By P.E., C.E.M. S. Bobby Rauf
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Additional resources for Finance and accounting for energy engineers
C. D. Organization I, III and IV Organization IV Organization II Organization III Chapter 2 Break-even Analysis INTRODUCTION A study of finance, accounting, and business in general, would be incomplete without due consideration of the topic of break-even analysis. When the total revenue generated by a business “breaks even” with the total cost incurred by that business, break-even point is achieved. A manufacturing firm does not achieve the state of profitability with production and sale of the first few units of product.
Therefore, we could call this energy firm’s current organizational structure a “centralized-decentralized” hybrid with centralized strategic corporate control. As you examine the lower tiers of this organization, in Figure 1-3, you notice that while the following major segments of this corporation are relatively self-sufficient and independent, they don’t meet the definition of an SBU, Strategic Business Unit; in that, these major segments are not true profit centers: 1. 2. 3. 4. 5. Engineering and R&D Power Generation Operations Energy Services (Inc.
Many vital business decisions, in decentralized organizations, are made at the local level. The added autonomy does, in many decentralized organizations, come at a tradeoff; in that, few or no support services are available to the local facilities through the corporate offices. Organizational structures of businesses within the same industry tend to be similar. For instance, businesses in beverage bottling industry may be organized in a similar fashion, yet quite different from organizational structures proven to be most effective in distinctly different industry, such as the software industry.
Finance and accounting for energy engineers by P.E., C.E.M. S. Bobby Rauf