Management Accounting Information for Activity and Process Decisions

1
Management Accounting Information for Activity
and Process Decisions

• Chapter 5

2
Evaluation of Financial Implications

• Managers must evaluate the financial implications
  of decisions that require trade-offs between the
  costs and the benefits of different alternatives
• Financial implications are important when
  considering decisions such as whether to
• Redesign an entire production process or replace
  existing machines
• Purchase services such as custodial help or to
  simply hire in-house custodians
• Financial information about the different types
  of costs form the basis of decisions about the
  organizations activities and processes

3
Relevant Costs and Revenues

• Whether particular costs and revenues are
  relevant for decision making depends on the
  decision context and the alternatives available
• When choosing among different alternatives,
  managers should concentrate only on the costs and
  revenues that differ across the decision
  alternatives
• These are the relevant cost/revenues
• Opportunity costs by definition are relevant
  costs for any decision
• The costs that remain the same regardless of the
  alternative chosen are not relevant for the
  decision

4
Sunk Costs are Not Relevant

• Sunk costs often cause confusion for decision
  makers
• Costs of resources that already have been
  committed and no current action or decision can
  change
• Not relevant to the evaluation of alternatives
  because they cannot be influenced by any
  alternative the manager chooses

5
Replacement Of A Machine (1 of 2)

• A Company purchased a new drilling machine for
  180,000 on September 1, 2003
• They paid 30,000 in cash and financed the
  remaining 150,000 with a bank loan
• The loan requires a monthly payment of 5,200 for
  the next 36 months
• On September 27, 2003, a sales representative
  from another supplier of drilling machines
  approached the company with a newly designed
  machine that had only recently been introduced to
  the market and offered special financing
  arrangements
• The new supplier agreed to pay 50,000 for the
  old machine, which would serve as the down
  payment required for the new machine
• In addition, the new supplier would require
  monthly payments of 6,000 for the next 35 months

6
Replacement Of A Machine (2 of 2)

• The new design relied on innovative computer
  chips, which would reduce the labor required to
  operate the machine
• The company estimated that direct labor costs
  would decrease by 4,400 per month on the average
  if it purchased the new machine
• In addition it had fewer moving parts than the
  current machine
• The new machine would decrease maintenance costs
  by 800 per month
• The new machine has greater reliability
• This would allow the company to reduce materials
  scrap cost by 1,000 per month
• Should the company dispose of the machine it just
  purchased on September 1 and buy the new machine?

7
Analysis Of Relevant Costs (1 of 3)

• If the company buys the new machine, it will
  still be responsible for the monthly payments of
  5,200 committed to on September 1
• Therefore, the 30,000 that it paid in cash for
  the old machine and the 5,200 it is committed to
  pay each month for the next 36 months are sunk
  costs
• The company already has committed these
  resources, and regardless if it decides to buy
  the new machine, it cannot avoid any of these
  costs
• None of these sunk costs are relevant to the
  decision

8
Analysis Of Relevant Costs (2 of 3)

• What costs are relevant?
• The 35 monthly payments of 6,000 and the down
  payment of 50,000 are relevant costs, because
  they depend on the decision
• Labor, materials, and machine maintenance costs
  will be affected if the company acquires the new
  machine
• The relevant expected monthly savings are
• 4,400 in labor costs
• 1,000 in materials costs
• 800 in machine maintenance costs
• The revenue of 50,000 expected on the trade-in
  of the old machine is also relevant, because the
  old machine will be disposed of only if the
  company decides to acquire the new machine

9
Analysis Of Relevant Costs (3 of 3)

• In a comparison of the cost increases/cash
  outflows to cost savings/cash inflows
• The down payment required for the new machine is
  matched by the expected trade-in value of the old
  machine
• The expected savings in labor, materials, and
  machine maintenance costs each month (6,200) are
  more than the monthly lease payments for the new
  machine (6,000)
• Thus, it is apparent that the company will be
  better off trading in the old machine and
  replacing it with the new machine

10
Difficulty of Making Correct Decision

• The technically correct decision for the company
  on a level is to dispose of the machine and
  replace it
• Not all managers would do so
• They are concerned about their reputations within
  their own organization
• Reversing a major decision made only just a month
  earlier makes the decision look like an error
• In many circumstances, by maintaining the
  original course of action, the manager does not
  have to reveal that a better decision could have
  been made

11
Responsibility For Decisions (1 of 2)

• If the manager does not purchase the new machine,
  then his or her behavior may be viewed as
  suboptimal
• It ensures lower productivity or performance from
  the old machine rather than improved performance
  with the new one
• By not making the correct decision now, the
  manager may incur the effects of a bad decision
  later
• If the manager admits to making an error when
  purchasing the old machine, that person might
  garner more respect from colleagues for accepting
  the responsibility

12
Responsibility For Decisions (2 of 2)

• Many decision makers have a difficult time
  distinguishing sunk cost business decisions from
  sunk cost personal decisions
• In contrast to business decisions, the associated
  costs of previous life decisions can evoke a
  complex set of personal feelings
• Unlike the case in the business decision, we do
  not end a friendship simply because a new friend
  materializes
• Thus, identifying what is relevant and
  disentangling personal responses when dealing
  with business decisions are critical tasks for
  any business decision maker

13
Make-or-Buy Decisions (1 of 3)

• As managers attempt to reduce costs and increase
  the competitiveness of their products, they face
  decisions about whether their companies should
• Manufacture some parts and components for their
  products in-house
• Subcontract with another company to supply these
  parts and components
• Such make-or-buy decisions illustrate how to
  identify relevant costs and revenues

14
Make-or-Buy Decisions (2 of 3)

• A company manufactures about 15 of the lamps
  required for its automobiles in its own plant in
  Ohio
• The companys president would like to reduce
  costs and has asked the production manager to
  evaluate the possibility of outsourcing all the
  lamps
• The production manager obtains firm quotes from
  several suppliers for the four types of lamps the
  company manufactures in-house
• Standard rear lamps
• Standard front lamps
• Multicolored rear lamps
• Curved side and rear lamps

15
Make-or-Buy Decisions (3 of 3)
16
Avoidable Costs (1 of 3)

• Avoidable costs are those eliminated when a part,
  product, product line, or business segment is
  discontinued
• If the production manager decides to outsource a
  product, the company may avoid certain production
  costs (using the std. rear lamp as an example)
• 1,296,000 of direct material costs (36 x
  36,000)
• 792,000 of direct labor costs (22 x 36,000)
• 504,000 of unit-related support costs (14 x
  36,000)
• Contraction or redeployment of resources may
  allow the company to save
• 360,000 (10 x 36,000) of batch-related support
  costs
• 216,000 (6 x 36,000) of product-sustaining
  support costs

17
Avoidable Costs (2 of 3)

• To decide whether facility-sustaining support
  costs are avoidable requires further
  consideration
• The company cannot dispose of part of the
  facility used to support the production of the
  standard rear lamp without disposing of the
  entire machine or building
• Most facility-sustaining support costs represent
  the prorated costs of indivisible common
  facilities
• Building space
• Machines

18
Avoidable Costs (3 of 3)

• It could be possible to find an alternative use
  for the part of the facility made available by
  not producing a product
• The manager considered the possibility of
  shifting the remaining production lines to
  another facility
• The company could save the facility-sustaining
  costs for the rental facility by terminating its
  lease there
• Such indirect savings in facility-sustaining
  costs for the organization are relevant for the
  decision to outsource production, because they
  can arise only if the lamp is outsourced
• The manager determined that it would be
  technically infeasible to transfer the
  manufacture of the other product lines to another
  plant

19
Summary of Financial Analysis

• To summarize the analysis so far, if the standard
  rear lamp is outsourced, the company may avoid
  3,168,000 of manufacturing costs
• Assuming batch-related and product sustaining
  support costs may be avoided
• The company would spend 2,952,000 to purchase
  the parts from the low-bid supplier
• The company could save 216,000 by outsourcing

20
Qualitative Factors

• For most decisions such as this, several
  additional factors, which are more qualitative in
  nature, need to be considered
• Permanence of the lower price
• Reliability of the supplier
• In meeting the required quality standards
• In making deliveries on time
• Many companies have adopted the practice of
  certifying a small set of suppliers who are
  dependable and consistent in supplying
  high-quality items as needed
• They provide their certified suppliers with
  incentives, such as quick payments and guaranteed
  total purchase volumes

21
Facility Layout Systems (1 of 2)

• In addition to understanding the relevant costs
  for many decisions that change the nature of
  activities and processes, managers must consider
  the entire operations process within a facility
• There are three general types of facility
  designs
• Process layouts
• Product layouts
• Cellular manufacturing
• Regardless of the type of facility design, a
  central goal of the design process is to
  streamline operations and thus increase the
  operating income of the system

22
Facility Layout Systems (2 of 2)

• One method that can guide this process for all
  three designs is the theory of constraints (TOC)
• TOC maintains that operating income can be
  increased by carefully managing the bottlenecks
  in a process
• A bottleneck is any condition that impedes or
  constrains the efficient flow of a process
• A bottleneck can be identified by determining
  points at which excessive amounts of
  work-in-process inventories are accumulating
• The buildup of inventories also slows the cycle
  time of production

23
Theory of Constraints (1 of 2)

• The theory of constraints relies on the use of
  three measures
• Throughput contribution
• Investments
• Operating costs
• Throughput contribution is the difference between
  revenues and direct materials for the quantity of
  product sold
• Investments equal the materials costs contained
  in raw materials, work-in-process, and finished
  goods inventories
• Operating costs are all other costs, except for
  direct materials costs, that are needed to obtain
  throughput contribution

24
Theory of Constraints (2 of 2)

• TOC emphasizes the short-run optimization of
  throughput contribution
• Proponents of TOC view operating costs as
  difficult to alter in the short run
• Accordingly, ABC-type analyses of activities and
  cost drivers are not conducted
• This limits the usefulness of the theory for the
  longer run
• In theory, however, there is no reason why TOC
  and ABC cannot be used together

25
Process Layouts

• In a process layout, all similar equipment or
  functions are grouped together
• Process layouts exist in organizations in which
  production of unique products is done in small
  batches
• The product follows a serpentine path, usually in
  batches, through the factories and offices that
  create it
• Process layouts are also characterized by high
  inventory levels
• It is necessary to store work-in-process in each
  area while it awaits the next operation
• Products might travel for several miles within a
  factory during the production process

26
Process Layout in a Bank (1 of 2)

• As an example, the process associated with a bank
  loan application may occur as follows
• The customer goes to the bank (a moving activity)
• The bank takes the loan application from the
  customer (processing activity)
• Loan applications are accumulated (storage
  activity)
• and passed to a loan officer (moving activity)
• for approval (both processing and inspection
  activity)
• Loans that violate standard loan guidelines are
• accumulated (storage activity) then
• passed (moving activity) to a regional supervisor
  
• for approval (processing activity)

27
Process Layout in a Bank (2 of 2)

• The customer is contacted when a decision has
  been made (processing activity)
• If the loan is approved, then the loan proceeds
  are deposited in the customers account
  (processing activity)
• In most banks, work-in-process stockpiles at each
  of the processing points or stations
• Loan applications may be piled on desk of
• The bank teller
• The loan officer
• The regional supervisor

28
WIP Accumulation (1 of 3)

• Work-in-process inventory accumulates at
  processing stations in a conventional
  organization for three reasons
• Handling work in batches
• At each processing station all items in the batch
  must wait while the designated employees process
  the entire batch before moving that batch to the
  next station
• Organizations use batches, on the other hand, to
  reduce setting up, moving, and handling costs

29
WIP Accumulation (2 of 3)

• If the rate at which each processing area handles
  work is unbalanced, work piles up at the slowest
  processing station
• Occurs when one area is slower or has stopped
  working due to problems with equipment,
  materials, or people
• Scheduling delays result
• Inventory levels increase

30
WIP Accumulation (3 of 3)

• If processing area managers are evaluated on
  their ability to meet production quotas
• Many managers deliberately maintain large stocks
  of incoming work-in-process so that they can
  continue to work even if the processing area that
  feeds them is shut down
• To avoid idling the next processing station and
  suffering the resulting recriminations, managers
  may store finished work they can forward to
  supply stations further down the line when their
  stations are shut down due to problems

31
Product Layouts

• In a product layout, equipment is organized to
  accommodate the production of a specific product
• Automobile assembly line
• Packaging line for cereal or milk
• Product layouts exist primarily in companies with
  high-volume production
• The product moves along an assembly line beside
  which the parts to be added to it have been
  stored
• Placement of equipment or processing units is
  made to reduce the distance that products must
  travel
• Arrangements for delivery of raw materials and
  purchased parts directly to the production line
  can often be made

32
Product Layout in a Cafeteria (1 of 2)

• Consider the work-in-process in a cafeteria
  setting
• People pass by containers of food and take what
  they want
• Employees organize the food preparation
  activities so that the containers are refilled
  just as they are being emptied
• The batch-related setup costs otherwise (one
  serving at a time) would be prohibitively
  expensive

33
Product Layout in a Cafeteria (2 of 2)

• Reducing setup costs allows for the reduction of
  batch sizes along the line
• This reduces the level of inventory (and costs)
  in the system
• It also improves quality while increasing
  customer satisfaction
• The ultimate goal is to reduce setup costs to
  zero and to reduce processing time to as close to
  zero as possible, so that the system can produce
  and deliver individual products just as they are
  needed

34
Cellular Manufacturing (1 of 2)

• Cellular manufacturing, refers to the
  organization of a plant into a number of cells
• Within each cell all machines required to
  manufacture a group of similar products are
  arranged in close proximity to each other
• The machines in a cellular manufacturing layout
  are usually flexible and can be adjusted easily
  or even automatically to make different products

35
Cellular Manufacturing (2 of 2)

• The shape of a cell is often a U shape, which
  allows workers convenient access to required
  parts
• Often when cellular manufacturing is introduced,
  the number of employees needed to produce a
  product can be reduced due to the new work design
• The U shape also provides better visual control
  of the work flow because employees can observe
  more directly what their coworkers are doing

36
Problems with Batch Production (1 of 2)

• It creates inventory costs
• It also creates delays associated with storing
  and moving inventory
• These delays increase cycle times, thereby
  reducing service to customers
• Delays may even happen before manufacturing
  begins

37
Problems with Batch Production (2 of 2)

• A manufacturer may require that a product be
  manufactured in some minimum batch size. If a
  customer order is less than the minimum batch
  size and if the order cannot be filled from
  existing finished goods inventory, then the
  customer must wait until enough orders have
  accumulated to meet the minimum batch size
  requirement
• A loan application (that may take a loan officer
  only five minutes to read and approve) may have
  to wait for hours or days before it reaches the
  loan officer, because having a clerk deliver each
  new loan application when it arrives is too
  expensive

38
Inventory-Related Costs (1 of 2)

• Demands for inventory lead to huge costs in
  organizations, including the cost of
• Moving
• Handling
• Storing
• Obsolescence or damage
• Many organizations have found that factory
  layouts and inefficiencies that create the need
  to hold work-in-process inventory hide other
  problems leading to excessive costs of rework

39
Inventory-Related Costs (2 of 2)

• In batch operations, workers near the end of a
  process (downstream) often find batch-size
  problems resulting from the way workers have done
  their jobs earlier in the process (upstream)
• When work is performed continuously on one
  component at a time, however, workers downstream
  can identify an upstream problem in that
  component almost immediately and correct it
  before it leads to production of more defective
  components

40
Cost of Nonconformanceand Quality Issues

• Cost reduction has become a significant factor in
  the management of most organizations
• Reducing costs involves much more than simply
  finding ways to cut product design costs
• For example, by using less expensive materials
• The premise underlying cost reduction efforts
  today is to decrease costs while maintaining or
  improving product quality in order to be
  competitive
• If the quality of products and services does not
  conform to quality standards, then the
  organization incurs a cost known as the cost of
  nonconformance (CONC) to quality standards

41
Quality

• Quality usually may be viewed as hinging on two
  major factors
• Satisfying customer expectations regarding the
  attributes and performance of the product
• E.g., its functionality and features
• Ensuring that the technical aspects of the
  products design and performance conform to the
  manufacturers standards
• Whether it performs to the expected standard

42
Quality Standards

• Global competition has led to the development of
  international quality standards
• Company certification under these standards
  indicates to customers that management has
  committed their company to follow procedures and
  processes that will ensure the production of the
  highest-quality goods and services
• ISO90002000 Series of Standards, developed in
  Europe, is one widely-recognized quality standard
  certification

43
ISO9000 (1 of 6)

• In 1987, the International Organization for
  Standardization (ISO), headquartered in Geneva,
  Switzerland, developed the first ISO9000 Series
  of Standards
• These standards were revised in 1994 and again in
  2000
• The goal of the member nations is to develop
  globally recognized independent (third party)
  quality system verification
• Today, over 400,000 organizations have been
  certified worldwide
• Many types of organizations are interested in
  becoming IOS9000 registered in order to
• Comply with external regulatory agencies,
• Meet or exceed customer requirements, or
• Implement a quality improvement program to remain
  competitive

44
ISO9000 (2 of 6)

• ISO 9000 contains more than 20 standards and
  documents
• Because of the increase in the number of
  standards, ISO 90002000 was developed
• ISO 90002000 consists of four primary standards
  and a greatly reduced number of supporting
  documents (guidance standards, brochures,
  technical reports, technical specifications)
• The major points in previous versions of the
  standards were integrated into the four primary
  standards

45
ISO9000 (3 of 6)

• The four primary standards are
• ISO 9000 Quality management systems
  Fundamentals and vocabulary
• ISO 9001 Quality management systems
  Requirements
• ISO 9004 Quality management systems  Guidance
  for performance improvement
• ISO 19011 Guidelines on quality and/or
  environmental management systems auditing (To be
  published)

46
ISO9000 (4 of 6)

• The most significant changes in the revised ISO
  9000 standards are
• Increased focus on top management commitment
• Emphasis on a process approach within the
  organization
• Continual improvement
• Increased focus on enhancing satisfaction for
  customers and other interested parties

47
ISO9000 (5 of 6)

• The overall revisions to ISO 9001 and 9004 are
  based on eight quality management principles from
  best management practices
• Customer focus
• Leadership
• Involvement of people
• Process approach
• System approach to management
• Continual improvement
• Factual approach to decision making
• Mutually beneficial supplier relationships

48
ISO9000 (6 of 6)
The ISO 90002000 Standards apply to all kinds of
organizations in all kinds of areas

• Manufacturing
• Forestry
• Electronics
• Computing
• Legal services
• Financial services
• Accounting
• Trucking
• Banking
• Retailing
• Drilling
• Recycling
• Aerospace
• Construction
• Pharmaceuticals

• Sanitation
• Software development
• Consumer products
• Transportation
• Design
• Tourism
• Communications
• Biotechnology
• Engineering
• Farming
• Entertainment
• Consulting
• Insurance
• and others

• Oil and gas
• Petrochemicals
• Publishing
• Shipping
• Telecommunications
• Health care
• Hospitality
• Utilities
• Aviation
• Food processing
• Agriculture
• Government
• Education
• Recreation

• More information can be obtained from the
  International Organization for Standardization
  (www.iso.org)

49
Costs Of Quality Control

• Companies have discovered that they can spend as
  much as 20 to 30 of total manufacturing costs
  on quality-related processes
• The best-known framework for understanding
  quality costs classifies them into four
  categories
• Prevention costs
• Appraisal costs
• Internal failure costs
• External failure costs
• Experience shows that it is much less expensive
  to prevent defects than to detect and repair them
  after they have occurred

50
Prevention Costs

• Prevention costs are incurred to ensure that
  companies produce products according to quality
  standards
• Quality engineering
• Training employees in methods designed to
  maintain quality
• Statistical process control
• Training and certifying suppliers so that they
  can deliver defect-free parts and materials and
  better, more robust, product designs

51
Appraisal Costs

• Appraisal costs relate to inspecting products to
  make sure they meet both internal and external
  customers requirements
• Inspection costs of purchased parts and materials
• Costs of quality inspection on an assembly line
• Inspection of incoming materials
• Maintenance of test equipment
• Process control monitoring

52
Internal Failure Costs

• An internal failure occurs when the manufacturing
  process detects a defective component or product
  before it is shipped to an external customer
• Reworking defective components or products is a
  significant cost of internal failures
• The cost of downtime in production is another
  example of internal failure
• Engineers have estimated that the cost of defects
  rises by an order of magnitude for each stage of
  the manufacturing process that the defect goes
  undetected
• Inserting a defective 1 electronic component
  into a subassembly leads to 10 of scrap if
  detected at the first stage, 100 at the next
  stage, and perhaps 10,000 if not detected for
  two more stages of assembly

53
External Failure Costs

• External failures occur when customers discover a
  defect
• All costs associated with correcting the problem
• Repair of the product
• Warranty costs
• Service calls
• Product liability recalls
• For many companies, this is the most critical
  quality cost to avoid
• Not only are costs required to fix the problem in
  the short run, but also customer satisfaction,
  future sales, and the reputation of the
  manufacturing organization may be in jeopardy
  over the long run

54
Cost-of-Quality Report (1 of 2)

• This information is compiled in a cost-of-quality
  (COQ) report, developed for several reasons
• It illustrates the financial magnitude of quality
  factors
• Often managers are unaware of the enormous impact
  that rework has on their costs
• Cost-of-quality information helps managers set
  priorities for the quality issues and problems
  they should address
• For example, one trend that managers do not want
  to see is a very high percentage of quality costs
  coming from external failure of a product
• External quality problems are expensive to fix
  and can greatly harm the reputation of the
  product or organization producing the product

55
Cost-of-Quality Report (2 of 2)

• The cost of quality report allows managers to see
  the big picture of quality issues
• It allows them to try to find the root causes of
  their quality problems
• The problem at its root will have positive ripple
  effects throughout the organization, as so many
  quality issues are interrelated

56
Just-in-Time Manufacturing

• Just-in-time (JIT) manufacturing is a
  comprehensive and effective manufacturing system
  that integrates many of the ideas discussed in
  this chapter
• Just-in-time production requires making a product
  or service only when the customer, internal or
  external, requires it
• It uses a product layout with a continuous flow
• No delays once production starts
• There must be a substantial reduction in setup
  costs in order to eliminate the need to produce
  in batches
• Processing systems must be reliable

57
Implications Of JIT Manufacturing (1 of 6)

• Just-in-time manufacturing is simple in theory
  but hard to achieve in practice
• Some organizations hesitate to implement JIT
• With no work-in-process inventory a problem
  anywhere in the system can stop all production
• Organizations that use just-in-time manufacturing
  must eliminate all sources of failure in the
  system
• The production process must be redesigned so that
  it is not prohibitively expensive to process one
  or a small number of items at a time
• This usually means reducing the distance over
  which work in process has to travel and using
  very adaptable people and equipment that can
  handle all types of jobs

58
Implications Of JIT Manufacturing (2 of 6)

• At the core of the JIT process is a highly
  trained workforce whose task is to carry out
  activities using the highest standards of quality
• When an employee discovers a problem with a
  component he or she has received, it is the
  responsibility of that employee to call immediate
  attention to the problem so that it can be
  corrected
• Suppliers must be able to produce and deliver
  defect-free materials or components just when
  they are required
• In many instances, companies hold a competition
  between suppliers of the same components to see
  who can deliver the best quality
• At the end of a performance period, the supplier
  who performs the best will obtain a long-term
  contract
• Preventative maintenance is also employed so that
  equipment failure is a rare event

59
Implications Of JIT Manufacturing (3 of 6)

• Just-in-time manufacturing has two major
  implications for management accounting
• First, management accounting must support the
  move to JIT manufacturing by monitoring,
  identifying, and communicating to decision makers
  the sources of delay, error, and waste in the
  system
• Second, the clerical process of management
  accounting is simplified by JIT manufacturing,
  due to the smaller inventory to monitor and report

60
Implications Of JIT Manufacturing (4 of 6)

• Important measures of a JIT systems reliability
  include the following benchmarks of manufacturing
  cycle effectiveness
• Defect rates
• Cycle times
• Percent of time that deliveries are on time
• Order accuracy
• Actual production as a percent of planned
  production
• Actual machine time available compared with
  planned machine time available
• Conventional labor and machine productivity
  ratios are inconsistent with the just-in-time
  production philosophy

61
Implications Of JIT Manufacturing (5 of 6)

• Just-in-time manufacturing has been a benefit to
  many organizations
• Those interested in implementing this system need
  to remember several things
• Any significant management innovation, such as
  ABC or JIT, requires a major cultural change for
  an organization
• JIT also can alter the pace of work and the
  overall work discipline of the organization
• It can cause structural changes in such areas as
  the arrangement of shop floors

62
Implications Of JIT Manufacturing (6 of 6)

• Because the central ideas behind JIT are the
  streamlining of operations and the reduction of
  waste, many people inside companies are
  ill-prepared for the change
• Because JIT relies on teamwork, often individuals
  have to subordinate their own interests to those
  of the team
• Some employees find this difficult, especially if
  they have come from a work environment where they
  worked on a single component in relative
  isolation, or if their personalities are not team
  oriented

63
If you have any comments or suggestions
concerning this PowerPoint presentation, please
contactTerry M. Lease(terry.lease_at_sonoma.edu)S
onoma State University