Accounting for Strategic Management and Control †MyAssignmenthelp.com

Question: Discuss about the Accounting for Strategic Management and Control. Answer: Introduction The report considers the explanation of the Balance Scorecard Approach and the manner of conduct within a business organization. FC High Tech Manufacturer (FCH) is a company leading in the sale of hand phones and manufactures the consumer and industrial goods. It also takes care of that enterprise manufacturing solutions are being provided towards the businesses which aspire to start their own manufacturing facilities. The company has been undertaking the operations of the three segments in a traditional manner and has no motive or vision to undertake the new approaches. There had been a recession situation in the company that has impacted the confidence of the financial markets. There has been a situation where the board of directors had performed an assessment of the situation and concurred that shareholders will be very unwilling to provide additional capital injection, unless the company can justify its request for fresh equity from its shareholders. The same has been discussed in the report below. The report will further take into consideration the conclusion after the implementation of the Balance Scorecard approach in the company. The report will further elaborate the prospective difficulties to be faced by the company in the near future due to the choice of the measures undertaken by the management (Bhasin, 2012). Existing Scenario The company is maintaining the measures such as ROI, EBITDA and Revenue growth tend to motivate managers to focus on short-term returns instead of looking at the long-term goal of maximizing shareholders' wealth. The Return on Income, Earnings before interest and taxes and the growth in revenue will increase the overall efficiency of the company. However, the simple growth in the revenue will not create a stable position and situation for the company as the same will only lead to a growth in the short term goals and objectives of a company. For a company to be effective and stabilized for brighter future, the company needs to attain a position of high stability. The Balance Score approach is the one that undertakes all the efficient features that leads to a strong and effective organization and the same is discussed as under. Significance of the Balanced Score Card Approach The Balance Score card approach of financial analysis takes into account the following considerations: Financial, Customer, Internal Process and the Learning and growth innovations The same is elaborated as under: Financial The segment of the balance score card takes on the financial performances taking place within the organization. The main objective includes the undertaking of the operations and functions that will not let the shareholders to sacrifice their interests. The stakeholders include the environment, government and community etc. Customer The segment of the balance score card takes on the satisfaction of the customers and their attitudes towards the organization and goals of the market. The elements covered by the customers include the acquisition, retention, and profitability, share of the market and the satisfaction of the customers. The maintenance of the following must be done i.e. Quality, Price, Brand, Availability and Services. Internal process The segment of the balance score card takes on the entire coverage of the goals of the internal business. It will have an overview of the internal procedures and processes occurring within the company to have a better development of the company. The major themes include the operations and the customers management process, innovation and social and the regulatory processes. Learning and growth innovation The segment of the balance score card takes on the human and organizational capital along with the training and other systems undertake for the innovation and growth of the entire department. The trainers of the company consider the instilling of the growth and development within the organization (Fiege, 2012). The company must have capabilities related with the human capital, information capital and organization capital. The company and the growth and development will have a major dependency on the actions undertaken by the company. The growth and development of the company will improve with the implementation of strong and significant perspectives that is given above. The growth is mainly dependent on the above perspectives like the improvement in the processes internally and the learning growth and innovation processes. The above processes will lead in the effectiveness of the customers effectiveness and efficiency. The balance scorecard will also help in the following ways: The companys vision will be included in the implementation of the balance score card approach and the same will be identified after proper clarification. The leaders and the management of the company will reach consensus and the changes will affect the performances of the overall company (Flage, 2014). The objectives and the measures under the strategic actions and movement of the company will be communicated and linked that will help in the establishment of effective connectivity with the stakeholders. The same will lead towards the encouragement and refinement in the processes by helping in the promotion of feedbacks received from the stakeholders of the company. The targets are set up and the planning will be done to align the same. The management will take steps to measure and evaluate the desired targets and objectives to link all of them and obtain a large amount of strategic objectives by undertaking numerous measures. The learning and innovation growth of the approach will increase the refinement and growth that will develop and increase the decision making process (Gavurov, 2012). Prospective difficulties that can evolve with the approach There are many issues related with the improper implementation of the balance score card approach and the complexities that the business organizations are likely to face during the implementation of such measures of performances are as below: Ambiguity in the policy and strategy: There are variety of policies and strategies that have a tendency of being highly leveled and they have an approach that has a forward and future looking approach. They even have the risks and threats that are related to the removing and declining of the ability of the translation into the efficient Balance Score card approach in an organization. The effective and the best policy to meet the given situation will require the refinement and revisiting of the policies. The revisiting must be carried with the owners and the management of the organization in order to have a transparency. The direction and the vision of the business organization must be transparent and clear to have an efficient strategy for the overall development of the company (Johnson, 2014). The translation effectiveness will be done after the inclusion of the desired targets and goals of an organization. The targets will be related with the medium, short term and long term targets. It will also include the values of the customers and other segments of the market and customers. Thus, there must be an inclusion of the necessary statements related to the business organization and the horizon of the planning must be in a range within five to ten years in approx. Lack in the defining of the important objectives of the company The strategy and the policy of the company are defined in various manners and the same is related to the organization of the business. A wide range of definitions are reflected with the related mission, vision, goals and other objectives that needs to be communicated to the stakeholders and important management of the business organization. Thus, there must be common language that must explain the requirements of the business organization. The same must be provided with the help of meetings and sessions to have an effective and overall growth of the company (Kaplan, 2012). Complexities evolving in the initial implementation The balance score card is ranged in a wide manner and a variety of criticalities occur within the implementation of such approach. In the initial stages of the implementation there are high possibilities that the management can get lost in the technical and detailed aspects occurring within the present scenario. There are many confusions and difficulties that can arise due to the strategy maps. The strategic themes also further assist the individuals and management to enter into a world of confusions and complexities. The confusions will mostly from the part of the initial levels and stages of the implementation of the balance score card approach (Saunders Cornett, 2014). There must be steps undertaken to solve the complexities and confusions occurring within an organization. The same will be done in a manner that will articulate the use of the approach. The various perspectives of the method of balance score card will be considered by the preparation of the Strategy Map to make the implementation transparent. The sensible and clarity in the picture of the balance score card will be required to be communicated within the business organizations (Ucbasaran et al., 2013). Challenges in the flow of the approach towards the customers The most challenging part is the flow of the implemented policies and strategies among the individuals that will require the engagement of the workforces. The mental and physical strengths will be used and the same will need the mental and physical power and force of the workforces. There will be requirement of the obtaining of the commitment and desired targets of the business organization. The whole approach will turn out to be vague if the individual engagement is not attained or achieved. The non attainment will result in a situation where there will be only the existence of mere records and documents that will be forming part of the period under reporting. Thus, the workforce must be convinced towards the participation in the implementation of the balance score card approach to maintain efficiency (Danaei Hosseini, 2013). Lack in the mechanism of tracking the records There can be scenarios and circumstances that can result in the loss of records of the budgeted and the actual data of the organization. The loss of the track in the mechanism of records can increase in the potential risks and threats of the company. Thus, there must be provision of reminders in small intervals towards the team members to get effectiveness in the implementation of the Balance Score Card. Conclusion Thus, on the basis of the above analysis and evaluation it can be concluded that the Balance Score Card approach is among the most efficient approaches, despite of many potential threats and complexities in the adaptation of the implementation program. The FCH Company must therefore take steps to implement the same by communicating with the employees and other workforces. It will increase the effectiveness and efficiency of the overall company. 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