Planning And Monitoring Productivity Linking Strategy And Operations
Planning And Monitoring Productivity Linking Strategy And Operations
J M Mcinnes
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Currently-evolving technology appears to hold the promise of radically cheaper (in real terms) capital assets. Productivity gains from the use of these assets will presumably in part be shared with labor. However, if a time lag between productivity gains from the use of higher-quality capital assets and wage contracts were to persist, then capital assets would maintain through time a favorable cost differential, in real terms, over labor. Finally, management has to decide on a preferred future ...state, and chart a course towards it. ■ ■ A planning process, consistent with this conceptual framework, is presented in the next section. V. A PLANNING FRAMEWORK The proposed framework is illustrated in Figure 7. Before discussing the framework, however, some preliminary comments are necessary. 5. 1 - Preliminary Commen ts A normative financial theory of the firm suggests the need to find an optimal solution to the production, investment and financing opportunities available to the firm, jointly and simultaneously across all relevant time periods in the firm's planning horizon.
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