MANAGEMENT ADVISORY SERVICES

OVERVIEW
OCTOBER 2017
 Accounting Differences
Financial Managerial
• External focus • Internal focus
• Whole organization • Segments or divisions
• Historical • Current/projected
• Quantitative • Quantitative/qualitative
• Monetary • Monetary and nonmonetary
• Verifiable • Timely/reasonable estimate
• GAAP • Benefits exceed costs
• Formal • Formal and informal
recordkeeping recordkeeping
 Organizational Strategy
1. Develop Mission Statement
2. Implement strategy
3. Measure and control the value chain and
managers’ performance
4. Set balance scorecard goals, objectives,
and targets
 Organizational Strategy
1. Develop Mission Statement
2. Implement strategy

Develop,
Establish implement, and
appropriate monitor
measures of necessary
accomplishment information
systems
 Organizational Strategy
1. Develop Mission Statement
– What an organization wants to accomplish
– How its products/services can meet customer
needs
– Why the organization exists
– Used to develop an organization’s strategy
– Modify over time
 Organizational Strategy
1. Develop Mission Statement
2. Implement strategy
Strategy - A plan to fulfill goals and
objectives by deploying resources to create
value for customers and shareholders
Organization strategy is supported by
business unit strategies
 Organizational Strategies
• Cost leadership strategy - Undercut
competitor prices
• Product differentiation strategy - Superior
quality products or unique services sold at a
premium
• Core competency – critical function or
activity providing a competitive advantage
 Organizational Strategy
1. Develop Mission Statement
2. Implement strategy
3. Measure and control the value chain and
managers’ performance
 Value Chain
Set of value-adding functions and processes that
convert inputs into products/services
– Research and Development
– Product Design
– Supply
– Production
– Marketing
– Distribution
– Customer Service

Communicate strategy to all members of the value chain

 Organizational Strategy
1. Develop Mission Statement
2. Implement strategy
3. Measure and control the value chain and
managers’ performance
4. Set balance scorecard goals, objectives,
and targets
Business outcomes are evaluated against
performance targets
Balance Scorecard
Four perspectives
• Learning and Growth
• Internal Business
• Customer Value
• Financial Performance
 Balance Scorecard
• Learning and Growth
– Use the organization’s intellectual capital to
adapt to changing customer needs or to
influence new customers’ needs and
expectations through product or service
innovations
 Balance Scorecard
• Learning and Growth
• Internal Business
– Things to do well to meet customer needs
and expectations
 Balance Scorecard
• Learning and Growth
• Internal Business
– Things to do well to meet customer needs
and expectations
• Customer Value
– How well the organization is doing relative
to important customer criteria
 Balance Scorecard
• Learning and Growth
• Internal Business
– Things to do well to meet customer needs
and expectations
• Customer Value
– How well the organization is doing relative
to important customer criteria
• Financial Performance
– Stockholders/stakeholders concerns about
profitability and organizational growth
Balance Scorecard
Four perspectives
• Learning and Growth
• Internal Business
• Customer Value
• Financial Performance
Measures
• Short term and long-term
• Internal and external
• Financial and nonfinancial