Traditional accounting based measurements, Operation Management

Assignment Help:

Traditional Accounting Based Measurements and Their Limitations 

Neely (1999) suggests that traditional financial measures of performance are criticised because they: 

  • Encourage short-termist actions
  • Lack strategic focus and fail to provide data on quality, responsiveness and flexibility
  • Encourage local optimism by measuring what can rather than what should be measured
  • Encourage managers to minimise the variances from standard rather than seek to improve continuously
  • Encourage local optimisation by measuring resources separately
  • Fail to provide information on what customers want and how competitors are performing.

 

There is general criticism that financial measures of performance focus on past events rather than the future and that they show the result rather than the cause of management action. 

Eccles (1991) cites several reasons why traditional measures of performance should be changed. Among these are: 

  • The changing nature of work
  • Increased competition
  • The power of information technology
  • National and international awards
  • Changing external (stakeholder) demands
  • Proliferation of improvement initiatives.

Related Discussions:- Traditional accounting based measurements

Explain what capability would an organization have, What capability would a...

What capability would an organization have to have to not need forecasts?

Explain a product at each stage of the plc, Using the product life cycle, d...

Using the product life cycle, describe a product at each stage of the PLC and support your choice.

What additional steps must the quality assurance team take, A quality analy...

A quality analyst wants to construct a sample mean chart for controlling a packaging process. He knows from past experience that the process standard deviation is two ounces. Each

Describe writing process to produce quality documents, Explain your persona...

Explain your personal writing process. What has worked for you in your effort to produce quality documents? What is your biggest writing challenge?

Least factors to a project manager when building a team, Compare and contra...

Compare and contrast attributes that are most and least important to a project manager when building a team. Provide a work or project example to support your answer. Back up your

Explain early retirement, Assume you are the project manager for a software...

Assume you are the project manager for a software company and your team is in charge of delivering an update to tax preparation software for the next tax season. The project team h

Explain authorities under the industrial disputes act, Explain the authorit...

Explain the authorities under the Industrial Disputes Act, 1947. Ans: One of the authorities under the Industrial Disputes Act, 1947 for investigation and settlement of indu

PROJECT MANAGEMENT CPM/PERT CHAT, prepare CPM/PERT chat and determine the s...

prepare CPM/PERT chat and determine the shortest time this project can be completed (using crash time )

Supply Chain Management, #questionLucille Jenkins, the CEO for the Durham I...

#questionLucille Jenkins, the CEO for the Durham International Manufacturing Company (DIMCO), believes that the company can significantly increase its operating profit by implement

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd