Application of throughput accounting in production mix decisions for a small metallurgical enterprise

The Six Sigma methodology creates many possibilities for radically improving process and product quality. While Six Sigma was initially applied within large corporations, the interest of small and medium-sized enterprises in improvement initiatives is increasing. A decade ago, small and medium-sized enterprises became aware that they can enhance their capability, improve quality, and increase their profitability by using Six Sigma. One of the most critical success factors for the implementation of Six Sigma is a strong organizational infrastructure led by different Six Sigma belts. Thus, the aim of this article is to examine the Six Sigma belt system for small manufacturing companies based on a detailed literature review. The fact that few research papers have been published regarding this research field indicates the Six Sigma belt system for small and medium-sized enterprises has not yet been adequately studied and thus opens the door for future research. Nevertheless, it can be concluded that the original Six Sigma belt roles used by large organizations cannot simply be transferred for the application in small enterprises, as there are too many differences between these two company types. This means an extensive organizational infrastructure like in large organizations is not needed in small enterprises. There are various expert opinions but almost no empirical evidence regarding the availability, proportion to the total workforce, working time, hierarchy, project executions, and cost savings of the various Six Sigma belts in small enterprises. For this reason, this paper highlights the need for a standardized approach of the Six Sigma belt system for manufacturing small and medium-sized enterprises.

This study investigates the implementation of Corporate Social Responsibility (CSR) practices in the manufacturing sector, with a focus on comparing the experiences and outcomes of small and large enterprises in Europe. Utilizing a mixed-methods approach, the research examines how these enterprises adopt CSR practices and the resultant impacts on financial and environmental performance. The findings indicate that both small and large enterprises benefit significantly from CSR, evidenced by improvements in key financial metrics such as Return on Assets (ROA) and Return on Equity (ROE), as well as reductions in carbon emissions and enhancements in energy efficiency. Small enterprises, despite facing challenges such as limited financial resources and lack of expertise, achieve notable local community engagement and operational efficiencies through targeted CSR initiatives. Large enterprises leverage their extensive resources to implement comprehensive CSR strategies, resulting in substantial environmental and financial gains. The study highlights the importance of stakeholder engagement, government support, and a robust organizational culture in facilitating effective CSR adoption. These insights underscore the need for supportive measures to help SMEs overcome barriers and enhance their contributions to sustainable development.

Throughput accounting heuristics is still adequate: Response to criticism

Innovation capacity and innovation development in small enterprises. A comparison between the manufacturing and service sectors

The aim of the paper is to compare the principles, information outputs and consequent managerial implications of the variable costing method and throughput accounting, according to their different perceptions of cost variability. These two approaches could give rise to various product mix decisions and findings relating to effect on profitability. The paper also provides a practical example of limitations experienced on two production lines for certain items. Comparison is made between these two approaches as to which elicits a relevant decision on production mix. Both the variable costing method and throughput accounting represent very similar methods based on variable costs that do not reflect fixed costs. Variable costing methods examine costs that change in accordance with volume of output. On the contrary, throughput accounting merely acknowledges total variable costs, and focuses on limitations which exist in a given company.

Nearly for two decades, throughput accounting has argued against practices of management accounting. It has built mainly its alternative theory on simple and static example of choosing right product mix to maximize profitability of a manufacturing unit. In this research work, we simulate original throughput accounting product mix problem and use stochastic variation in the production process phases and in the end product demand. Results show that variation creates situation, where system profits increase significantly; this is mostly caused by the reason that we have enough WIP in the process, constraint resource is having occasionally lower cycle-times and un-favoured low throughput product is being produced due to the reason that there does not exists that high demand high yield one. Based on these findings, we propose that throughput accounting theory should be modified – variability in some situations and with low throughput products is the main factor for higher profitability.

Despite its potential, the impact of digital finance on small and medium enterprises’ access to funding remained underexplored, with limited empirical evidence and an incomplete understanding of how digitalization addressed information-related challenges. In Kenya, small and medium enterprises were critical to economic growth. However, many small enterprises faced financial exclusion due to limited access to traditional banking systems. This study investigated the impact of accessibility to digital financial services on financial inclusion among small and medium enterprises in Taita Taveta County, a county characterized by a burgeoning digital economy and a significant reliance on mobile financial solutions. With the rapid growth of mobile money platforms, particularly M-Pesa, and digital lending services, small enterprises gained unprecedented access to financial resources that were previously out of reach. The research employed a quantitative approach, utilizing a structured questionnaire to gather data from 125 SMEs across various sectors in Taita Taveta County. The findings revealed that digital financial services, particularly mobile money platforms like M-Pesa and digital lending services such as Tala and M-Shwari, substantially enhanced small enterprises' access to financial resources, thereby mitigating traditional barriers to finance. The study identified key factors influencing the adoption and utilization of digital financial services, including technological literacy, cost-effectiveness, and the perceived ease of use. Furthermore, it explored the implications of these services on small and medium enterprises' operational efficiency, growth potential, and overall contribution to economic development. This research not only contributed to the theoretical discourse on financial inclusion but also provided practical insights for policymakers and financial institutions aiming to foster an inclusive financial ecosystem for small and medium enterprises in Kenya. Additionally, the study highlighted the role of digital financial services in improving transaction efficiency and reducing reliance on traditional banking infrastructure. The results underscored the importance of digital financial services in promoting financial inclusion, ultimately contributing to the economic development of small and medium enterprises in Taita Taveta County.

The subject of scientifc research is the scientifc and practical principles of development of various types of agricultural enterprises in Ukraine. The purpose of the article is to substantiate the conceptual directions of production in small, medium and large agricultural enterprises in the war and postwar period. The data of the State Statistics Service of Ukraine, regulatory acts of Ukraine and the scientifc research (abstract-logical, system approach, monographic, statistical-economic method) were used. Based on the retrospective analysis of agricultural enterprises production efciency, the key areas of economic activity of large, medium and small agricultural enterprises are identifed. In the conditions of wartime and the further postwar period, when a signifcant decline in investment activity is expected, agricultural production will be oriented towards more labor-intensive and less capital-intensive types of agribusiness, in particular in small and medium agricultural enterprises. In agricultural enterprises there is a different share of working capital in the total value of assets. In small enterprises, the capital structure is dominated by working capital, while in large – fxed capital and capital security is 3-4 times higher than in other types of enterprises in the branch. Based on this, in a state of war and the risk of capital investment in the industry, the most economically advantageous is the situation in small and medium enterprises, where the best rates of return on investment and rates of return. It is proved that for large agricultural enterprises it is necessary to determine the economic vectors of their development in the short and medium term. In particular, to diversify agribusiness and combine the development of crop and livestock production, to diversify sales channels to the external food market, and to focus on the domestic consumer market. Also, these companies need to pay attention to the production of biofuels, other energy resources and more. Based on the analysis of capital investment in various types of agricultural enterprises, the directions of investment in agricultural machinery and equipment are substantiated (they can be moved quickly in case of the military front approach). Such investment and reproduction processes can be traced in small and medium enterprises, in contrast to large enterprises, which have invested a lot in the construction of production and logistics facilities. Small, medium and large forms of entrepreneurship in agribusiness should take their place in the economy of rural areas. The study has generalized the conceptual directions – strategic landmarks of social and economic development of various types of agricultural enterprises for the future period are. Key words: entrepreneurship, agricultural enterprise, farming, food security, employment, economic efciency, capital investments.

The purpose of this paper is to examine the effect of different sources of external finance on the performance of Indian Private Limited Small and Medium Enterprises (SMEs). Previous studies have used a ratio of different sources of capital to analyse their impact on firm performance. In this study, we have analysed this relationship on firms that employ only one type of external finance. This aspect is something we have not seen in any of the preceding research and can help us realise the individual influences of these sources on performance.We measure performance through equivalents of Profit Margin (PM), Return on Assets (RoA) and Asset Turnover (AT). Our PSM results reveal that small firms that are financed by either of the external sources experience lesser PM and better RoA and AT than firms that do not borrow. IS are found to wield a negative impact on PM, a positive impact on RoA and AT, as do non-institutional sources. But the influence of institutional sources on all measures of performance is lesser than that of non-institutional sources. In the case of medium enterprises, external finance has a negative impact on PM, but it is not as pronounced as it is in the case of small enterprises. There is no significant impact on RoA or AT. Such extensive study on developing countries is almost not present. This is also the first study that analyses firms that are financed exclusively by one external source of financing. Therefore, we believe this study can help us determine and distinguish between the individual contributions of different sources of funding.

The Contribution of Small Enterprises to Household and National Income in Kenya

Objective: To inquire exhaustively the research on the organizational characteristics and with it the implementation of managerial tools, which help the development of micro-enterprises? Materials and Methods: In this sense it develop schemas in the fishing productive units in the city of Riohacha and sets analysis of the traditional system of cost with an instrument of organizational management called ”Throughput Accounting”, creating new paradigms applied to micro-enterprises in the fisheries sector. Ananalysis was applied to the traditional system and methods of business management basedon the Throughput Accounting, on fishing productive units. Finding: the results allow us to observe significant changes in decision-making, mainly by the analysis of existing restrictions in the organization, the growth of the performance and the aggregate values are set to the products. Application: the organizations belonging to the fisheries sector with the new organizational scheme proposed and the launch of the management system based on the Throughput accounting, are entered in the new technological paradigms, as well as the market takes a course, from the point of view of supply and demand, because organizations will not produce based on an analysis of unit costs under the traditional system, but rather based on performance to establish the actions to be taken according to the decisions of the performance: Throughput = Price - Variable Costs. On the other hand, from the point of view of the market, it is not to offer what apparently more is sold, but also generate performance as well as the proportions of the amount sold is less than in volumes. Keywords: Accounting Costs, Bottle-neck, Restrictions, Throughput Accounting, Yields

Este trabalho tem como objetivo analisar os métodos do custeio baseado em atividades e da contabilidade de ganhos da teoria das restrições, no que se refere aos critérios de decisão gerencial utilizados pelos mesmos. Uma análise é realizada com a verificação do impacto no lucro, segundo o mix de produção recomendado por cada método. Através de um estudo de caso, constata-se que uma empresa metalúrgica alcança um crescimento expressivo na sua lucratividade, desde o momento em que passou a recorrer à contabilidade de ganhos para sustentar sua tomada de decisões. Mostra-se que o mix de produção selecionado pelo custeio ABC, para o cálculo do custo do produto, gera um prejuízo. Por outro lado, o mix proposto pela contabilidade de ganhos, que recorre ao cálculo do ganho unitário do produto por uso do tempo na restrição, fornece um mix que maximiza o lucro da empresa.

This study explores the impact of Environmental, Social, and Governance (ESG) constraints on throughput performance in the Nigerian banking sector using Fidelity Bank and UBA as comparative case studies. Drawing on the Theory of Constraints and Throughput Accounting, the research employs ESG metrics aligned with IFRS S1 and S2, including emissions data, board diversity, CSR expenses, and ESG scores. Pearson correlation analysis reveals a positive relationship between ESG performance and Return on Assets (ROA), with Fidelity Bank’s environmental investments correlating with higher efficiency. The findings offer novel insights for banks in emerging markets striving to balance sustainability with operational efficiency. The paper concludes with recommendations for balanced ESG strategy and improved emissions disclosure, highlighting implications for regulators, investors, and bank managers.

Clustering enterprises into eco-industrial parks: Can interfirm alliances help small and medium-sized enterprises?

Purpose - The concept of recognizing all inclusive income, which is used by IFRS and Indonesian SAK, is the basis for presenting other comprehensive income in the income statement. This change in format became the idea of developing a financial performance measurement.Methodology - Testing the effect of attributable comprehensive income ROA and attributable ROA net income on future cash flows and net income, as a proxy for the ability to provide future returns, and applying them in measuring performance before and during the Covid-19 pandemic.Findings - ROA net income is better able to predict future investment returns. ROA comprehensive income has more relevance value, when only other items of comprehensive income that have the potential to be realized are included. In assessing performance, users are advised to keep using the ROA of the net income version, and when using the ROA of the comprehensive income version, it is advisable to include only OCI which will be reclassified. The financial performance of companies in many industrial sectors experienced a decline during the Covid 19 pandemic using two ROA measures.Novelty - Development of ROA formulation by including other comprehensive income and profit attribution, so far ROA is only based on net income.