IMA Educational Case Journal
Volume 3, Issue 1
Argento Dairy Farm
Marcela Porporato, and Nelson Waweru
This case describes the decision that a farmer faces regarding the transformation and viability of the business and profitability of two models of growth of her dairy farm: vegetative or aggressive. Jenna, the subject of the case, is the third generation of farmers in Schomberg, Ontario (Canada) and needs to evaluate whether her current dairy operation, designed to support the beef cow/calf operation of her parents, can become an independent, full-fledged dairy farm. Industry-related information as well as detailed revenue and cost data are provided to evaluate the business and the decision regarding the growth model.
Keywords: dairy, farm, living assets growth, living assets management, marginal contribution analysis, and capital budgeting.
JEA: On the Road to Cost Transparency
John B. MacArthur, Jeffrey E. Michelman, Bobby E. Waldrup, Dana M. Wallace
This teaching case examines how one chief information officer, called Vice President (VP) of Technology Services (TS), engaged in a strategic cost initiative to make costs more transparent to users/customers and to impact on their demand for the services of the TS unit at a community-owned electric, water, and wastewater utility. The case bridges the mechanics of process-based costing (PBC) redesign with management and other employee behavior, performance measurement (e.g., the balanced scorecard), and continuous improvement (e.g., Six Sigma) issues. In particular, the case examines the important behavioral aspects of ongoing executive support of strategic initiatives and the role of a multifunctional consulting team in the development of an improved PBC system. As a vital part of the process, the VP of TS integrates a PBC metric into her balanced scorecard as she attempts to look toward the support of this initiative by other members of the organization’s c-suite/executive committee.
Keywords: cost transparency, behavioral issues, executive champion, user participation, process-based costing, balanced scorecard, and Six Sigma.
Haworth, Inc.: Building for the Triple Bottom Line
Today’s managers must consider more factors than accounting numbers in making operating decisions, including those that affect the environment. This case describes One Haworth Center, Haworth, Inc.’s, LEED gold-certified office/showroom building built in 2008, and Haworth’s ongoing sustainability efforts. The case provides students with a realistic context in which to examine the concepts of the triple bottom line, sustainability, corporate social responsibility, and green building. Students are asked to identify how Haworth is addressing each of the triple bottom lines (people, planet, and profit) and to determine how success might be measured for each of these. Students are encouraged to make connections between sustainability efforts and other management accounting topics such as cost control, business risk, and capital investment decisions. Finally, students are asked to make recommendations to management regarding future sustainability efforts.
Keywords: triple bottom line, sustainability, corporate social responsibility, and performance measurement.