Core Concepts of Management Schermerhorn Prepared by Cheryl Wyrick California State Polytechnic University Pomona John Wiley & Sons, Inc Schermerhorn - Chapter 7
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Chapter 7 Controlling - To Ensure Results Planning Ahead How do controls work in organizations? How do organizational systems assist in control? How can operations management improve control? How can planning and controlling be integrated? Schermerhorn - Chapter 7
Schermerhorn - Chapter 7 How Controls Work Steps in the Control Process Establish objectives and standards Measure actual performance Compare results with objectives and standards Take corrective action as needed Schermerhorn - Chapter 7
Schermerhorn - Chapter 7 How Controls Work Step 1: Establishing Objectives and Standards Types of Standards output measure results in terms of performance criteria input measure effort in terms of amount of work Schermerhorn - Chapter 7
Schermerhorn - Chapter 7 How Controls Work Step2: Measuring Actual Performance goal is accurate measurement of output and/or input standards Schermerhorn - Chapter 7
Schermerhorn - Chapter 7 How Controls Work Step 3: Comparing Results with Objectives and Standards Need for action x desired performance - actual performance Historical Comparison Relative Comparison Engineering Comparison Schermerhorn - Chapter 7
Schermerhorn - Chapter 7 How Controls Work Step 4: Taking Corrective Action Management by exception problem situation opportunity situation Schermerhorn - Chapter 7
Schermerhorn - Chapter 7 How Controls Work Characteristics of Effective Controls strategic and results oriented understandable encourage self-control timely and exception oriented positive in nature fair and objective flexible Schermerhorn - Chapter 7
Schermerhorn - Chapter 7 Types of Controls Feedforward (Preliminary) Controls ensure that objectives are clear proper directions are established right resources are available focus on conditions before a work activity begins Schermerhorn - Chapter 7
Schermerhorn - Chapter 7 Types of Controls Concurrent (Steering) Controls monitor ongoing operations to make sure they are being done according to plan focus on quality of task actitivites during work process Schermerhorn - Chapter 7
Schermerhorn - Chapter 7 Types of Controls Feedback (Postaction) Controls take place after work is completed focus on quality of end results Schermerhorn - Chapter 7
Schermerhorn - Chapter 7 Types of Controls Internal Versus External Control Internal allows motivated individauls to exercise self-discipline in fulfilling job expectations External personal supervision formal administrative systems Schermerhorn - Chapter 7
Organizational Control Systems Management Process Controls strategy and objectives policies and procedures selection and training performance appraisal job design and work structures performance modeling performance norms organizational culture Schermerhorn - Chapter 7
Organizational Control Systems Employee Discipline Systems progressive discipline achieve compliance with organizational expectations use least extreme amount of reprimand possible Schermerhorn - Chapter 7
Organizational Control Systems Information and Financial Controls liquidity leverage asset management profitability Schermerhorn - Chapter 7
Operations Management and Control Purchasing Control leverage buying power small number of suppliers supplier-purchaser partnerships Schermerhorn - Chapter 7
Operations Management and Control Inventory Control Economic Order Quantity (EOQ) minimize two costs ordering carrying just-in-time scheduling Schermerhorn - Chapter 7
Operations Management and Control Quality Control Involves checking processes, materials, products, and services to ensure that they meet high standards. Statistical quality control involves: Taking samples of work Measuring quality in the samples Determining the acceptability of results Schermerhorn - Chapter 7
Management by Objectives (MBO) structured process of regular communication supervisor and worker jointly set performance objectives jointly review results Schermerhorn - Chapter 7
Management by Objectives (MBO) Formal agreement worker’s performance objectives for a specific time period plans through which they will be accomplished standards for measuring results procedures for reviewing results Schermerhorn - Chapter 7
Management by Objectives (MBO) Advantages clearly focuses employee work efforts clearly focuses manager’s work efforts on areas of support relationship building between manager and employee employee participates in decisions that affect work Schermerhorn - Chapter 7
Management by Objectives (MBO) Performance objectives improvement personal development maintenance Schermerhorn - Chapter 7
Management by Objectives (MBO) Performance objective criteria specific time defined challenging measurable Schermerhorn - Chapter 7
Management by Objectives (MBO) How to make MBO work hire best people work with them to set challenging performance objectives give best possible support hold employee accountable Schermerhorn - Chapter 7
Management by Objectives (MBO) Pitfalls to avoid tying MBO to pay focusing too much attention on easily quantifiable objectives requiring excessive paperwork have managers tell workers objectives Schermerhorn - Chapter 7