TRADITIONAL AND

MODERN CONTROL
TECHNIQUES

PRESENTED BY:-
PUNIL GUPTA
ROLL NO :-34
BIBLIOGRAPHY & REFERENCES

• MANAGEMENT BY STEPHEN P. ROBBINS &

MARY COULTER (PAGE 498-507)
• PRINCIPLE & PRACTICE OF MANAGEMENT
BY : L.M.PRASAD PAGE (692-700)
• ESSENTIAL OF MANAGEMENT
BY: HAROLD KOONTZ & WEIHRICH
PAGE 393-408
• MANAGEMENT CONCEPT,PRACTICES & SKILLS
BY: R.WAYNE MONDY & SHANE.R.PREMEAUX
PAGE 488
 WEBSITES
• WWW.MBA .HELP.ORG.
• WWW.MANAGEMENTTASK.COM
• WWW.GEOCITIES.ORG.
 DEFINITION
• “CONTROL IN MANAGEMENT MEANS
MEASUREMENT, WHEREAS CONTROLLING
IS A PROCESS OF GATHERING AND FEEDING BACK
INFORMATION ABOUT PERFOMANCE SO THAT
DECISION MAKERS
CAN COMPARE ACTUAL RESULTS WITH PLANNED
RESULTS & DECIDE WHAT TO DO
ABOUT ANY APPARENT PROBLEM “
BY : GIGLIONE & BEDEIAN
TECHNIQUES OF CONTROL

• INTRODUCTION
• TRADITIONAL CONTROL TECHNIQUES
• MODERN CONTROL TECHNIQUES
TRADITIONAL CONTROL TECHNIQUES

1. BUDGET CONTROL
USES OF BUDGETARY CONTROL
1. PLANNING
2. COORDINATION
3. CONTROL
ELEMENTS OF BUDGETARY CONTROL

1. BUDGET POLICY GUIDELINE

2. PREPARATION OF BUDGET
3. REPORTING OF VARIANCE
4. REVIEW AND FOLLOW-UP
TYPES OF BUDGET
1. EXPENSE BUDGET
2. REVENUE BUDGET
3. CASH BUDGET
4. CAPITAL BUDGET
5. SALES BUDGET
6. PRODUCTION BUDGET
7. PURCHASE BUDGET
8. LABOUR BUDGET
9. MASTER BUDGET
 STANDARD COSTING
• ADVENTAGES
1. SERVES AS A YARD STICK
2. OPPORTUNITY TO REVIEW THE COST
3. OPPORTUNITY FOR THE IMPROVEMENT IN THE
METHOD OF OPERATION
4. SERVES AS A VALUEABLE AID TO MANAGEMENT
• LIMITATIONS
1. IT IS DIFICULT & EXPENSIVE TO APPLY
2. IT DEPENDS ON RELIABILITY & ACCURACY OF
STANDARDS
3. STANDARDS MAY VARY FROM PERSON TO
PERSON
MODERN TECHNIQUES

1.BREAK EVEN ANALYSIS

 FIXED COST
 VARIABLE COST
BREAK EVEN VOLUME=TOTAL
VOLUME= FIXED COST
CONTRIBUTION MARGIN PER UNIT
• ADVANTAGES
1. TOOL FOR PROFIT PLANNING
2. BASIS FOR BUDGETING
3. OBJECTIVITY IN COSTVCONTROLING
4. INDICATION OF SAFETY MARGIN
• LIMITATIONS
1. SELLING PRICE ARE NOT EFFECTED BY
THE VOLUME OF OPERATION
 PRGRAMME EVALUATION AND
REVIEW TECHNIQUES (PERT)
• USE OF PERT IN FOLLOWING MANAGERIAL
TECHNIQUES
• PLANNING
• SCHEDULING
• CONTROL
• ADVANTAGES
1. ADVANCE PLANNING
2. SYSTEMATIC PLANNING
3. ATTENTION ON CRITICAL EVENTS
4. PROBABILITY OF FORWARD LOOKING
CONTROL
• LIMITATIONS
1. TIME ESTIMATE
2. NO EMPHASIS ON COST
 CRITICAL PATH METHOD
• ADVANTAGES
1.IT DETRMIMES PATH BETWEEN TWO OR
MORE OPERATION
2.TO LOCATE THE POINT OF LIKELY OBSTACLES
3. TO DETERMINE THE STARTING & FINISHING
TIME FOR EACH OPERATION
• LIMITATIONS
1. IT HAS LIMITED USE & APPLICATION IN
RESPECTIVE OPERATION
 MANAGEMENT AUDIT
• ADVANTAGES
1. IT IS AN INSURANCE AGAINST SELF –
COMPLACEMENT
2. IT SUPPLIES MANAGEENT WITH USEFUL
INFORMATION
3. IT EVALUATES ALL ASPECTS OF THE
ORGANIZATION
• LIMITATION
1. IT MAY DISCOARGE MANAGEMENT FROM
TAKING INITIATIVE
2. EXECUTIVES ALSO LIKELY TO BE
DISCOURAGE
CORPORATE EXAMPLE

• McDONALD’S CONTROL TECHNIQUES