Aligning Strategy and Performance Management †MyAssignmenthelp

Question: Discuss about the Aligning Strategy and Performance Management. Answer: Introduction NAB had decided to lay off 6000 jobs to increase the profit by choosing digitalization and automation over more manual labor. AS per the authorities the baking industry was under the pressure to reshape its business, and that these jobs cut offs will happen over a period of three years and not immediately. The company aims to move 60 percent of its business online in the times to come and the total cost of redundancies would be equal to $800 million, but the underlying cash profit would reach an all-time high of $6.6 billion. The main reasons why the bank is removing 6000 jobs because there is external pressure on the banking industry to reshape its structure and move towards digitalization, this will help in reducing the overall cost of having these many employees and will also help in reducing the total efforts that the company puts. Digitalization is the trend of this century and to curb competition and perform excellent in the market the company needs to make sure that they are opting for automation and because of that they must lay off so many of their employees and cut off jobs(Dichev, 2017). The main stakeholder who would be affected by this scenario would be the employees of the company as they were losing their jobs and their source of livelihood, the bank has just announced that 6000 jobs would be cut off and that would affect the employees as there is no job security. The other stakeholders include: The shareholders These people would be affected if the company goes into loss due to this restructuring and they will end up receiving little income on their investment. Thus, their primary concern would be that the company is making profit so that they get good returns. The bank has also decided to go for increase its total amount of investments by a billion-internal investment program, so that would also affect the position of the investors in the company. The shareholders should get adequate returns for their money and that is their only concern(Abbott Kantor, 2017). The customers The customers should get good services from the banks, in case the bank is going for restructuring, the banks plans to halve the number of products that it sells and move a larger portion of its business online. So in a way that would affect the company and make it more vulnerable to the demands of the customers(Chiapello, 2017). The stakeholder theory suggest that the main aim of any business is to create as much value for its stakeholders, to succeed and be more sustainable over time. The business should try to align the interest of its various stakeholders with the overall policies of the business so that they get what the ultimately deserve from the organization. The demands of the stakeholders and the policies of the business should move in a similar direction(Alexander, 2016). All the policies framed by the company should have their stakeholders in preference. In case the same is applied to the NAB case the likely motivation for each of the group would be Shareholders In case the business goes for digitalization, initially there will be restructuring cost but as time will pass, the company will earn more profit and they will earn more return so the banks policy are in sync with the demands of the investor, to provide them better returns. Customers The customers will also benefit from this change, as online is the new trend and it makes it easier for the customers to avail the services that the bank provides. So we see in a way it would be beneficial for them. Initially there might be few issues but ultimately this will help the customers in solving large amount of problems(Maynard, 2017). The company will be benefited as they will have an opportunity to curb competition and go as per the demands of the market in this century. This process of digitalization will help in reducing a lot of cost going forward and that can be seen from the high cash profit that the company has recorded(Vieira, et al., 2017). In this new age world the people are shifting towards the online business and are find it more easy and time saving to perfrom and get these services on the internet, so that should be helpful for the business from the customer point of view who will get their desired services easily. It is also important that companies should do proper online research before taking such steps that might affect their future growth prospects and opportunities. The second accounting theory that can be applied to this case is the corporate governance theory as per which the company should follow such rules and principles that will help in balancing the needs and interests of all the stakeholders dependent on the company that will include customers, shareholder management, suppliers, government, investors etc(Chariri, 2017). The same can be applied to the NAB case where the aim of the management should be to balance out the needs of all the stakeholders by providing them equal importance when forming policies for the business. The needs of all the stakeholders should be balanced. In case same is applied to NAB the management with going for automation to increase the profit and curb the competition should look for ways that can provide better job security to the customers who are dependent on the company. This decision by the company would be beneficial for one set of stakeholders and the other one will suffer because of it(Chron, 2017). Out of all the theories the best theory that will apply to this case of NAB would be the corporate governance theory and the management should form its business policies based on the demand of all the people who are associated with it and working for it. The customers, the employees, the public, the investors each of them have their separate needs from the company and the aim of the management should be to balance out each of them. The company is going for digitalization and opting for automation but that in turn is affecting the revenue of the company and the life of so many employees of the company who must give on their job for the sake of this decision(Dichev, 2017). Thus, the company should follow corporate governance that will help in balancing the needs of the stakeholders and provide them with the desired results. The stakeholder theory is more focused on the needs of individual stakeholder rather than considering them as one and balancing the same. Thus, based on this it can be said corporate governance is the best policy for the company(Delone Mclean, 2004). Conclusion The third accounting theory that can be applied is the agency theory as per which one of stakeholder will act as a representative of the other stakeholder and present their demands infront of the management. In this way each of the stakeholder would be able to understand the needs of the other party who is affected by the decisions of the company and management.The agent has the responsibility to act in behalf of the principal and see to it that the personal needs of the agents are not influencing the needs of the principal. In this case the investors and the shareholders who are putting forward the demand of automation should see to it that their needs do not affect the needs of the other people who are concerned with the business and that includes the employees and the general public. Out of all the theories the theory of corporate governace is best as per which the demands of all the stakeholders of the company should be balanced and equal importance should be given to each of the m , so that in the end each of them is benefited from this decision. References Abbott, M. Kantor, A., 2017. Fair Value Measurement and Mandated Accounting Changes: The Case of the Victorian Rail Track Corporation. Australian accounting Review. Alexander, F., 2016. The Changing Face of Accountability. The Journal of Higher Education, 71(4), pp. 411-431. Chariri, A., 2017. FINANCIAL REPORTING PRACTICE AS A RITUAL: UNDERSTANDING ACCOUNTING WITHIN INSTITUTIONAL FRAMEWORK. Journal of Economics, Business and Accountancy, 14(1). Chiapello, E., 2017. Critical accounting research and neoliberalism. Critical Perspectives on Accounting, Volume 43, pp. 47-64. Chron, 2017. five-common-features-internal-control-system-business. [Online] Available at: https://smallbusiness.chron.com/five-common-features-internal-control-system-business-430.html [Accessed 07 december 2017]. Delone, W. Mclean, E., 2004. Measuring e-Commerce Success: Applying the DeLone McLean Information Systems Success Model. International Journal of Electronic Commerce, 9(1). Dichev, I., 2017. On the conceptual foundations of financial reporting. Accounting and Business Research, 47(6), pp. 617-632. Maynard, J., 2017. Financial accounting reporting and analysis. second ed. United Kingdom: Oxford University Press. Vieira, R., ODwyer, B. Schneider, R., 2017. Aligning Strategy and Performance Management Systems. SAGE Journals, 30(1).