Financing Plan for Science Technology Company
Essay by Clarisse Dawn Picardo • January 29, 2019 • Case Study • 515 Words (3 Pages) • 830 Views
*View Point of Mr. Bill Watson
*Time Context: October 11, 2018
- Statement of the Problem:
How can Mr. Finson’s 5-year financing plan for Science Technology Company influence the firm?
- Objectives:
- To be recognized international leader in providing integrated quality management systems to manufacturers of electronic devices and equipment.
- To be viable financially.
- To pursue aggressively most major segments of the semiconductor and electronics manufacturing industries throughout Europe, North America, and the Pacific basins.
- Areas of Consideration
Strengths
- Leading manufacturer of computer-controlled automated test equipment (ATE)
- Its 2nd large business was its semiconductor test operation
- Has a large consumer base
- A fair position in VLSI testing
- A dominant share of printed circuit board test market
Weaknesses
- Poor forecasting track record
- Inconsistent financial results year to year
- Failing to keep pace with competition
Opportunities
- Many new consumer products being developed, ranging from computers to calculators to electronic toys
- Constant need for improvement, and innovation (smaller chips, more memory, lower power utilization, etc)
- ATE firms were also helped by the steady increase in labor rates
- Automated test equipment was also of increasing importance in the field
Threats
- Falling prices
- A large number competitors, including Teradyne, Zhentel, Taked Riken, Ando, Marconi, Fairchild, Hewlett-Packard, and LTX
- Consumers demanded and could expect products of high quality at low prices
- Assumptions
None
- Alternative Courses of Action
ACA 1 STC must implement immediate cost-cutting measures to improve financial position.
ACA 2 Should introduce new ideas and services.
ACA 3 Proper cooperation and adaptation must be done in all its division.
- Analysis of Alternative Courses of Action
ACA 1
Advantages
- It can be a tool to evaluate outsourcing deals.
- Reflects the real cost of the purchasing rather than the pure acquisition.
- It helps the firm in reducing its costs and thus reduces its prices.
- Cost controls are the foundation for creating budgets.
Disadvantages
- Lower quality.
- Customer dissatisfaction.
ACA 2
Advantages
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