CASE ANALYSIS

PREPARED BY:

ESCALANTE, ANGELICA
EVANGELIO, VERONICA
FORTES, RHYSSA MARI ANGELA
GUARDIAN, JULIUS IAN
IMPERIAL, HANS CHRISTIAN
MALEJANA, BEA
TEE, VIRGETTE

BS ACCOUNTANCY IV-A
 ANALYSIS

SUMMARY
Best Engineering Consultancy Inc., is am engineering firm who made a
partnership with a consulting firm through outsourcing arrangement to outsource
some of its engineering functions. Suddenly, the company’s employees have been
diminished from 30 to 5. Also, for the customers, the engineering work was of low
quality but with high value and beyond schedule. So the chief engineer got
disappointed that he resigned. Because of resignation and terminations, only 5
employees remained at Best, whereas originally the bot firm had 30 personnel at the
time of partnership. In addition, it has been reflected in Best’s billing the consultant’s
overhead costs and profits. The consultant charged the owner overhead costs to
accommodate the employees that were moved to the new partnership. Apparently, the
budget should be determined and should stay within the boundaries allowed for
particular project but the fixed costs of the project are not properly charged to the
project’s budgets. As a result, miscomputations and misappropriation of costs occur.
Because of the situation, the CEO of Best got so bothered and worried. The
contract between the two companies will end this subsequent year and if Best will
preterminate the contract, there will be Php 100, 000 penalty. So the company needs
to think for another strategy to resolve the problem.
 OBJECTIVES

 To be able to meet customers’ satisfaction.

 To be able to know the cause of
miscomputation and misappropriations.
 To be able to employ highly skilled engineers.
 ANALYSIS

STATEMENT OF THE PROBLEM

 The number of engineers directly employed with Best

diminished from 30 to 5.

 Customers felt that engineering work was of low quality at a

high value and beyond schedule.

 The chief engineer has resigned.

 Miscomputations and misappropriations of costs occur.

 There is need for another strategy of Best Company upon

finishing their contract of partnership to the outsourcing
firm.
 SWOT ANALYSIS
(STRENGTHS)

 Outsourcing arrangements
 Availability of Services
 Strong Financial Performance
 WEAKNESSES

 Diminished number of Engineers

 Low quality of Performance
 Unreasonable Project Cost
 Engineers don’t comply on time schedule
 Lack of Accounting Support
 Lack of set of qualifications for hiring engineers
 Lack of training and development
 High Pricing of Services
 Miscomputation of Cost
 Negative Background
 OPPORTUNITIES

 Hires high standard or licensed engineers

 Currently, the companies are relying on
agencies
 Customers’ need for high quality of services
 THREATS

 Customers loyalty and satisfaction.

 Competitors
 Limited Applicants of Licensed Engineer
 ANALYSIS

ALTERNATIVE COURSES OF ACTION

 There will be a corporate board meeting to discuss the matters

concerning the company and to develop possible solution and quick
response.
 Work redesign and People Management- it is the responsibility of HR
dep’t to have personnel who have expertise needed by Best for them to
evaluate, recruit and train that will enable the employees to be productive
and improve work performances.
 Pay structure and benefits- to motivate the employees to do their job well,
do promotions and recognitions.
 Company must improve learning and growth system of employees to
enhance their work.
 Customer perspective- Best Company should focus on customers’ needs
and wants to have customer loyalty and satisfaction.
 ANALYSIS

RECOMMENDED SOLUTION/ IMPLEMETATION

1. Hire highly skilled Engineers

2. Hire New Internal Auditor
3. Establish Competitive compensation and benefit packages.
4. Hire a senior engineer
5. Modify the contact with the consulting firm
 1. Hire highly skilled Engineers

ADVANTAGES
 High quality of outputs
 Entice more customers
 Establish strong relationship to customers
 Innovation of services
DISADVANTAGES
 The computation of highly skilled engineers are too
costly.
 Possibility of piracy in competitors perspective.
 The charging of cost of services will increase
 2. Hire New Internal Auditor

ADVANTAGES
 Measurable flow of funds in a timely and consistent
manner.
 Avoiding miscomputations and misappropriation of
costs.
 Prevent anomalies.
 Detect fraudulent acts.
 Take necessary actions for detected problems.
 2. Hire New Internal Auditor

DISADVANTAGES
 Possibility of arrangement between the consulting
firm and internal auditor.
 Additional expenses in hiring internal auditor.
 3. Establish Competitive compensation and
benefit packages.

ADVANTAGES
 Can attract highly skilled engineers.
 Motivates the applicants and current employees.
 Can pirate outstanding performance from
competitors.
 Loyalty of employees.
DISADVANTAGE
 Additional Expenses
 4. Hire a Senior Engineer

ADVANTAGES
 He shall facilitate the new engineer to ensure that
their work meet the required standard
 He shall monitor the time used by the engineers
required to finish a contact with a client and confirm
that no delay will prosper
DISADVANTAGES
 It may entail additional expense for the company
 Collusion may occur
5. Modify the Contract with the Consulting Firm

ADVANTAGE
 It would resolve the problems that could lead to the
improvement of the future performance of the
consulting firm
DISADVANTAGE
 Additional expense could occur in modifying the
contract
 The consulting firm may not adhere to the
modification or they may further disintegrate the
image of Best
THANK YOU!