Control
This is actually a summary of items discussed in the following
chapters (17, 18, and 19)
What is control?
-The process of monitoring activities to ensure that the activities
(and results) are
being accomplished according to plans. Control is also the process of taking corrective
action to adjust the activities towards the plan.
The control process:
1. Measure actual performance
-Observation (MBWA)
-Statistical
-Written /oral reports
2. Comparison-Range of variation-
3. Taking managerial action
Correction or Change
Types of control:
1. Feed forward- Anticipates problems and resolves the
problems before they happen.
2. Concurrent-
3. Feedback
Qualities of control system
1. Accuracy
2. Timelines
3. Economical
4. Flexibility
5. Understandability
6. Reasonable- (and attainable)
7. Placement of controls- We cannot have controls in every
area. We must put controls in sensitive
areas.
8. Emphasis on the exception
9. Multiple criteria
Ethical problems with control:
Employee privacy- Drug testing
3 types of control:
A. Operational control
Controlling the transformation process that
converts labor and RM into finished
goods.
Controlling operations
1. Direct costs
2. Indirect costs
3. Purchasing controls
-Inventory ordering
Safety stock and EOQ
4. Maintenance controls
-Preventative maintenance
5. Quality control
-Sampling
-TQM
6. Reducing inventory
-Just in time
-Outsourcing
B. Financial Controls
-Budgeting
-Ratio analysis
C. Behavioral controls
-Direct supervision
-Performance Appraisals
-Discipline- Progressive
discipline
-Immediate -Warnings
-Consistency -Impersonal
- Staffing -Culture
-Structure -Training