9-56 Management Control System at Procter & Gamble
Setting up management control systems and determining measurementmethods and who should be
responsible for particular revenues, costs, and information can bea large task. The structure of the
organization plays a part in how well a particular measure islikely to work. Ensuring that the goals of
the organization are in concert with the management control systemis also an important factor. It is
not possible to evaluate a companyâs management control system froman Internet site. What we can
do, however, is to use a site as an example and apply some of theconcepts of the chapter to measures
and tools that would be possibilities for a fi rm.
1. A well-known and well-established company with worldwideacceptance is Procter & Gamble
(P&G) . Log on to the companyâs Web site at www.pg.com . Locatethe most recent annual report
by following the links under the âInvestor/Shareholder Relationsâtab to âFinancial Reporting.â
Examine the âLetter to Shareholdersâ section of the annual report.What does P&G consider to be
the most important factors that drive their growth strategy? Howdoes P&G ensure that managers
meet the company's objectives?
2. The company has numerous products, and the Web site divides theminto different categories and
brands to help customers find relevant product information. Clickon âBrands and Innovation.â
What are the major categories of brands listed on the Web site?Click on the âHousehold Careâ
category. What are some of the brands in this category that you arefamiliar with? How could a
system be set up to help measure the success of the firmâs goal tobuild brands in the âHousehold
Careâ category? What would be three possible financial measures?What about three nonfinancial
measures?
9-56 Management Control System at Procter & Gamble
Setting up management control systems and determining measurementmethods and who should be
responsible for particular revenues, costs, and information can bea large task. The structure of the
organization plays a part in how well a particular measure islikely to work. Ensuring that the goals of
the organization are in concert with the management control systemis also an important factor. It is
not possible to evaluate a companyâs management control system froman Internet site. What we can
do, however, is to use a site as an example and apply some of theconcepts of the chapter to measures
and tools that would be possibilities for a fi rm.
1. A well-known and well-established company with worldwideacceptance is Procter & Gamble
(P&G) . Log on to the companyâs Web site at www.pg.com . Locatethe most recent annual report
by following the links under the âInvestor/Shareholder Relationsâtab to âFinancial Reporting.â
Examine the âLetter to Shareholdersâ section of the annual report.What does P&G consider to be
the most important factors that drive their growth strategy? Howdoes P&G ensure that managers
meet the company's objectives?
2. The company has numerous products, and the Web site divides theminto different categories and
brands to help customers find relevant product information. Clickon âBrands and Innovation.â
What are the major categories of brands listed on the Web site?Click on the âHousehold Careâ
category. What are some of the brands in this category that you arefamiliar with? How could a
system be set up to help measure the success of the firmâs goal tobuild brands in the âHousehold
Careâ category? What would be three possible financial measures?What about three nonfinancial
measures?
