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Organisational Control
Session 07
“The movement of an organization might get directed elsewhere due to internal and external influences”
Deviation Internal factors External factors
Organisational Control The movement of an organization might get - - PowerPoint PPT Presentation
Organisational Control The movement of an organization might get - - PowerPoint PPT Presentation
Session 07 Organisational Control The movement of an organization might get directed elsewhere due to internal and external influences Deviation Internal factors External factors Definition - Organization Control Organisational control
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Definition - Organization Control
Organisational control is the systematic process through which managers regulate
- rganisational activities to
make them consistent with expectations established in plans, targets, and standards
- f performance
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Controlling Points
The business process is the flow of work. This total process could be controlled at 3 main points:
Input stage (feed-forward) Preventing probable deviations During the conversion (concurrent) Output stage (feedback): Reviewing Feed-forward
- Control
Input
Recurrent
- Control on-
going conversions
Feedback
- Control
Output
Input Conversion Output
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C1 – Feed-forward Controls
Used to anticipate problems before they arise so that problems do not occur later during the conversion process
Input Conversion
Control
E.g.
- Supplier controls
- HR controls
- Finance controls –
Budgets
- Machinery controls,
etc.
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C2 - Recurrent Controls
Give managers immediate feedback on how efficiently inputs are being transformed into outputs These will allow managers to correct problems as they arise E.g.’s:
Statistical quality control system Conduct meetings (e.g. Daily, weekly, monthly, annually, etc.) Temperature controls in a plant/machinery
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Statistical Quality Controls
Pick a random sample of products (e.g. 10 donuts) Check whether they are in line with the specifications
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C3 - Feedback Controlling Methods
Control your output stage – reactive controlling
Basic feedback control model Balance scorecard method Financial statements Financial ratio analysis
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Feedback Control Model
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The Balanced Scorecard
Balanced perspective of company performance Integrates various areas of the organisation Managers record, analyze, and discuss the
metrics
Serves as core management-control system
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The Balanced Scorecard
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Quality Controlling
Quality is the fitness for use in terms of design, conformance, availability, safety and field use
- Juran
Deming
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Total Quality Management (TQM)
Infuse quality into every aspect of the business, all day-to-day
activities
TQM focuses on: Teamwork Increasing customer satisfaction Lowering costs The goal of TQM is zero defects
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Hierarchical versus Decentralized Controlling Approaches
Hierarchical controls include the monitoring of behavior through rules, policies, reward systems, and written documentation (Theory X type) Decentralized controls based on values and assumptions; rules are only used when necessary (Theory Y type)
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Lean Management
Combining advanced technology and innovative
management processes and using highly trained employees to solve problems, cut waste, improve productivity, quality and customer value
Developed by Taiichi Ohno in Japan, and popularized by James P. Womack and Daniel T. Jones in their 1996 book 'Lean Thinking'
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Questions to Try
What is Balance Scorecard Method?
Discuss the importance of evaluating non- financial performance along with financial performance?
“Poor feedforward controlling will lead to
difficulties in conversion stage” – explain and justify this statement
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