presentation on control techniques

1. PRESENTATION ON CONTROL TECHNIQUE AND
PERFORMANCE
Submitted by: Submitted to:
Rakesh kumar Mrs. Reena sidana
(MBA 1st semester) HOD MBA

2. INTRODUCTION
1. To enable managers effectively control the
organizational activities, a large number of
controlling techniques are available.
2. A manager should know these techniques and in
which situation it should be applied.
3. There are two types of techniques of controlling.

3. TWO TECHNIQUES
 Traditional techniques
 Modern techniques

4. TRADITIONAL TECHNIQUES
1. Personal observation
2. Budgeting
3. Break-even analysis
4. Financial statement
5. Statistical data & report
6. Setting examples
7. Standard costing
8. Written instructions

5. PERSONAL OBSERVATION
 This is the most traditional method of control.
 It helps managers to collect first hand information.
 It also creates a psychological pressure on the
employees to perform well as they are aware that they
are being observed personally on their job.
 How ever it is very time consuming , & not suitable for
all kinds of jobs.

6. BUDGETING Meaning-
 A budget is a statement
which reflects future
incomes ,expenditures &
profits of the firm.
 Benefit of budgeting-
1. Standards of
performance
2. Planning
3. Predicting the future
4. Financial planning

7. BREAK EVEN ANALYSIS
 It deals with the study of the relationship between
costs, volume, & profit.
 It determines the probable profit and losses at
different levels of activity.
 The sales volume at which there is no profit, no loss is
known as breakeven point.
 It can be calculated as ,
 Breakeven point=fixed cost/selling price per unit –
variable cost per unit.

8. FINANCIAL STATEMENT
 Financial statements shows financial position of
a firm over a period of time, generally one year.
 These are prepared along with last year
statements, so that firm can compare its present
performance with last year’s performance &
improve its future performance.
 It offers information on ,
1. Liquidity
2. Financial strength
3. profitability

9. STATISTICAL DATA & REPORT
 Statistical analysis in the form of
averages,percentages,ratios,..etc.
 Data can be used for diagramatic representations like
histograms, pie chart, bar graphs..etc.
 A Report is a statement that represents data in the
form of information for carrying out the controlling
function.

10. SETTING EXAMPLES
 It is old saying that “example is better than precepts”
 Some managers follow this and put good examples of
performance before subordinates and expect the same
from them.
 Behaviour and actions of subordinates can be
controlled through exemplary behaviour of the
manager.

11. STANDARD COSTING
 It is a technique of cost control.
 Under this technique ,standard costs of
materail,labour,overheads etc. are determined.
 Actual cost are recorded and compared with the
standard costs and variances are found out.
 Then measures are taken to prevent variances in
future.

12. WRITTEN INSTRUCTIONS
 These instructions are issued time to time to the
organization members.
 These provide latest information and instructions in
the light of changing rules and conditions.
 These are supplementary control technique.

13. MODERN TECHNIQUES
1. Return on investment.
2. Management audit.
3. Management information system (MIS).
4. PERT/CPM.

14. RETURN ON INVESTMENT
 Investment consists of fixed asset
and working capital used in business.
 Profit on the investment is a reward for risk taking.
 If the ROI is high then the financial performance of a
business is good and vice-versa.
 It also shows the areas where corrective actions are
needed.

15. MANAGEMENT AUDIT
 Management Audit is an evaluation of the
management as a whole. It critically examines the
full management process.
 It finds out the efficiency of the management.
 Management auditing is conducted by a team of
experts.
 The data is analyzed and conclusions are drawn about
managerial performance and efficiency.

16. MANAGEMENT INFORMATION
SYSTEM
 In order to control the organisation properly the
management needs accurate information.
 Information is collected continuously to identify
problems and find out solutions.
 They need information about the internal working of
the organisation and also about the external
environment.
 MIS collects data, processes it and provides it to the
managers.

17. PERT/CPM
 Programme Evaluation and Review Technique (PERT)
and Critical Path Method (CPM) techniques were
developed in USA in the late 50's.
 Any programme consists of various activities and sub-
activities.
 Importance is given to identifying the critical activities.
 by controlling the time of the critical activities, the total
time and cost of the job are minimized.

18. THANKS