Management accounting provides information internally to help managers make better decisions and improve efficiency. It focuses on control through rational decision making processes like setting strategies, budgets, and evaluating performance. However, behavioral research shows accounting must consider human and organizational factors. Contingency theory states the best accounting system depends on situational factors like a firm's environment, strategy, and technology. While contingency theory aims to make accounting more contextual, it has limitations like oversimplifying relationships and failing to consider all relevant contingencies.
This is a lecture I have for female managers from third world countries. It is part of a larger course financed by SIDA - the Swedish foreign aid development agency
This is a lecture I have for female managers from third world countries. It is part of a larger course financed by SIDA - the Swedish foreign aid development agency
This paper discusses strategy evaluation, review and redesign or the point at which the cycle of strategic management process end and restarts. The complex and contingency nature of this process blends an agenda of resource-based, structure-conduct-performance, agency and other theories. The paper takes the middle course theory of organizational structure-conduct-performance for strategy evaluation, review and redesign. Literature survey on the subject reveals emphasis on ways to simplify and understand the multifarious nature of strategic management process as it projects the trio of evaluation, review and redesign as its driving force. The paper explains the seeming similarities, possible uniqueness and relationship of strategy evaluation, review and redesign to show how the trio functions as rear axles of strategic management process. A simulation exercise is provided to facilitate the application of knowledge skills on strategy evaluation, review and redesign by the NIPSS-PSLC Participants
This paper discusses strategy evaluation, review and redesign or the point at which the cycle of strategic management process end and restarts. The complex and contingency nature of this process blends an agenda of resource-based, structure-conduct-performance, agency and other theories. The paper takes the middle course theory of organizational structure-conduct-performance for strategy evaluation, review and redesign. Literature survey on the subject reveals emphasis on ways to simplify and understand the multifarious nature of strategic management process as it projects the trio of evaluation, review and redesign as its driving force. The paper explains the seeming similarities, possible uniqueness and relationship of strategy evaluation, review and redesign to show how the trio functions as rear axles of strategic management process. A simulation exercise is provided to facilitate the application of knowledge skills on strategy evaluation, review and redesign by the NIPSS-PSLC Participants
Introduction to Management Control Systems, Basic Concepts, Boundaries of man...SachinLad27
Introduction to Management Control Systems, Basic Concepts, Boundaries of management Control – How different from Strategy Formulation, Goal Congruence & informal factors that affect it, The Formal Control System , Functions of the Controller
Strategy, budgetary planning and expenditure managementTonderayi Chikanda
Explore how enhancing your strategic planning skills, budgetary planning and expenditure management can significantly transform your organization's effectiveness, efficiency and excellence.
FEATURE STORYSusanna E. KrentzAaron M. DeBoerSashaN.Pr.docxssuser454af01
FEATURE STORY
Susanna E. Krentz
Aaron M. DeBoer
SashaN.Preble
AT A GLANCE
> Providers need to
understand the various
types of metrics, the
importance of each
type, and how to use
them eHectively.
> Providers should use
strategic metrics to
monitor implementa-
tion of their organiza-
tion's strategic plan.
> To overcome obstacles
to successful use of
strategic metrics,
providers should com-
municate the organiza-
tion's strategic intent,
establish accountability
for achieving the tar-
gets, and ensure buy-in
through review of met-
rics and involvement of
appropriate people.
staying on course
with strategic metrics
Are you using strategic metrics? If not, you might be straying off course
and not know it.
Metric Cnie-trik)
Function: noun.
A standard of measurement.
—Merriam-Webster Online Dictionary
Charting a suecessful course in today's competitive market requires health-
care organizations to employ a rigorous strategic planning process. At the
same time, the uncertainty that characterizes the future of health care means
that course corrections inevitably will be required as the plan is implemented.
To monitor progress, most organizations have developed extensive and
numerous performance metrics and dashboards focused on operational or
tactical activities. These metrics are useful, hut they do not provide manage-
ment and the board with meaningful ways to gauge strategic performance. To
get the results the organization demands, providers need to understand the
various types of metrics, the importance of each type, and how to use them
effectively.
Metrics, a combination of a measure (the criterion used as the hasis of
measuring success) and a target (the value associated with a measure that the
organization wants to achieve), can he developed for tactical and strategic
planning. Metrics are divided into two major categories, management and
strategic, each with specific characteristics and uses. Understanding that the
board's job is to govern and management's joh is to manage is key to differ-
entiating among these types of metrics.
Management metrics, although not part of the strategic plan, can he developed
for strategies and tactics. Strategies identify where an organization's
resources are deployed, w-hile tactics go one step further to identify specific
work plans that will help realize the strategies. Management metrics are
more discrete than strategic metrics. Management metrics, especially at the
tactical level, are useful for implementation teams but are much too detailed
for reporting to the board or senior leadership. In general, these types of
metrics should he clear and measurable, and can numher upwards of loo.
Remember, achievement of the target does not ensure arrival at the
86 MAY 2006 healthcare financial management
Strategic Metrics
organization's desired
vision or end point.
Strategic metrics focus
on achievement of the
organization's vision
or goals, which iden-
tify strategic direction. ...
The case study discusses the potential of drone delivery and the challenges that need to be addressed before it becomes widespread.
Key takeaways:
Drone delivery is in its early stages: Amazon's trial in the UK demonstrates the potential for faster deliveries, but it's still limited by regulations and technology.
Regulations are a major hurdle: Safety concerns around drone collisions with airplanes and people have led to restrictions on flight height and location.
Other challenges exist: Who will use drone delivery the most? Is it cost-effective compared to traditional delivery trucks?
Discussion questions:
Managerial challenges: Integrating drones requires planning for new infrastructure, training staff, and navigating regulations. There are also marketing and recruitment considerations specific to this technology.
External forces vary by country: Regulations, consumer acceptance, and infrastructure all differ between countries.
Demographics matter: Younger generations might be more receptive to drone delivery, while older populations might have concerns.
Stakeholders for Amazon: Customers, regulators, aviation authorities, and competitors are all stakeholders. Regulators likely hold the greatest influence as they determine the feasibility of drone delivery.
Oprah Winfrey: A Leader in Media, Philanthropy, and Empowerment | CIO Women M...CIOWomenMagazine
This person is none other than Oprah Winfrey, a highly influential figure whose impact extends beyond television. This article will delve into the remarkable life and lasting legacy of Oprah. Her story serves as a reminder of the importance of perseverance, compassion, and firm determination.
Artificial intelligence (AI) offers new opportunities to radically reinvent the way we do business. This study explores how CEOs and top decision makers around the world are responding to the transformative potential of AI.
Senior Project and Engineering Leader Jim Smith.pdfJim Smith
I am a Project and Engineering Leader with extensive experience as a Business Operations Leader, Technical Project Manager, Engineering Manager and Operations Experience for Domestic and International companies such as Electrolux, Carrier, and Deutz. I have developed new products using Stage Gate development/MS Project/JIRA, for the pro-duction of Medical Equipment, Large Commercial Refrigeration Systems, Appliances, HVAC, and Diesel engines.
My experience includes:
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Successfully developed the $15-20M yearly corporate capital strategy for manufacturing, with the Executive Team and key stakeholders. Created project scope and specifications, business case, ROI, managed project plans with key personnel for nine consumer product manufacturing and distribution sites; to support the company’s strategic sales plan.
Over 15 years of experience managing and developing cost improvement projects with key Stakeholders, site Manufacturing Engineers, Mechanical Engineers, Maintenance, and facility support personnel to optimize pro-duction operations, safety, EHS, and new product development. (BioLab, Deutz, Caire)
Experience working as a Technical Manager developing new products with chemical engineers and packaging engineers to enhance and reduce the cost of retail products. I have led the activities of multiple engineering groups with diverse backgrounds.
Great experience managing the product development of products which utilize complex electrical controls, high voltage power panels, product testing, and commissioning.
Created project scope, business case, ROI for multiple capital projects to support electrotechnical assembly and CPG goods. Identified project cost, risk, success criteria, and performed equipment qualifications. (Carrier, Electrolux, Biolab, Price, Hussmann)
Created detailed projects plans using MS Project, Gant charts in excel, and updated new product development in Jira for stakeholders and project team members including critical path.
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2. DEFINITION
Management Accounting is concerned
with the provision of information to
people within the organization to help
them make better decisions and control
in order to improve the efficiency and
effectiveness of the business affairs.
3. MAIN PURPOSES OF
MANAGEMENT
ACCOUNTING
Provide Information to
Business
Help make better decisions
Improve efficiency
Help control business activities
The main focus -understand the various
approaches to “control”
7. RATIONAL CONTROL
MODEL
Management Control Process
is one of the three areas of
organisational controls.
Those are:
1. Strategy Formulation
2. Management Control Process
3. Task Control
10. RATIONAL DECISION MAKING
PROCESS
1. Identify the objectives of the
organisation
2. Identify potential strategies
3. Evaluate alternative strategic
options
4. Select course of action
5. Implement the long-term plan
6. Monitor actual results
7. Respond to divergencies from plan
1- 5 can be identified as long term decisions
6- 7 involve short term decisions
11. THE ROLE OF ACCOUNTING
INFORMATION IN CONTROLS AND
DECISION MAKING?
Accounting provides quantitative
integrated mechanisms that are
available
Provides aggregated measures of
performance
Combine and communicate
organisational activities
Provides a financial control system
along with other organisational
controls
16. BEHAVIOURAL RESEARCH IN
ACCOUNTING
Accounting researchers called
for research to study human’s
behaviour in an organisational
settings in order to achieve
better performance
Psychology becomes the main
reserve of these studies
Theories of motivation have been
repeatedly used by the
accounting researchers
21. EQUITY THEORIES
Job satisfaction is an important
aspects of motivation
Job dissatisfaction arises when
one individual feels his/her
position is unfair by comparing
like with like
The perceived inequalities lead
to motivational effects
24. MOTIVATION THEORIES –
TARGET SETTING
Motivation theories are
operationalised in Target Setting i.e.
Budgeting. Several findings re:
Target Setting and Motivation are as
follows:
1. Specific hard goals produce a higher
performance
2. Hard goals produce less overall task-
liking than easy goals
3. Specific hard goals produce more
interest in the task
27. MANAGEMENT ACCOUNTINGMANAGEMENT ACCOUNTING
The managers who were evaluated
under the BC and BP styles reported
a range of dysfunctional feelings and
behaviour, including:
higher levels of job-related tension;
deteriorating relations with
superiors;
less favourable relations with peers
etc
34. MANAGEMENT ACCOUNTINGMANAGEMENT ACCOUNTING
How about environment? What
about the interactions of changing
environment and organization?
Behavioural theorists fails to
incorporate the wider context of the
organisation, social conflicts, politics,
organisational conflicts and
managerial choices in setting modes
of control.
These criticisms have led accounting
researchers to pursue alternative
theories
35. BEHAVIOURAL
UNDERSTANDING OF
ACCOUNTING
How about managers and employee’s
understanding of budgets
Different people can view budget
differently - depending on their
practical situations
Meaning of budget could be diverse
within organisations (Read Ashton
et. al., p. 285)
39. • Advocates that there is no one best
design of a management accounting
control system (MACS) and that it all
depends on the situational (contingent)
factors
•Various contingent factors warrant
different type of control systems in
different situation
CONTINGENCY THEORY
APPROACH
40. 1. The external environment
• Evidence to suggest that business units that
face higher environmental uncertainty use a
more subjective performance appraisal
approach.
• The greater the perceived environmental
uncertainty the greater the need for more
sophisticated accounting information that has a
broad scope.
41. 2. Competitive strategy and
strategic mission
• Business units pursuing a low cost strategy should adopt
results measures that emphasize cost reductions and
Budget
achievement.
• Business units competing on the basis of differentiation
or those prospecting new markets should:
1. Have a more participative decision-making environment
2. Emphasize rewards based on non-financial factors (e.g. product
innovation, market development) besides secondary financial
measures.
42. 3. Firm technology and
interdependence
• The nature of the production process determines the type
of costing system (Job or process costing).
• Pooled, sequential and reciprocal interdependencies create
the need for recharging costs to user centres.
43. 4. FIRM SIZE, DIVERSIFICATION,
STRUCTURE AND
INDUSTRY TYPE
• Positive relationship between firm size and the
sophistication of the management accounting
system.
• Related diversification:
1. Elaborate planning and budgeting systems to
coordinate activities.
2. Rewards based on group performance
44. UNRELATED DIVERSIFICATION
1. Decentralization and the creation of profit and
investment centres.
2. Greater reliance on financial results controls.
Structure — Interdependence that exists between
responsibility centres determines style of budget
evaluation.
Industry type influences type of control system
employed.
45. 5. Knowledge and observability factors
Three areas examined:
1.A. Knowledge of the transformation process
and the ability to measure output.
2.B. Appropriate type of performance
assessment in relation to cause-and-effect
relationships.
3.C. Influence of programmability of decisions on
the type of controls that should be used
46. A. Knowledge of the transformation process and the ability
tomeasure output (Source: Ouchi, 1979)
47. B. Appropriate type of performance assessment in
relation to cause-and-effect relationships (Macintosh,
1985)
48. C.Influence of programmability of decisions on the type
of controls that should be used (Emmanuel Et al. (1990)
• A programmed decision is one where the decision is
sufficiently well understood for a reliable prediction of the
decision outcome to be made:
1. Equivalent to cell 1 in the two previous diagrams
2. Behavioural and output controls are appropriate
• A non-programmed decision is where one has to rely on
the judgement of managers because there is no formal
mechanism for predicting likely outcomes:
1.Equivalent to cells 2 and 4 in the two previous
diagrams.