objectives in correlation with the management decision process. To change it and implement a new system, Ted Richards and Frank Edwards took few key decisions on: Then, they decided to create an administrative sector which forces them to review the organization of the company, which have a cost. In the future, an incentive program more accurate can be developed to motivate and attract staff.

Recommendations First, we think that Ted and Frank need to improve their knowledge about the plane sector. Then, Ted felt a problem linked to the personnel work ambiance, their seriousness and more over their professionalism.

Decisions are taking arbitrarily, without the search of a consensus. Indeed, the figures in the balance sheet for Air Tex aviation appear to be very disorganized.

The control process gives performance results of divisions each month. Each divisional manager will be more autonomous and can directly impact their future performances. With the new control system, the leadership is divided between Ted Richards and Frank Edwards as equal partners and as best aviatuon and they try to encourage staff to take desirable actions by decentralizing the power and involving the staff. Furthermore, a training and development program will be interesting to improve the management skills of the staff.

case study airtex aviation

To motivate managers, there is also the creation of incentives for managers: Then, there is a difficulty to understand the accounting system and the economical situation is exigent.