Responsibility for analysis of performance. (20-30 minutes) KariAnna Nedregotten is the new corporate controller of a multinational company that has just overhauled its organisational structure. The company is now decentralised. Each division is under an operating vicepresident who, within wide limits, has responsibilities and authority to run the division like a separate company.

Nedregotten has a number of bright staff members. One of them, Signy Henriksen, is in charge of a newly created performance-analysis staff. Henriksen and staff members prepare monthly division performance reports for the company president. These reports are division income statements, showing budgeted performance and actual results, and they are accompanied by detailed written explanations and appraisals of variances. In the past, each of Henriksen’s staff members was responsible for analysing one division; each consulted with division line and staff executives and became generally acquainted with the division’s operations.

After a few months, @yvind Hedby, vice-president in charge of Division C, stormed into the controller’s office. The gist of his complaint follows:

‘Your staff are trying to take over part of my responsibility. They come in, snoop around, ask hundreds of questions, and take up plenty of our time. It’s up to me, not you and your detectives, to analyse and explain my division’s performance to central headquarters. If you don’t stop trying to grab my responsibility, [ll raise the whole issue with the president’

REQUIRED 1. What events or relationships may have led to Hedby’s outburst?

2. As Nedregotten, how would you answer Hedby’s contentions?

3. What alternative actions can Nedregotten take to improve future relationships? lo2