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Problem Identification
The first step in solving the HBR Case Study is to identify the problem. A
problem can be regarded as a difference between the actual situation and the
desired situation. This means that to identify a problem, you must know where
it is intended to be. To do a AGGREGATE PLANNING AT GREEN MILLS case
study analysis and a financial analysis, you need to have a clear understanding
of where the problem currently is about the perceived problem.
For effective and efficient problem identification,
1. Company history:
The AGGREGATE PLANNING AT GREEN MILLS case study consists of the history
of the company given at the start. Reading it thoroughly will provide you with
an understanding of the company's aims and objectives. You will keep these in
mind as any Harvard Business Case Solutions you provide will need to be
aligned with these.
Another way how you can do the AGGREGATE PLANNING AT GREEN MILLS
financial analysis is through financial modelling. Financial Analysis through
financial modelling is done by:
Thus, it is a snapshot of the company and helps analysts assess whether the
company's performance has improved or deteriorated. It also gives an insight
about its expected performance in future- whether it will be going concern or
not. AGGREGATE PLANNING AT GREEN MILLS Financial analysis can, therefore,
give you a broader image of the company.
It takes into account the future value of money, thereby giving reliable
results.
It considers the cost of capital in its calculations.
It gives the return in dollar terms simplifying decision making.
The formula that you will use to calculate AGGREGATE PLANNING AT GREEN
MILLS NPV will be as follows:
Present Value of Future Cash Flows minus Initial Investment
Present Value of Future cash flows will be calculated as follows:
PV of CF= CF1/(1+r)^1 + CF2/(1+r)^2 + CF3/(1+r)^3 + …CFn/(1+r)^n
where CF = cash flows
r = cost of capital
n = total number of years.
Cash flows can be uniform or multiple. You can discount them by AGGREGATE
PLANNING AT GREEN MILLS WACC as the discount rate to arrive at the present
value figure. You can then use the resulting figure to make your investment
decision. The decision criteria would be as follows:
If Present Value of Cash Flows is greater than Initial Investment, you can
accept the project.
If Present Value of Cash Flows is less than Initial Investment, you can
reject the project.
Thus, calculation of AGGREGATE PLANNING AT GREEN MILLS NPV will give you
an insight into the value generated if you invest in AGGREGATE PLANNING AT
GREEN MILLS. It is a very reliable tool to assess the feasibility of an investment
as it helps determine whether the cash flows generated will help yield a positive
return or not.
However, it would be better if you take various aspects under consideration.
Thus, apart from AGGREGATE PLANNING AT GREEN MILLS’s NPV, you should
also consider other capital budgeting techniques like AGGREGATE PLANNING AT
GREEN MILLS’s IRR to evaluate and fine-tune your investment decisions.
AGGREGATE PLANNING AT GREEN MILLS DCF can also be calculated using the
following formula:
DCF= CF1/(1+r)^1 + CF2/(1+r)^2 + CF3/(1+r)^3 + …CFn/(1+r)^n
In the formula:
AGGREGATE PLANNING AT GREEN MILLS IRR impacts your finance case solution
in the following ways:
1. Think about the order of the AGGREGATE PLANNING AT GREEN MILLS xls
worksheets in your finance case solution
2. Use more AGGREGATE PLANNING AT GREEN MILLS xls worksheets and
tables as will divide the data that you are looking at in sections.
3. Choose clarity overlooks
4. Keep your timeline consistent
5. Organise the information flow
6. Clarify your sources
The following tips and bits should be kept in mind while preparing your finance
case solution in a AGGREGATE PLANNING AT GREEN MILLS xls spreadsheet:
1. Liquidity Ratios: Liquidity ratios gauge a company's ability to pay off its
short-term debt. These include the current ratio, quick ratio, and working
capital ratio.
2. Solvency ratios: Solvency ratios match a company's debt levels with its
assets, equity, and earnings. These include the debt-equity ratio, debt-
assets ratio, and interest coverage ratio.
3. Profitability Ratios: These show how effectively a company can
generate profits through its operations. Profit margin, return on assets,
return on equity, return on capital employed, and gross margin ratio is
examples of profitability ratios.
4. Efficiency ratios: Efficiency ratios analyse how efficiently a company
uses its assets and liabilities to boost sales and increase profits.
5. Coverage Ratios: These ratios measure a company's ability to make the
interest payments and other obligations associated with its debts.
Examples include times interest earned ratio and debt-service coverage
ratio.
6. Market Prospect Ratios: These include dividend yield, P/E ratio,
earnings per share, and dividend payout ratio.
FCFF
FCFE
DDM
Comparable
o DDM is an appropriate method if dividends are being paid to
shareholders and the dividends paid are in line with the earnings of
the company.
o FCFF is used when the company has a combination of debt and
equity financing.
o FCFE, on the other hand, shows the cash flow available to equity
holders only.
These three methods explained above are very commonly used to calculate the
value of the firm. Investment decisions are undertaken by the value derived.
AGGREGATE PLANNING AT GREEN MILLS calculations for projected cash flows
and growth rates are taken under consideration to come up with the value of
firm and value of equity. These figures are used to determine the net worth of
the business. Net worth is a very important concept when solving any finance
and accounting case study as it gives a deep insight into the company's
potential to perform in future.
Alternative Solutions
After doing your case study analysis, you move to the next step, which is
identifying alternative solutions. These will be other possibilities of Harvard
Business case solutions that you can choose from. For this, you must look at the
AGGREGATE PLANNING AT GREEN MILLS case analysis in different ways and
find a new perspective that you haven't thought of before.
Once you have listed or mapped alternatives, be open to their possibilities.
Work on those that:
Feasibility
Suitability
Flexibility
Implementation
Once you have read the AGGREGATE PLANNING AT GREEN MILLS HBR case
study and have started working your way towards AGGREGATE PLANNING AT
GREEN MILLS Case Solution, you need to be clear about different financial
concepts. Your Mondavi case answers should reflect your understanding of the
AGGREGATE PLANNING AT GREEN MILLS Case Study.
You should be clear about the advantages, disadvantages and method of each
financial analysis technique. Knowing formulas is also very essential or else you
will mess up with your analysis. Therefore, you need to be mindful of the
financial analysis method you are implementing to write your AGGREGATE
PLANNING AT GREEN MILLS case study solution. It should closely align with the
business structure and the financials as mentioned in the AGGREGATE
PLANNING AT GREEN MILLS case memo.
You can also refer to AGGREGATE PLANNING AT GREEN MILLS Harvard case to
have a better understanding and a clearer picture so that you implement the
best strategy. There are a number of benefits if you keep a wide range of
financial analysis tools at your fingertips.
Also, adding an action plan for your recommendation further strengthens your
AGGREGATE PLANNING AT GREEN MILLS HBR case study argument. Thus, your
action plan should be consistent with the recommendation you are giving to
support your AGGREGATE PLANNING AT GREEN MILLS financial analysis. It is
essential to have all these three things correlated to have a better coherence in
your argument presented in your case study analysis and solution which will be
a part of AGGREGATE PLANNING AT GREEN MILLS Case Answer.