United International University

(UIU)
COURSE TITEL: Industrial Management

COURSE CODE: IPE-401

ASSIGNMENT-1

SUBMITTED
TO: Mr.
Whashak Faeid
Lecturer,
UIU

SUBMITTED BY:
 Name: Marufa Akter

ID: 0112230230
SECTION: E

Answer to the Qus no 01:

In my capacity as manager of "Lichi" Company, I believe that licensing is the best
way to obtain "Mapple's" memory chip technology.
1. Licensing as the Preferred Acquisition Method: A licensing deal is when two
businesses, Limchi and Maple, exchange money for the right to utilize each other's
technology. In this instance, Mapple would allow Lichi to use its memory chip
technology in return for royalties or a licensing fee.
Principal justifications for choosing licensing:
Low Investment: Lichi's requirement for little investment is in line with the fact
that licensing often costs less initial cash than buying or creating new technology.
Rapid Access: By using this technique, Lichi can quickly obtain Mapple's
technology without having to wait years for internal research and development
procedures.
Less Risk: By utilizing Mapple's proven and profitable technology, Lichi avoids
the financial and technological risks involved in developing new technologies from
the ground up.
No Need for Complete Control: Lichi's only objective is to incorporate Mapple's
tested technology into their goods, hence they do not require complete control of
the technology.

2. Elements Affecting the Choice:

Speed: In order for Lichi to be competitive in the market, it must swiftly obtain the
technology. Compared to mergers or joint ventures, licensing includes fewer
operational and legal complications, making it the quickest way to obtain the
technology.
Cost-Effectiveness: Compared to more expensive and complicated acquisition
approaches like mergers or full acquisitions, licensing usually involves a lot smaller
initial expenditure.
Technological expertise: Investing in internal R&D would require a significant
time and resource commitment, as Lichi is not proficient in the production of
memory chips. Through licensing, the business can avoid this problem and take use
of Mapple's experience right away.
Market Competitiveness: Since Mapple leads the memory chip industry, Lichi
would be able to benefit from the best technology out there without having to
directly compete with it or pay hefty acquisition costs by licensing it.

Answer to the Qus no 02:

Introduction: The present value of future cash flows, discounted at a specific

interest rate, is the basis for the Net Present Value (NPV) method, a capital
budgeting technique used to assess investment projects. The following is the NPV
method's decision rule for independent projects: accept the project if NPV > 0 and
reject the project if NPV < 0. When a project is deemed autonomous, decisions are
taken for each one separately, taking other initiatives into consideration.

NPV Calculation Formula: NPV = -Initial Investment + Σ (Cash Flow / (1 + r) ^t)

Where “r” is the interest rate and “t” is the time period.
Example Calculation
Let’s assume the following data for two independent projects (A and B):

Initial Investment
Project Time
Cash Flow (CFₜPeriod
) Discount Rate
(C₀) (n) (r)

$100,000 $30,000 per

Project 5 years 10%
A year

$150,000 $50,000 per

Project 5 years 10%
B year

Calculate the NPV for both projects independently.

NPV Calculation for Project A

For Project A, the NPV is calculated as follows:
NPV_A= (30,000/(1+0.10)^1 + 30,000/(1+0.10)^2 + 30,000/(1+0.10)^3 +
30,000/(1+0.10)^4 + 30,000/(1+0.10)^5) − 100,000
NPVA = 113,722 - 100,000
NPV_A = 13,722
Since the NPV for Project A is positive ($13,722), we would accept Project A.
NPV Calculation for Project B
For Project B, the NPV is calculated as follows:
NPV_B= (50,000/ (1+0.10)^1 + 50,000/(1+0.10)^2 + 50,000/(1+0.10)^3 +
50,000/(1+0.10)^4 + 50,000/(1+0.10)^5)−150
NPV_B = 189,537−150,000
NPV_B = 39,537
Since the NPV for Project B is positive ($39,537), we would also accept Project .
Since both projects are independent, Both projects have positive NPVs, indicating
that they are profitable. In this case:
• Project A: NPV = $13,722 (Accept)
• Project B: NPV = $39,537 (Accept)
In conclusion, the decision stays the same when using the NPV approach with the
specified interest rate and treating the projects as independent. Due to their
respective positive net present values, both projects would be approved.

Answer to the Qus no 03:

A product has significant market share but modest growth. Bennet ought to place it
in the BCG Matrix's "Cash Cow" quadrant.

BCG Matrix:
Portfolio analysis is conducted using a strategic tool called the Boston Consulting
Group (BCG) Matrix.
It classifies goods according to two criteria:
• Market share in comparison to rivals.
• Rate of Market Growth.
The matrix classifies the products into four groups:
• Stars: Strong market share and rapid growth
• Question Marks: Low market share, high growth
• Cash Cows: large market share, low growth.
• Dogs: limited market share, limited growth.
Bennet's product has a significant market share but is not growing the market at all,
according to the information given. The product is still being bought by the
product's devoted customer base, but market growth has stalled and new customer
acquisition is minimal.

Accordingly, this product belongs in the BCG Matrix's Cash Cow category.

The Meaning of Cash Cow:

High Market Share: Because of its devoted consumer base, the product has a
strong market position and earns large revenue.
Low Market Growth: There are few prospects for growth in the product's mature
or falling market.
The product may be managed to optimize profitability with little further effort
because it is a cash cow. Potential approaches that Bennet could use for this product
are listed below:
1. Maintain Market Position: Without making a sizable additional expenditure,
concentrate on keeping the product's market share. Maintain a steady level of
quality to keep your devoted clientele.
2. Optimize Profitability: Seek methods to cut expenses and boost production and
distribution efficiency. Considering the devoted client base, think about modest
price hikes if the market will allow them.
3. Use Generated Cash for Other Goals: To spur expansion in other areas of the
business, reinvest the proceeds from this product into "Stars" or "Question Marks"
inside the portfolio.
4. Minimal Marketing Investment: Reduce marketing investment for this
product, focusing primarily on maintaining brand awareness and loyalty.
5. Product Line Extensions: To appeal to the current consumer base and possibly
draw in new ones, think about introducing variations or complimentary items.
6. Investigate New Markets: To possibly spark growth again, look for chances to
introduce the product to new client segments or geographic areas.
7. Watch for Decline: Pay careful attention to consumer and market trends to
foresee any possible turn in the direction of becoming a "Dog" (low market share,
poor growth).
8. Innovation: To stay relevant, think about making improvements to the product's
packaging, distribution, or customer experience rather than making significant
investments in the product itself.
9. Customer Retention methods: To guarantee the ongoing support of the current
customer base, put loyalty programs or other retention methods into place.
Periodic Reassessment: Review the product's place in the BCG matrix on a regular
basis to make sure that market developments haven't caused it to move to a
different category.

In the BCG Matrix, Bennet should place the product in the Cash Cow category. The
next actions should center on managing the product effectively, retaining a base of
devoted customers, and optimizing profitability with the least amount of
investment. Bennet may decide to pursue future repositioning or disposal plans, or
it may decide to keep collecting earnings according on the state of the market.

Answer To the Question no -04:

Economic Order Quantity (EOQ): A mathematical model known as the Economic
Order Quantity (EOQ) is used to calculate the ideal inventory order quantity that
reduces overall inventory costs. These expenses usually consist of holding (such as
inventory storage) and ordering (such as placing an order).

EOQ Formula:
EOQ = √(2DS / H) Where:
D = Demand (units per period)
S = Ordering cost per order
H = Holding cost per unit per period

Components of EOQ:

1. Ordering costs: These include supplier fees, shipping expenses, and other costs
related to placing an order and receiving inventory.
Example: The administrative charges go up if an order needs to be placed more
than once a year.
2. Holding Costs (Carrying Costs): These are the expenses incurred for insurance,
depreciation, storage fees, and opportunity costs in order to keep and manage
inventory.
Example: A company's holding costs increase with the amount of inventory it
possesses.
3. Total Inventory Costs: These comprise the price of both ordering and storing
inventory. EOQ seeks to identify the ideal order quantity in order to reduce overall
costs.

Diagram: EOQ Model

As shown in the diagram, the EOQ point is the optimal order quantity where the
total inventory costs are minimized.
Conclusion: By assisting businesses in determining the ideal amount of inventory to
order, the Economic Order Quantity (EOQ) model plays a critical role in inventory
management. By doing this, it ensures a balance between ordering and holding
expenses, minimizing the overall inventory costs. This results in increased
efficiency, cost savings, and improved resource management.

Answer To the Question no -05:

Role of Technology Management in Achieving Competitive Advantage:
• Innovation and Efficiency: By streamlining procedures and cutting expenses,
technology management gives businesses a competitive edge while fostering
innovation and increasing operational efficiency.
• Product Differentiation: By using cutting-edge technologies, businesses might
provide distinctive goods or services that are challenging for rivals to imitate.
• Market Adaptation: Through constant technical advancements, technology
management helps businesses to quickly adjust to shifting consumer needs and
maintain an advantage over rivals.
• Better Decision-Making: Managers can increase their competitive edge by
utilizing data analytics and artificial intelligence (AI) to make well-informed, data-
driven decisions.

Key Challenges in Integrating New Technologies:

• High Costs: Putting new technology into practice frequently necessitates a large
financial outlay, which might tax available funds.
• Employee Resistance: Workers may be resistant to changes because they are
uncomfortable with new processes, fear new technologies, or lack the necessary
skills.
• Integration with Current Systems: Organizations frequently experience
operational disruptions when attempting to integrate new technology with legacy
systems.
• Data Security and Privacy: Implementing new technology may put a company
at risk for security breaches, necessitating stronger cybersecurity defenses.
• Rapid technology Changes: Organizations may become obsolete as a result of
the rapid rate of technology innovation, which makes it difficult for them to keep
up.

A retail organization implemented a point-of-sale (POS) system that was coupled

with inventory management software as an example of how technology
management was employed. This made it possible to track sales and stock levels in
real time. Consequently, the business gained a competitive edge by effective
resource management and customer service, lowering stockouts, optimizing
inventory, and raising customer satisfaction.