Exhibit 4
Management Accounting and Control
Policy Area Typical Japanese
Typical U.S.
Overall reporting strategy.
Used to influence behavior. Emphasis on non financial measurements of strategic activities with charts on wall.
Used to inform management. Emphasis on financial measurements. Management by the numbers, i.e., net income, ROI, and EPS.
Planning and control.
Bottom up. Goal setting and feedback. Worker involvement. Near fanatical commitment to four step Plan, Do Check Action approach. Budget and compare actual to market driven dynamic target costs continuously reduced.
Top down. Roll down financial budgets to lower levels. Budget and compare actual to flexible budgets based on engineer driven standard costs for given plant and resource constraints.
Cost.
Long run plant wide life cycle costs.
Short run production costs.
Measurements.
Life cycle costs. Quality, lead time, flexibility (e.g., average number of jobs mastered per employee, average setup times) number of line stops, down time, process times, amount of inventory, number of customer complaints.
Cost variances, labor efficiency, machine utilization. Meet due dates.
Investment justification.
Long term perspective. Emphasis on growth, increasing market share, flexibility, customer needs and business unit interrelationships.
Short run emphasis. Quick pay back.