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Certainly providing information and analysis in some of the categories listed in Table 1 presents particular challenges. In general terms, the type of information that will be useful in strategy formulation is more broad-based and informal than internal, narrowly defined and historical data.

Network Management: Accounting and Performance Strategies (Paperback)

Enterprise resource planning systems facilitate the integration of internal information in an organisation, allowing easier generation of data about customers and suppliers.

However, identifying future opportunities requires stepping outside the regular systems of information recording and processing in such systems.

Broadening the basis of the management accounting system also requires abandoning the belief that everything of value can be measured in monetary terms.

Hoque, Beyond these concerns, environmental impacts that have no direct cost to the organisation but impose costs on the public or future generations externalities are increasingly important to organisations when they are considering strategy.

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A challenge facing strategic management accounting, and accounting more broadly, is how to represent these almost unquantifiable issues in reports and decisions. A strategic approach to management accounting also requires collection of data from the external environment.

However, it also requires an element of informal collection of information by individuals in the organisation who are part of larger networks of contacts. Making connections between events in the wider environment to trigger the identification of opportunities cannot be programmed into a system.

The management accounting information and tools that will be most appropriate will depend on the organisational context and purpose. For example, even though broad based, outward looking data may be important in choosing a cost leadership strategy, its implementation requires accurate and timely cost information as part of tight controls and formal systems.

This approach fits well with the traditional management accounting techniques of budgeting and variance analysis. The paradox of strategic management accounting is that, while the need for it is clear, exactly what it is, is not!

Challenges in advanced management accounting

It is not uncommon, however, for service functions like management accounting to evolve with the changes in organisations, just as the organisations are changing in response to the pressures they face. Not defining SMA too closely allows the flexibility that is needed to apply appropriate tools and change them as needed.

The comparison with a strictly traditional approach to management accounting highlights some stark differences in the focus and types of information useful for SMA. However, it is important to distinguish between the role of SMA in supporting the formulation of strategy and its implementation.

These can be disk usage, link utilization, CPU time, etc. Performance management[ edit ] Performance management is focused on ensuring that network performance remains at acceptable levels.

It enables the manager to prepare the network for the future, as well as to determine the efficiency of the current network, for example, in relation to the investments done to set it up.

The network performance addresses the throughput , network response times, packet loss rates, link utilization, percentage utilization, error rates and so forth. This information is usually gathered through the implementation of an SNMP management system , either actively monitored, or configured to alert administrators when performance moves above or below predefined thresholds.

Actively monitoring current network performance is an important step in identifying problems before they occur, as part of a proactive network management strategy.

By collecting and analysing performance data, the network health can be monitored. Trends can indicate capacity or reliability issues before they affect services. Also, performance thresholds can be set in order to trigger an alarm.

The alarm would be handled by the normal fault management process see above. Alarms vary depending upon the severity of the problem.

Security management[ edit ] Security management is the process of controlling access to assets in the network. Data security can be achieved mainly with authentication and encryption. Security management is not only concerned with ensuring that a network environment is secure, but also that gathered security-related information is analyzed regularly.

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Security management functions include managing network authentication, authorization, and auditing, such that both internal and external users only have access to appropriate network resources. Other common tasks include the configuration and management of network firewalls, intrusion detection systems, and security policies such as access lists.Lewis, J.

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Balboni, B. Security Considerations: Nohria, R.

Wakeup Call: Strategic Management, Network Alarms, and Performance

Oesterle, M. How to Position Active and Passive Monitoring Chetty, S. The next section takes a perspective that may be controversial, that is, that some customers may not be worth having!