PRINCIPLES OF MANAGEMENTSr. No. Chapter No. Chapter Heading

1 1 Management: Science, Theory and Practice (27th September 2010)2 4 Essentials of Planning and Managing by Objectives (4th Oct)3 5 Strategies, Policies and Planning Premises (11th Oct)4 6 Decision Making (18th Oct)

5 7 The Nature of Organizing, Entrepreneuring, and Reengineering (25th Oct)

6 8 Organization Structure: Departmentation (1st Nov)7 9 Line/ Staff Authority, Empowerment and Decentralization (15th Nov)8 10 Effective Organizing and Organization Culture (22nd Nov)9 14 Human Factors and Motivation

10 15 Leadership11 16 Committees, Teams and Group Decision Making12 18 The System and Process of Controlling (29th Nov)

Sessional Evaluation External Evaluation15 15 20 50 50

Quiz per Class Assignment & Presentation Mid-term Total Sessional External Exam

Planning

O r g a n i z i ng

Leading

C o n t r o l l i n g

GROUP WISE ASSIGNMENTS1. Compensatory assignments2. Classes left? Sunday class? Next few classes3. Project (4 groups of 7 each) 15 marks

1. Portfolio Matrix with TOWS (Chap 3)2. Planning stages of a new company (Chap 2,3)3. Departmentation (chap 6) and culture(chap 8)4. Controls (chap 12)

4. Mark dates, assignment to students

The System and Process of ControllingmQ

http://www.slideshare.net/Subjectmaterial

Chapter 12

TABLE OF CONTENTS1. THE BASIC CONTROL PROCESS2. CRITICAL CONTROL POINTS, STANDARDS, AND

BENCHMARKING3. CONTROL AS A FEEDBACK SYSTEM4. REAL-TIME INFORMATION AND CONTROL5. FEEDFORWARD, OR PREVENTIVE, CONTROL6. CONTROL OF OVERALL PERFORMANCE7. PROFIT AND LOSS CONTROL8. CONTROL THROUGH RETURN ON INVESTMENT9. MANAGEMENT AUDITS AND ACCOUNTING FIRMS10. BUREAUCRATIC AND CLAN CONTROL11. REQUIREMENTS FOR EFFECTIVE CONTROL

QUIZ

Disclosed quiz for next sessionTake the words home as many as possible …

THE BASIC CONTROL PROCESSWhat is controlling?

The measurement and correction of performance in order to make sure that enterprise objectives and the plans devised to attain them are being accomplished

The Basic Control ProcessEstablishment of standardsMeasurement of performanceCorrection of Deviation

CRITICAL CONTROL POINTS, STANDARDS, AND BENCHMARKING

The principle of critical point control:Effective control requires attention to factors critical

to evaluating performance against plansTypes:

Physical StandardsCost StandardsCapital StandardsRevenue StandardsProgram StandardsIntangible StandardsGoals as standardsStrategic plans as control points for strategic control

Systematic monitoring at strategic control points and modifying the organization’s strategy based on this evaluation

CRITICAL CONTROL POINTS, STANDARDS, AND BENCHMARKING

Benchmarking:An approach for setting goals and productivity

measures based on best industry practicesTypes

Strategic BenchmarkingIt compares the various strategies and identifies the key

strategic elements of succesOperational Benchmarking

It compares relative costs or possibilities for product differentiation

Management BenchmarkingIt focuses on support functions such as market planning

and information systems, logistics, human resource management and so on

Management control is a feedback system, similar to common household thermostat

A thermostat is used to control/ regulate the heat/ temperature of the system

Manager measure actual performance, compare this against standards, and identify and analyze deviations.

They need to develop a program for corrective action and implement this program to arrive at the desired performance levels

CONTROL AS A FEEDBACK SYSTEM

CONTROL AS A FEEDBACK SYSTEM

Desired performance

Actual performance

Measurement of actual

performance

Comparison of actual

performance against

standards

Identification of deviations

Analysis of causes of deviations

Program of corrective

actionImplementation of Corrections

Real-Time information pertains to knowing what is happening, while it is happening

Examples flight info, electronic cash registers, time lines etc

Manager collect data and find the deviations through Real Time information systems, Further analysis of data needs specialization

Programmed decisions may be taken although where structured tasks are being monitored

REAL TIME INFORMATION AND CONTROL

FEED FORWARD, OR PREVENTIVE CONTROL