Control with Fairness in Transfer Pricing
Synopsis
Interviews with nearly 150 executives in 13 companies show that transfer pricing schemes are a means of generating information and control for implementing corporate, business unit, and product strategy. A company's transfer pricing policy, which includes whether to source inside or out, and the way it is administered depend on the situation and the direction of the organization. Companies can be categorized into four "pure" types: competitive, cooperative, collaborative, and collective. Each type has its own set of problems and characteristics. Problems common to all types include performance problems, interpersonal disputes, power imbalances, demand fluctuations, and product pricing. Regardless of the approach used to set the transfer price, unit managers will agree to it if they feel that top management is treating them fairly.
- Copyright:
- 1983 Harvard Business School Publishing - HBR
Book Details
- Book Quality:
- ISBN-13:
- Publisher:
- Harvard Business Publishing
- Date of Addition:
- 2016-08-04T02:53:13Z
- Language:
- English
- Categories:
- Usage Restrictions:
- This is a copyrighted book.