Professional Documents
Culture Documents
Understanding Strategies
Management control systems are
tools for implementing strategies.
Strategies
differ
between
organizations, and controls must be
tailored to the requirements of
specific
strategies.
Different
strategies require different task
priorities; different key success
factors;
and
different
skills,
perspectives, and behaviors.
2.1 Goals
Goals of a corporation refer to the end results
that it wants to attain and which is set the chief
executive officer and other top executives or
sometimes by the owners.
The major forms of goals include the followings:
Profitability
Maximizing shareholder value
Risk
Multiple stakeholder approach
Corporate-Level Strategy
Corporate strategy is concerned
more with the question of where to
compete than with how to compete
in a particular industry; the latter is a
business unit. At the corporate level,
the issues are (1) the definition of
businesses in which the firm will
participate and (2) the deployment of
resources among those businesses.
In terms of their corporate-level strategy, companies can be classified into one of three categories:
Implications of Control
Systems
Corporate strategy is a continuum
with single industry at the end of the
spectrum
and
unrelated
diversification at the other end
(related diversification is in the
middle of the spectrum). Many
companies do not fit neatly into one
of the three classes.
The
planning
and
control
requirements of companies pursuing
different
corporate
level
BCG Model
Starhold
Question markbuild
Cash cowharvest
Dogdivest
Industry competitors
Bargaining power of customers
Bargaining power of suppliers
Threat of substitute products
Threat of new entry.
Generic Strategies
Primary activities
Support activities
Human resources
Finances
Engineering and R & D
General administration
Supervising
internal
audit
and
accounting control procedures to
ensure the validity of information,
establishing adequate safeguards
against
theft
and
fraud,
and
performing operational audits
Developing
personnel
in
the
controller
organization
and
participating in the education of
management personnel in matters
relating to the controller function.