14:  Controlling:  regulation of activities so performance remains within acceptable limits

 

            Provides an indication on how well a firm is meeting its goals

            Provides a way to adjust performance to keep the organization moving in the right direction

   

A.  Purpose of Control

            Adapting to the environment

            Limiting errors

            Coping with complexity

            Minimizing costs

 

            Which of these purposes was lacking in the following situations:  9-11 & the  

            Challenger accident

 

B.  Types of control

            1.  Areas

                        *  Physical resources

                        *  Human resources

                        *  Information resources

                        *  Financial resources

            2.  Levels

                        *  Operational

                        *  Financial

                        *  Structural

                        *  Strategic

            3.  Responsibility

                        *  Controllers

                        *  Operating employees

 

C.  Steps in the Control Process

            1.  Establish Standards

 

            2.  Measure Performance

 

            3.  Compare Performance to Standards

           

            4.  Determine the Need for Corrective Action

 

D.  Operations Control:  occur at different points in the transformation process used  

                                        by organizations

            *  Preliminary (inputs)

            *  Screening (transformational)

            *  Postaction (outputs)

 

E.  Financial Control

            1.  Budgets

            *  Levels, timeline and expression?

 

            *  Purposes?

            *  Types

                        Financial –

 

                        Operating –

 

                        Nonmonetary-

 

           

                        *  Strengths and Weaknesses

 

 

 

            2.  Financial Statements

                        *  Balance sheets and Income statements

 

            *  Ratio analysis

            *  Financial audits

F.  Structural Control:  What is the difference between bureaucratic and clan control

 

 

 

G.  Managing Control in Organizations

            *  Integration with planning

            *  Flexibility

            *  Accuracy

            *  Timeliness

            *  Objectivity

 

H.  Resistance to Control

            *  Overcontrol

            *  Inappropriate Focus

            *  Rewards for Inefficiency

            *  Too much accountability

 

 

I.  Overcoming Resistance