Meredith Corporation makes a special-purpose D4H machine used in the textile industry. Meredith has designed the D4H machine for 2013 to be distinct from its competitors. It has been generally regarded as a superior machine. Meredith presents the following data for the years 2012 and 2013.
Meredith produces no defective machines, but it wants to reduce direct materials usage per D4H machine in 2013. Manufacturing conversion costs in each year depend on production capacity defined in terms of D4H units that can be produced, not the actual units of D4H produced. Selling and customer-service costs depend on the number of customers that Meredith can support, not the actual number of customers Meredith serves. Meredith has 75 customers in 2012 and 80 customers in 2013. At the start of each year, management uses its discretion to determine the number of design staff for the year. The design staff and costs have no direct relationship with the quantity of D4H produced or the number of customers to whom D4H is sold.
1. Is Meredith’s strategy one of product differentiation or cost leadership? Explain briefly.
2. Describe briefly key elements that you would include in Meredith’s balanced scorecard and the reasons for doing so.

  • CreatedJuly 31, 2015
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