Following on from ‘Developments in IT and the impact on performance management – part 1’ (see ‘related links’), this article looks at some more recent developments in IT; specifically process automation, artificial intelligence (AI), data visualisation and the internet of things. Process automation Process automation is the concept of processes being performed by machines rather…
This article explains what professional marks are, how they are awarded in the Strategic Professional exams and to remind potential candidates how best to achieve these additional, and often crucial, marks. Professional marks were introduced to the ACCA Qualification to allow candidates to demonstrate – and the ACCA examining team to assess – particular professional…
This article looks at what you can do to improve your chances of passing ACCA’s Strategic Professional exams. Strategic Professional exams are a step up from the Applied Skills level and candidates require a different approach to these exams in order to pass and move on towards becoming an ACCA member. A useful resource is…
A major part of performance management involves managing employees and managers, as their performance will have a major effect on the performance of the organisation as a whole. This article looks at how reward schemes can be used to influence the behaviour of employees Meaning of reward schemes A broad definition of reward schemes is…
This article looks at the nature of human resource management, and at the link between human resource management and performance management. It then examines aspects of the staff appraisal system, and considers the impact of these on the performance of an organisation. Nature of human resource management Human resource management is defined by Bratton as…
Activity-based management (ABM) can be defined as the entire set of actions that can be taken on a better informed basis using ABC information. The aim is to achieve the same level of output with lower costs. During the 1980s, many businesses started to introduce activity-based costing (ABC) systems. The aim of these was to…
This article is intended to help students understand environmental management accounting, its increasing importance, and new developments. The global profile of environmental issues has risen significantly during the past two decades, precipitated in part by major incidents such as the Bhopal chemical leak (1984) and the Exxon Valdez oil spill (1989). These events received worldwide…
Prediction and prevention Students are required to be familiar with failure prediction models based on both quantitative and qualitative information, and also to comprehend the underlying factors leading to the decline and eventual demise of a company. In this article, the various failure prediction models are critically discussed and an attempt is made to identify…
This article explains why increasing recognition is given to satisfying the needs of different stakeholders. Recent years have witnessed major changes in business structure. In general, today’s businesses are far more complex in terms of both structure and operation. Increasing recognition is given to satisfying the needs of different stakeholders who include customers, suppliers, employees,…
A focus on the success of airlines such as EasyJet and Ryanair and how the balanced scorecard might be utilised to maintain the low-cost carriers’ competitive edge. The emergence in the 1990s of low-cost airlines and the expansion of the European travel market has shown how competition can significantly affect the structure of an industry….
This article outlines the issues which are central to the understanding and assessment of performance measurement. It has become increasingly important for organisations to develop systems of performance measurement which not only reflect the growing complexity of the business environment but also monitor their strategic response to this complexity. The need for good performance management…
This article provides a brief overview of two models which can assist accountants, not only in the determination of business strategy, but also in the appraisal of business performance. Porter’s Five Forces Model The use of Porter’s five forces model (see Figure 1) will help identify the sources of competition in an industry or sector….
The term ‘charity’ refers to the practice of benevolent giving. Charities are established for general or specific philanthropic purposes. They are one type of not-for-profit organisation, but with several additional distinguishing features: they exist entirely to benefit defined groups in society as their purposes are philanthropic, they can usually avail themselves of favourable tax treatment,…
This article explains some of these features. The first part of the article broadly describes the generic characteristics of not-for-profit organisations. The second part of the article takes a specific and deeper look at charities, which are one of the more important types of not-for-profit organisations. Several papers in the ACCA Qualification may feature questions…
Public sector organisationsPublic sector organisations come in many shapes and forms. The most obvious examples are schools and hospitals, police forces and local transport providers, but there are many less visible organisations such as regulatory bodies. The objectives of public sector organisations are very different from those of commercial organisations, and this can make performance…
Transfer prices are almost inevitably needed whenever a business is divided into more than one department or division In accounting, many amounts can be legitimately calculated in a number of different ways and can be correctly represented by a number of different values. For example, both marginal and total absorption cost can simultaneously give the…
The second part of an article on Economic Value Added (EVA focuses on how to interpret the calculated EVA and its use as both an organisational and divisional performance measure. Relevant to ACCA Qualification Paper P5 In the first part of this article, we considered the rise in popularity of Economic Value Added – or…
In the first part of two articles, we look at an alternative performance measurement system, Economic Value Added – or EVA – which has gained widespread use among companies such as Siemens, Coca Cola and Herman Miller. Relevant to ACCA Qualification Paper P5 A successful performance measure evaluates how well an organisation performs in relation…
In this second article on the risks of uncertainty, we build upon the basics of risk and uncertainty addressed in the first article published in April 2009 to examine more advanced aspects of incorporating risk into decision making In particular, we return to the use of expected values and examine the potential impact of the…
Clearly, risk permeates most aspects of corporate decision making (and life in general), and few can predict with any precision what the future holds in store Risk can take myriad forms – ranging from the specific risks faced by individual companies (such as financial risk, or the risk of a strike among the workforce), through…
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