This came about in 1997, when the company was restructured. It was transformed from a 17-product line organisation to one with six divisions, each with responsibility for its own operations. The board's role is to enforce a consistent set of measures, which comprise non-financial as well as financial indicators. Consider SmithKline Beecham. Even so, says CFO Andrew Bonfield, the company is considering creating a corporate-wide initiative dashboard that will allow the directors to review the key performance measures for each business.
Regional differences can also be a problem.
Thirty-nine per cent of surveyed firms are having difficulty coming up with measures that capture the nuances of each region's operations and market conditions, yet are still consistent enough to be comparable across regions. At PSA Peugeot Citroen, for example, regardless of location, one person is responsible for managing production, one individual is in charge of finance, one looks after marketing and sales and so forth. According to Yann Delabriere, this not only allows for consistent management of each of the functions world-wide but makes it easier for senior management to grasp the total costs and revenues from each of the functions. You can't have, in an emerging market like China, the same kind of system that you would have for a mature market like Germany. Gillette approaches the problem from the opposite direction.