ACCTBA3 Chapter 1
Chapter 1
Lecture Notes
i. Strategy
2. Definition ii. A strategy is a “game plan” that enables a company to attract customers by distinguishing itself from competitors.
1. Customer value propositions iii. Companies that adopt a customer intimacy strategy strive to understand and respond to individual customer needs better than competitors. Examples of companies that pursue this strategy include:
Ritz-Carlton, Nordstrom, and Starbucks.
iv. Companies that adopt an operational excellence strategy strive to deliver products and services faster, more conveniently, and at a lower price than competitors. Examples of companies that pursue this strategy include:
Southwest Airlines, Wal-Mart, and The Vanguard Group.
v. Companies that adopt a product leadership strategy strive to offer higher quality products than competitors. Examples of companies that pursue this strategy include:
BMW, Cisco Systems, and W.L. Gore.
i. Organizational structure
2. Decentralization
Decentralization is the delegation of decision-making authority throughout an organization by giving managers the authority to make decisions relating to their area of responsibility.
3. The functional view of organizations
An organizational chart shows how responsibility is divided among managers and it shows formal lines of communication.
4. Line and staff relationships
An organization chart also depicts line and staff positions in an organization.
A person in a line position is directly involved in achieving the basic objectives of the organization.
A person in a staff position is indirectly involved in achieving those basic objectives. Staff positions support line positions, but they do not have authority over them.
5. The Chief Financial Officer
The Chief Financial Officer (CFO) is the member of the top management team who is responsible for providing timely and relevant data to support planning and control activities and for preparing financial statements for external users.
The controller
Lecture Notes
i. Strategy
2. Definition ii. A strategy is a “game plan” that enables a company to attract customers by distinguishing itself from competitors.
1. Customer value propositions iii. Companies that adopt a customer intimacy strategy strive to understand and respond to individual customer needs better than competitors. Examples of companies that pursue this strategy include:
Ritz-Carlton, Nordstrom, and Starbucks.
iv. Companies that adopt an operational excellence strategy strive to deliver products and services faster, more conveniently, and at a lower price than competitors. Examples of companies that pursue this strategy include:
Southwest Airlines, Wal-Mart, and The Vanguard Group.
v. Companies that adopt a product leadership strategy strive to offer higher quality products than competitors. Examples of companies that pursue this strategy include:
BMW, Cisco Systems, and W.L. Gore.
i. Organizational structure
2. Decentralization
Decentralization is the delegation of decision-making authority throughout an organization by giving managers the authority to make decisions relating to their area of responsibility.
3. The functional view of organizations
An organizational chart shows how responsibility is divided among managers and it shows formal lines of communication.
4. Line and staff relationships
An organization chart also depicts line and staff positions in an organization.
A person in a line position is directly involved in achieving the basic objectives of the organization.
A person in a staff position is indirectly involved in achieving those basic objectives. Staff positions support line positions, but they do not have authority over them.
5. The Chief Financial Officer
The Chief Financial Officer (CFO) is the member of the top management team who is responsible for providing timely and relevant data to support planning and control activities and for preparing financial statements for external users.
The controller