1、1Advanced Management Accounting(MA2)Course introductionAdvanced Management Accounting MA2 is the second of two courses in the management accounting stream in the CGA program of professional studies.Discussion : 1. What do you have learned in MA1 ( Management accounting fundamentals) 2. What will you

2、 study in MA2? Introduction4MA2 & MA1Management Accounting 2 MA2 is the final of two mandatory courses in the management accounting stream in the CGA program of professional studies.You should have master all the topics in MA1, especiallyCost behavior and CVP analysisVariable, absorption, and activi

3、ty-based costingRelevant costs for decision making Flexible budgetingIntroduction5General course aimsAcquiring conceptual understanding of the role of management accountant in providing information to support managerial decisionsBuilding up an ability to perform analyses relevant to specific manager

4、ial decisionsDeveloping an awareness of current issues in designing and implementing effective management control systemsCultivating the moral responsibilities of management accountants to their profession and to the managers they adviseIntroductionCourse syllabusLesson 1 Strategy Lesson 2 Corporate

5、 governance and ethical issues Lesson 3 Risk managementLesson 4 Organizational structure and interdivisional relationshipsLesson 5 Budget systems designLesson 6 Control mechanismsLesson 7 Performance measurementLesson 8 Performance evaluation and compensationLesson 9 Performance management and susta

6、inabilityIntroductionCourse materials1. Lesson Notes 2. Textbook (1) Kenneth Merchant , Management control systems: performance measurement, Evaluation and incentive, Third Edition (2) Robert N. Anthony , Management control systems, Twelfth Edition (3) Charles Horngren, Cost accounting, A Managerial

7、 Emphasis, Fifth Canadian Edition.IntroductionIntroduction目錄第1章 管理控制系統的性質第一編 管理控制環境第2章 理解戰略 第3章 組織行為 第4章 責任中心：收入和費用中心 第5章 利潤中心 第6章 轉移定價 第7章 評價與控制所運用的資產 第二編 管理控制過程 第8章 戰略計劃 第9章 預算編制第10章 財務業績分析報告 第11章 業績計量 第12章 管理層薪酬 第三編 管理控制變形 第13章 差異化戰略的控制 第14章 服務型組織 第15章 跨國組織 第16章 項目管理控制 Introduction11Contents of t

8、he MA2Strategy (Chapter 1)Corporate governance and ethical issues( Chapter 13,14,15) Risk managementOrganization structure and interdivision relationships (Chapter 3,7 )Budget systems design (Chapter 8, 12) Control mechanisms ( Chapter 2,3, 4) Performance measurement ( Chapter 10,11) Performance eva

9、luation and compensation (Chapter 9, 10, 12) 9. Performance management and sustainability Introduction1213Study method for MA2Preview before the classScanning the Lesson notes and required readingParticipate in class activelyTry to mastery all key points in classes.After classDo the assignmentsDiscu

10、ss with your classmates, or teacher.IntroductionCourse RequirementsYou are required to prepare for every class, to efficiently finish homework, and to ethically participate final exam. Accordingly, your grade for this course will be determined as follows: 1.Class participation, questions for class d

11、iscussion, Assignments 20% 2. Final exam 80%Introduction15Contact with Me Email : Telephone:ntroduction16Strategy Lesson 117Introduction of lesson 1Overview of strategyOutline the strategic management processOverview of the role of management accounting in creating and evaluating corpor

12、ate strategy. 18Lesson 1 Topics outlineWhat is strategy? (1.1) Strategic leadership (1.2) Developing strategy (1.3 ;1.5) Implementing strategy (1.6; 1.7)Importance of strategic financial management (1.4)Role of the management accountant in implementing strategy (1.8)Quality of management decision ma

13、king (1.9)19Topic 1: What is strategy?Learning objectiveDefine the term “strategy,” and Identify factors managers consider when developing strategy. (Level 1)Required readingSelected reading , Anthony : Chapter 2Historical Description ofManagement Accounting1880 - 1925Most of the product-costing and

14、 internal accounting procedures used in the last century were developed.1925-1950Emphasis of accounting information for internal management. Management accounting practices developed, including: Flexible budgeting, Standard costs, Variance analysis, transfer prices et al.1950-1980The first managemen

15、t accounting revolution. Emphasis on the decision-making role ,and the mathematics of management accounting.1980- The Second management accounting revolution .Significant efforts have been made to radically change the nature and practice of management accounting. Emphasis on strategy Topic 1: What i

16、s strategy?Just-in-time productionTotal quality managementProcess reengineeringTheory of constraintsInternational competitionE-commerceBusiness environment changes in the past twenty years The Changing Business EnvironmentTopic 1: What is strategy?CURRENT FOCUSNeed for innovation and relevant produc

17、es:Activity-based managementABC Improves accuracy of assigning costsCustomer orientationStrategic positioning to maintain competitive advantageValue chain framework to focus on customer valueTotal quality management emphasized continuous improvementTime becomes a competitive advantage for the firm w

18、ho compress the value chainStrategic managementTopic 1: What is strategy?23Strategic managementStrategyStrategy can be defined the long range planning developed and carried out by an organization to achieve its corporate goals and objectives. Goals describe the broad overall aims of the organization

19、 .Objectives describe specific steps to accomplish the goals within a given timeframe.Strategic managementis the process a company uses to match its core competencies with industry opportunities in order to have a competitive advantage and accomplish its overall objectives. Topic 1: What is strategy

20、?Successful Strategy = Competitive AdvantageA strategy is implemented to create a competitive advantage over other companiesA company is said to have a competitive advantage when its profitability is greater than the average profitability for all firms in the industry A competitive advantage is cons

21、idered sustained when it is maintained for several yearsTwo Strategy LevelsCorporate-level Strategy (Companywide)Refers to the selection and management of a mix of businesses that compete in several industries or product markets .Business-level Strategy (Competitive)Is an integrated and coordinated

22、set of commitments and actions that the firm uses to create and gain a competitive advantage by exploiting core competencies in specific product markets.The former is focused on where to compete; then latter is concerned with how to compete.Topic 1: What is strategy?What is Strategy?Topic 1: What is

23、 strategy?28Corporate StrategiesCorporate strategy: Address the question: “What is the appropriate scale and scope of the enterprise?”Maintenance strategies: 穩定型戰略 Development strategies: 成長型戰略一體化戰略（integration strategies）密集型戰略（intensive strategies）多元化戰略（diversification strategies）Defense Strategies

24、 ：收縮型戰略Withdrawal strategies ：清算型戰略Topic 1: What is strategy?案例 安利是美國最大的著名直銷企業，總公司位于美國密歇根州大急流市亞達城，1959 年，成立于杰.溫安洛先生和理查.狄維士先生在家中的地下室。創立之初，公司的產品也僅有一種樂新多用途濃縮清潔劑，但這款產品卻是當時市場上率先采用具有生物可降解性表面活性劑的洗滌劑，第一年的營業額達到了50萬美元。1963年，安利在美國境外的首家分公司加拿大安利分公司誕生，1971年5月，安利在北美以外的首家分公司在澳大利亞正式創立，這標志著安利已開始躋身國際跨國公司的行列。美國安利亞太區公司，

25、現在已擁有安利產品在澳大利亞、香港、澳門、馬來西亞、新西蘭、臺灣、泰國、文萊以及中國的獨家代理權。1972年，由世界維生素工業之父卡爾宏邦于1934年創立的紐崔萊被收購于安利旗下。安利(中國)于1992年成立并開始投資建廠，1995年4月10日正式開業。1997年， 旗下的紐崔萊成為世界上最大的維生素與礦物質營養補充食品品牌之一。1998年7月21日，經國家對外貿易經濟合作部、國家工商行政管理局、國家國內貿 易局批準，安利(中國)根據中國市場特點，結合中國市場環境，以開設店鋪并雇傭推銷員的方式成功轉型經營。2006年12月1日，安利(中國)正式拿到直銷牌照，這意味著安利公司在未來的幾年將是全力

26、騰飛的時期。2007年，安利公司實現了80億元的銷售額。2008年，安利公司首次推出未來四年的戰略目標，預計到2012年，安利公司全球銷售收入超過120億美元!剛聘用原可口可樂一女性CEO加入安利全球管理層，她表示公司將推行強有力的戰略措施，實現120億美元的目標。安利公司目前銷售紐崔萊營養保健食品、雅姿美容化妝品、個人護理用品、家居耐用 品四大系列，在廣州建有先進的大型生產基地。安利在它的業務經營中同時兼任生產及銷售商。安利采用直銷的經營模式，產品從工廠生產出來，經過經銷商、直銷員或者專賣 店，直接到客戶手中，減少中間的流通環節，并保證其售前、售中、售后服務，讓客戶可以得到更好的服務。案例討

27、論說明安利公司在發展過程中采用哪些戰略;.多元化戰略。安利公司從一開始只是生產清潔劑，到現在主營日用消費品，涵蓋了紐崔萊營養保健食品、雅姿美容化妝品、個人護理用品、家居護理用品和家居耐用品等系列產品，說明采用的是相關多元化戰略。一體化戰略，因為安利公司在它的業務經營中同時兼任生產商及銷售商，所以它采用的是一體化戰略。The Trend Over Time: Diversified Companies among the Fortune 500Percentage of Specialized Companies (single-business, vertically-integrated a

28、nd dominant-business)Percentage of Diversified Companies (related-business and unrelated business)BUT Since late 1970s, diversification has declined.1949 1954 1959 1964 1969 1974 70.2 63.5 53.7 53.9 39.9 37.029.8 36.5 46.3 46.1 60.1 63.0Motives for DiversificationGROWTH -The desire to escape stagnan

29、t or declining industries has been one of the most powerful motives for diversification (tobacco, oil, defense). -But, growth satisfies management not shareholder goals.-Growth strategies (esp. by acquisition), tend to destroy shareholder valueRISK -Diversification reduces variance of profit flowsSP

30、READING -But, does not normally create value for shareholders, since shareholders can hold diversified portfolios. -Capital Asset Pricing Model shows that diversification lowers unsystematic risk not systematic risk.PROFIT -For diversification to create shareholder value, the act of bringing differe

31、nt businesses under common owner- ship must somehow increase their profitability.Diversification and Performance: Empirical EvidenceDiversification trends have been driven by beliefs rather than evidence:- 1960s and 70s diversification believed to be profitable; 1980s and 90s diversification seen as

32、 value destroying.Empirical evidence inconclusive- no consistent findings on impact of diversification on profitability, or on related vs. unrelated diversification.Some evidence that high levels of diversification detrimental to profitabilityDiversifying acquisitions, on average, destroy share- hol

33、der value for acquirersRefocusing generates positive shareholder returns 1 2 3 4 5 6 index of product diversity321return on net assets (%)Corporate-Level StrategyCorporate-level Strategys Key questions:What businesses should the firm be in?How should the corporate office manage the group of business

34、es?Business UnitsTopic 1: What is strategy?Business portfolio analysisAssess the suitability of current business portfolio. Allocate resources according to the portfolio, finally reach the strategic goalsTools : BCG Matrix model , GE model Topic 1: What is strategy?BCG modelThe model was developed b

35、y the Boston Consulting Group in the early 1970s.The BCG model is based on classification of company business units ( or products) into four categories based on combinations of market growth and market share relative to the largest competitor.Topic 1: What is strategy?BCG MatrixAccording to The pote

36、ntial of the businesses: market growthThe position of the company in these businesses: market shareJudge The suitability of current business portfolioThe cash contribution of different businessesDecide the future portfolio and development strategyTopic 1: What is strategy?案例：IBM的PC產業 BCG的精華在于動態的觀點。由

37、于產品生命周期變動的緣故，某些行業逐漸由問題行業長成為明星行業，而明星行業會隨著產品生命周期的循環，成長率逐漸降低，進入成熟期，轉化為金牛行業，等到了產品衰退期，產品開始沒落，就有現金牛行業轉為瘦狗行業。這正如IBM的PC產業，在80年代初時，由于它的剛出現，市場需求很大，因此IBM大力研發，使之成為明星產業；但隨著時間的推移，越來越多的廠商都能進行大規模生產，雖然IBM占有70%的市場份額，但PC行業的增長率變得很低，逐年變為現金牛事業，到八十年代后期與整個九十年代，由于沒有模仿障礙，毫無差異化，IBM創造了競爭者崛起的機會，這使得它在PC行業的市場占有率逐漸下降，伴隨著PC部門極低的增長率

38、，PC行業基本無利可圖，淪為了瘦狗行業。因此，果斷處理掉PC部門絕對是一個明智之舉。Critiques to BCG MatrixThe difficulty of defining market, market share and growth rateToo simple to label the status high or lowFocusing on the surface not the potential (innovation capability and so on)Topic 1: What is strategy?General ElectricPlanning Mode

39、l MatrixThe GE matrix is an alternative model developed in the 1970s.It introduces a three by three matrix, which now includes a medium category. Growth/share are replaced by market attractiveness/ competitive positionTopic 1: What is strategy?General ElectricPlanning Model MatrixFactors reflecting

40、industry attractivenessMarket growth rate, industry size and profitability. Such as market growth rate, industry size and profit, competition, technology, social environment and etc.Factors reflecting business competitive advantageMarket share, profit rate, competitiveness, technology, managementTop

41、ic 1: What is strategy?45Business-unit strategiesCost leadershipIntended to generated competitive advantage by achieving cost that lower than all competitors, Based on operational efficiencyDifferentiationBased on the ability to distinguish your product or service from competitors.focused or niche s

42、trategyThis is either a cost-leadership or differentiated strategy that focuses on a small subsection of the overall market or niche.Topic 1: What is strategy?Cost leadership strategy Low-cost competitive strategy Aimed at broad mass market Aggressive construction of efficient-scale facilities Cost

43、reduction Cost minimizationTopic 1: What is strategy?47Major Risks of Cost Leadership StrategyThere can only be one cost leaderTechnological change can eliminate cost advantageSpillovers lead to imitationEfficiency focus may create blind spots : customer preferencesTopic 1: What is strategy?Differen

44、tiation Strategy Broad mass market Unique product or service Charge premiums Lower customer sensitivity to priceTopic 1: What is strategy?49Pitfalls of Differentiation StrategiesDifferentiating on characteristics not valued by buyers (e.g., HP)Over-differentiating Price premium is too highFailing to

45、 signal valueFocusing on product instead of entire value chain50Focused Business-Level StrategiesA focus strategy must exploit a narrow targets differences from the balance of the industry by:isolating a particular buyer groupisolating a unique segment of a product lineconcentrating on a particular

46、geographic marketfinding their “niche”51Major Risks of Focused StrategiesFirm may be “outfocused” by competitorsLarge competitor may set its sights on your niche marketPreferences of niche market may change to match those of broad marketTypes of Business-Level StrategiesCostUniquenessDifferentiation

47、Cost LeadershipFocused DifferentiationFocused Cost LeadershipIntegrated Cost Leadership/ DifferentiationBroadTargetNarrowTargetCompetitive AdvantageCompetitiveScope10Topic 1: What is strategy?53Topic 2: Strategic leadershipLearning objectiveDescribe the importance of strategic leadership to an organ

48、ization. (Level 2)Required readingTextbook : Chapter 1 Page 8Leader VS. ManagerThere is a common saying：“manager do things right，leaders do the right thing.”DiscussionIs there a difference between them?Who is more important ？Analysis: leader: who decides what needs to be done. Manager: who focus on

49、how getting it doneThese questions have no one definite answer. Textbook P9:As Adrian Grace, managing director of Bank of Scotland, proffers :Success in business is 25% strategy but 75% execution.Strategic leadershipStrategic leadership is the ability to anticipate, envision, maintain flexibility, a

50、nd empower others to create strategic change as necessary.Effective strategic leadership is the foundation for successfully using the strategic management process:Topic 2: Strategic leadershipKey Strategic Leadership Actions Determining strategic direction (long-term vision) Exploiting and maintaini

51、ng core competencies, Developing human capital and social capital Sustaining an effective organizational culture Emphasizing ethical practice Establishing balanced organizational control (financial vs. strategic control)Topic 2: Strategic leadershipStrategic leaders functions 1. Manage the firms ope

52、rations effectively; 2. Sustain a high performance over time; 3. Make better decisions than their competitors; 4. Make courageous, pragmatic decisions; 5. Understand how their decisions affect the internal systems in use by the firm; and 6. Solicit feedback from peers, superiors and employees about

53、their decisions and visions. Topic 2: Strategic leadership61Topic 3: Developing strategyLearning objectiveDescribe the steps required to develop and manage strategy. (1.3)Describe various tools used in developing and assessing and organizations strategy (1.5)Required readingNo required readingTopic

54、3: Developing strategySteps in developing and managing strategyEnvironmental scanningStrategy formulationStrategy implementationStrategy evaluationTopic 3: Developing strategy64Environment scanningExternal scanning tools: PESTEL analysis Porters five forces analysisInternal scanning tools: Resources

55、 & Capabilities analysis Value chain analysis Topic 3: Developing strategyExternal environment Scanning Topic 3: Developing strategy67Macro-environmentIndustryMarketFirmExternal environment: Levels68Macro-environment: PESTEL frameworkPolitical (P)Government stabilityTaxation policyTrade regulationSo

56、cial (S)DemographicsLifestyle changesSocial trendsEducation levelsConsumerismEnvironmental (E)Environmental regulationWaste managementEnergy issuesEconomical ()GNP trendsInflationUnemploymentTechnological (T)Rate of technological changesTechnology transfer policyGovernment and industry spending on r

57、esearch and developmentLegal (L)Employment LawsHealth and safety69The macro-environment affects the industry environment which affects the firmR. Grant, Contemporary Strategy Analysis, 2000 From macro-environment to industry analysisNational/ International EconomyTechnologyGovernmentNatural environm

58、entSocial & demographical structureFirmIndustryenvironmentPorters Five Forces of Competition FrameworkSUPPLIERSPOTENTIALENTRANTSSUBSTITUTESBUYERSINDUSTRYCOMPETITORSRivalry amongexisting firmsBargaining power of suppliersBargaining power of buyersThreat ofnew entrantsThreat ofsubstitutesTopic 3: Deve

59、loping strategyTHREAT OF ENTRYCapital requirementsEconomies of scaleAbsolute cost advantageProduct differentiationAccess to distribution channelsLegal/ regulatory barriersRetaliationSUBSTITUTECOMPETITION Buyers propensity to substitute Relative prices & performance of substitutesBUYER POWER Buyers p

60、rice sensitivity Relative bargaining powerINDUSTRY RIVALRYConcentrationDiversity of competitorsProduct differentiationExcess capacity & exit barriersCost conditionsSUPPLIER POWER Buyers price sensitivity Relative bargaining power The Structural Determinants of CompetitionTopic 3: Developing strategy