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| Author: | Reilly, R. R. Campbell, B. |
| Title: | How corporate performance measurement systems inhibit globalization |
| Journal: | Human Resource Management
1990 : SPRING, VOL. 29:1, p. 63-68 |
| Index terms: | COMPANY PERFORMANCE PERFORMANCE MEASUREMENT INTERNATIONALIZATION MANAGERS ACCOUNTING SYSTEMS RESOURCE ALLOCATION DECISION MAKING |
| Language: | eng |
| Abstract: | The global firm is not constrained by national boundaries as it searches for ideas, talent, capital, and other resources required for its success. However, managers use internal accounting systems to judge the performance of country operations, divisions, departments and plants in their effort to achieve the best overall firm results. Several problems with the accounting-based performance evaluation systems are identified and discussed. Arguments are presented that adherence to these systems leads managers to avoid value-creating opportunities to globalize. This results in poor resource allocation, bad operating decisions, and inappropriate performance rewards. The problems with transfer pricing, overhead allocation etc. are examined. |
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