Elevating Healthcare Standards

Introduction

Healthcare industry is witnessing change and to ensure efficiency in the process proper advanced techniques are required. Innovation and manufacturing of pharmaceutical medicines are the primary goals of the healthcare and therefore it is important to ensure values. Healthcare dissertation help is essential in this particular regard. The study intends to ensure transparency, accountability and development based upon the GSK and its activities. The objective of the study is to attain better understanding about management information and accounting for greater relevance and minimisation of wastage. The purpose is to prepare proper report so that the costs are managed along with ensuring viability using the management accountant technique. GSK is one of the science-led global healthcare companies which intend to help people to feel better and live longer. The company has three global businesses that tend to research, develop, and manufacture pharmaceutical medicines that are innovative for healthcare. The goal is to be innovative and ensure effectiveness in healthcare. GSK is one of the brilliant places to work, and its value is to focus upon the patient, ensure transparency, respect and integrity so that the expectations in terms of courage, accountability, and development are insured (GSK, 2018). The objective is to determine the aspect of management information and accounting techniques.

Nature, source and purpose of management information in GSK

Management accounting is about presenting the accounting information to formulate better policies in GSK and improve the day to day activities. Management accounting is of relevance to formulate effective planning and controlling for ensuring better financial goals and maintaining cost. Management information system is developed based upon the corporate goals and ensures monitoring to meet the business goals. The management information is determined to make effective business decisions and to ensure efficiency in business operations. It is to leverages power through the help of innovation along with preventive and curative healthcare system to improve the life and quality.

The nature is to determine the finances of the organisation and ensure that appropriate data are collected from the valid and reliable sources to meet the corporate goals. The management information nature is such that it ensures financial control and transcational processing. The management information is used to make effective decisions to ensure better control and monitoring.

The sources that are used for the purpose of data collection are journals, official websites, annual reports of the company along with scholarly journals and articles. These sources are valid as it provides valuable insights about the subject and offers better understanding. The sources are company websites and graded journals.

The purpose of the management system is to meet the goals of GSK by ensuring better designs and formulation of medicines to serve people better. Management information is critical because it tends to make an effective decision so that the transparency is maintained. Concerning GSK, it is noted that entrophy is provided to manage the risk and integrate health along with safety (British Standards Institution, 2019). The purpose of management information is to meet the environmental health and safety through effective communication and collaboration. The purpose is to meet the resources efficiently so that the collection and management of data are effective. Thus, the management information role in GSK is huge as it makes a decision that helps to develop better production (Integrify, 2020). GSK intends to implement the management information so that the departments can offer better solutions and legacy systems.

The management information is effective and focuses on innovation, performances along with trust. The values and expectations of the company are being considered upon, so that transparency, respect, and integrity are meeting with accountability and development of teamwork. The scope of management information is huge upon GSK as it improves its functionality, thus improving performances and decision making (British Standards Institution, 2019). Innovation is vital for GSK, and it invests upon scientific along with technical excellence so that the new products are developed to meet the changing needs of consumers. The performances are effective and ensure development along with deliverance of products with value.

Analysis of a wide range of Management Accounting techniques available for GSK

Management Accounting has a strong role to play in manufacturing companies to improve managerial performances. Management accounting is about collecting information along with reports so that the decision is effective regarding financing and distribution. It is a process that is used to measure and ensure the reporting information based upon the economic activity for the effective use of managers in the process of planning and performances with effective evaluation along with operational control. Management accounting is used by GSK to ensure the pricing of products, costing activities, generating activities, and effective allocations (CIMA, 2009). Several techniques of management accounting are being implemented by the business organization for effective decision making and planning. The wide range of management accounting techniques for GSK Absorption costing, ABC, marginal costing, standard costing and Direct costing.

Absorption costing is vital and is being used by the business organization for the valuation purpose of inventory and the calculation of the cost of products based upon the direct and indirect expenses. It is about adding up all costs for the better production process and accounting standards (Warren & Reeve, 2006). ABC is a costing that helps to identify organisational activities based upon all services and products. Marginal Costing is about ascertaining differences amid fixed and variable cost. It is useful to identify profit. Standard costing techniques is about actual cost and deviation that is analysed by causes. Direct costing relates to operational activities based upon fixed costs giving rise to profits. These techniques are relevant for GSK as it helps to determine the costs that are linked with innovation ion products and services. The costs are subject to reduction of the overhead costs and minimise the risks associated with GSK (GSK, 2018).

Application of Absorption Costing and ABC costing techniques using the information

GSK is manufacturing two products called Multi Vit patch and Multi Vit Syrup. Both the products are priced by 100% mark up on costs to attain the selling price.

Absorption cost formula = Direct labour cost per unit + Direct material cost per unit + Variable manufacturing overhead cost per unit + Fixed manufacturing overhead per unit

Total Overheads £100,000

Total machine Hours 25000 hrs

With the help of the formula, the absorption cost is determined using the financial data as demonstrated in excel below:

The absorption costing is applied to help GSK to determine its contribution margin for both the products. The application of the absorption costing helps to determine the production units to ensure profits.

The next ABC costing technique is a method that tends to assigns the overheads and indirect costs to the products. This costing is about recognizing the relationship between costs, overheads activities, and is different from the traditional costing methods. This costing is effective as it enhances the costing process (Hashim, 2019). The cost pools are determined along with the overhead costs for better cost activities.

The cost pools had setups for the products useful for better effectiveness as determined from the spreadsheet depicted below:

Thus, the ABC costing technique is applied in GSK to determine the cost pool and drivers that impact the activities. It is different from traditional for better financial understanding and decision making by the firms.

Interpretation and recommendation future costing strategy for GSK

From the analysis of the gathered data, it is noted that GSK has a strong financial position, and the cost is well maintained. It can focus on applications such as communication, marginal costing, and more for the development of the training program. The costs and viability are determined using the ABC costs. Similarly, based on the ABC costing, the overhead allocation cost states that Patch set up cost per unit is £2857.14 and for the syrup is £1428.57, respectively (Refer to appendix).

It is recommended that ABC is effective as it ensures accuracy in the process of costing and cost control. This costing is helping GSK to improve the cost with proper control by managing the operational activities in an effective manner. GVK is taking measures to improve its costing strategy in the future to improve the delivery of products the medicines which in the year 2018 was delivered around 2.3 billion packs and about 3.8 billion consumer healthcare products. To improve the growth of the company, the strategy is to maintain the pricing. The future costing strategy is based upon proper pricing and access to attract the attention of governments and the public. The focus is on value-based pricing based on proper costing. The future strategy of GVK is to change the pricing strategy so that the strategic measure is effective based upon the affordability and healthcare system (GlaxoSmithKline plc.. 2020).

Cost-benefit analysis is one of the common strategies that are to be implemented in the future by GVK so that the process of decision making is smooth and is comprised of costs so that the profitability can be ensured. ABC Cost strategy can be effective through the consideration of restructuring so that the costs estimated and actual are the same minimizing the impact upon earnings and sales.

Conclusion

From the analysis, it is worthy to state that GSK is taking measures to implement the information gathered through the management information so that the cost is maintained, and sales improved. It is comprehended from the study that ABC costing is implemented by GSK to reduce the risk and increase costing accuracy. The innovation in the products requires proper management which is effectively done through ABC costing techniques. The price and viability of GSK are better with the application of the accounting techniques so that the two comparable products are manufactured based upon proper cost. The costing techniques are improving the performances of GSK to ensure profitability and sustainability in the healthcare system.

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