Management Control System

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Q1. Describe NYTD’s evolution to date. What is the strategy of NYTD? Are the organization and control consistent with the strategy?
Evolution: New York Times first ventured into the Internet in 1995. Back then, the company was calledthe New York Times Electronic Media Company. At first, the organization included four more employees.Later during the first year, Martin Niesenholtz was hired as a president and the project consisted of onlyone webpage; NYTimes.com. Mr. Niesenholtz reported to both the general manager and the editor of the newspaper. Later, Bernie Gwertzman was assigned to direct the editorial operations of NYTimes.com. At this time there was a need for an own newsroom for the digital version of thenewspaper. In 1999, a new operating division, Times Company Digital, was created, which reporteddirectly to corporate management. The new division included NYTimes.com, Boston.com, NYToday.com,GolfDigest.com, WineToday.com, and Abuzz. The new division had a very decentralized structure anddifferent organizational structures but still with similar roles as a common newspaper. The differentwebsites were combined in the new organization to be able to learn from eachother. However, in 2000, the organizational structure changed and “product” manage rs were nominated as well as functionalheads. A lot of effort was then put into creating a culture of team-work and openness, and the NYTDmoved into a new building. This separated unit, first organizationally and then physically, led to tensionsbetween the original Company and the new division. The new culture and employees hired from outsidethe Company created a very competitive internal environment.Strategy: The main strategy of NYTD is to convert printed newspapers into website content that wouldbe displayed over the internet. The NYTD aimed to find new and creative ways to utilize the fullpotential of internet multimedia. The division encouraged conversation and cooperation to inspire newideas between groups of people and they used a decentralized organization. The NYTD is anindependent division. Moreover, NYTD collects customer information through registration. However,registration is free of charge; most revenues come from selling advertisements on the website. Anotherpart of the strategy is to add value through interactive features and functions to the webpage. To create a distinct “Internet culture”, which aimed to be experimental, can also be seen as a strategy. Several ideas were realized but then later discontinued if not profitable. An objective for NYTD was also toenhance the geographical reach.Was it consistent with organization and control? Control was minimized but some processes weredefined. Information was shared and decision-making was to be transparent. The hiring process wasconsistent with the strategy; NYTD wanted to find persons who fitted into the new culture (young, smart,ambitious, with dotcom experience). The organization and location supported the openness of theculture. NYTD had a bottom-up approach to budgeting; ideas were welcome from all areas of theorganization.

Q2. What impact has NYTD had on the rest of the Company?
In the beginning, NYTD was considered a credible part of the corporation. However, in time NYTDcreated a lot of tensions with the original Company . NYTD broke down the “Chinese Wall” that existed

between the editorial and business operations in the original Company; they encouraged collaboration

KASUS 9-1: NEW YORK TIMES
1. Jelaskan evolusi NYTD to-date. Apa strategi NYTD? Apakah organisasi dan kontrol yang konsisten dengan strategi? Evolusi: New York Times pertama berkelana ke Internet pada tahun 1995. Waktu itu, perusahaan ini disebut New York Times Elektronik Media Company. Pada tahun 1999, sebuah divisi operasi baru, Times Perusahaan Digital, diciptakan, yang melaporkan langsung kepada manajemen perusahaan. Divisi baru termasuk NYTimes.com, Boston.com, NYToday.com, GolfDigest.com, WineToday.com, dan beramai-ramai....
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