On November 22, 2013, the direct-to-consumer genetic testing provider, 23andMe, received a letter from the U.S. Food and Drug Administration (FDA) ordering the company to halt the sale and promotion of its genetic testing kit. The FDA stated that the product was marketed as a diagnostic and preventative tool and that it was subject to the agency's regulations for medical devices. Company co-founder Anne Wojcicki and chairman Andy Page carefully considered the potential impact of the FDA's letter on 23andMe's position in the industry and the sustainability of its operations.
Following the FDA's letter in November 2013, which ordered 23andMe to cease sales of its DNA test kits, observers wondered how co-founder and CEO, Anne Wojcicki, would guide the company in the presence of uncertainty.
The case describes the efforts of Beiersdorf, a worldwide leader in the cosmetics and skin care industries, to generate and commercialize new R&D through open innovation using external crowds and "netnographic" analysis. Beiersdorf, best known for its consumer brand Nivea, has a rigorous R&D process that has led to many successful product launches, but are there areas of customer need that are undervalued by the traditional process? A novel online customer analysis approach suggests untapped opportunities for innovation, but can the company justify a launch based on this new model of research?
The Duke-NUS Graduate Medical School in Singapore was initially established with the intention of transplanting the Duke University School of Medicine curriculum to Singapore, where the British style of medical education had been dominant. A small team of pioneer faculty faced many challenges, including transplanting the U.S. model while trying to improve upon and adapt it to the local environment, facing skepticism from the local medical community, and securing support for an innovative educational approach both inside and outside the school. The public watched carefully as the first cohort of students prepared to graduate. How would these graduates perform? What would their performance say about the efforts of the Duke-NUS faculty and its supporters?
The president of General Mills Canada wants to build a culture of innovation in his firm. Prior to a senior management meeting in 2010 to review the company's plans for 2011 and beyond, he met with the vice-president of Human Resources and asked him to provide feedback and suggestions about what the organization could do to change its corporate culture. A conservative organization with a collegial atmosphere where consensus and support were essential to moving projects ahead, General Mills Canada had developed an analysis-based, detail-oriented culture that was not necessarily conducive to innovation. This case provides an opportunity to engage in a discussion about the uncertainty faced by senior management in terms of specifically how to build a culture of innovation. While the senior leaders know they want to build a culture of innovation, the real question is how they should go about doing this.
This case is set in a multi-divisional company with sales offices in several European countries and manufacturing plants in several others. The management control system has been badly designed and students must figure out what is wrong with it and what to do in light of the accountant's recommendation that no changes be made.
This is a case on ABC but with a tricky differential cost decision of the keep/discontinue variety embedded in it. Students need to work with manufacturing overhead allocation, ABC, overhead variances, and variable costing. They also need to see the big picture, which includes a new product line that, while covering its manufacturing overhead, is contributing only about $5,000 to $58,000 of selling, general, and administrative costs.
This case covers a spectrum of management control issues, including the design of responsibility centers, budgeting, measurement and reporting, and behavioral considerations. It is been used successfully as a final exam in a course on management accounting.
This case is set in a health clinic in a Sub-Saharan African country, and requires (a) a fairly standard flexible budget and variance analysis and (b) a somewhat unusual variance analysis. The latter focuses first on variances in volume and mix/efficiency based on minutes per visit rather than cost, and then requires the student to translate this information into an analysis of staffing needs.
This case is helpful for illustrating the concept of cost drivers, and demonstrating how the use of cost drivers can help managers better understand the forces that govern the use of resources in their organizations. It also can be used to demonstrate that by changing a fundamental cost accounting decision (cost centers, in this instance), an organization can change the cost of its products or services.
The case provides a forum that allows an instructor to discuss some of the more counterintuitive aspects of financial accounting, which should help students to increase their grasp of the concepts. The case could stand alone if the goal were to give students just a little information about financial accounting. Ideally, it is taught in conjunction with the Brookstone Ob-Gyn Associates (B) case.
This is a pretty simple case in preparing a budget, with a couple of tricky spins to make it interesting. It is designed to be accompanied by Pacific Park School (B), in which the program ran a deficit, and students must calculate the relevant variances.
This is a relatively simple case on the subject of flexible budgeting, but it raises enough issues concerning the use of the reports that it can easily be used for an entire class session. It provides a nice lead-in to somewhat more complex variance analysis cases.
This case requires the computation of both a flexible budget and some variances, but there is insufficient information to compute all of the traditional variances. Thus, students need to adjust their thinking somewhat and be a little creative. They also need to understand variance analysis enough to play with the data a little bit.
The note looks at operational budgeting through several lenses. The discussion begins with the nature of the operating budget, and the broad context in which budgeting takes place, distinguishing between budgeting's behavioral and mechanical aspects. It then looks at the components of the operating budget, and the steps involved in formulating a budget. An appendix to the note discusses some budgeting misfits, or areas where the budgeting phase may be poorly aligned with other organizational activities.
The note begins with a review of the idea that different costs are used for different purposes, and discusses the differences. It then summarizes the criteria for a good responsibility accounting system. Next, it illustrates the contingent nature of responsibility accounting systems by positioning them as one of several activities that interrelate and that must be well coordinated if an organization is to be successful. This is followed by a brief discussion of each of these activities. The note concludes by emphasizing the importance of senior management's role in designing the activities.