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The Control System. Control . Definition monitoring employees’ activities, determining, whether the organization is on target toward its goals, and making corrections as necessary. Purpose To measure progress toward planned performance and apply corrective measures. .

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Presentation Transcript
  • Definition
    • monitoring employees’ activities, determining, whether the organization is on target toward its goals, and making corrections as necessary.
  • Purpose
    • To measure progress toward planned performance and apply corrective measures.
why is control important
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.
what is control system
What is control system
  • Control systems are designed to measure progress toward planned performance and, if necessary, to apply corrective measure
four major steps
Four major steps
  • Setting performance standards;
  • Measuring performance;
  • Comparing performance against the standards and determining deviations
  • Taking corrective action
setting performance standards
Setting performance standards
  • Standard
    • The level of expected performance for a given goal;
    • Desired performance levels
    • Job requirements, objective data;
    • Reference: quantity; quality; time used; cost;
  • When do managers set standard?
measuring how and what we measure
Measuring: How and What We Measure
  • Control Criteria
    • Employees
      • Satisfaction
      • Turnover
      • Absenteeism
    • Budgets
      • Costs
      • Output
      • Sales
measuring performance
Measuring performance
  • Information collection
  • Three sources:
    • Written reports;
      • Formal, broad level, precise;
    • Oral reports;
      • Swift, two-way communication
      • No records
Personal observations;
    • An intimate picture
    • General and subjective
    • Time consuming
    • Misleading
comparing performance
Comparing performance
  • To evaluate the performance;
  • Note: range of variation acceptable;
  • Exception
    • Significant deviations;
  • Managers should pay attention to exceptional cases;
  • Determining 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).
taking corrective action
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 action
  • Immediate corrective action
  • Basic corrective action
taking managerial action
Taking Managerial Action
  • Courses of Action
    • “Doing nothing”
      • Only if deviation is judged to be insignificant.
    • Correcting actual (current) performance
      • Immediate corrective action to correct the problem at once.
      • Basic corrective action to locate and to correct the source of the deviation.
    • Corrective Actions
      • Change strategy, structure, compensation scheme, or training programs; redesign jobs; or fire employees
taking managerial action cont d
Taking Managerial Action (cont’d)
  • Courses of Action (cont’d)
    • Revising the standard
      • Examining the standard to ascertain whether or not the standard is realistic, fair, and achievable.
        • Upholding the validity of the standard
        • Resetting goals that were initially set too low or too high.
taking corrective action1
Taking corrective action
  • Action
    • A change in a procedure or method;
    • A disciplinary action;
    • A major organizational modification;
    • A change of the standard.
three types of control
Three types of control
  • Feedforward control
  • Concurrent control
  • Feedback control
feedforward control
Feedforward Control
  • Definition:
    • Process control in which changes are detected at the process input and an anticipating correction signal is applied before process output is affected.
feedforward control1
Feedforward Control
  • Characteristic:
    • Future oriented
    • Limiting activities in advance
    • prevent the problems before they arise
advantages and disadvantages
Advantages and disadvantages
  • Advantages:
    • 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.
  • Inspection of raw materials
  • Proper selection and training of employees
  • Japan’s unique cost management system
concurrent control
Concurrent control
  • Definition:
    • Take place while plans are carried out ,
    • is the heart of any control system.
  • Characteristic:
    • While plans are being carried out
    • Directing , monitoring and fine-tuning activities
advantages and disadvantages1
Advantages and disadvantages
  • Advantages:
    • Is helpful to improve staff's working ability and the self-control ability.
    • Reduce loss quickly
  • Disadvantages:
    • The cost is high
    • hard to be accepted
  • Supervisors monitor the employees
  • Production line
  • Question:
  • How does Information technology affect the concurrent control?
feedback control
Feedback control
  • Definition:
  • Feedback control implies that performance data were gathered and analyzed and the results returned to someone (or something) in the process to make corrections.
feedback control1
Feedback control
  • Characteristic:
    • Waiting for results and comparing them with goals
    • analyzing the reason
    • taking corrective action
advantages and disadvantages2
Advantages and disadvantages
  • Advantages:
    • 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
important aspect timing
Important aspect—Timing
  • If feedback on performance is not timely, managers cannot quickly identify and eliminate the problem and prevent more serious harm.
  • The product quality checks
  • Evaluate an accomplishment
difference and connection
Difference and connection

Out put

In put

Transformation processes

Concurrent control

Feedback control

Feedforward control


Control type


Can you tell more difference?


Control type


Can you tell more difference?

  • Three type of control Compose a control system .
  • They mutually affect.
  • Preliminary control sets antecedents
  • Concurrent 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.
which type of control do they belong to
which type of control do they belong to?
  • Rocket launching
  • Legislation
  • sign contract
  • Work summary
  • Directing working
  • reduce the staff
  • revises the law
  • Analyzes the control types of our school and their connection during the appraisal stage.
  • 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.
developing a budget
Developing a budget
  • Guidelines for budget preparation: detailed economic, sales, and profit forecasts
  • Who?
  • 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.
The advantages of the “bottom-up” approach
  • The process of developing a comprehensive budget
building flexibility into the budget
Building flexibility into the budget
  • A serious drawback to many budgets
  • How to avoid this problem
  • Variable budget: a series of different budgets based on different levels of output
  • Flexible budgets, sliding-scale budgets, step budgets
program planning budgeting systems ppbs
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.
program planning budgeting systems ppbs1
Program Planning Budgeting Systems (PPBS)
  • Five basic steps:
  • 4. Analyze alternatives.
  • 5. Integrate the first four steps into the budgetary process.
program planning budgeting systems ppbs2
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.
zero base budgeting zbb
Zero-Base Budgeting (ZBB)
  • What is the essence of zero-base budgeting?
  • The steps of zero-base budgeting
  • The advantages and disadvantages of zero-base budgeting
  • The development of ZBB concept
types of budgets
Types of Budgets
  • Manufacturing:
  • 1. Manufacturing Budget
  • 2. Capital Expenditures Budget
types of budgets1
Types of Budgets
  • Marketing:
  • 1. Marketing Budget
  • 2. Product Budget
types of budgets2
Types of Budgets
  • Finance:
  • 1. Cash Flow Budget
  • 2. Budget Income Statement
  • 3. Balance Sheet Budget
types of budgets3
Types of Budgets
  • Research and General Management:
  • 1. Research and Development Budget
  • 2. Executive Staff Budget
  • 3. Branch and Regional Budget