Musimundo Case Study :: Business Strategy Analysis

1.DESCRIBE THE STRATEGIC mise en scene IN WHICH QUINTANA SHOULD JUDGE MUSIMUNDOS PERFORMANCE. WHAT atomic number 18 THE CHARACTERISTICS OF THE ENVIRONMENT THAT MUSIMUNDO COMPETES IN? WHAT ARE PEGASUS STRATEGIC OBJECTIVES FOR MUSIMUNDO? HOW DO THESE FACTORS AFFECT THE BUDGETING PROCESS?Strategic ContextQuintana wants to strategically reward the managers of the Musimundo stores for meeting their cypherary goals however, some managers were completely unable to do this and other managers were guaranteed their sales quota.Quintana dissolve rectify this situation by modifying the Musimundo inducement organization. Quintana can use multiple performance measures to reward his managers. These performance measures can be sales based on a flexible budget that looks at historical sales and measures them against current sales. The manager could be rewarded for the constituent of increase.Quintana can also use a balanced scorecard greet for each store. A stores success can be based on a number of factors aside from sales. These factors could be client satisfaction surveys, growth within the store, and management of employees and human resources.Additionally for the bordering year, Quintana should implement and/or refine an Activity Based Budgeting system. Quintana can initiative assign overhead costs to cost pools that represent the largest activities for Musimundo. These costs would be related to the purchase, location, and stocking of Music (Music represented 41% of the Musimundo business in 2004). aft(prenominal) these overhead costs are assigned, the costs can be allocated to the dissimilar retail stores based on their consumption of the good (e.g. the number of melodious works they stock and sell).The Musimundo EnvironmentThe Musimundo environment is jaded and disproportionately fat in various regions of Argentina. As Argentina was exiting its economic crisis, various regions were detective work up in the realm of consumption however, other regions were either not catching up or overlooked the activity to generate the proper sales. Managers in the more profitable regions were achieving/surpassing their sales goals, while managers in the little active regions were unable to achieve their sales goals. These underperforming managers were penalized by a system that they neither fostered nor developed. In all likelihood, the underperforming managers were disincentivized by unrealistic budgetary goals for their region, needing win assurances from corporate that their vision could be achieved. All retail stores suffered from a lack of product, destroying the potential sales that they could have gained. The stores in less popular/ live regions may have garnered a reputation for being unreliable and continually out of stock.