Management Control Systems

Program : MBA Class of : 2011

Credit : 3 Sessions : 33
Course Code : SL GM 601 Third Semester

Objective
The objective of the course is to give students a broad understanding of the control process & reporting systems and
their applications to real life business situations.

REFERENCE BOOKS AUTHOR / PUBLICATION

Management Control Systems
Management Control Systems
Management Control Systems : Using Adaptive
Systems to Attain Control, 2nd e
Management Control Systems : Text and Cases
Management Control Systems
Robert Anthony and Vijay Govindarajan -
Special Indian Edition –TMH
IUP
Maciariello, Joseph A / Kirby, Calvin J .
Prentice-Hall, India
Anthony, Robert N / Deardon, John. Irwin Inc
Dutta, Abhijit . Kalyani Publishers

Detailed Syllabus
Introduction to Management Control Systems: Nature of Management Control - Purpose of Management Control
Systems - The Organizational Context of Managerial Control Systems - The Formal Systems - The Informal
Systems - The Subsystems and the Components of Control Systems – Use of Information Technology on Control
Systems
Designing the Control Process and Managerial Controls: Introduction - Schools of thoughts in control
(contingency approach, Cybernetic Approach, Management control process approach) - Designing Management
Controls - The Control Process Hierarchy - Communication and Reporting Structures in the Control Systems.
Key Success Variables and Measures of Performance: Identification of Key Success Variables - Key Success
Variables and the Control Paradigm - Performance Indicators - EVA, Profitability measures.
Design, Style and Culture of Control Systems: Managerial Styles and the Design of Control Systems - Corporate
Culture and Control Systems - Establishing a Customer-Focused Culture.
Organization Structures for Adaptive Control: Different types of organization structures and control implications
– Role of Controller in different organizational structures – Structural requirements for an Adaptive Organization.
Autonomy, Responsibility and Performance Measurement: Divisional Autonomy - Style and Processes of
Management - Responsibility Structure - Overall Effectiveness Measures - Standard Cost Center - Revenue Center -
Profit Center - Investment Center - Performance Measurement of Decentralized Operations - Inter profit - Center
Relations.
Tools for Management Control: Budgeting as a control tool – Analyzing and reporting financial performance –
analysis of variances - Target Costing - Activity based costing- (simple numerical examples to be used to explain the
above tools) - Quality Control tools (focus on how they act as tools for operational control)
Management Control in Multinational Corporations: Control Issues in the Multinational Corporation - Cultural
differences and resulting structural design problems - Transfer Pricing - Foreign Exchanges Management.
Management Control in Non-Profit Institutions: Introduction - The Mission of Non-Profits institutions - Key
Success Factors - Performance Measures - Management Style and Culture - Formal Control Processes

Detailed Syllabus – The Class of 2011 1

Management Control in Service Organizations: Introduction - Implications for Management Control in service
organizations – Control systems in Financial Institutions - Professional Service Organizations and Hospitality
Sectors
Management Control in Projects: Nature of Planning and Control in Projects - control environment in projects –
reporting – project auditing – Evaluation of projects
Management Audit: Introduction- Circumstances Leading to Development of Management Audit (including
various types of functional audits) - Weaknesses Revealed by Management Audit - Management Audit Process -
Financial Audit, Cost Audit, Internal Control/Audit and Management Audit – Parameters of evaluating of
management audit – Social and environmental audits.
Cases
Faculty will be handling eight or more cases
Jack Welch and Jeffrey Immelt – Continuity and Change in Strategy, Style, and Culture at GE
Infosys’ Global Delivery Model
Some HR Dilemmas in Information Technology and Business Process Outsourcing Firms
EVA and Compensation Management System at Tata Consultancy Services
Balanced Scorecard Implementation at Philips
Hollinger International – The Lord Black Saga
BP: Putting Profits before Safety?
Corporate Governance at Ahold
P&G’s Brand Management System
Global Supply Chain Management – Best Practices at Li & Fung Limited
Amazon.com’s Inventory Management
Consumer-driven Six Sigma at Ford
The AXA Way – Improving Quality of Services
The Millau Viaduct Project – Creating an Engineering Marvel
Xerox PARC – Innovation without Profit?
Human Resource Management System Reforms at Matsushita
Outsourcing IT – The GM Way
CRM Implementation Failure at Cigna Corporation
Governance and Control at AXA
Ping Fu – Inspiring Entrepreneurship
Source: Case studies in Management Control Systems

Detailed Syllabus – The Class of 2011 2

 Suggested Schedule of Session

Topic No. of Sessions

Introduction to Management Control Systems 2
Designing the Control Process and Managerial Controls 2
Key Success Variables and Measures of Performance 2
Design, Style and Culture of Control Systems 3
Organization structure for Adaptive Control 2
Autonomy, Responsibility and Performance Measurement 4
Tools for Management Control 5
Control of Multinational Operations 4
Control of Non-profit Institutions 2
Control of Service Organizations 2
Management Control of Projects 2
Management Audit 3
Total Sessions 33

Detailed Syllabus – The Class of 2011 3