Transcript Management 8e. - Robbins and Coulter
8 th edition
Steven P. Robbins Mary Coulter
What Is Control?
•
Control
The process of monitoring
(supervising)
activities to ensure that they are being accomplished as planned and of correcting any significant
(important)
deviations
(differences)
.
•
The Purpose of Control
To ensure that activities are completed in ways that lead to accomplishment of organizational goals.
Page 384 Slide 2
Designing Control Systems
•
Market Control
Emphasizes the use of (external)
(processes)
market mechanisms to establish the standards used in the control system.
External measures: price competition and relative market share.
•
Bureaucratic Control
Emphasizes organizational authority and relies
(depends)
on rules, regulations, procedures, and policies.
•
Clan Control
Regulates
(influences)
behavior by shared values, norms, traditions, rituals, and beliefs of the firm’s culture.
Page 384 Slide 3
Designing Control Systems
•
Depending on the shape and needs of the organization, when a manager must decide on a system of control, he/she might choose one of these three approaches: Market Control: Which analyses, focuses and relies on the monitoring of market processes such as price competition, sales figures, market share, delivery periods, etc...
Bureaucratic Control: Which analyses and focuses on enforcement or implementation of rules, regulations, procedures and policies of the organization.
Clan Control: Which analyses and focuses on regulating activities, based on implications
(meanings)
of the firm's Culture, such as values, norms, traditions, rituals and beliefs that are shared by members of the organization.
No page Slide 4
Why Is Control Important?
•
It is the final link in management functions and the only way managers know whether organizational goals are being met and, if not, the reasons why.
Planning-controlling link
Controls let managers know whether their goals and plans are on target and what future actions to take.
Control and management
Managers need to delegate
(give)
duties and empower
(authorize)
employees to make decisions. But because managers are responsible for performance results, they need the feedback mechanism
(process)
provided by the control system.
which is Page 386 Slide 5
Page 386 The Planning –Controlling Link Exhibit 19.2
Slide 6
The Control Process
•
The Process of Control
1.
Measuring actual performance.
2.
Comparing actual performance against a standard.
3.
Taking action to correct deviations
(differences)
or inadequate
(unsatisfactory)
standards.
Page 387 Slide 7
Page 387 The Control Process Exhibit 19.3
Slide 8
Measuring: How and What We Measure
•
Sources of Information
Personal observation
Statistical reports
Oral reports
Written reports What we measure is more critical to the control process than how we measure:
-- The selection of wrong criteria can result in serious consequences
-- What we measure determines what people in the organization will attempt to excel at
(to improve)
.
•
Control Criteria
Employees
Satisfaction
Turnover
Absenteeism
Budgets
Costs
Output
Sales Page 388 Slide 9
Common Sources of Information for Measuring Performance Slide 10
Comparing
•
Determining the degree of variation between actual performance and the standard.
It is critical to determine the acceptable range of variation.
The size (large or small) and direction (over or under) of the variation from the standard (forecast or budget).
Page 389 Slide 11
Defining the Acceptable Range of Variation Page 389 Exhibit 19.4
Slide 12
Sales Performance Figures for July, Eastern States Distributors Page 390 Exhibit 19.5
Slide 13
Taking Managerial Action
•
Courses of Action
“Do nothing”
Only if deviation is judged to be insignificant
(minor)
.
Correct actual performance
Immediate corrective action to correct the problem at once.
Basic corrective action looks at how and why performance has deviated and corrects the source of the deviation.
Possible corrective actions:
–
Change strategy, structure, compensation scheme, or training programs; redesign jobs; or fire employees.
Page 390 Slide 14
Taking Managerial Action
•
Courses of Action
Revising the standard
Examining the standard to ascertain
(check)
whether or not the standard is realistic, and achievable.
–
Resetting goals that may have been too high or too low.
Page 391 Slide 15
Managerial Decisions in the Control Process Exhibit 19.6
Page 392 Slide 16
Types of Control
•
Feedforward Control
Focuses on preventing anticipated problems before they occur.
It takes place before the actual work activity.
•
Concurrent
(simultaneous)
Control
It takes place while a work activity is in progress.
Direct supervision: management by walking around.
The manager concurrently monitors actions and corrects problems as they occur.
Page 393 Slide 17
Types of Control
•
Feedback Control
Takes place after a work activity is done (after-the fact) .
A major drawback
(disadvantage)
is that by the time the manager has the information, the problems have already occurred. At this point, the manager’s only option is to try and correct the situation.
Advantages of feedback
Feedback provides managers with information on the effectiveness of their planning efforts.
Feedback enhances employee motivation by providing them with information on how well they are doing.
Page 394 Slide 18
Types of Control Page 393 Exhibit 19.7
Slide 19
Types of Control
•
Contingency Factors in Control These factors include:
Size of the organization
One’s position in the organizational hierarchy
Degree of decentralization
Organizational culture
Importance of a work activity Page 395 Slide 20
Types of Control
•
Contingency factors in Control
The size of the organization
A small organization relies more on informal and personal control approaches. Larger organizations rely on formal control systems and highly formalized feed forward and feedback controls .
One’s position in the organizational hierarchy
Lower level jobs have clearer definitions of performance. The higher up one moves in the hierarchy, the greater the need for multiple
(many)
of control criteria.
sets Page 396 Slide 21
Types of Control
•
Contingency factors in Control
The degree of decentralization
The greater the degree of decentralization, the more managers need feedback on employees’ decisions and performance. Because managers are ultimately
(in the end)
responsible, they want assurances that their employees’ actions are effective and efficient.
The organizational culture
In a culture of trust, autonomy
(independence)
and openness, we can expect to find informal self-control. In another of fear, reprisal and mistrust, we find externally imposed
(enforced)
and formal control systems.
Page 396 Slide 22
Types of Control
•
Contingency factors in Control
The importance of a work activity
The degree of importance of a work activity influences
(determines)
whether, and how, it will be controlled. If an error can be highly damaging to the organization, extensive controls are likely to be implemented.
Page 397 Slide 23
The Controller and Control The job of the controller
The controller is the staff person who assists managers with the controlling function by gathering
(collecting)
information and generating
(developing)
reports.
In smaller organizations, managers may themselves gather this information and develop reports. In medium-sized to large companies, the controller handles this work.
Page 399 Slide 24
The Controller and Control The job of the controller
The controller is responsible for generating information managers need to exercise the control function. He/she usually works with information about: 1.
Profits 2.
3.
4.
5.
Revenues
(income & taxation)
Costs Investments Discretionary
(undetermined)
expenses.
Page 400 Slide 25
The Controller and Control How Much Control is Needed?
The process of comparing the cost of an activity with the expected benefit of implementing the activity is called cost benefit analysis.
Control activities should be implemented if the expected benefits of such activities exceed
(are greater than)
the cost of these activities.
Page 400 Slide 26
Power and Control
•
Power:
The degree to which an individual is able to influence others so that they respond to orders.
The greater this ability, the more power an individual is said to have.
Orders given by a manager may or may not be followed precisely
(exactly)
, depending on how much power the manager has over others.
Page 402 Slide 27
Power and Control
•
Total Power
The total power a manager has is made up of two different kinds of power.
a) b) Position power: Power derived
(gained)
from the organizational position a manager holds.
Personal power: Power derived
(gained)
a manager’s relationship with others.
from Page 402 Slide 28
Power and Control
•
Increasing Total Power
Managers can increase their total power by enhancing
(increasing)
their position power, their personal power or both.
Importance of developing personal power
Trying to control others solely on the basis of one’s position simply does not work.
Not many will passively accept and completely obey a constant stream of orders from someone just because he/she is the “boss”.
Page 402 Slide 29
Power and Control
•
Increasing Personal Power
To increase personal power managers should encourage and develop these beliefs and attitudes in other organization members.
1.
2.
3.
4.
A sense of obligation toward the manager.
A belief that the manager possesses a high level of expertise.
A sense of identification with the manager.
The perception that they are dependent on the manager.
Page 403 Slide 30
Increasing Personal Power
1.
2.
3.
4.
A sense of obligation toward the manager: personal favors for people.
Do A belief that the manager possesses a high level of expertise: Quietly make your achievements visible to others, build up a successful track record and a solid professional reputation.
A sense of identification with the manager: Behave
(act)
in ways that other members respect; share their goals, values and ideals.
The perception that they depend on the manager: Convey
(make known)
the amount of authority you have over organizational resources such as salaries and bonuses. The Golden Rule : “He who has the gold makes the rules”.
Page 403 Slide 31
Performing the Control function
•
Barriers to Successful Controlling
Long-Term Versus Short-Term Production Quotas
(numbers)
.
E.g. To ensure that performance meets the production quotas
(numbers)
in the short term, machines might be “pushed” hard for a higher output, by managerial decision. This kind of action could prevent the machines to be serviced properly, cause them to deteriorate, and make it impossible to meet long-term production standards.
Page 404 Slide 32
Performing the Control function
•
Barriers to Successful Controlling
Employee Frustration
(disappointment)
and Morale
(team spirit)
.
Worker morale tends to be low when management exerts too much control and will not allow them the freedom they need to do a good job.
Page 404 Slide 33
Performing the Control function
•
Barriers to Successful Controlling
Filing of Reports.
Employees may feel pressured
(obliged, compelled)
to falsify
(cheat on)
reports so that corrective action concerning their organizational unit will not be drastic
(forceful)
or too severe
(strong)
.
Page 404 Slide 34
Performing the Control function
•
Barriers to Successful Controlling
Perspective
(view)
of Organization units.
Managers must remember to consider any corrective action not only in relation to the specific activity being controlled, but also in relation to its effect on all other organizational units.
Page 405 Slide 35
Performing the Control function
•
Barriers to Successful Controlling
Means
(method)
Versus Ends
(goals)
.
Managers must keep in mind that the information gathering and report generating in the control process can be costly
(expensive)
, and should only be justified
(acceptable)
if those activities yield
(provide)
benefits that exceed the cost of performing them.
Page 405 Slide 36
Performing the Control function
•
Making Controlling Successful
To make the control process more effective, managers should consider the following factors.
Specific organizational activities being focused on.
Different kinds of organizational goals.
Timely
(prompt)
corrective action.
Communication of the mechanics
(procedure)
of the control process.
Page 403 Slide 37
Performing the Control function
•
Making Controlling Successful
Specific organizational activities being focused on.
Managers must make sure the various aspects of the control process are appropriate for the control activity that is being carried out
(executed)
.
E.g. Standards of measurements concerning line workers’ productivity are different from standards of measurements concerning a vice president’s performance.
Page 405 Slide 38
Performing the Control function
•
Making Controlling Successful
Different Kinds of Organizational Goals.
The control process can be applied to many different facets
(aspects)
of organizational life. Each of these facets must be considered to provide maximum benefit from controlling.
Page 406 Slide 39
Page 406
Performing the Control function
•
Making Controlling Successful
Timely Corrective Action.
Managers should take the corrective action as promptly as possible to ensure that the situation depicted
(shown)
by the control process has not changed.
Slide 40
Performing the Control function
•
Making Controlling Successful
Communication of the Mechanics
(procedure)
of the Control Process.
All individuals involved in controlling must have a working knowledge of how the control operates.
Page 406 Slide 41
Contemporary Issues in Control
•
Cross-Cultural Issues
In technologically advanced nations , managers use indirect control devices -- computer generated reports and analyses -- in addition to standardized rules and direct supervision to ensure that work activities are going as planned.
In less technologically advanced countries, managers tend to rely more on direct supervision and highly centralized decision making for control.
Page 407 Slide 42
Contemporary Issues in Control
•
Workplace Concerns
Workplace privacy
Employee theft
Workplace violence Page 408 Slide 43
Contemporary Issues in Control
•
Workplace Concerns
Workplace privacy versus workplace monitoring
Many companies monitor employee usage of E mail, telephone, computer, and Internet.
Concerns about offensive messages, inappropriate images displayed on workers’ computer screens, racial and sexual harassment
(mistreatment, annoyance)
including leaking
(telling)
of company secrets are reasons for workplace monitoring.
Page 408 Slide 44
Types of Workplace Monitoring by Employers Internet use Telephone use E-mail messages Computer files Job performance using video cameras Phone conversations Voice mail messages 54.7% 44.0% 38.1% 30.8% 14.6% 11.5% 6.8%
Source:
Based on S. McElvoy, “E-Mail and Internet Monitoring and the Workplace: Do Employees Have a Right to Privacy?”
Communications and the Law
, June 2002, p. 69.
Page 408 Exhibit 19.9
Slide 45
Contemporary Issues in Control
•
Workplace Concerns
Employee theft
The unauthorized taking of company property by employees for their personal use.
Fraudulent
(dishonest)
filing of expense reports.
Removing equipment, parts, software, and office supplies from company premises.
We can use the concept of feedforward, concurrent, and feedback control (see slide #46) to identify measures for reducing employee theft.
Page 409 Slide 46
Page 410 Control Measures for Employee Theft or Fraud
Sources:
Based on A.H. Bell and D.M. Smith. “Protecting the Company Against Theft and Fraud,”
Workforce Online
(
www.workforce.com
) December 3, 2000; J.D. Hansen. “To Catch a Thief,”
Journal of Accountancy
, March 2000, pp. 43 –46; and J. Greenberg, “The Cognitive Geometry of Employee Theft,” in
Dysfunctional Behavior in Organizations: Nonviolent and Deviant Behavior
, eds. S.B. Bacharach, A. O’Leary-Kelly, J.M. Collins, and R.W. Griffin (Stamford, CT: JAI Press, 1998), pp. 147 –93.
Exhibit 19.10
Slide 47
Contemporary Issues in Control
•
Workplace Concerns
Workplace violence
Anger, rage, and violence in the workplace is affecting employee productivity.
Factors contributing to workplace violence include employee stress caused by rising layoffs
(firings)
, long working hours, unrealistic deadlines and uncaring managers.
The competitive demands of succeeding in a global economy put pressure on organizations and employees in many ways.
We can use the concept of feedforward, concurrent, and feedback control (see slide #49) to identify actions for managers.
Page 410 Slide 48
Workplace Violence Witnessed yelling or other verbal abuse Yelled at co-workers themselves Cried over work-related issues Seen someone purposely damage machines or furniture Seen physical violence in the workplace Struck a co-worker 42% 29% 23% 14% 10% 2%
Source:
Integra Realty Resources, October-November Survey of Adults 18 and Over, in “Desk Rage.”
BusinessWeek
, November 20, 2000, p. 12.
Page 410 Exhibit 19.11
Slide 49
Page 412 Control Measures for Deterring or Reducing Workplace Violence
Sources:
Based on M. Gorkin, “Five Strategies and Structures for Reducing Workplace Violence,”
Workforce Online
(
www.workforce.com
). December 3, 2000; “Investigating Workplace Violence: Where Do You Start?”
Workforce Online
(
www.forceforce.com
), December 3, 2000; “Ten Tips on Recognizing and Minimizing Violence,”
Workforce Online
(
www.workforce.com
), December 3, 2000; and “Points to Cover in a Workplace Violence Policy,”
Workforce Online
(
www.workforce.com
), December 3, 2000.
Exhibit 19.12
Slide 50
C H A P T E R R E V I E W 1/6 What Is Control and Why Is It Important?
(slides 2~5)
3) 4) 5) 1) 2) Define control.
Contrast the three approaches to designing control systems.
Discuss the reasons why control is important.
Explain the planning-controlling link.
What is the role of control in management?
Page 415 Slide 51
C H A P T E R R E V I E W 2/6 The Control Process
(slides 7, 9~11, 14, 15)
6) 7) 8) 9) Describe the three steps in the control process.
Name four methods managers can use to acquire information about actual performance.
Explain why what is measured is more critical than how it’s measured.
Explain the three courses of action managers can take in controlling.
Page 386 Slide 52
C H A P T E R R E V I E W 3/6 Types of Control
(slides 17, 18, 20~23)
10) Contrast feedforward, concurrent, and feedback controls.
11) What types of contingency factors will affect the design of an organization’s control system?
The controller and Control
(slides 24~26)
12) What is a controller?
13) What would a typical job description for a controller include?
14) How are cost-benefit analysis and controlling related?
Page 415 Slide 53
C H A P T E R R E V I E W 4/6 Power and Control
(slides 27~31)
15) What is power?
16) Discuss the relationship between power and control.
17) What is total power?
18) Define position power.
19) Define personal power.
20) How can managers increase their total power?
21) What steps can managers take to increase personal power?
Page 402 Slide 54
C H A P T E R R E V I E W 5/6 Performing the Control Function
(slides 32~41)
22) Discuss long- and short-term production quotas as barriers to controlling 23) How can employee frustration and morale be barriers to controlling?
24) How can filing reports be a barrier to controlling?
25) How can the perspective of organization members affect controlling?
26) Discuss means versus ends as a factor affecting controlling.
27) What tactics can managers use to make controlling successful?
Page 404 Slide 55
C H A P T E R R E V I E W 6/6 Contemporary Issues in Control
(slides 42~44, 46, 48)
28) 29) Describe how managers may have to adjust controls for cross-cultural differences.
Discuss the types of workplace concerns managers face and how they can address those concerns.
Page 415 Slide 56