Nike is an Oregon-based company that focuses on the design, development, and worldwide marketing of high-quality footwear, apparel, equipment, and accessory products

Identify one decision that Nike managers make in each of the six value chain functions.

For each decision in requirement 1, identify one piece of accounting information that would aid the manager's decision.

The six value chain functions are:

1) R&D

It is the process that is conducted to generate and experiment with ideas related to new products, services, or processes. R&D department can look at information regarding operating expenses to identify weaknesses and errors in terms of processes, operations,etc. and can improve those processes for increasing bottom line profits. Similarly, trends in sales revenue also guide the R&D department to continuously seek improvement in existing products as well as develop new products. For example, if sales in a particular product line of Nike is decreasing, R&D managers of Nike can look for factors that can improve the sales.

2) Design: It is the detailed planning and engineering of products, services, or processes.

Design is particularly interested in accounting information related to sales, operations, processes and systems and look for figures presented in the profit and loss statement to capture trends regarding productivity, efficiency, etc.If the sales are decreasing, they will bring the desired changes in products or services to enhance revenues. If the operating expenses are increasing, design evaluate alternatives to improve efficiency of operations. Some of the other aspects which design looks are in accounting figures are those related to procurement or purchasing costs,costs of raw materials,etc. For example, if input costs or cost of operations are rising, Nike managers in charge of the design process can look for improvement in supply chain processes and other operations.

3) Production: It is the acquisition, coordination, and assembly of resources to produce
a product or deliver a service. Figures such as cost of goods sold, raw material costs, labor costs, and other operating expenses presented in the profit and loss account are of particular interest to Nike managers who are incharge of production as they need to improve bottom line profits of the company by producing in the most efficient manner.

4) Marketing: Marketing team looks for sales/revenue figures, costs related to advertising and marketing,etc. to figure out whether or not their sales efforts are paying off and the company is increasing is sales and revenues and the amount spent on advertising is justified or not.

5) Distribution: Distribution team utilized figures presented in profit and loss account with respect to selling and distribution costs to make it sure that amount spent on distribution is justified and is consistent with the increase or decrease in sales revenues. Further, they try to minimize costs and maximize customer satisfaction.

6) Service: After sales service are a significant part of any company's strategy today as Total customer satisfaction is the ultimate goal of any organization. The result of an excellent after sales service is enhanced revenue and goodwill. Thus, after sales team is particularly interested in sales/revenue figures, amount spent on after sales service/customer service,etc. in the profit and loss account and make it sure whether or not their efforts are bringing enhanced revenues and goodwill to the company.

Write 5 questions that can be answered by accounting information. For example, "How many shoe styles should Nike produce for next year?" or "where are the sales trends declining?"

Questions which can be answered by accounting information are:

1) Which segment is bringing maximum revenues/profitability to the company? For example, shoes or apparel,etc.?

2) Are the input costs, such as cost of raw material or labor rising? If yes, is there are a need to revise price?

3) Is the operating profit margin decreasing or increasing? If increasing, what areas need to be improved?

4) Is the sales revenue increasing as per market growth?

5) Is the financing costs under control or in other words, is the cost of capital too high?

6) Is the cash flow adequate? Will the company be able to meet its short term cash requirements?

Student: In case the assignment requires value chain analysis of the Porter's eight value chain functions, it is given below:

1) Inbound logistics: In this function, goods are received from a company's suppliers and are stored until they are needed in production. Goods are moved around the organization. Costs related to purchasing, inventory etc. is of particular importance in this regard to identify whether or not the inventory levels are optimal and the storage costs are under control.

2) Operations: I have already described this section in the assignment submitted earlier.

3) Outbound Logistics: You can write the same as distribution in the assignment submitted earlier.

4) Marketing and Sales: This section is also explained in the earlier submission.

5) Service: This section is also explained in earlier submission.

6) Procurement: It is similar to inbound logistics in the sense that cost of raw materials being purchased along with purchasing related costs are analyzed from financial statements to identify whether or not input costs are under control and sourcing or purchasing is done in the most efficient manner.

7) Technology Development: Companies need to innovate and reduce cost with the help of technology and sustain competitive advantage in today's competitive environment. Thus, figures such as operating expended, expenditure on research and development and new technology is of particular importance to this function to identify whether or not new technology is effective in keeping costs under control.

8) Human Resource Management: For HR department, costs related to salary and benefits or bonuses is the most important piece of information from financial statements to keep HR costs under control.

9) Firm infrastructure: This function includes and is driver by corporate or strategic planning. IT includes the MIS and other mechanisms for planning and control such as the accounting department. For this department, figures related to operating expenses, other costs, revenues/sales etc. are of importance as this functions aids in control function and strategic planning.