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Striker Corporation
What are the missions of CER’s and the Capital Budgeting Process at Striker? To
what extent have they been shaped by elements of corporate finance theory? To what
extent are they shaped by Striker’s particular industry, history and culture?
What are the primary strengths and weaknesses of the current system? How should
the performance of such system be evaluated?
What are the missions of CER’s and the Capital Budgeting Process at Striker? To
what extent have they been shaped by elements of corporate finance theory? To what
extent are they shaped by Striker’s particular industry, history and culture?
Striker Corporation is a manufacturer of medical tool and devices that are designed to
improve surgical procedures and or help patients recover from them more quickly and
effectively. The mission of Stryker’s Capital Expenditure Requests is to regulate and
formalize the capital budgeting process. Stryker’s capital allocation process was structured
around formal requests for authority to spend funds referred to as Capital Expenditure
Requests (CER’s). These CER’s embodied a proposal and approval process that was
utilized throughout the entire corporation. These CER’s were comprised of two main
sections. The first one was setting forth the business proposition and the second to
summarized pertinent financial analysis. These submissions had to include extensive
background and supporting documentation as well as goals for revenue, operating profit,
and cash flow that are both achievable and consistent with corporate targets of 20%
growth. CERs established a formal process of requesting capital expenditure and its
approval. The missions of CER’s and the Capital Budgeting Process at Striker was to
