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Management Control System

Program : MBA Credit : 2 Semester : IV

Objective: To give s a broad understanding of the control process, control systems and their applications to real life business situations Learning Outcome: Ability to understand importance of the control systems in an organization and the knowledge to design the control process Prescribed Textbook: Title Author/ Publications
Management Control Systems Case Mapping and Session Plan
Sessi on 1 Topic Topics Covered Overview of Management Control System 2 Introduction to Management 3 Control Systems Nature of Organizations and need for Management Control The Subsystems and the Components of Control Systems. Chapter 1 (RA VG): The Nature of Management Control Systems Chapter 1: Management Control Systems By Joseph Maciariello and Calvin Kirby 4 Understanding Strategies Chapter 2: Understanding Strategies ( MCS by RAVG) Becton Dickson: Designing the New Strategic, Operational, and Financial Planning Process (HBS Ref No. 9-197-014) 5 Behavior and Managerial Styles and the Design Chapter 4 Style and Culture and the Guidant Corporation: Shaping Culture ATH Micro Technologies : Making the Numbers (HBS Ref No: 9-108-091) Nucor Corp A & B (Case no 1-1 and 3-2 in RA VG Additional Reading Discussion on Course Handout Case Title

Class of : 2014 Sessions : 22

Robert Anthony & Vijay Govindarajan; 12th Edition, Tata McGraw-Hill

Culture for Control Systems

of Control Systems - Corporate Culture and the Design of Control Systems.

Design of Control Systems (MCS By Joseph Maciariello and Calvin Kirby) Chapter 3- Behavior in Organizations (MCS By RA VG

through Systems (HBS Ref No. 9-198-076)

Decentralization vs. Centralization - Evolution of the Matrix Structure - Matrix vs. Functional - Divisional Autonomy

Chapter 5 - Infrastructure I : Organizing for Adaptive Control (MCS by Joseph Maciariello and Calvin Kirby ) Chapter 4 Responsibility Centers: Revenue and Expense Centers Chapter 5 Profit Centers

Appex Corporation (HBS Ref No.9-491-082)

7&8 Organization Structure and Control 9

Responsibility Structure - Overall Effectiveness Measures - Standard Cost Center - Revenue Center Profit Center - Investment Center Transfer Pricing Objectives Methods and simple problem in Transfer Pricing Budgeting as a control tool

North County Auto (Case no 5-2 in RA VG) Higashimaru Shoyu Company, Ltd.(A): Price Control System (HBS Ref No.9-195-050)

Chapter 6: Transfer Pricing

Birch Paper Company (HBS Ref No.9-158-001)


Chapter 9: Budget Preparation

Empire Glass Company (A) (HBS Ref No.9109-043)


Beyond Budgeting

Borealis (HBS Ref No.9-102-048)

Management Control Process 12 NCP - 1 CLASS TEST - Class Test 1 15% Weightage

13 Analyzing and reporting financial performance analysis of variances Chapter 10: Analyzing Financial Performance Chapter 11: Performance Measurement Systems 14 Performance Measurement Interactive Control- Target Costing - Activity based costing 15 Management Compensation & Communication 16 Management Control in Service Organizations Rewards as a control toolCharacteristics of IncentivesCommunication Structures in Support of the Control Process Impact of Information Technology on Control Systems. Introduction Nature of Control in service organizations Control systems in Financial Institutions Chapter 14: Service Organizations OReilley Associates (Case no 14-1 in RA VG) Chapter 12: Management Compensation Crown Point Cabinetry (Case no 12-2 in RA VG) Chapter 11: Performance Measurement Systems Continental Media Group : Business Highlights (HBS Ref No. 5-110-090) Problems on Material & Labor variances


Management Control in

Cultural differences and resulting structural design problems Transfer Pricing

Chapter 15: Multinational Organizations

Labor Unrest at Honda Motorcycle & Scooter India (P) Ltd. ICMR- HROB104


Multinational Corporations

AB Thorsten (Case no 15-1 in RA VG)


Management Control in Projects

Nature of Planning and Control in Projects control environment in projects reporting project auditing Evaluation of projects.

Chapter 16 Management Control of Projects

Turner Construction Company: Project Management Control Systems (HBS Ref No.9190-128)

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NCP -2 CLASS TEST - 15% weightage Objectives types of risks- Risk Enterprise Risk Management management process- COSO ERM framework Turnaround Strategy, Control Systems, Incentives, Organizational & Cultural changes Other contemporary issues

Countering the biggest Risk of All (HB Article) Enterprise Risk Management at Hydro One (HBS Ref No.9-109-001 Ranjana Kumar Interview in IIMB Management Review, March 2004


Comprehensive view of Control System


It would have four components as follows (with weight): 1. Class Participation : 30% 2. Class Test 1 & 2: 30% 3. End term examination: 30% 1. Class participation 40% CP 1 CP 2 After 11th Session After 22nd Session 15 % 15%

2. Class Test 1 (15 %) - will be held on the 12th Session 3. Class Test 2 (15%) - will be held on the 20th Session 4