Justification. Documentaries have significant impact on the reputation and the revenue of the VYP

Documentaries have significant impact on the reputation and the revenue of the VYP. Moreover the documentary “Banks – friend or foe?” is important and is potentially worthy of award, which means that it can contribute a lot to the company’s reputation and VYP cannot risk to have a lower quality programme than it’s possible. We should take into account that the estimated loss amounts only to 0,1% of the operating profit of company and in case of gaining an award VYP may possibly gain much more in the future, as it will strengthen its positions on the market.

As our recommendation is not to cut costs, to reach the break-even point we suggest to tackle the problem from the other way – by increasing revenues. As average commissioning revenue per hour has a tendency to fall (in the financial year 2011 it dropped by 14,4% compared to the year 2010), it’s high time VYP thought of the other ways of gaining profit. This is an alternative way to cutting back expenses, and we believe it worth taking into account and thinking over. If this direction is taken VYP will be able to secure its reputation for high quality documentaries and to maintain its profitability. Furthermore it can avert the brewing conflict between programme producers and directors, who each hold to their principles of work.

That such a problem has occurred in the first place shows lack of thorough planning and of cost control. VYP should set a stricter cost control on the programme so as the documentary will be a cost effective programme, otherwise there is still a risk to overrun the new forecast costs. If this happens the professional skills of the programme producer in question can be doubted and so the ability of VYP to make successful programmes profitably.