Codeman Shurtleff Inc
Report Body:
Management information, including planning and budgeting, can be used for a variety of purposes, such as decision making, control, signaling, education & learning, and, external communication. With respect to J&J’s formal planning and budgeting system, these above-mentioned purposes are all well served.
Johnson & Johnson was organized on the principle of decentralized management and conducted its business through autonomous, integral operating subsidiaries, with which lies direct operation responsibility, and whose reporting line to Johnson & Johnson executive committee. The company operated manufacturing subsidiaries in 46 countries, sold its products in most countries of the world and employed 75,000 people worldwide. And, for Codman & Shurtleff alone, one of J&J’s subsidiaries in question, it competed in 12 major product groups, operated three manufacturing locations and a distribution facility, in a very complex and competitive market, due to many factors including market shift from quality superiority to customer needs led, price sensitive one, and the impacts brought about by legislation changes, etc. Under such a circumstance, from the perspective of corporate management of Johnson & Johnson, how it monitored and measured its subsidiaries’ performances decided not only its own management efficiency, but also how its subsidiaries worked accordingly. Fortunately, based on the considerations of measurability, cost, cause-effect understanding and desired level of innovation, Johnson & Johnson adopted such a bottom-up approach that reflected what its president suggested three basic tenets in their success: 1. belief in decentralized management, 2. a sense of responsibility to key constituents and, 3. a desire to manage for the long term. Contrary to the usual practice of other big multinationals, Johnson & Johnson did not have corporate planning function or a top-down strategic plan, rather, the sum of the
Management information, including planning and budgeting, can be used for a variety of purposes, such as decision making, control, signaling, education & learning, and, external communication. With respect to J&J’s formal planning and budgeting system, these above-mentioned purposes are all well served.
Johnson & Johnson was organized on the principle of decentralized management and conducted its business through autonomous, integral operating subsidiaries, with which lies direct operation responsibility, and whose reporting line to Johnson & Johnson executive committee. The company operated manufacturing subsidiaries in 46 countries, sold its products in most countries of the world and employed 75,000 people worldwide. And, for Codman & Shurtleff alone, one of J&J’s subsidiaries in question, it competed in 12 major product groups, operated three manufacturing locations and a distribution facility, in a very complex and competitive market, due to many factors including market shift from quality superiority to customer needs led, price sensitive one, and the impacts brought about by legislation changes, etc. Under such a circumstance, from the perspective of corporate management of Johnson & Johnson, how it monitored and measured its subsidiaries’ performances decided not only its own management efficiency, but also how its subsidiaries worked accordingly. Fortunately, based on the considerations of measurability, cost, cause-effect understanding and desired level of innovation, Johnson & Johnson adopted such a bottom-up approach that reflected what its president suggested three basic tenets in their success: 1. belief in decentralized management, 2. a sense of responsibility to key constituents and, 3. a desire to manage for the long term. Contrary to the usual practice of other big multinationals, Johnson & Johnson did not have corporate planning function or a top-down strategic plan, rather, the sum of the