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Management ControlManagement Control
1
The meaning of controlThe meaning of control
• A systematic effort to set performance
standards with planning objectives, to design
information feedback systems, to compare
actual performance with standards, to
determine whether there are any deviations
and to take any action if required.
• Control is the process of ensuring that actual
activities conform to planned activities.
2
Process of Control
Slide 3 of 3
3
Set
performance
standards
Measure
actual
performance
Compare
performance
with
standards
Take no
corrective
action
Take
corrective
action
If deviations are
acceptable
If deviations are
unacceptable
Steps in the control processSteps in the control process
• 1.Establish standards and methods for measuring
performance.-standards should be stated in clear,
measurable terms that include specific deadlines.
• 2.Measure performance-measurement is an
ongoing repetitive process.
• 3.Determine whether performance matches the
standard-This is the easiest step in the control
process
• 4.Take corrective action-This step is necessary if
performance falls short of standards and the
analysis indicates action is required.
4
The importance of control
• 1.Change-Control systems should be able to
detect changes affecting org.
• 2.Complexity-A more formal and careful
control approach is required.
• 3.Mistakes-allows managers to detect mistakes
before they become critical
• 4.Delegation-allows managers to check on
subordinates progress
5
Types of control methodsTypes of control methods
• 1.Pre-action control
• 2.Steering control
• 3.Screening or Yes/No control
• 4.Post-action control
6
1.Pre-Action Contro1.Pre-Action Controll
• Control before an action is undertaken e.g
before a new product is launch, marketers
conduct market testing.
7
Allow corrective action to be taken before a
particular sequence of actions is
completed.e.g after launching a new
product, marketers will monitor
competitors, customers and dealers
reaction and take corrective actions if
required.
3.Screening or Yes/No controls3.Screening or Yes/No controls
Provides a screening process in which specific
aspects of a procedure must be met before
the operations is allowed to proceed.e.g
large customers withdrawal must be
approved by a bank officer.
8
4.Post-action controls4.Post-action controls
Measure the result of a completed action e.g
marketers conducted Profitability analysis
to assess the profitability of the new
product
Selecting the Focal Point
for Control
• Feedforward (Preventive) Control
– Focuses on detecting undesirable material,
financial, or human resources that serve as
inputs to the transformation process.
• Concurrent Control
– Focuses on the transformation process to
ensure that it is functioning properly.
9
Selecting the Focal Point for Control
Slide 2 of 2
• Feedback Control
– Focuses on discovering undesirable output and
implementing corrective action.
• Multiple Focal Points
– Most organizations use several control systems
focused on various phases of the transformation
process.
10
Control Focal Points
11
Control system
Transformation
process
Inputs Outputs
Feedforward
control
Concurrent
control
Feedback
control
Characteristics of effective controlCharacteristics of effective control
systemssystems
1.Accurate-provide accurate info
2.Timely-up to date info
3.Objective and comprehensive-clear and
measurable
4.Focused on strategic control points-
focus on key areas such as finance and quality
12
Characteristics of effective control
systems
5.Economically realistic-cost should be less
than the benefits
6.Organizationally realistic-org should have
adequate resources
7.Flexible-adaptable to changes
8.Prescriptive and operational-describe the corrective
actions to be taken
9.Accepted by organizational members
13
Management from the IslamicManagement from the Islamic
perspectiveperspective
The management process based on
the Quran and the Sunnah to
promote societal well being and
Islamic values.-Islamic mgt seek to achieve a
balance between org profit, customer satisfaction,
societal well being and Islamic values.
14
The principles Management from theThe principles Management from the
Islamic perspectiveIslamic perspective
1.Tauhid-work an an Ibadah or way of submission
to Allah
2.Syura-the importance of teamwork
3.Justice-the importance of fairness
4.Masruai’ah-the concept of legality based on the
syariah laws
5.Qualification-based on competencies
6.Maslahah-priority based on Islamic values
15

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Management Control: Key Concepts and Effective Processes

  • 2. The meaning of controlThe meaning of control • A systematic effort to set performance standards with planning objectives, to design information feedback systems, to compare actual performance with standards, to determine whether there are any deviations and to take any action if required. • Control is the process of ensuring that actual activities conform to planned activities. 2
  • 3. Process of Control Slide 3 of 3 3 Set performance standards Measure actual performance Compare performance with standards Take no corrective action Take corrective action If deviations are acceptable If deviations are unacceptable
  • 4. Steps in the control processSteps in the control process • 1.Establish standards and methods for measuring performance.-standards should be stated in clear, measurable terms that include specific deadlines. • 2.Measure performance-measurement is an ongoing repetitive process. • 3.Determine whether performance matches the standard-This is the easiest step in the control process • 4.Take corrective action-This step is necessary if performance falls short of standards and the analysis indicates action is required. 4
  • 5. The importance of control • 1.Change-Control systems should be able to detect changes affecting org. • 2.Complexity-A more formal and careful control approach is required. • 3.Mistakes-allows managers to detect mistakes before they become critical • 4.Delegation-allows managers to check on subordinates progress 5
  • 6. Types of control methodsTypes of control methods • 1.Pre-action control • 2.Steering control • 3.Screening or Yes/No control • 4.Post-action control 6
  • 7. 1.Pre-Action Contro1.Pre-Action Controll • Control before an action is undertaken e.g before a new product is launch, marketers conduct market testing. 7 Allow corrective action to be taken before a particular sequence of actions is completed.e.g after launching a new product, marketers will monitor competitors, customers and dealers reaction and take corrective actions if required.
  • 8. 3.Screening or Yes/No controls3.Screening or Yes/No controls Provides a screening process in which specific aspects of a procedure must be met before the operations is allowed to proceed.e.g large customers withdrawal must be approved by a bank officer. 8 4.Post-action controls4.Post-action controls Measure the result of a completed action e.g marketers conducted Profitability analysis to assess the profitability of the new product
  • 9. Selecting the Focal Point for Control • Feedforward (Preventive) Control – Focuses on detecting undesirable material, financial, or human resources that serve as inputs to the transformation process. • Concurrent Control – Focuses on the transformation process to ensure that it is functioning properly. 9
  • 10. Selecting the Focal Point for Control Slide 2 of 2 • Feedback Control – Focuses on discovering undesirable output and implementing corrective action. • Multiple Focal Points – Most organizations use several control systems focused on various phases of the transformation process. 10
  • 11. Control Focal Points 11 Control system Transformation process Inputs Outputs Feedforward control Concurrent control Feedback control
  • 12. Characteristics of effective controlCharacteristics of effective control systemssystems 1.Accurate-provide accurate info 2.Timely-up to date info 3.Objective and comprehensive-clear and measurable 4.Focused on strategic control points- focus on key areas such as finance and quality 12
  • 13. Characteristics of effective control systems 5.Economically realistic-cost should be less than the benefits 6.Organizationally realistic-org should have adequate resources 7.Flexible-adaptable to changes 8.Prescriptive and operational-describe the corrective actions to be taken 9.Accepted by organizational members 13
  • 14. Management from the IslamicManagement from the Islamic perspectiveperspective The management process based on the Quran and the Sunnah to promote societal well being and Islamic values.-Islamic mgt seek to achieve a balance between org profit, customer satisfaction, societal well being and Islamic values. 14
  • 15. The principles Management from theThe principles Management from the Islamic perspectiveIslamic perspective 1.Tauhid-work an an Ibadah or way of submission to Allah 2.Syura-the importance of teamwork 3.Justice-the importance of fairness 4.Masruai’ah-the concept of legality based on the syariah laws 5.Qualification-based on competencies 6.Maslahah-priority based on Islamic values 15