Reference no: EM131264940
Business Analysis Group Report - In-depth Analysis of Strengths and Weaknesses
Detailed Guidelines for Completing the Body of the Report and the Conclusion
Section 1: Individual Company Profiles
In this section, you will be examining the company each of you has been assigned. You will produce an in-depth profile of each company, addressing the following areas:
1. Company strategy and objectives
Provide an overview of the company's current & future strategy.
Identify the company's main objectives, both qualitative and quantitative.
2. Functional Areas
a. Human Resources
i. Organization chart (www.theofficialboard.com may be helpful)
ii. names, tenure & backgrounds of 3 C-suite executives (NOT Board of Directors)
iii. number of employees & whether this has been ↑ or ↓
iv. description of benefits package offered to employees
v. description of types of training and/or educational support provided to employees
b. Marketing
i. List of full range of product lines and/or brands manufactured by company
ii. List of geographic regions where company sells its products
iii. Name of advertising agency and size of overall marketing communications and/or advertising budget (the company's income statement or www.adage.com may be helpful here)
iv. Recent public relations activities (i.e. major sponsorships)
v. Identification of production philosophy (e.g. lean manufacturing)
vi. Identification of current issues relating to supply chain, logistics and product quality
vii. Identification of programs relating to quality assurance (e.g. Six Sigma, ISO)
viii. Identification of provider of software used for enterprise resource planning (ERP) (Note: you may have to go back to the early 2000s to find this)
c. Finance
Part 1 - Income statement analysis
I. Create an Excel spreadsheet showing raw data, drawn from your company's last three income statements (full fiscal years only):
i. Total Revenue (sometimes called sales)
ii. Cost of Goods Sold (CGS)
iii. Gross Profit
iv. EBITDA (earnings before interest, taxes, depreciation and amortization)
v. Selling, General and Administrative Expenses (SGA)
vi. Research and Development (R&D)
II. Compute the MEAN and STDDEV across the three years of data for each of the variables above and put them on your spreadsheet.
III. Produce a horizontal analysis for the last two fiscal years on all six variables (i-vi). Show the results on your spreadsheet. (see text, pages 156-159 for details)
IV. Produce a vertical analysis of the variables ii-vi (shown above), that is, calculate each as a % of total revenue
V. Using the data from your vertical analysis, and with time (i.e. the last three fiscal years) on the x-axis, produce a set of line charts, one for each of the five variables, ii-vi.
Part 2 - Ratio analysis - investor perspective
VI. Using one specific date (your choice) as your point of reference for the share price & number of shares outstanding & the data from the last fiscal year, produce a spreadsheet showing calculations for items c-f.
a. Company share price
b. Number of shares outstanding
c. Market capitalization
d. Earnings per share (EPS)
e. Dividend yield
f. Price/earnings ratio
3. Commitment to Social Responsibility
Provide an overview of the company's values and/or philosophy.
Provide concrete evidence (e.g. recent activities undertaken) of its commitment to social responsibility.
4. Company Profile - Conclusion
Basing your analysis on each major section addressed in the company profile (including the findings and subfindings for each functional area), produce a table summarizing your company's strengths and a table summarizing its weaknesses. In the case of the section on Finance, provide your conclusions for income statement analysis and ratio analysis/investor perspective separately. For the ratio analysis, compare to the industry average (available on Yahoo Finance) to determine if this is a strength or weakness for the company.
Section 2: Cross-Company Analysis
In this section, you will be comparing the companies you've been assigned to each other, on a section-by-section basis, examining your findings from the individual company analyses and using a variety of visuals to communicate your group's analysis of which companies are the strongest and weakest.
1. Company strategy and objectives
Which company appears to have the best strategy? The worst? Explain.
Which company had the most ambitious objectives? The least? Explain.
2. Functional Areas
a. Human Resources
Which company has the most hierarchical organization chart? The flattest? Explain.
Which company has the most long-serving executives? The least? Strength or weakness? Explain.
Which companies have executives with the most varied backgrounds (i.e. either from other industries and/or geographic regions)? Strength or weakness? Explain.
Which company has had the highest increase in number of employees? Which has had the largest decrease? Explain.
Which company has the best benefits packages? The worst? Explain.
Which company provides the best training opportunities? The worst? Explain.
b. Marketing
Which company has the broadest product range? The least? Strength or weakness? Explain.
Which company has the broadest geographic reach? The least? Strength or weakness? Explain.
Which company has the largest advertising budget? The least? Strength or weakness? Explain.
c. Operations
Which company appears to be doing the best job managing its supply chain and logistics?
Which is doing the worst? Explain.
d. Finance
For each of the following variables (each variable will be shown on the y-axis), create a separate combination bar/line chart.
i. Total Revenue (sometimes called sales)
ii. Cost of Goods Sold (CGS) as a % of Total Revenue
iii. Gross Profit as a % of Total Revenue
iv. EBITDA (earnings before interest, taxes, depreciation and amortization) as a % of Total Revenue
v. Selling, General and Administrative Expenses (SGA) as a % of Total Revenue
vi. Research and Development (R&D) as a % of Total Revenue
The chart's x-axis will provide identify all of the companies you profiled, for the last three full fiscal years. The companies should be shown as a set of different bars on the chart, organized by fiscal year. You will then superimpose a line on the bar chart that represents the average for that variable, across all companies, for each of the three fiscal years. These combination charts will provide you with a snapshot of how each company is performing on each of the above variables, against the average for all companies profiled.
Based on these charts, what conclusions can you reach about which company is the strongest and which is the weakest? Explain.
For each of the following variables (each variable will be shown on the y-axis), create a separate bar chart.
a. Earnings per share (EPS)
b. Price/earnings ratio
c. Dividend yield
The bars on each chart's x-axis will be the company names. You will then superimpose a straight line (the line will be straight, because there is only one average available for one point in time) on the chart that represents the average for that variable, across all companies. These combination charts will provide you with a snapshot of how each company is performing on each of the above variables, against the average for all companies profiled. Based on these charts, what conclusions can you reach about which company is the most attractive to investors and which is the most unattractive? Explain.
3. Social Responsibility
Which company appears to take its commitment to social responsibility most seriously? Least seriously? Explain.
4. Overall Conclusion
Having done an in-depth examination and analysis of the companies from many different perspectives, write a conclusion that addresses the following:
- your group's pick for the company with the most strengths across the spectrum. Provide an explanation for your choice, referring back to the specific areas that contributed to your choice.
- your group's pick for the company with the most weaknesses across the spectrum. Provide an explanation for your choice, referring back to the specific areas that contributed to your choice.