Instructor for this course
more

Over the past thirty years, private and public sector organizations have spent billions of dollars implementing a wide range of management tools and practices in efforts to improve their performance. The benefits of this massive investment were not usually fully realized, and many initiatives failed. Surveys by both Bain & Co. and McKinsey estimate that only 25 to 30 percent of all change programs succeed. Reasons for project failure include ineffective leadership, lack of commitment, and poor implementation.

Many firms rush to purchase and implement performance management tools without considering a fundamental question – which problem are we trying to solve? The purpose of this course is to provide an overview of the key building blocks of a robust performance management process, and includes takeaways that can be used at work.

The course starts with an overview of the organizational levels where performance should be measured, and includes an explanation of how the levels fit into a hierarchy. Transfer pricing techniques are then explored, followed by how to implement internal profitability. Return on investment is reviewed, including a discussion of how residual income can compare the impacts of project of different sizes.

The course concludes with an overview of the balanced scorecard, which focuses on the interaction of customer, internal processes, innovation and financial perspectives. The course content covers performance management topics tested in the Certified Management Accountant (CMA) Part 1 examination.

Topics include:
• Responsibility Centers.
• Transfer Pricing.
• Internal Profitability Analysis.
• Return on Investment and Residual Income.
• The Balanced Scorecard.

Course Key Concept: Balanced scorecard, business unit analysis, contribution margin, controllable fixed costs, cost plus transfer pricing method, dual rate transfer pricing method, full cost transfer pricing method, goal congruence, key performance indicators (KPI’S) , market price transfer pricing method, negotiated price transfer pricing method, non-controllable allocated fixed costs, non-controllable fixed Costs, residual income, return on investment (ROI), transfer pricing, variable cost transfer pricing method.

Other Performance Management topics tested in the Certified Management Accountant (CMA) Part 1 Examination courses by Tom Coghlan.
Standard Cost and Variance Analysis

Learning Objectives

  • Identify and explain different types of responsibility centers.
  • Identify segments that organizations evaluate, including product lines, geographical areas, or other meaningful segments.
  • Recognize transfer pricing and the objectives of transfer pricing.
  • Identify and calculate transfer prices using variable cost, full cost, market price, negotiated price, and dual-rate.
  • Recognize the issues in determining product, customer and business unit profitability.
  • Recognize and calculate return on investment (ROI) and residual income (RI), and compare and contrast the benefits and limitations of ROI and RI as measures of performance.
  • Recognize the relationships between the strategic plan, key performance indicators, and the balanced scorecard.
  • Explore the concept of the balanced scorecard and identify and describe its four perspectives.
Last updated/reviewed: Aug 30, 2020

4 Reviews (23 ratings)Reviews

4
Anonymous Author
Well presented and thoughtful content, but a little tough to absorb in a 6 hour span. May be better in individual modules.
5
Anonymous Author
Excellent review of standard costs, variance analysis, budgeting, and management reporting. Worthwhile course.
5
Member's Profile
Great materials, liked doing the review questions in smaller increments.
4
Anonymous Author
Very good course materials. A lot was covered in very logical flow.

Prerequisites

Course Complexity: Intermediate

No advanced preparation or prerequisites are required for this course.

Education Provider Information

Company:
Illumeo, Inc., 75 East Santa Clara St., Suite 1215, San Jose, CA 95113
Contact:
For more information regarding this course, including complaint and cancellation policies, please contact our offices at (408) 400- 3993 or send an e-mail to .
Course Syllabus
Introduction and Overview
  2:53Introduction to Corporate Performance Management
  19:12Responsibility Centers
  quizREVIEW QUESTIONS: Responsibility Centers
  14:54Transfer Pricing
  quizREVIEW QUESTIONS: Transfer Pricing
  7:36Internal Profitability Analysis
  9:08Return on Investment and Residual Income
  14:07The Balance Score Card
  quizREVIEW QUESTIONS: The Balanced Scorecard
CONTINUOUS PLAY
  1:07:50Corporate Performance Management
SUPPORTING MATERIALS
  PDFSlides: Corporate Performance Management
  PDFCorporate Performance Management Glossary/Index
REVIEW AND TEST
 examFINAL EXAM