Applicable VLOs or EESs for This Week's Case Study

VLO 1. Analyze best practices of accounting, finance, marketing and economics into relevant aspects of Human Resources (HR) management in order to deliver effective and efficient HR programs, practices and services.

VLO 2. Use computer-based information systems to efficiently deliver HR programs and services.

This Week's Detailed Case Study Information

The FV corporation was established in 1885. The company headquarters are in Toronto, ON, specializing in apparel and footwear. The Company previously operated a couple of manufacturing plants in the USA and Canada. But as globalization started taking over the world, the Company faced unprecedented competition from foreign manufacturers. Over the years, the Company faced numerous challenges, mainly due to offshoring apparel and footwear production. In the 1980s, the Company started losing customers at an unprecedented rate. When the economy slowed down in Canada and USA, customers started thinking about price rather than value. Our Company provided quality and value to clients, but its price was a bit expensive compared to imports. It couldn't compete with imported goods and decided to offshore some of its manufacturing operations.

The Company started offshoring its manufacturing operations to Latin America. It chose Latin America because it was close by and shared the same time zone. Also, many Latin American countries speak English and have good relationships with Canada. The first factory opened up in Belize. This factory proved to be a massive success for the Company since quality did not change and prices went down. It could now compete effectively with imported goods from other countries. Over the years, almost all manufacturing operations moved abroad. The corporation grew exponentially and took over all small retail outlets going bankrupt because they couldn't compete with imported goods. The Company has revenue exceeding $10 billion with a net income of around $2 billion.

Over the past four years, the Company has been designing apparel using advanced computer systems. These computer systems using artificial intelligence proved to be very successful. The transition from traditional manufacturing to artificial intelligence manufacturing requires a lot of change at the company level. Since many employees will be laid off in favor of computers, the Company has to do a lot of work in educating and ensuring a smooth transition for its operations and workers. The Company cares for its workers and offers them various services, from discounted merchandise to financial planning. To carry out this transition, the Company would require many staff proficient in various aspects of business and human resources.

You want to go to the career fair organized by Lambton College and see the company booth there. You talk to the recruiting manager and realize the Company is hiring. You submitted your resume to the Company. After a couple of weeks, they gave you a call and they asked you to come for an interview. The first round of interviews went well, and you successfully passed it. Then you participated in the second round of interviews, which you successfully passed. You were impressed by the Company's operations and internal systems and were eager to start working for the Company. To your surprise, the Company hired you as an intern, not a full-time employee. Explain to you that they currently do not need full-time employees since they are laying off many existing employees. They asked you to be patient and participate in the Company's various departmental trainings. They mentioned that they are always eager to hire new talent with new ideas and skills compared to old talent. They also mentioned that they like holding your employees since the compensation for new employees is usually lower than for older employees. Even though they are not offering you full-time employment, you still decide to join the Company and accept their internship.

You will be working with the following individuals:

Mohammed Ahmed Is your mentor and the go-to person at the Company. If you face any issues or have any questions, you should address these with your supervisor. She Is a Jack of all trades. She knows much about accounting, finance, marketing, and other business-related functions. You will be able to get this knowledge and first-hand experience from She

Tim Gonzalez Graduated from the University of Mumbai and immigrated to Canada around 20 years ago. Tim Gonzalez possesses enormous knowledge in corporate and personal financial planning.

Messam Fonk graduated from the Bombay Technical School of Engineering. Messam Fonk Immigrated to Canada around 25 years ago and decided to apply his skills at the Company. Combining the international experience with the local experience created a unique opportunity to grow the business and innovate.

Edward White studied at Lambton College and graduated last semester. Edward White Joined the bank shortly after graduation and became an assistant manager. It proves you both come from a similar background and enjoy the same food.

Sharon Ramirez is a certified public accountant working with the firm for over 20 years. The manager focuses on investment, taxation, and management for clients to minimize taxes. Sharon Ramirez is considered one of the top taxation accountants in the organization.

Donald Sanchez Is an expert at employing innovative technologies to market the corporation's products.

Yasser Sabae Is an expert at social selling and social marketing. Possessing a degree from a reputable university in Canada and more than 20 years of experience, Yasser Sabae Is the ideal candidate for developing sales strategies.

You will be working at the "The FV corporation" head office in Barrie at 123 Street, Barrie, ON R2D 3L0.

Note: use external resources and assume any missing information. Clearly state your assumptions in your submissions.

Finance was your favorite subject at Lambton College. After joining the labor force, you realized the value of your education from Lambton College and now comes the time to apply this knowledge. You will utilize your capital investments, credit planning, and finance knowledge to recommend the best Human Resources (HR) management system to deliver effective and efficient HR programs, practices, and services.

Mohammed Ahmed handed you the below client's case:

Rakesh is a successful business owner; his modern retail approach enabled his business to post double-digit percentage growth rates. Everything was different when Rakesh inherited this business from his dad ten years ago. The Company at that time was drowning in debt, and its concept of retailing was standard; thus, it faced a lot of competition from other retailers. Rakesh spent his nights thinking about the business and analyzing what could be done. He experimented a lot and finally figured out the correct formula for success, which he still uses daily.

Rakesh's concept is simple; focus on technology to minimize costs and boost revenues. To implement this strategy, his business requires a lot of capital investments. The equipment he buys depreciates pretty fast and requires replacement over several years. Rakesh carefully plans the capital investments because he knows that sound financial management is crucial to his business success.

So now comes the time to buy a new piece of equipmentthe "Artificial Intelligence Human Resource Management System" (AIPOS). Rakesh has two options: buy the basic AIPOS or the advanced AIPOS. The expected cash flows for each option are detailed below. The AIPOS equipment will be salvaged after five years of use.

AIPOS Basic
Year	Cash Flow	Comment
2024	$ (1,000,000.00)	Includes installation costs
2025	$ 100,000.00
2026	$ 300,000.00
2027	$ 100,000.00
2028	$ 400,000.00
2029	$ 1,000,000.00	Includes salvage value
The cost of Capital is 11%

AIPOS Advanced
Year	Cash Flow	Comment
2024	$ (3,000,000.00)	Includes installation costs
2025	$ 200,000.00
2026	$ 500,000.00
2027	$ 1,500,000.00
2028	$ 1,500,000.00
2029	$ 800,000.00	Includes salvage value
The cost of Capital is 11%

Your task is to analyze the above capital projects and reach a capital decision based on (IRR, NPV, and Payback).

To finance this project, the Company has three options:

• Line of Credit
• Secured Loan
• Corporate Credit Card

Which option should be selected and why?

Deliverables for This Week's Case Study

• Use computer-based information systems to efficiently deliver the below information to assess the effectiveness of the suggested HR programs and services.
• Correct calculation of NPV, IRR, and Payback
• Correct project selection
• Selecting the appropriate credit facility and justifying the selection

Note: assume any missing information.