Codman & Shurtleff

1152 words 5 pages
Analysis of Codman & Shurtleff

Codman & Shurtleff is an autonomous subsidiary of Johnson and Johnson (J&J). J&J is a decentralized company which has 3 basic doctrines to achieve success – decentralized management, sense of responsibility and long term management. J&J has 155 autonomous subsidiaries in 46 countries and it employs 75,000 people worldwide. These 155 units are divided into sectors based primarily on products. Codman & Shurtleff employs 800 people in 3 manufacturing locations and competes in 12 major medical product groups.

Codman & Shurtleff ‘s mission is similar to the building strategy, the company is focus mainly on innovation and differentiation, and its strategy is based on investing in R&D and developing new
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So it is possible that a person who is not right in him/her forecast and strategy but is a good ‘seller' go through the revision, because nobody is going to challenge his/her ideas.
2. Remuneration indicator: the objective indicator used to set remuneration is link with every manager activity, this might create conflict because every division will try to fill achieve their numbers even when this implies affect other division performance. For example, if R&D managers are measure by the number of project ongoing or completed, the will try to pull the resources to do so, on the other hand sale managers who perhaps are measure by sales and new product introduction will try to launch as much product as possible without checking their profitability. This may create conflict of interests.
3. Lose the focus on ultimate goal: for every company the ultimate goal is to be profitable and generate profit for its shareholders. This planning and control method does not make much emphasis on cost structure, return on investment o profit margin. It is describe in the case that the market for Codman & Shurflett has suffered a contraction in approximately 20% even though it strategy has been to keep "research spending at near the double to the historical Codman level", that the market is asking for more affordable product, in order to do that the company should focus more project

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