ISSUE: that there is not organizational mission or plan. The first issue that arises is whether DigiTech Industries Limited should continue growth in the installation sector of their business without continuing monitoring services. Associated with first issue, another topic that needs to be assessed is how stable they currently are and could DigiTech discontinue installation operations altogether and only rely on income generated from monthly fees charged to existing clients.

Second, the owners of DigiTech are having problems controlling the high level of costs in their day to day operations which in turn are hurting the overall gross profit earned. There seems to be an inconsistency between the sa

DigiTech needs to clarify and establish a procedure for sales representatives’ customer quotes. A basis needs to be established, first through the accurate cost estimate of a basic system. After the basic system average cost is accurately established additional upgrades can also be added or customized to the customer’s preferences. DigiTech had a revenue loss of 41% (based on 10 quotes listed) due to underestimated costs by sales representatives. This was an astronomical loss for the company.

Expand in their current market while focusing on cost control. DigiTech needs to first get their costs under their control so that they can expand effectively into new markets. If DigiTech expands without addressing their cost control issues, the problem will increase while decreasing profits further.

Another issue is that of a lack of mission statement or vision. There is no indication of where DigiTech’s owners desire the business to be in the future or what it is to be to customers. Without a mission statement or vision for DigiTech it is difficult to determine what its future goals should be. There is no direction for where the company should be headed either through expansion of customer base, growth, or industries competing in.

Interest Coverage Ratio (0.021) (0.441) 0.554

If DigiTech chose this alternative their costs from installations could be reduced while increasing their monitoring revenue. The problem associated with this solution is that DigiTech would loose control over their customer base. DigiTech prides themselves on the quality of the service of installations. This could be compromised with an outside agent acting on behalf of the company. Since a great portion of the advertising was from word of mouth; the use of an agent may limit future contracts.

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