1. Problem Definition
Company policy is changing to allow an option between driving a company supplied and maintained car for a set payroll deductions and purchasing a car and stopping the payroll deduction. For the purposes of this analysis I will consider the company supplied car to be a lease making the problem to be solved a cost benefit analysis of a lease vs. purchase.
2. Feasible Alternatives
There are two possible alternatives:
1. either keep the company car
2. or buy a car that will be owned by me
As a subset of problems to be solved is the issue of whether the car should be bought locally or purchased from someplace outside Nigeria and shipped.
3. Develop the outcomes for each alternative
To make the decision I need to understand the full cost of owning the car. The overall cost of ownership in addition to the price of the car includes insurance, maintenance, importation fees, NGN/USD exchange rates and customs duties.
My criteria for selecting the car is it should be a late model SUV with four wheel drive capabilities. Also in consideration is the resale value of the car as well as ease of maintenance in the local environment. I will use a combination of internet research of blue book value for the alternatives.
4. Acceptable Criteria
Acceptable decision will be the one that provides the greatest financial benefit to me with the lowest risk.
5. Analysis and comparison of the alternatives
6. Select the preferred alternative
Based on the analysis above, the most cost effective option is to buy a car. To reduce my risks and give me greater peace of mind, will buy from a dealer in the US and ship the car here.
7. Performance Monitoring & Post Evaluation of Result
Successful importation and registration of the car will be my successful performance metric.
References
AWESOME case study LaShae..... Doesn't get much better than that....
ReplyDeleteAnd by working smart, not hard, you are able to claim credit not only for your W2 blog posting, but you can also claim credit for one of your two problems from Chapter 6 in Engineering Economy, "Comparison and Selection between Alternatives". A "Twofer"..... credit for two deliverable's for the cost of only one.
The only concern I have is your online citations are not yet up to APA formatting standards.
Go here: http://owl.english.purdue.edu/owl/resource/560/10/
Scroll down the page to the appropriate citation. What I should be seeing each week looks something like this-
Author, A. A., & Author, B. B. (Date of publication). Title of article. Title of Journal, volume number, page range. Retrieved from http://www.someaddress.com/full/url/
Do yours look like this? If not, why not? As this is one of the KPI's AACE uses for your papers, I expect people to be meeting the APA standards in their blog postings and in the papers.
BR,
Dr. PDG, Jakarta