Competitive Managerial Analysis Project

Project description: Choose a manufacturing company and assume you are an employee of this company. Your management has given you the task of reporting back to them about how well your company is managed relative to its nearest competitor. You will be researching your company, its nearest competitor, and its industry. In addition, you will prepare a horizontal and vertical analysis, and a comparative ratio analysis to formulate observations about your company and to compare performance to your major competitor and to your industry. You will summarize your final assessment of which company managers are being more effective at the managerial process – planning, action, and control.

General Instructions: DUE DATE Monday, November 19, 2018

A. Select a Manufacturing Company that you might be interested in from the list provided on Bb.

· Send the professor an email containing both the team members and your first 4 choices of companies on the list.

· Include your class time and team number in the subject line: i.e. 2PM M & F class Team 1 choices

· Teams will be assigned on a first-come, first-serve basis.

B. Research guidance - The project involves researching your company, its main competitor, and its industry. You will gather your information by using the following sources with the guidance of Bryant Librarians. There is also a library instructional video available in the assignment folder.

a. Form 10-K (available through sec.gov).

b. Definitive Proxy Statement (available through sec.gov).

c. Company website – additional information may be available

d. Financial databases such as IBIS, Hoover’, Mergent – use these to gather company ratios, competitor ratios, and industry ratios.

e. Business periodicals and newspapers

NOTE: Be sure to properly cite your sources. Failure to do so is a serious offense and one which will severely impact your grade on the project.

C. Writing Quality and Report Presentation - Characteristics to be evaluated:

· 12 font – Times new Roman, 1 inch margins

· Professionally written, professional in appearance (bound), consistent format throughout

· Goes above and beyond in answering the questions

· Charts are prepared in excel, present information in an efficient user-friendly manner (not split between pages)

· Makes connections between answers of various questions

· Report has a quality worthy of presenting to your supervisor in a professional work environment

· Charts and tables of information are integrated within the document

· Fatal Flaws - Your grade will be penalized for fatal flaws like awkward wording, poor sentence structure, spelling errors, punctuation errors, sentence fragments, run-on sentences, poor paragraph structure. See Fatal Flaw document in general documents on Bb.

D. Team Evaluation

· The team evaluation form (available in the assignments folder) must be completed and handed in by each team member individually on the due date of the project. The overall project grade will be penalized if any team evaluation forms are missing on the due date.

· Individual grades will vary from the team grade based on team evaluations.

· No evaluations should have a perfect score on every characteristic.

E. Put this project on your resume – Report to Management – Competitive Managerial Analysis Project

CHECKLIST FOR DELIVERABLES - Both Electronic and Hardcopy Submission Required

1. Hard copy of project should include the following (points will be deducted if items are missing):

· cover page with company name, team member names, time class meets

· answers to the questions in order

· works cited page(s) – MLA format required

· Use of 10-k and definitive proxy – when this is referenced in your report, you should include the page number from which you retrieved the information

· TEAM EVALUATION FORM – each of you must hand this in individually on the due date

· Copy of safe assign similarity report.

2. Electronic copy of project submitted to SafeAssign link provided in Bb.

3. Electronic copy of Excel Worksheets submitted to link in Bb.

Project questions: Download an electronic copy of these questions and insert your answers below each question.

Company Analysis

1. (10 points) Locate and summarize the following information about your company. (Listing it is acceptable here.)

a. Company name & headquarters address

b. Website address

c. Ticker symbol

d. Stock exchange on which company trades

e. Fiscal year end

f. Date of most recent 10-K

g. Key products

h. Geographic market - Indicate where your company operates (not just their headquarters location)

i. Business Segments - Create a chart listing the segments that are reported for your company and the relative percent of overall business and profit that each segment represents. Write one concise paragraph discussing the relative importance of each segment to the company.

NOTE: Large companies often breakdown their company operations into “segments”. Segments can represent different product lines, brands or geographical markets. This information can be found in the footnotes to the financial statements and may be discussed in the Management Discussion & Analysis (MD&A) section of Form 10-K.

2. (15 points) Past Performance, Future Performance, Related Challenges - Read the Management Discussion & Analysis. This is in the 10-K or in the annual report. Be sure to properly cite the page numbers within the 10-K that you obtained this information.

a. Recent results - What does management indicate about the company’s recent results? Be specific about different aspects of the company’s recent financial performance.

b. Future predictions - Explain and be specific about management’s opinion of the future direction of the company.

c. Challenges - Describe three (3) challenges your company faces currently and/or in the future. What ratios or trends would you, as a manager, monitor to determine whether the challenges are being addressed? Why these ratios?

Competitor and Industry Research

3. (20 points) Competitor and Industry Research

The major purpose of your competitor and industry research is to identify your company’s major competitor and to understand the major trends or developments that are occurring in your company’s industry.

a. Discuss the company’s main competitor found in your research. Establish why it is a main competitor.

· What measure(s) are you using to determine that it is a main competitor? For example, are you comparing sales, number of locations, market share, Fortune 500 rankings, etc.

b. Search business periodical databases and find at least three (3) articles in business periodicals and/or newspapers that discuss your company, its competitor, or its industry. Based on your articles and related research, discuss what is happening in the news that may affect your company’s business, your competitor’s business, your industry’s business. How might stock prices or your business, your competitor, or your industry be effected? Describe the industry and/or competitor outlook, any major trends, and how these trends may affect your company.

NOTE: Take care when selecting articles. Be sure they are published NO MORE THAN SIX MONTHS PRIOR TO THE DUE DATE OF THIS PROJECT. Also, be sure they are NOT press releases issued by your company’s management. Be sure to properly site ALL of “your articles and other sources used in this research.

Financial Analysis of the Company, its Competitor, and Industry

4. (25 points) Organize your company’s and its closest competitor’s financial information in an Excel Workbook

a. Create Vertical and Horizontal Analysis spreadsheets - Using your company’s financial statements reported in their 10-K, create two excel worksheets within your Excel workbook, one labeled “Balance Sheet” and the other labeled “Income Statement”. Perform a vertical and horizontal analysis on your company’s balance sheet and income statement using the two most recent years of financial statements. (Examples of vertical and horizontal analysis are displayed in Chapter 13 of the text).

b. Create Ratio spreadsheet - a third worksheet in your Excel workbook and label the tab “Ratios”. Include the following information in a management report that is easy to read and comprehend. Show a 3 year trend of your company’s key ratios, separated into the categories of profitability, liquidity, and solvency. You must choose at least 3 ratios that tell us something different about profitability, at least 3 ratios that tell us something different about liquidity, and at least 3 ratios that tell us something different about solvency. For example, inventory turnover is a liquidity ratio but days sales in inventory, also a liquidity ratio, tells us the same thing in different ways….therefore, these are not considered 2 different liquidity ratios.

· Do the same for your company’s closest competitor.

· Do the same for the industry (note that the library tour will help you to obtain industry ratios)

NOTE 1: Your Excel worksheets must be included within the hard copy of the project in question order . In addition, an electronic copy of the Excel workbook must be submitted through the appropriate assignment link in Blackboard. To receive full credit for this portion of your project, you must incorporate basic Excel skills when creating your workbook. At a minimum, you are expected to –

· Create and manipulate formulas, columns, and rows, labels, and titles within a worksheet

· Format worksheet information so each worksheet has a professional appearance when printed as part of your report

NOTE 2: DO NOT MANUALLY CALCULATE THE RATIOS! Use either the IBIS, Hoovers, or Mergent financial database to obtain and download the ratios. You can access these databases through “Articles and Databases” on the Bryant library website. Choose ONE of these databases, and use it consistently throughout this project.

5. (30 points) Analyze company and competitor information

a. Analyze your vertical and horizontal analysis Income Statement and Balance Sheets to identify major trends and/or observations of key line items in those statements. Discuss at least 2 observations from your vertical and horizontal income statement and at least 2 observations from your vertical and horizontal balance sheet. Be sure to connect your observations to your Management Discussion & Analysis dialogue above (question 2).

b. Consider the company’s industry and products. What are the main variable and fixed costs? Describe what you feel is the company’s “cost structure”. Why should this be something that management is aware of?

c. Assume you are charged with reporting to your management about how well your company is managed relative to its nearest competitor and the industry. Use your comparative ratio analysis to formulate observations from the point of view of profitability, liquidity, and solvency. Be sure to prove you understand what profitability, liquidity, and solvency are and how the ratios chosen describe that attribute. Additional support from your articles and horizontal/vertical analysis would be good as well. Be sure to summarize your final assessment of how effective your company is at planning and controlling operations relative to your competitor and industry.

Total Points (100 POINTS) NOTE: Your final grade on the project is subject to the group evaluation. Your score may be higher or lower than the project grade based on the evaluations.