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and HewlettPackard
Prepared by:
CHARISMA ARISTA
HENRIKUS GALIH IRAWAN
RIFKY ANDRIAN
17 December 2016
Management Control
System
MM UGM JAKARTA-INTER 1
Prepared by:
Other differences of HP and TI in relation to the management control system are the
differences of product life cycle, where HP more tended to create a new product and then
replaced it when it matured and TI tend to enter early in a products life cycle, and stayed
through maturity. In the strategy differences of cost and price, HP desired cost improvements,
but sought higher margins and held prices longer while TI emphasized aggressive cost
improvements with equally aggressive price cuts. On the product or process matrix
differences, HP concentrated on flexible production processes to match low-volume, more
custom products need and TI concentrated on more capital-intensive, cost effective
production processes to match high-volume standard product needs. And the other one, in the
positioning and resources movement strategy, both HP and TI have their own different
strategy. HP sought all high-growth, high-margin businesses that met their own resource
needs, largely on an individual basis and on the contrary TI sought a balanced portfolio of
business where mature, large businesses provide resources for young, high-growth
businesses.
Since we know that both HP and TI have their own strategy to be implemented in their
business, then they also have differences of implication such as the implication strategic
planning system (table 2), the implication for budgeting (table 3), the implication for
reporting (table 4) and the implication for incentive compensation and performance
evaluation (table 5).
Management will measure on short term period by measuring financial performance, but
have less compensating systems compared to rival, HP.
From both explanations above, we cant judge which one is better, because different
strategies will impact into different results, and in order to decide what strategies that one
company should applied or not, it should be measured by many factors. Different strategies
also need different efforts and considering internal and external environment.