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Managing Strategic Cost and Performance in eBusiness

Unit Code: LEB602




Duration

Contact Hours

Campus

Prerequisite

Corequisite

12 weeks or equivalent

Minimum of 2 hours per week or equivalent for online students using discussion forum

Lilydale, Off-Campus

 or equivalent

Credit Points: 12.5 Credit Points

Related Course/s:

This unit is for continuing students only and has no new intakes.
A postgraduate unit in the Master of Business (eBusiness and Communication) and the Master of Management at the Graduate Diploma level

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Aims & Objectives:

2006:
This unit is designed for eBusiness managers and takes a strategic and holistic view of cost and performance management in an eBusiness environment. It introduces a strategic management model and system evaluation process that can be applied to address the long-term implications of cost behaviour in relation to key business issues.  This model is applied to managing costs of quality, environment and knowledge. Techniques emerging from particular business cultures and environments are examined, including target costing, benchmarking, Balanced Scorecard and knowledge management. The relationship between models of analysis and decision support systems is examined.

After completing this unit students will be able to:

  • Describe how to take a strategic approach to cost management
  • Apply strategic cost management techniques to improve future performance
  • Understand the nature and role of decision support systems for performance improvement
  • Design systems that meet the needs of strategic decision-makers

 2007:

This unit is designed for business and enterprise managers to actively engage with performance measurement concepts, principles and techniques in ways that will enable them to collaborate with measurement specialists in future performance management activities. The environment assumed for this learning is complex and subject to constant change, and as a consequence attention is given to the evolving nature of performance measurement and its grounding in practice. Many of the concepts studied have emerged from practice and the techniques you will apply are based on research studying successful business practice across different industries and locations in the global economy.

You will begin with an investigation of the concepts of measurement, strategy and performance and the development of an understanding of the mental models demanded of you to think in relation to changing global environments. Balanced scorecard®, key performance indicator and strategy map design will focus your attention on the importance of applying performance measurement techniques that are meaningful in the context of strategic decision making. You will be introduced to the challenges faced in measuring the cost aspect of performance, through study and application of activity based costing and management to different aspects of enterprise management. Target costing is used as an example of an approach that arose out of the need to shift thinking patterns dramatically in order to address a strategic performance dilemma of significant proportions, which in hindsight seems quite straightforward.

Towards the conclusion of the unit your focus will shift to a more asset based view of strategic performance measurement and you will explore asset allocation decisions including risk analysis, financial performance measures and knowledge creation and management. Your study of assets includes consideration of the economic value of both tangible and intangible assets.

On completion of the unit you will be able to:

  • Appreciate the importance of measurement qualities in relation to strategic performance including accuracy, relevance, validity and reliability
  • Understand the complex relationships between the cost and income stream components of performance measurement
  • Distinguish clearly between the measurement of operating and strategic performance, and internal and external strategic performance measurement
  • Think through the measurement issues involved in different business strategies at both a structural and practical level, with flexibility and confidence
  • Design and develop performance measures using balanced scorecard®, strategy maps, triple bottom line, activity based costing and management, target costing and life cycle costing in ways that are useful in an ear of constant change
  • Apply relevant processes to evaluate opportunities in relation to strategic performance in time of uncertainty and complexity.

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Teaching Methods:

On line delivery is supported by a unit outline with CDROM, a unit website with a variety of resources which may include lessons, learning objects (documents and presentations), virtual lectures, threaded discussions and interactive chat rooms. Face-to-face workshops may be conducted in a variety of configurations (weekly or 2 day blocks) subject to demand. International students will attend weekly workshops taking a work-related approach.

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Assessment:

2007:
  • Measuring strategic performance using Balance Scorecard® 30%
  • Strategy development using customer profitability analysis or target costing 30%
  • Strategic performance measurement plan for complex environments – overview and selected aspect (marketing, service configuration, supply chain, logistics, information systems, computer resources, human resources) 40%

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Generic Skills Outcomes:

You will be able to:

  • Take an innovative and multi-viewed approach to the process of measuring strategic enterprise performance
  • Develop an ability to take in and adapt your thinking patterns and measurement designs to take account of informed critique and different points of view
  • Take a professional approach to performance measurement and develop the generic skills of measurement practice
  • Apply measurement concepts and tools across multiple environments, including internal/external in relation to the enterprise and local/global in relation to the market and collaborative partnerships
  • Adapt thinking and application techniques in relation to sustainability and the interconnectedness of systems

     

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Content:

2006:

  • Strategic cost management models and applications
  • Decision support systems
  • Profitability analysis, target costing and Balanced Scorecard
  • Supply chain management and benchmarking
  • Procurement cost management and just-in-time systems
  • System design for cost and performance management with an eBusiness focus

2007:

  • Measurement and strategic response at internet speed using enterprise design conceptual framework (EDCF)
  • Strategic performance measurement using balanced scorecard (BSC)
  • Designing key performance indicators (KPI) in an era of constant change
  • Managing intangible value using strategy maps
  • Accurate product and service costing using activity based costing (ABC)
  • Strategy development using customer profitability analysis
  • Strategic product/service design and response readiness with target costing
  • Strategic performance reviews – activity based management (ABM)
  • Strategic performance focused problem solving – supply chain
  • Measurement and thinking styles for opportunity evaluation
  • Strategic asset allocation systems, sustainability and risk analysis
  • Financial performance measurement and strategic performance – return on investment (ROI) and triple bottom line (TBL)
  • Designing measures to meet the needs of strategic decision makers in eCommerce environments

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Reading Materials:

Ansari, S, Bell, J, Klammer, T & Lawrence, C. 2004, Management Accounting: A Strategic Focus, Houghton Mifflin, Boston, Massachusetts, USA
Hamel, G & Prahalad, CK, ‘Strategic Intent’, Harvard Business Review, Jul/Aug 2005, Vol 83 Issue 7/8, p148-161
Kaplan, RS & Norton, DO. 1996, The Balanced Scorecard: Translating Strategy into Action, Harvard Business School Press, Boston, Massachusetts, USA
Kaplan, RS & Norton, DO. 2004, Strategy Maps: Converting Intangible Assets to Tangible Value, Harvard Business School Press, Boston, Massachusetts, USA
Langfield-Smith, K, Thorne, H & Hilton, RW, 2004, Management Accounting: Australian Perspective, 3rd edn, McGraw-Hill Australia, Sydney
Mankins, MC & Steele, R. ‘Turning Great Strategy into Great Performance’ Harvard Business Review, Jul/Aug 2005, Vol 83, Issue 7/8, p64-72
Slywotzky, AJ & Drzik, J. ‘Countering the Biggest Risk of All’, Harvard Business Review, Apr 2005, Vol 83, Issue 4, p78-88

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