Transcript ch07 - Management Class

Chapter 7
Foundations
of Control
Robbins et al., Fundamentals of Management, 4th Canadian Edition
©2005 Pearson Education Canada, Inc.
FOM 7.1
Learning Outcomes





Define control
Describe three approaches to control
Explain why control is important
Describe the control process
Distinguish among the three types of
control
(continued)
Robbins et al., Fundamentals of Management, 4th Canadian Edition
©2005 Pearson Education Canada, Inc.
FOM 7.2
Learning Outcomes
(continued)

Describe the qualities of an effective control
system

Identify contingency factors in the control
process

Explain how controls can become
dysfunctional

Describe how national differences influence
the control process
(continued)
Robbins et al., Fundamentals of Management, 4th Canadian Edition
©2005 Pearson Education Canada, Inc.
FOM 7.3
Learning Outcomes
(continued)

Identify the ethical issues in employee
monitoring

Describe how an entrepreneur controls for
growth
Robbins et al., Fundamentals of Management, 4th Canadian Edition
©2005 Pearson Education Canada, Inc.
FOM 7.4
Control
Process of monitoring activities to
ensure that what is being
accomplished matches plans and
corrects significant deviations
Robbins et al., Fundamentals of Management, 4th Canadian Edition
©2005 Pearson Education Canada, Inc.
FOM 7.5
Controlling
Planning
PlanningControlling
Linkage
Leading
Robbins et al., Fundamentals of Management, 4th Canadian Edition
©2005 Pearson Education Canada, Inc.
Organizing
FOM 7.6
Purpose of Controls
Goals and

Measuring Performance

Comparing to Standards

Taking Corrective Action
Objectives
Organizational
Divisional
Departmental
Individual
Robbins et al., Fundamentals of Management, 4th Canadian Edition
©2005 Pearson Education Canada, Inc.
FOM 7.7
Approaches to Control



Market
Bureaucratic
Clan
Robbins et al., Fundamentals of Management, 4th Canadian Edition
©2005 Pearson Education Canada, Inc.
FOM 7.8
The Control Process
Compare
Performance
to Standard
Measure
Performance
Yes
Do Nothing
No
Variance
Acceptable?
Objectives
Standard
Standard
Attained?
Yes
Do Nothing
No
Standard
Acceptable?
Yes
Identify
Causes
No
Revise
Standard
Robbins et al., Fundamentals of Management, 4th Canadian Edition
©2005 Pearson Education Canada, Inc.
Correct
Performance
FOM 7.9
How Do Managers Measure?

Personal
observations
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
Robbins et al., Fundamentals of Management, 4th Canadian Edition
©2005 Pearson Education Canada, Inc.
MBWA
(management-bywalking about)
Statistical reports
Oral reports
Written reports
FOM 7.10
What Do Managers Measure?
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Information
Operations
Finances
People
Robbins et al., Fundamentals of Management, 4th Canadian Edition
©2005 Pearson Education Canada, Inc.
FOM 7.11
Discrepancies Between Goals and Performance
Acceptable
Upper Limit
Acceptable
Range of
Variation
Standard
Acceptable
Lower Limit
t
t+1
t+2
t+3
Robbins et al., Fundamentals of Management, 4th Canadian Edition
©2005 Pearson Education Canada, Inc.
t+4
t+5
FOM 7.12
CanuckBrew’s Sales for July
(in hundreds of cases)
Brand
Standard
Propeller
Actual
Over (Under)
1,075
913
(162)
630
634
4
Okanagan Spring 800
912
112
Garrison
620
622
2
Oland’s Export
540
672
132
McAuslan’s
160
140
(20)
Granville Island
225
220
(5)
80
65
(15)
Nelson After Dark 170
286
116
4,464
164
Big Rock Ale
Unibroue’s
Total Cases
4,300
Robbins et al., Fundamentals of Management, 4th Canadian Edition
©2005 Pearson Education Canada, Inc.
FOM 7.13
Do Nothing
Taking
Managerial
Action
Immediate/Basic
Corrective
Action
Revise
the Standard
Robbins et al., Fundamentals of Management, 4th Canadian Edition
©2005 Pearson Education Canada, Inc.
FOM 7.14
Three Types of Control
Input
Processes
Output
Feedback
Control
Concurrent
Control
Feedback
Control
Corrects problems
as they happen
Corrects problems
after they occur
Anticipates
problems
Robbins et al., Fundamentals of Management, 4th Canadian Edition
©2005 Pearson Education Canada, Inc.
FOM 7.15
Feedback Control


Robbins et al., Fundamentals of Management, 4th Canadian Edition
©2005 Pearson Education Canada, Inc.
Meaningful
information
Enhance employee
motivation
FOM 7.16
Qualities Of An Effective
Control System
Corrective
Action
Accuracy
Multiple
Criteria
Emphasis on
Exceptions
Timeliness
EFFECTIVE
CONTROL
SYSTEM
Strategic
Placement
Economy
Flexibility
Reasonable
Criteria
Robbins et al., Fundamentals of Management, 4th Canadian Edition
©2005 Pearson Education Canada, Inc.
Understandability
FOM 7.17
Contingency Factors in Control Systems
Contingency Variable
Organization Size
Position and Level
Degree of Decentralization
Organizational Culture
Importance of an Activity
Control Recommendations
Small
Informal, personal management
Large
Formal, personal management
High
Many complex criteria
Low
Few, easy-to-measure criteria
High
Increased number of controls
Low
Reduced number of controls
Open
Informal, self-control
Closed
Formal, external controls
High
Comprehensive controls
Low
Loose, informal controls
Robbins et al., Fundamentals of Management, 4th Canadian Edition
©2005 Pearson Education Canada, Inc.
FOM 7.18
Adjusting Controls
for National Differences
Distance
and the
Formality
of Controls
Robbins et al., Fundamentals of Management, 4th Canadian Edition
©2005 Pearson Education Canada, Inc.
Technology
and the
Comparability
of Data
FOM 7.19
Dysfunctional Controls
Inflexible
Controls
Robbins et al., Fundamentals of Management, 4th Canadian Edition
©2005 Pearson Education Canada, Inc.
Unreasonable
Standards
FOM 7.20
Contemporary Issues in
Control
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Rights that manager has to monitor
employee behaviour
Rights that manager has to control
private lives of employees.
Employers MAY be able to control
employee behaviour outside the work
environment
Robbins et al., Fundamentals of Management, 4th Canadian Edition
©2005 Pearson Education Canada, Inc.
FOM 7.21
You and Your Computer
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Employers can read your e-mail
Employers can listen to your phone
calls
Employers can monitor your work by
computer
Robbins et al., Fundamentals of Management, 4th Canadian Edition
©2005 Pearson Education Canada, Inc.
FOM 7.22
Employee Theft
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Ranges from embezzlement to
fraudulent filing of expense reports to
equipment removal
Nearly 85% of all organizational theft
and fraud is committed by employees
Ready availability of information
technology has made employee stealing
an escalating problem
Robbins et al., Fundamentals of Management, 4th Canadian Edition
©2005 Pearson Education Canada, Inc.
FOM 7.23
Control and
Ethics
Inform
Employees
Written Policy
Monitor for
Business Reasons
Robbins et al., Fundamentals of Management, 4th Canadian Edition
©2005 Pearson Education Canada, Inc.
FOM 7.24
Entrepreneurs Controlling for
Growth
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Plan for growth
Organize for growth
Control for growth
Robbins et al., Fundamentals of Management, 4th Canadian Edition
©2005 Pearson Education Canada, Inc.
FOM 7.25
Entrepreneurs Managing
Downturns
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Recognizing crisis situations
Things can turn worse
Exit the venture
Business evaluation
Robbins et al., Fundamentals of Management, 4th Canadian Edition
©2005 Pearson Education Canada, Inc.
FOM 7.26