Internet-Based Contracting Issues

It is often suggested that one of the most important aspects of a Strategic Performance Measurement System (SPMS), and specifically a Balanced Score Card (BSC), is its ability to “translate strategy into action” in other words Strategic Alignment. A necessary step in developing this strategic alignment is to determine cause-and-effect relationships inherent in the organisation’s activities and by extension in its various organisational sub-units (usually expressed by way of a strategy map). Having identified these cause-and-effect relationships, the BSC is used to identify and then implement a relevant and comprehensive set of leading and lagging key performance indicators (KPIs) across the financial and various non-financial perspectives. And then most importantly, these various activities and perspectives, with their relevant KPIs, are linked to the incentive system of the organization. Kaplan and Norton make the strong point that a BSC can only really impact the organizational performance if it is linked to the manager’ intrinsic and extrinsic incentives.

As part of these considerations, the goal of achieving goal congruence between managers and the organisation, and between subsidiaries and the parent company is important. As goals differ between managers and between subsidiaries, control and goal congruence can be achieved by differentiating the compensation packages to

various managers (both parent and subsidiary managers) according to their roles and contribution to the overall stratagies of the organisation and it’s subsidiaries. And to add further complication, the cultural distance beween the parent division and the subsidiaries of a multinational corporation and the location of the foreign subsidiary would also have an effect on the compensation system.

Research Activity

Undertake a search of the relevant literature to determine what are the major issues related to the implementation of Strategic Performance Measurement Systems (SPMSs), such as the Balanced Scorecard, in respect to management performance evaluation and compensation, in multi-national organisations.

Prepare a Report/Essay

Having completed your research you are then required to prepare a paper that outlines the major issues related to the implementation of Strategic Performance Measurement Systems (SPMSs) ), such as the Balanced Scorecard, in respect to management performance evaluation and compensation, in multi-national organisations.

Your paper should include a brief discussion on the nature of SPMSs, such as the Balanced Scorecard, and a detailed discussion on the implications related to strategic alignment, management performance evaluation and compensation, in multi-national organisations.

The paper should be written in fluent grammatical English. It should include a bibliography of referenced sources. Internet resources used should be acknowledged and fully referenced.3 Full copies of internet materials used should be submitted separately as electronic files (eg PDF) in a separate document(s) accompanying the assignment4,

3 Your assignment will then be automatically compared to work of your classmates, previous students from CDU and other universities, with material available on the Internet, both freely available and subscription-based electronic journals as well as texts and other sources. Plagiarism will be penalised.

4 Instructions for creating PDF documents and/or combining documents of different formats are provided on the Learnline site.

5 The length of assignment is an indication of the depth of analysis that is required. It does not include appendices, tables, illustrations or calculations. The length of the assignment is provided only a guide and need not be adhered to exactly. The intention is that students demonstrate that sufficient analysis is undertaken, without excessive workload.

All references and sources must be properly acknowledged. A copy of the final paper should be retained by the author.

The paper should be between 1,500 to 3,000 words

5. The paper may take the form of a report, or an essay. However, the form is irrelevant provided that the information required is provided within the limits given.