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Management Controll System Book

Management Controll System Book

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Management Controll System Book BEC DOMS BY BABASAB PATIL
Management Controll System Book BEC DOMS BY BABASAB PATIL

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Published by: Babasab Patil (Karrisatte) on May 23, 2012
Copyright:Attribution Non-commercial

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MANAGEMENTCONTROLSYSTEMSBABASABPATIL(BECDOMS)
1
MANAGEMENTCONTROLSYSTEMS
MANAGEMENTCONTROLSYSTEMSUnit-1
Nature of Management Control - Control in organizations - Phases op management control system- Management control vs task control. (3)
Unit-2
Control and Organizational Behavior - Types of organizations and their implications -Types of organizations and their implications - Types of control and variations in control based on organizationalstructure and design. (32)
Unit-3
 
Goals and Strategies - Key variables in management control design and their types - Key result areas. (53)
Unit-4
Management Control Structure - Expense control - Profit centers Transfer pricing -Investmentcaters - Management control process Programming and budgeting -Analyzing reporting - Performanceevaluation. (83)
Unit-5
M.I.S. for Management Control - Systems theory and management control - Installation of management information and control system Structured and unstructured decision - Implication for control.(138)
Unit-6
Special Management Control Situations - Multinational companies Service organizations -Non-profitorganizations - Multi-project organization. (164)
 
MANAGEMENTCONTROLSYSTEMSBABASABPATIL(BECDOMS)
2
Unit1
Nature of Management Control - Control in Organizations - Phases of management control system -Management control vs. task control.
NatureandScopeofManagementControl
Every Organization exists to achieve certain objectives. It as limited sources at its command andoperates quite often in a dynamic environment. In order to achieve its objectives; the managersadministrators of the organization prepare and execute plans. After the plans are put into action there canbe several hurdles in the achievement of objectives. Plans are themselves may not be effective,Organization structure may be defective, staff may be incompetent, motivated, direction may be faulty orthe changes in the environment may disturb the operations. As a result performance may fail short of targets or expectations. Managers, therefore, require a system by which they can regularly monitorprogress, identify the bottlenecks and take timely actions to set right. This is the function of control.
MEANINGOFMANAGEMENTCONTROL
Control is the System of ensuring that the actual state of affairs is in line in the desired state of affairs. It is the process of ensuring that activities and plans are producing the desired results. Accordinglyto
Anthony 
et.al.” Management control is the process
by 
which managers assure that resources obtainedand used effectively and efficiently in the accomplishment of the organization's objectives."This definition highlights three main points about management control.
First,
management controlis a Process consisting of some inter-related and sequential steps. Secondly, management control aims ateffectiveness and efficiency in the acquisition and utilization of resources such as money, materials,machinery and manpower. Thirdly, management control is designed to further the objectives of dieorganization.Anthony’s definition appears to be comprehensive though loose or general in nature. It does notspecify that management control is a continuous process of [measuring actual results with the desiredresults and of minimizing the gap between the two. It involves guiding and regulating operations towardssome pre-determined targets.In the words of Koontz and O’Donnell, “Managerial control implies the measurement oaccomplishments against the standards and the correction of deviations to assure attainment of objectivesaccording to plans”.This definition focuses on the measurement of performance and corrective actions for ensuring thatplanned targets are achieved. However, the ongoing nature of control is not explicit in the definition.Moreover, corrective actions are not confined to adjustment of operations alone. Plans themselves mighthave to be revised.Mills has defined management control as “the handling of people-employees within theadministration, and clients, suppliers, government officials, bankers outside it-to get decisions made andcarried out in ways that will achieve the firm’s, objectives.
 
This definition appears to be too wide and treats management control as the total Managementprocess. Management control is an important function. Bin it is by no means the Whole of management. Forexample, management control does not include selection of personnel and building up of an organization.Tannenbaum has defined control as “any process in which a person or a group of persons or organizationof persons determined, that is, intentionally affects the behavior of another person, group or organizationThis concept of control equates control with influence and, therefore, this definition fails to differentiatebetween control and leadership.Management control may simply be defined as the continuous process of verifying whether actionsare being taken as planned and ensuring that the desired objectives are being taken as planned andensuring that the desired objectives are being efficient and effectively.Management control is thus concerned with the maintenance, which is required to achieve thepurposes of the organization.
 
MANAGEMENTCONTROLSYSTEMSBABASABPATIL(BECDOMS)
3
NATUREANDSCOPEOFMANAGEMENTCONTROL
Management control is by nature both restrictive as well as regulative. Traditionally, managementcontrol is by nature both restrictive as well as regulative. Traditionally, management control has beenassociated with restricting people. Under the traditional view, control-enables us to compare targets withactual performance and to take corrective action where deviation occur. This view takes the targets as giveand control system is designed to tell us how near we are to the planned course. This view of control isessentially a restricted short range onetime, regulating the existing programme.The modern view of control is that it is designed not only to tell us how near we are to our targetshut to evaluate the targets themselves in relation to both the constraints in the external environment andthe available resources. Environmental changes can make existing plans inappropriate and the main task of the top management is to ensure the plans are adjusted continuously to the changing environment. This isa more comprehensive and realistic view of Control. Under it control and planning are treated asinterrelated rather than as independent functions. Its purpose is not only to regulate but also to improveresults rather than restricting actions.
OVERVIEWOFMANAGEMENT
Management is that function of an industrial undertaking, which organizes, directs and controlsvarious activities of the enterprise directed towards specific ends (objectives). The objectives of theenterprise are accomplished through the use of resources like men, money, material, machines, matters(information) and minutes. The management function of a concern is a major segment of co-ordination.Management entails the coordination of human effort and material resources toward the achievement of organizational i objectives.Harbison and Myers* observe Management as
 
(a) An economic source, because the management resources of a firm determine; to a large extent itsproductivity and profitability.
 
(b) A system of authority, because historically, first of all management developed AuthoritarianPhilosophy, and(c) A Class and Status system, because entrance into the class of managers is based upon highereducation and brain.Management embraces all duties and functions that pertain to the initiation of an enterprise, itsfinancing, the establishment, of all major policies, the provision of all necessary equipment, the outliningof the general form of organization under which the enterprise is to operate and the selection of theprincipal officers.
PrinciplesofManagement-CONTRIBLTORS
A principle of Management implies a list of current management practices. - Though F.W. Taylordeveloped principles of management; Credit, goes to Henri Fayol, a French, management theorist foradvocating and publicizing certain principles (or laws) for the soundness and good working of themanagement. Henri Fayol warned that the principles of management should be, (i) Flexible and notabsolute-must be usable regardless of changing conditions, (ii) Used with intelligence and with a sense of proportion, etc. Henri Fayol listed 14 principles, that grew out of his experience.
THECONTROLFUNCTIONSTheControlFunction:
 
Planning sets forth the objectives a manager intends to pursue. Organizingprovides the structure, people and responsibility, to attain those objectives. Directing provides theleadership, the motivating environment. Control provides knowledge of deviation from plans and correctionfor assurance of conformance to plans. Control is the determination or measurement of progress towardobjectives in accordance with the established plans. It concerns the attainment of the planning, organizing,directing, and staffing objectives.
ControlandSupervision
 
: Some people confuse the term “control” with ‘Supervision’. Control includessupervision to see that employees perform what they are supposed to perform and measurement of 

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