You are the recently appointed chief executive of the Omega organisation. Your organisation is located in a large town and comprises five operating units and a head office with personnel, client service, management services and finance divisions. It employs a total of 5000 people.
The organisation has been successful in recent years. Clients report receiving good service and the financial performance of the organisation is good. The organisation has been run on centralised lines with tight financial controls applied by the Finance Division.
You have concluded that a more decentralised approach to management is needed, mainly to give unit managers greater discretion. The clients served by the five operating units have different and changing needs. You feel that greater discretion will allow a more flexible response to these various needs at unit level.
One of the ways you have decided to achieve decentralisation is to decentralise the management accounting function. Each operating unit will have a management accountant responsible to the unit general manager for operational matters. The finance director will retain overall professional responsibility for the finance discipline, for financial accounting, planning and reporting. Unit management accountants will therefore report to the finance director for professional purposes but to the relevant general manager for operational purposes.
In line with these changes, the finance director has proposed a number of changes to the role of the head office Finance Division. In particular, he wishes to encourage a more constructive and cooperative approach by finance staff to staff in other divisions. In the past, finance staff have identified inefficiencies in the utilisation of resources and generally called the various unit management teams to account. He wishes to move towards a more problem solving style through which finance staff help others both to identify problems and develop solutions.
As part of this, he wishes to see a change in the extent to which the Finance Division relies solely on traditional financial control techniques, often as a means of preventing change and limiting expenditure. Finally, he wishes to reduce the use of financial and accounting jargon.
These are significant organisational and professional changes. You accept the need for them and are fully committed to decentralisation. However, you are concerned about a number of issues.

Questions

Write a paper for circulation to your top management colleagues covering the following issues:
(a) What are likely to be the main problems and advantages of decentralised management accounting?
(b) What measures should be adopted to support the changed professional role for the Finance Division?
(c) What actions should be taken with the top management team (the general managers of the five operating units, and the directors of the personnel, client service, management services and finance divisions) in preparation for the changes?