Strategy and Management Control System Overview Priyanka Darshana

Strategy and Management Control System Overview Priyanka Darshana MBA (Aus), ACMA (UK), CGMA, B B Marketing (Kelaniya) 1

Module aim This module aims to impart knowledge, competencies, and skills relating to the notion of strategy and its connections with the practices of management controls in the organization, with reference to strategy concepts and emerging management control system practices.

Intended learning outcome By the end of this module, a student should be able to do the following: • 1. Understand why, how and what concepts of strategy developed worldwide, making everybody strategic conscious • 2. Understand why, how and what concepts of management control systems developed worldwide making everybody control conscious • 3. Articulate the relationship between strategy and MCS, with an emphasis on the changing nature of management control systems

Tasks Involved in Strategic Management & MCS Defining business and stating a Vision/mission Setting measurable objectives Crafting a strategy to achieve objectives Implementing a strategy Evaluating performance of the strategy, reviewing new developments and taking corrective action

Defining the mission/vision and objectives of the organization • Defining the mission and vision is the starting point of the strategy development • Mission statement address the purpose or objective of existence. • Vision is desired end state of the business

Mc. Donald’s Mission Statement “Our mission is to be our customers’ favorite place and way to eat & drink. We’re dedicated to being a great place for our people to work; to being a strong, positive presence in your community; and to delivering the quality, service, cleanliness and value our customers have come to expect from the Golden Arches – a symbol that’s trusted around the world. ” Apple Mission Statement Apple is committed to bringing the best personal computing experience to students, educators, creative professionals and consumers around the world through its innovative hardware, software and Internet offerings. "

BBC’s purpose statement “To educate, inform and entertain” Walt Disney’s Purpose Statement “To make people happy”

Vision statement –Desired end state of the business Developing vision document §Where you need to be and how you would like to see by 2020 §What do you need achieve/accomplished by next 10 years “VISION 2020” To become a most sought-after private health care brand in Sri Lanka

Vision, objectives and strategic road map VISION 2020 Objectives Strategic road map “What will be your achievements’

Objectives § Common shared objective (Goal congruence not the sub optimization) § Strategic Objectives and Financial objectives § SMART objectives

Strategic Objectives Focused on improving long term competitive business position. 1. Wining a X % of Market share 2. Achieving lower COP than competitor 3. Having a wider products line than competitor 4. Increase the brand position in the market 5. Consistently introducing new or improved products to market

Financial Objectives • Outcome focused on improving financial results of firm. 1. 2. 3. 4. 10% growth in turn over (YOY) Increasing PAT by 5% (YOY) Increasing EPS by 10% (YOY) Increasing Dividend yield and up ward trading the share price

Tourism in Sri Lanka: Strategic road map 2025 Vision 2025 It is hoped that Sri Lanka will be identified as a place for memorable, authentic and diverse tourism experiences by 2025. Mission Fundamentally, the ambitions of this TSP are to increase revenue for the country, support local communities, and increase tourism on a sustainable platform.

Stakeholders involvement § Tourist § Communities § Investors § Workforce § Government

Strategic Objectives 4 Years Strategic Plan to achieve the objectives

The essence of strategy of the organization Perspective strategy or rational view An emergent view

Rational perspective

Management accounting and strategy • Objectives - Specific statement of what the organisation aims to achieve, often quantified and relating to a specific period of time (SMART) • Strategies - Strategy is the direction and scope of an organisation over the long term which achieves advantage for the organisation through its configuration of resources within a changing environment to fulfil stakeholder expectations. G. Johnson and K. Scholes Exploring Corporate Strategy 6 th edition

The essence of strategic management-a perspective view • Major decisions - What business will we operate in? - What are our basic directions for the future - What systems and structures should we have in place to support our strategies? • Corporate strategy - Decisions about the types of businesses to operate in, which businesses to acquire and divest, and how best to structure and finance the organisation