2 Control Definition Purpose monitoring employees’ activities, determining, whether the organization is on target toward its goals, and making corrections as necessary.PurposeTo measure progress toward planned performance and apply corrective measures.
3 Why Is Control Important? As the final link in management functions:Controls let managers know whether their goals and plans are on target and what future actions to take.Control systems provide managers with information and feedback on employee performance.Controls enhance physical security and help minimize workplace disruptions.
4 What is control systemControl systems are designed to measure progress toward planned performance and, if necessary, to apply corrective measure
5 Four major steps Setting performance standards; Measuring performance; Comparing performance against the standards and determining deviationsTaking corrective action
6 Setting performance standards The level of expected performance for a given goal;Desired performance levelsJob requirements, objective data;Reference: quantity; quality; time used; cost;When do managers set standard?
7 Measuring: How and What We Measure Control CriteriaEmployeesSatisfactionTurnoverAbsenteeismBudgetsCostsOutputSales
8 Measuring performance Information collectionThree sources:Written reports;Formal, broad level, precise;Oral reports;Swift, two-way communicationNo recordsWritten reports: statistic reports; figures;Oral reports: meetings, party, face to face conversation, phone talk;
9 Personal observations; An intimate pictureGeneral and subjectiveTime consumingMisleadingMbwa: management by walking around
10 Comparing performance To evaluate the performance;Note: range of variation acceptable;ExceptionSignificant deviations;Managers should pay attention to exceptional cases;For some activities relatively small deviations are acceptable; while in others a slight deviation may be serious;
11 ComparingDetermining the degree of variation between actual performance and the standard.Significance of variation is determined by:The acceptable range of variation from the standard (forecast or budget).The size (large or small) and direction (over or under) of the variation from the standard (forecast or budget).
12 Taking corrective action To adjust operation to achieve the initially planned results;By whom?those having authority (Higher-ups)the operator at the point;Corrective actionImmediate corrective actionBasic corrective actionBasic corrective action: how deviation, why, correct;
13 Taking Managerial Action Courses of Action“Doing nothing”Only if deviation is judged to be insignificant.Correcting actual (current) performanceImmediate corrective action to correct the problem at once.Basic corrective action to locate and to correct the source of the deviation.Corrective ActionsChange strategy, structure, compensation scheme, or training programs; redesign jobs; or fire employees
14 Taking Managerial Action (cont’d) Courses of Action (cont’d)Revising the standardExamining the standard to ascertain whether or not the standard is realistic, fair, and achievable.Upholding the validity of the standardResetting goals that were initially set too low or too high.
15 Taking corrective action A change in a procedure or method;A disciplinary action;A major organizational modification;A change of the standard.
18 Feedforward control Concurrent control Feedback control Three types of controlFeedforward controlConcurrent controlFeedback control
19 Feedforward ControlDefinition:Process control in which changes are detected at the process input and an anticipating correction signal is applied before process output is affected.A temperature sensor outside of a room to indicate a drop of temperature so people can start heating the roomSpeed limit on highway.
20 Limiting activities in advance prevent the problems before they arise Feedforward ControlCharacteristic:Future orientedLimiting activities in advanceprevent the problems before they arise
21 Advantages and disadvantages Prevents accidents before they occur.Easy to be accepted and implemented.Disadvantages:Need massive accurate information.Hard to estimate the new situation and the question.
22 Inspection of raw materials Proper selection and training of employees examplesInspection of raw materialsProper selection and training of employeesJapan’s unique cost management system
23 Take place while plans are carried out , Concurrent controlDefinition:Take place while plans are carried out ,is the heart of any control system.Characteristic:While plans are being carried outDirecting , monitoring and fine-tuning activities
24 Advantages and disadvantages Is helpful to improve staff's working ability and the self-control ability.Reduce loss quicklyDisadvantages:The cost is highhard to be accepted
25 Supervisors monitor the employees Production line Question: ExamplesSupervisors monitor the employeesProduction lineQuestion:How does Information technology affect the concurrent control?
26 Feedback controlDefinition:Feedback control implies that performance data were gathered and analyzed and the results returned to someone (or something) in the process to make corrections.
27 Waiting for results and comparing them with goals analyzing the reason Feedback controlCharacteristic:Waiting for results and comparing them with goalsanalyzing the reasontaking corrective action
28 Advantages and disadvantages Summarizing the rule for further implementation, creating the condition , realizing the positive cycle, enhancing the efficiency and so on.Disadvantages:The deviation has produced before the implementation measure.cannot control the process in time
29 Important aspect—Timing If feedback on performance is not timely, managers cannot quickly identify and eliminate the problem and prevent more serious harm.
30 The product quality checks Evaluate an accomplishment examplesThe product quality checksEvaluate an accomplishment
31 Difference and connection Out putIn putTransformation processesConcurrent controlFeedback controlFeedforward control
32 Can you tell more difference? Feedfordward controlConcurrent controlFeedback controlThe time they take placeFocus on in a control systemFunctionControl typeAspectCan you tell more difference?
33 Can you tell more difference? Feedfordward controlConcurrent controlFeedback controlThe time they take placeBefore operations beginWhile plans are being carried outAfter the factFocus on in a control systeminputTransformation processesOut putFunctionPrevent problems before they ariseMonitor behaviorPoint out and correct improper performanceControl typeAspectCan you tell more difference?
34 Three type of control Compose a control system . They mutually affect. connectionThree type of control Compose a control system .They mutually affect.Preliminary control sets antecedentsConcurrent control monitor behavior According to the antecedents and find the information results.Feedback control analyze the results in order to correct improper performance or revised the antecedents.
35 which type of control do they belong to? Rocket launchingLegislationsign contractWork summaryDirecting workingreduce the staffrevises the law
36 QuestionAnalyzes the control types of our school and their connection during the appraisal stage.
38 Budgets The origin of budget: France in the Middle Ages Definition: A budget is simply a financial plan listing in detail the resources or funds assigned to a particular product, division, or project.
39 Developing a budgetGuidelines for budget preparation: detailed economic, sales, and profit forecastsWho?1. Budgets are developed at the top management levels.2. The department and individuals responsible for implementation should be allowed to contribute to the development of budget.
40 The advantages of the “bottom-up” approach The process of developing a comprehensive budget
41 Building flexibility into the budget A serious drawback to many budgetsHow to avoid this problemVariable budget: a series of different budgets based on different levels of outputFlexible budgets, sliding-scale budgets, step budgets
42 Program Planning Budgeting Systems (PPBS) Five basic steps:1. List and analyze the objectives of the activity.2. Analyze the results of a given program or activity based on the objectives.3. Estimate future program costs as well as original outlays.
43 Program Planning Budgeting Systems (PPBS) Five basic steps:4. Analyze alternatives.5. Integrate the first four steps into the budgetary process.
44 Program Planning Budgeting Systems (PPBS) The advantages of PPBS:1. It relates the budget to agency or departmental objectives and requires accountability.2. It requires a realistic appraisal of future costs and requires managers to justify their decision.3. It brings into sharp focus the relationship between costs and benefits.
45 Zero-Base Budgeting (ZBB) What is the essence of zero-base budgeting?The steps of zero-base budgetingThe advantages and disadvantages of zero-base budgetingThe development of ZBB concept
46 Types of Budgets Manufacturing: 1. Manufacturing Budget 2. Capital Expenditures Budget
47 Types of BudgetsMarketing:1. Marketing Budget2. Product Budget
48 Types of Budgets Finance: 1. Cash Flow Budget 2. Budget Income Statement3. Balance Sheet Budget
49 Types of Budgets Research and General Management: 1. Research and Development Budget2. Executive Staff Budget3. Branch and Regional Budget