How Technological Change, Globalisation, and Customer Expectations Influence Management Accounting of Tesla Motors
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This report explores the influence of technological change, globalisation, and customer expectations on the management accounting of Tesla Motors. It discusses the limitations of traditional budgetary control systems and the use of activity-based costing. It also proposes the adoption of a Balanced Scorecard approach to measure the performance of the organization.
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INTRODUCTION....................................................................................................................................3
MAIN BODY...........................................................................................................................................3
How technological change, globalisation and customer expectations will influence management
accounting of company........................................................................................................................3
Memo for the management of Tesla Motors........................................................................................4
How the adoption of a Balanced Scorecard approach could be used to measure the performance of
the organisation....................................................................................................................................8
Proposes a Balanced Scorecard for Tesla Motors..............................................................................10
CONCLUSION......................................................................................................................................12
REFERENCES.......................................................................................................................................13
MAIN BODY...........................................................................................................................................3
How technological change, globalisation and customer expectations will influence management
accounting of company........................................................................................................................3
Memo for the management of Tesla Motors........................................................................................4
How the adoption of a Balanced Scorecard approach could be used to measure the performance of
the organisation....................................................................................................................................8
Proposes a Balanced Scorecard for Tesla Motors..............................................................................10
CONCLUSION......................................................................................................................................12
REFERENCES.......................................................................................................................................13
INTRODUCTION
It is important for an organisation to manage their performance in effective manner as it help
in gaining better position within business environment. This report is based on Tesla which is an
American electric vehicle as well as clean energy company based in Palo Alto, California. Respective
organisation is well known or specialised in electric vehicle manufacturing, battery energy storage
from home to grid scale and by its acquisition of SolarCity, solar panel as well as solar roof tile
manufacturing. It was founded in 2003 and serving at worldwide level.
Respective report will going to discuss how technological change, globalisation and customer
expectation will influence management accounting of an organisation. Along with this, memo will
also design which include limitation in use of traditional budgetary control system in modern
workplace as well as also discuss activity based costing. Furthermore, balance scorecard approach will
critically examine and there use also in measuring performance of company.
MAIN BODY
How technological change, globalisation and customer expectations will influence management
accounting of company
Tesla, Inc., is an American electric vehicle and clean energy organization situated in Palo Alto,
California. This organization has some expertise in electric vehicle fabricating, battery life storing
from home to network scale and, through its securing of Solar City, sunlight based board and sun
oriented rooftop tile producing. Tesla motors is the one part that deals in automotive functions.
The vehicle business has consistently been of the most open enterprises to developing advances.
From the starting of twentieth century, innovation has re-imagined the manner in which vehicles are
fabricated, worked and kept up. Innovation has just re-imagined the manner in which vehicles use
fuel, with electric, half breed and sun based vitality frameworks starting to uproot the inner burning
motor and gas-took care of motors as the main thrust of things to come. Still, the evolving nature of
this industry not stopped (Zainuddin and Sulaiman, 2016). There are many new technologies will be
coming up in future like autonomous technology, self-driving systems on radar etc.
Since the 1980s, the car business has advanced due to solid moves towards globalization. With
further continuous globalization, the car business faces significantly increasingly complex issues over
the world, with extensive complications for its future position. The current overall situation of
depression has negative effect on worldwide market opportunities, Vast creation overcapacity and
Volatile crude material costs. Furthermore, the worldwide car organizations will enter new markets, in
It is important for an organisation to manage their performance in effective manner as it help
in gaining better position within business environment. This report is based on Tesla which is an
American electric vehicle as well as clean energy company based in Palo Alto, California. Respective
organisation is well known or specialised in electric vehicle manufacturing, battery energy storage
from home to grid scale and by its acquisition of SolarCity, solar panel as well as solar roof tile
manufacturing. It was founded in 2003 and serving at worldwide level.
Respective report will going to discuss how technological change, globalisation and customer
expectation will influence management accounting of an organisation. Along with this, memo will
also design which include limitation in use of traditional budgetary control system in modern
workplace as well as also discuss activity based costing. Furthermore, balance scorecard approach will
critically examine and there use also in measuring performance of company.
MAIN BODY
How technological change, globalisation and customer expectations will influence management
accounting of company
Tesla, Inc., is an American electric vehicle and clean energy organization situated in Palo Alto,
California. This organization has some expertise in electric vehicle fabricating, battery life storing
from home to network scale and, through its securing of Solar City, sunlight based board and sun
oriented rooftop tile producing. Tesla motors is the one part that deals in automotive functions.
The vehicle business has consistently been of the most open enterprises to developing advances.
From the starting of twentieth century, innovation has re-imagined the manner in which vehicles are
fabricated, worked and kept up. Innovation has just re-imagined the manner in which vehicles use
fuel, with electric, half breed and sun based vitality frameworks starting to uproot the inner burning
motor and gas-took care of motors as the main thrust of things to come. Still, the evolving nature of
this industry not stopped (Zainuddin and Sulaiman, 2016). There are many new technologies will be
coming up in future like autonomous technology, self-driving systems on radar etc.
Since the 1980s, the car business has advanced due to solid moves towards globalization. With
further continuous globalization, the car business faces significantly increasingly complex issues over
the world, with extensive complications for its future position. The current overall situation of
depression has negative effect on worldwide market opportunities, Vast creation overcapacity and
Volatile crude material costs. Furthermore, the worldwide car organizations will enter new markets, in
this manner managing new neighbourhood approaches and import systems that will play both
prohibitive and empowering jobs. Further, the car business must adapt to individual portability, which
is getting progressively separated over the globe.
Over the period of time customer expectations are also changed within automobile industry. The
demand is increase regarding the cars of high power with better performance (Agrifoglio And et.al.,
2017). This changed the way of operating of the different organisations present in this industry. Tesla
is also the one that emerged themselves according to the changes occur in time and industry. This will
provide the opportunity to be innovative always from other and satisfactory in terms of fulfilling the
demand of consumers.
The change is not easy for the organisation (Azudin and Mansor, 2018). The change in any aspect
either technology, global operations and consumer expectations, organisation is needed to made
changes in their internal operating procedures too which is not just associated with the advancement
of production capacities but the many other functions that have equivalent support towards success of
an organisation.
Management accounting is the one concept that evolved over the period of time within an
organisation on terms of usage at different levels. From the use of traditional methods, organisation is
shifted towards the use of new and modern techniques that include job costing, balance scorecard,
benchmarking, ABC analysis, starting and marginal costing, EOQ etc. The use of all these have
effective towards contributing in the success of an organisation through effective allocation of raw
materials to all different production departments on timely basis (Seal, 2017).
Memo for the management of Tesla Motors
(a): Traditional budgetary control system
MEMO
Overview:
Budget is an estimation of total profit and expenses that are going to be incurred over a
specific period of time. In fact, every company like Tesla motor need to make plan for their up-
coming expenditure and investments so that an ideas could be determine effectively. However, it
is important to have proper control system that can help to manage their budget of an
organization (Asogwa and Etim, 2017). Budgetary control is a valuable process by which budget
is formulated for the future as well as compare with the actual performance for examines the
variances. Moreover, there are various key budget that are used are efficiently reliable for the
prohibitive and empowering jobs. Further, the car business must adapt to individual portability, which
is getting progressively separated over the globe.
Over the period of time customer expectations are also changed within automobile industry. The
demand is increase regarding the cars of high power with better performance (Agrifoglio And et.al.,
2017). This changed the way of operating of the different organisations present in this industry. Tesla
is also the one that emerged themselves according to the changes occur in time and industry. This will
provide the opportunity to be innovative always from other and satisfactory in terms of fulfilling the
demand of consumers.
The change is not easy for the organisation (Azudin and Mansor, 2018). The change in any aspect
either technology, global operations and consumer expectations, organisation is needed to made
changes in their internal operating procedures too which is not just associated with the advancement
of production capacities but the many other functions that have equivalent support towards success of
an organisation.
Management accounting is the one concept that evolved over the period of time within an
organisation on terms of usage at different levels. From the use of traditional methods, organisation is
shifted towards the use of new and modern techniques that include job costing, balance scorecard,
benchmarking, ABC analysis, starting and marginal costing, EOQ etc. The use of all these have
effective towards contributing in the success of an organisation through effective allocation of raw
materials to all different production departments on timely basis (Seal, 2017).
Memo for the management of Tesla Motors
(a): Traditional budgetary control system
MEMO
Overview:
Budget is an estimation of total profit and expenses that are going to be incurred over a
specific period of time. In fact, every company like Tesla motor need to make plan for their up-
coming expenditure and investments so that an ideas could be determine effectively. However, it
is important to have proper control system that can help to manage their budget of an
organization (Asogwa and Etim, 2017). Budgetary control is a valuable process by which budget
is formulated for the future as well as compare with the actual performance for examines the
variances. Moreover, there are various key budget that are used are efficiently reliable for the
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company.
Traditional budget control system: It happens to be a crucial methods used by the
company for the preparation of the budget in which previous year budget is taken as base. Only
those items are included that are required to be justified as well as over and above the last year
reports. Basically, it involves overall estimation of sales, expenses and profit that are incurred by
the company. For instance, Tesla motors need to make use of this particular budget to analyse
their previous year performance as well as make specific modification for inflation in the
business. Budgeting is a key to the survival of Telsa motors from the point of preparation of the
point of implementation. As accounting systems is heavily relies on cost standards, target
estimation and performance that enable effective decision making within resources limit.
However, it is an instrumental to performance analysis, development of strategies and control
mechanism and many more for the Tesla motors.
There are certain criticism against use of traditional budgeting that is often lead to
dysfunctional attitude between their staffs, consumer evaluation times, affects the overall
flexibility as well as adaptability of the Tesla motors in any give business situation.
Limitation:
Here are certain limitations that are associated with the use of traditional budgetary control
system.
Inefficiency: It has been seen that preparation of traditional budget tends to consumes too
much time as well as use plenty of Tesla motors resources such as version control issues,
accurate formulation are some key problems associated with this budget. However, only a little
percent of the people involved in this process believe that the time spent is valuable (Hänninen,
2013).
Low chance of responsiveness: Tesla motors have a yearly budgeting period and this would aim
frequently makes the budget outdated soon after it has been formed. Also, it is not possible for
2/3rd of total Tesla motors to investigate the details of their budgets in a real time.
Failure to motivate desirable behaviour: The traditional budgets control system has
failed to increase the motivation level among the people to act in their company’s interest as it
could encourage unprofessional behaviour in the budget cost. It will also enable knowledge
sharing, but it would reinforce departmental barriers in Tesla motors.
Less connection from the strategic plan: The managers of Tesla motors are so obsessed with
recording the values in accurate manner; they are often missing the strategic objective of
Traditional budget control system: It happens to be a crucial methods used by the
company for the preparation of the budget in which previous year budget is taken as base. Only
those items are included that are required to be justified as well as over and above the last year
reports. Basically, it involves overall estimation of sales, expenses and profit that are incurred by
the company. For instance, Tesla motors need to make use of this particular budget to analyse
their previous year performance as well as make specific modification for inflation in the
business. Budgeting is a key to the survival of Telsa motors from the point of preparation of the
point of implementation. As accounting systems is heavily relies on cost standards, target
estimation and performance that enable effective decision making within resources limit.
However, it is an instrumental to performance analysis, development of strategies and control
mechanism and many more for the Tesla motors.
There are certain criticism against use of traditional budgeting that is often lead to
dysfunctional attitude between their staffs, consumer evaluation times, affects the overall
flexibility as well as adaptability of the Tesla motors in any give business situation.
Limitation:
Here are certain limitations that are associated with the use of traditional budgetary control
system.
Inefficiency: It has been seen that preparation of traditional budget tends to consumes too
much time as well as use plenty of Tesla motors resources such as version control issues,
accurate formulation are some key problems associated with this budget. However, only a little
percent of the people involved in this process believe that the time spent is valuable (Hänninen,
2013).
Low chance of responsiveness: Tesla motors have a yearly budgeting period and this would aim
frequently makes the budget outdated soon after it has been formed. Also, it is not possible for
2/3rd of total Tesla motors to investigate the details of their budgets in a real time.
Failure to motivate desirable behaviour: The traditional budgets control system has
failed to increase the motivation level among the people to act in their company’s interest as it
could encourage unprofessional behaviour in the budget cost. It will also enable knowledge
sharing, but it would reinforce departmental barriers in Tesla motors.
Less connection from the strategic plan: The managers of Tesla motors are so obsessed with
recording the values in accurate manner; they are often missing the strategic objective of
budgeting. It has been noticed that it would basically aims on cost reduction instead of value
creation.
(b): Activity based management and costing
MEMO
Concept:
In accounting recording, activity based management (ABM) is tends to be essential
method that is used by internal department to analyse their daily business activities. The primary
motive behind using this method is to evaluate all the key activities that are performed within an
organization. In fact, the Tesla motors need to analyse the value added or non-value activities
that has increase the customer’s value of the Tesla products and services. However, once the
activity has been determine as being either value or non-value could be aimed on increasing the
performance of the company (Kumar and Mahto, 2013). Moreover, the basic purpose of using
ABM is to eliminate the inaccurate materials as well as improve the efficiency and overcome the
wasteful spending on non-value operations.
Activity-based costing: This particular method is used to assign overhead as well as indirect
costs that are incurred by the company during their manufacturing process such as utilities and
wages to the workers. In financial terms, this system of costing is based on all the key activities
that are performed by the Tesla motors during the production of their products. However, it has
been seen that ABC tends to follow two-stage cost evaluation process as well as allot resources
values such as factory overhead to activity cost to examine the value of resources incurred within
the project planning.
Use of ABM and ABC in attaining strategic objectives:
Both these methods uses to improve the Tesla motors overall performance for the attainment of
future strategic objectives. It would also guide valuable efforts to adopt business strategies to
fulfil the competitive pressures as well as improve their operations departments. The Tesla
motors could also be able to examine the cost information that is used by the management for
their operation control. However, accuracy of traditional cost management for decision-making
is quite limited to the financial objectives only. Under the key head of Tesla motors operation, it
would lead to the tendency to develop wide range products sizes and tends to continue
unprofitable product lines in the near future.
creation.
(b): Activity based management and costing
MEMO
Concept:
In accounting recording, activity based management (ABM) is tends to be essential
method that is used by internal department to analyse their daily business activities. The primary
motive behind using this method is to evaluate all the key activities that are performed within an
organization. In fact, the Tesla motors need to analyse the value added or non-value activities
that has increase the customer’s value of the Tesla products and services. However, once the
activity has been determine as being either value or non-value could be aimed on increasing the
performance of the company (Kumar and Mahto, 2013). Moreover, the basic purpose of using
ABM is to eliminate the inaccurate materials as well as improve the efficiency and overcome the
wasteful spending on non-value operations.
Activity-based costing: This particular method is used to assign overhead as well as indirect
costs that are incurred by the company during their manufacturing process such as utilities and
wages to the workers. In financial terms, this system of costing is based on all the key activities
that are performed by the Tesla motors during the production of their products. However, it has
been seen that ABC tends to follow two-stage cost evaluation process as well as allot resources
values such as factory overhead to activity cost to examine the value of resources incurred within
the project planning.
Use of ABM and ABC in attaining strategic objectives:
Both these methods uses to improve the Tesla motors overall performance for the attainment of
future strategic objectives. It would also guide valuable efforts to adopt business strategies to
fulfil the competitive pressures as well as improve their operations departments. The Tesla
motors could also be able to examine the cost information that is used by the management for
their operation control. However, accuracy of traditional cost management for decision-making
is quite limited to the financial objectives only. Under the key head of Tesla motors operation, it
would lead to the tendency to develop wide range products sizes and tends to continue
unprofitable product lines in the near future.
ABC tends to encourage Tesla motors to implement world class production tools and
techniques while producing their products. The current costing systems will mislead the
operating administration towards the direct labor efficiency as well as avoid the additional
expense or costs within the organization (Almeida and Cunha, 2017). With the rapid growth in
production of products has shown a great sign of potential in the international market for the
Tesla motors. They need to realize and acknowledge their implication on their management at
macro level and costing at micro level. ABC would also provide specific information regarding
monitoring as well as controlling the primary resources of Tesla motors that are considered as
valuable sources of competitive market. Therefore, it is important to have a well-organize system
that can guide and control the additional cost so that chances of profitability could be increased
in the future for the Tesla.
techniques while producing their products. The current costing systems will mislead the
operating administration towards the direct labor efficiency as well as avoid the additional
expense or costs within the organization (Almeida and Cunha, 2017). With the rapid growth in
production of products has shown a great sign of potential in the international market for the
Tesla motors. They need to realize and acknowledge their implication on their management at
macro level and costing at micro level. ABC would also provide specific information regarding
monitoring as well as controlling the primary resources of Tesla motors that are considered as
valuable sources of competitive market. Therefore, it is important to have a well-organize system
that can guide and control the additional cost so that chances of profitability could be increased
in the future for the Tesla.
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How the adoption of a Balanced Scorecard approach could be used to measure the performance of the
organisation
Balanced scorecard is strategic management performance metric which utilise for identifying
as well as improving several internal functions of company as well as also external outcomes. In
addition to this, balance scorecards are also used for measuring as well as providing feed back to
business firm. For gaining quantitative results it is important to collect data which manager as well as
other executives will gather and interpret (Akkermans and Van Oorschot, 2018). Utilise gathered
information for better decision making of company. In simple term it can be said that, balanced
scorecard utilised for attaining objectives, measurements, initiatives as well as goals which result
through four primary function of company. Business firm can identify hindrances which hamper
business performance and outline strategic changes which tracked through future scorecards. Most of
the organisations use balance Scorecard as it have long been utilised in strategic business management
for tracking key performance indicators as well as this framework is designed for providing a
framework to manage resources.
Tesla, Inc., is an American electric vehicle and clean energy organization situated in Palo Alto,
California. This organization has some expertise in electric vehicle fabricating, battery life storing
from home to network scale and, through its securing of Solar City, sunlight based board and sun
oriented rooftop tile producing. Tesla motors is the one part that deals in automotive functions.
There are four basic viewpoint of balance scorecard i.e., financial perspective, customer
perspective, internal process perspective, learning and growth or innovation perspective (Hansen and
Schaltegger, 2016).
Financial perspective: How to increase profit and shareholder value? – There are several ways
through which Tesla can increase their profit and shareholders value such as increase sales
(attract investors, long term success, require capital, Metric unit sold), increase capital (metric
total equity, fund research, operations, infrastructure), reduce manufacturing costs
(manufacturing cost, substantial raw material, personnel and assembly costs), increase
economic/ government incentives (Metric: grant revenue, price competitively, increase
demand), maximise debt (metric: debt to equity ratio and covenants).
Customer perspective: how do customers see us? – It includes customer’s value, satisfaction
and retention. All these are important for Tesla as well as play essential role in their long term
sustainability within business environment. Increase customer retention (high quality products,
customer loyalty, customer services), generating new customers (offering innovative products,
increase product range, differentiation from competitors) (Cooper, Ezzamel and Qu, 2017).
organisation
Balanced scorecard is strategic management performance metric which utilise for identifying
as well as improving several internal functions of company as well as also external outcomes. In
addition to this, balance scorecards are also used for measuring as well as providing feed back to
business firm. For gaining quantitative results it is important to collect data which manager as well as
other executives will gather and interpret (Akkermans and Van Oorschot, 2018). Utilise gathered
information for better decision making of company. In simple term it can be said that, balanced
scorecard utilised for attaining objectives, measurements, initiatives as well as goals which result
through four primary function of company. Business firm can identify hindrances which hamper
business performance and outline strategic changes which tracked through future scorecards. Most of
the organisations use balance Scorecard as it have long been utilised in strategic business management
for tracking key performance indicators as well as this framework is designed for providing a
framework to manage resources.
Tesla, Inc., is an American electric vehicle and clean energy organization situated in Palo Alto,
California. This organization has some expertise in electric vehicle fabricating, battery life storing
from home to network scale and, through its securing of Solar City, sunlight based board and sun
oriented rooftop tile producing. Tesla motors is the one part that deals in automotive functions.
There are four basic viewpoint of balance scorecard i.e., financial perspective, customer
perspective, internal process perspective, learning and growth or innovation perspective (Hansen and
Schaltegger, 2016).
Financial perspective: How to increase profit and shareholder value? – There are several ways
through which Tesla can increase their profit and shareholders value such as increase sales
(attract investors, long term success, require capital, Metric unit sold), increase capital (metric
total equity, fund research, operations, infrastructure), reduce manufacturing costs
(manufacturing cost, substantial raw material, personnel and assembly costs), increase
economic/ government incentives (Metric: grant revenue, price competitively, increase
demand), maximise debt (metric: debt to equity ratio and covenants).
Customer perspective: how do customers see us? – It includes customer’s value, satisfaction
and retention. All these are important for Tesla as well as play essential role in their long term
sustainability within business environment. Increase customer retention (high quality products,
customer loyalty, customer services), generating new customers (offering innovative products,
increase product range, differentiation from competitors) (Cooper, Ezzamel and Qu, 2017).
Internal business process – In this motive of Tesla is to satisfy their stakeholders and
customers for which business process have to be excel at operational, improving brand,
innovation processes and social responsibility. objective behind this is to improve
manufacturing efficiency, enhance manufacturing productivity, improve design efficiency,
develop new as well as innovative product and services for their customers. For all these Tesla
have to take some initiatives such as monitor manufacturing for reducing defects, daily
monitoring of completed automobiles and many more.
Learning and growing – It is important for Tesla to change and improve some areas for
achieving their vision. Thus, focus area are includes employee efficiency, employees
satisfaction and customer acceptance. Behind implementation of all these Tesla have several
objectives such as enhancing staff member efficiency, employee’s satisfaction and customer
acceptance. Thus, for implementing all these Tesla have to take initiatives such as appropriate
training, informative commercials, word of mouth information and many more.
Thus, implementation of Balance scorecard will be beneficial for Tesla as it provide assistance in
several manner such as financial perspective, customer perspective, internal process perspective,
learning and growth or innovation perspective. Apart from this, there are several advantages and
disadvantages explanation of these are as follows :-
Advantages – There are several advantages which Tesla will gain after implementation of Balance
Scorecard approach within there working. Explanation of these are as follows :-
Provide clear picture – Application of balanced scorecard posit that this is systematic as well
as methodological tool which provide clear picture to Tesla. Along with this, it provide
assistance to Tesla as how they have to meet goals and action plan will design to accomplish
these goals (Keyes, 2016). Moreover, balance Scorecard has different legs or perspectives,
measurement are shown separately as well as make it easier to understand and visualize.
Indicates company performance – It provide assistance to manager of Tesla as they will be
able to monitor staff member performance and design plan of action which help them in
tracking their success in term of finance. For every organisation finance is their backbone and
everyone wants success in terms of finance.
Disadvantages - There are several disadvantages also through which Tesla will go after
implementation of Balance Scorecard approach within there working. Explanation of these are as
follows :-
customers for which business process have to be excel at operational, improving brand,
innovation processes and social responsibility. objective behind this is to improve
manufacturing efficiency, enhance manufacturing productivity, improve design efficiency,
develop new as well as innovative product and services for their customers. For all these Tesla
have to take some initiatives such as monitor manufacturing for reducing defects, daily
monitoring of completed automobiles and many more.
Learning and growing – It is important for Tesla to change and improve some areas for
achieving their vision. Thus, focus area are includes employee efficiency, employees
satisfaction and customer acceptance. Behind implementation of all these Tesla have several
objectives such as enhancing staff member efficiency, employee’s satisfaction and customer
acceptance. Thus, for implementing all these Tesla have to take initiatives such as appropriate
training, informative commercials, word of mouth information and many more.
Thus, implementation of Balance scorecard will be beneficial for Tesla as it provide assistance in
several manner such as financial perspective, customer perspective, internal process perspective,
learning and growth or innovation perspective. Apart from this, there are several advantages and
disadvantages explanation of these are as follows :-
Advantages – There are several advantages which Tesla will gain after implementation of Balance
Scorecard approach within there working. Explanation of these are as follows :-
Provide clear picture – Application of balanced scorecard posit that this is systematic as well
as methodological tool which provide clear picture to Tesla. Along with this, it provide
assistance to Tesla as how they have to meet goals and action plan will design to accomplish
these goals (Keyes, 2016). Moreover, balance Scorecard has different legs or perspectives,
measurement are shown separately as well as make it easier to understand and visualize.
Indicates company performance – It provide assistance to manager of Tesla as they will be
able to monitor staff member performance and design plan of action which help them in
tracking their success in term of finance. For every organisation finance is their backbone and
everyone wants success in terms of finance.
Disadvantages - There are several disadvantages also through which Tesla will go after
implementation of Balance Scorecard approach within there working. Explanation of these are as
follows :-
Expensive and time consuming – It can be said that implementation of balance scorecard is
expensive as well as time consuming procedure. This is major disadvantage of respective
approach for Tesla.
Poor support from staff members - Implementation of balance Scorecard approach is not
even supported by staff members in Tesla within appropriate manner (Singh and et. al., 2018).
Because learning and understanding of Balance Scorecard required time and training which is
major reason behind on supported by employees.
Proposes a Balanced Scorecard for Tesla Motors
Introduction
Balanced scorecard is strategic management performance metric which utilise for identifying
as well as improving several internal functions of company as well as also external outcomes. In
addition to this, balance scorecards are also used for measuring as well as providing feed back to
business firm.
SLIDE 1
Financial perspective: How to increase profit and shareholder value? – There are several ways
through which Tesla can increase their profit and shareholders value such as increase sales
(attract investors, long term success, require capital, Metric unit sold), increase capital (metric
total equity, fund research, operations, infrastructure)
Customer perspective: how do customers see us? – Increase customer retention (high quality
products, customer loyalty, customer services), generating new customers (offering innovative
products, increase product range, differentiation from competitors).
Internal business process – In this motive of Tesla is to satisfy their stakeholders and
customers for which business process have to be excel at operational, improving brand,
innovation processes and social responsibility. Objective behind this is to improve
manufacturing efficiency, enhance manufacturing productivity, improve design efficiency,
develop new as well as innovative product and services for their customers. For all these Tesla
have to take some initiatives such as monitor manufacturing for reducing defects, daily
monitoring of completed automobiles and many more.
Learning and growing – It is important for Tesla to change and improve some areas for
achieving their vision. Thus, focus area are includes employee efficiency, employees
satisfaction and customer acceptance. Behind implementation of all these Tesla have several
objectives such as enhancing staff member efficiency, employee’s satisfaction and customer
acceptance. Thus, for implementing all these Tesla have to take initiatives such as appropriate
training, informative commercials, word of mouth information and many more.
expensive as well as time consuming procedure. This is major disadvantage of respective
approach for Tesla.
Poor support from staff members - Implementation of balance Scorecard approach is not
even supported by staff members in Tesla within appropriate manner (Singh and et. al., 2018).
Because learning and understanding of Balance Scorecard required time and training which is
major reason behind on supported by employees.
Proposes a Balanced Scorecard for Tesla Motors
Introduction
Balanced scorecard is strategic management performance metric which utilise for identifying
as well as improving several internal functions of company as well as also external outcomes. In
addition to this, balance scorecards are also used for measuring as well as providing feed back to
business firm.
SLIDE 1
Financial perspective: How to increase profit and shareholder value? – There are several ways
through which Tesla can increase their profit and shareholders value such as increase sales
(attract investors, long term success, require capital, Metric unit sold), increase capital (metric
total equity, fund research, operations, infrastructure)
Customer perspective: how do customers see us? – Increase customer retention (high quality
products, customer loyalty, customer services), generating new customers (offering innovative
products, increase product range, differentiation from competitors).
Internal business process – In this motive of Tesla is to satisfy their stakeholders and
customers for which business process have to be excel at operational, improving brand,
innovation processes and social responsibility. Objective behind this is to improve
manufacturing efficiency, enhance manufacturing productivity, improve design efficiency,
develop new as well as innovative product and services for their customers. For all these Tesla
have to take some initiatives such as monitor manufacturing for reducing defects, daily
monitoring of completed automobiles and many more.
Learning and growing – It is important for Tesla to change and improve some areas for
achieving their vision. Thus, focus area are includes employee efficiency, employees
satisfaction and customer acceptance. Behind implementation of all these Tesla have several
objectives such as enhancing staff member efficiency, employee’s satisfaction and customer
acceptance. Thus, for implementing all these Tesla have to take initiatives such as appropriate
training, informative commercials, word of mouth information and many more.
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SLIDE 2
Financial perspective: How to increase profit and shareholder value?
Increase sales - attract investors, long term success, require capital, Metric unit sold.
Increase capital - metric total equity, fund research, operations, infrastructure.
Customer perspective: how do customers see us?
Increase customer retention - High quality products, customer loyalty, customer services.
Generating new customers - Offering innovative products, increase product range,
differentiation from competitors.
Financial perspective: How to increase profit and shareholder value?
Increase sales - attract investors, long term success, require capital, Metric unit sold.
Increase capital - metric total equity, fund research, operations, infrastructure.
Customer perspective: how do customers see us?
Increase customer retention - High quality products, customer loyalty, customer services.
Generating new customers - Offering innovative products, increase product range,
differentiation from competitors.
CONCLUSION
After going through entire discussion it has been summarised that, there are several factors
which have wide impact on management accounting of an organisation such as technology change,
globalisation as well as customer experience. Along with this, an organisation has to design memo for
their proper management as it assist in managing things within more effective manner. Moreover,
using traditional budgetary control system have some limitation within modern workplace
implementation. Every company have some strategic objectives for achieving these organisation use
activity based management approach because it will help them in same manner. In addition to this,
balanced scorecard approach utilise for measuring performance of an business firm.
After going through entire discussion it has been summarised that, there are several factors
which have wide impact on management accounting of an organisation such as technology change,
globalisation as well as customer experience. Along with this, an organisation has to design memo for
their proper management as it assist in managing things within more effective manner. Moreover,
using traditional budgetary control system have some limitation within modern workplace
implementation. Every company have some strategic objectives for achieving these organisation use
activity based management approach because it will help them in same manner. In addition to this,
balanced scorecard approach utilise for measuring performance of an business firm.
REFERENCES
Books and Journals
Akkermans, H. A. and Van Oorschot, K. E., 2018. Relevance assumed: a case study of balanced
scorecard development using system dynamics. In System Dynamics (pp. 107-132). Palgrave
Macmillan, London.
Hansen, E. G. and Schaltegger, S., 2016. The sustainability balanced scorecard: A systematic review
of architectures. Journal of Business Ethics, 133(2), pp.193-221.
Cooper, D. J., Ezzamel, M. and Qu, S. Q., 2017. Popularizing a management accounting idea: The
case of the balanced scorecard. Contemporary Accounting Research, 34(2), pp.991-1025.
Keyes, J., 2016. Implementing the IT balanced scorecard: Aligning IT with corporate strategy. CRC
Press.
Singh, S. And et. al., 2018. Fuzzy-based sustainability evaluation method for manufacturing SMEs
using balanced scorecard framework. Journal of Intelligent Manufacturing, 29(1), pp.1-18.
Zainuddin, Z. N. and Sulaiman, S., 2016. Challenges faced by management accountants in the 21st
century. Procedia Economics and Finance, 37, pp.466-470.
Agrifoglio, R. And et.al., 2017. How emerging digital technologies affect operations management
through co-creation. Empirical evidence from the maritime industry. Production Planning &
Control, 28(16), pp.1298-1306.
Seal, W., 2017. Agent or victim?: Shared services and management accounting. In The Role of the
Management Accountant (pp. 233-245). Routledge.
Azudin, A. and Mansor, N., 2018. Management accounting practices of SMEs: The impact of
organizational DNA, business potential and operational technology. Asia Pacific Management
Review, 23(3), pp.222-226.
Asogwa, I.E. and Etim, O.E., 2017. Traditional Budgeting in Today's Business Environment. Journal
of Applied Finance and Banking. 7(3). p.111.
Hänninen, V., 2013. Budgeting at a crossroads-The viability of traditional udgeting-A case study.
Kumar, N. and Mahto, D.G., 2013. Current trends of application of Activity Based Costing (ABC): A
review. Global Journal of Management and Business Research Accounting and
Auditing. 13(3).
Almeida, A. and Cunha, J., 2017. The implementation of an Activity-Based Costing (ABC) system in
a manufacturing company. Procedia manufacturing. 13. pp.932-939.
Books and Journals
Akkermans, H. A. and Van Oorschot, K. E., 2018. Relevance assumed: a case study of balanced
scorecard development using system dynamics. In System Dynamics (pp. 107-132). Palgrave
Macmillan, London.
Hansen, E. G. and Schaltegger, S., 2016. The sustainability balanced scorecard: A systematic review
of architectures. Journal of Business Ethics, 133(2), pp.193-221.
Cooper, D. J., Ezzamel, M. and Qu, S. Q., 2017. Popularizing a management accounting idea: The
case of the balanced scorecard. Contemporary Accounting Research, 34(2), pp.991-1025.
Keyes, J., 2016. Implementing the IT balanced scorecard: Aligning IT with corporate strategy. CRC
Press.
Singh, S. And et. al., 2018. Fuzzy-based sustainability evaluation method for manufacturing SMEs
using balanced scorecard framework. Journal of Intelligent Manufacturing, 29(1), pp.1-18.
Zainuddin, Z. N. and Sulaiman, S., 2016. Challenges faced by management accountants in the 21st
century. Procedia Economics and Finance, 37, pp.466-470.
Agrifoglio, R. And et.al., 2017. How emerging digital technologies affect operations management
through co-creation. Empirical evidence from the maritime industry. Production Planning &
Control, 28(16), pp.1298-1306.
Seal, W., 2017. Agent or victim?: Shared services and management accounting. In The Role of the
Management Accountant (pp. 233-245). Routledge.
Azudin, A. and Mansor, N., 2018. Management accounting practices of SMEs: The impact of
organizational DNA, business potential and operational technology. Asia Pacific Management
Review, 23(3), pp.222-226.
Asogwa, I.E. and Etim, O.E., 2017. Traditional Budgeting in Today's Business Environment. Journal
of Applied Finance and Banking. 7(3). p.111.
Hänninen, V., 2013. Budgeting at a crossroads-The viability of traditional udgeting-A case study.
Kumar, N. and Mahto, D.G., 2013. Current trends of application of Activity Based Costing (ABC): A
review. Global Journal of Management and Business Research Accounting and
Auditing. 13(3).
Almeida, A. and Cunha, J., 2017. The implementation of an Activity-Based Costing (ABC) system in
a manufacturing company. Procedia manufacturing. 13. pp.932-939.
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