Unit 1: Introduction to Management Control System

1.9 Further Readings Notes

Books Anthony, Robert N and Govindrajan, Vijay, "Management Control System", Tata
McGraw Hill.

Kaura, Mohinder N, "Management Control and Reporting System", Response Books.

Maciariello, Joseph A. and Kirby Calvin J., Management Control Systems, 2nd
Edition, Prentice Hall of India Private Limited.

Merchant, Kenneth A, "Management Control System: Text and Cases", Pearson

Education Asia.

Saravanavel, P, "Management Control System", Himalaya Publishing House.

Online links ynaweb.dti?dynasection=subsidiaries&dynapage=managementcontrolsystems

http://www.jnbs.com

http://www.scribd.com/doc/13822327/Management-control-system

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Management Control Systems Neha Tikoo, Lovely Professional University

Notes Unit 2: Strategic Management Framework

CONTENTS

Objectives

Introduction

2.1 Strategic Planning

2.2 Strategic Formulation

2.2.1 Distinction between Strategic Formulation and Management Control

2.3 Management Control

2.3.1 Management Control Activities

2.3.2 Goal Congruence

2.3.3 Tools for Implementing Strategy

2.4 Task Control/Operational Control

2.4.1 Distinction between Task Control and Management Control

2.5 Formal Control Process and Role Played by Accounting Systems and Information
Handling System

2.6 Summary

2.7 Keywords

2.8 Review Questions

2.9 Further Readings

Objectives
After studying this unit, you will be able to:
 Discuss the strategic formulation
 Identify the distinction between strategy formulation and management control
 Identify the distinction between task control and management control
 Construct the management control environment
 Explain the concept of strategy
 Describe the management and control structures

Introduction

Management Control Systems are tools to implement strategies. Strategies differ between
organizations and controls should be tailored to the requirements of specific strategies. Different
strategies require different task priorities, different key success factors and different skills,
perspectives and behaviours.

Management Control is one of the several types of planning and control activities in an
organization. The other two control and planning activities are: (a) strategic planning and
(b) task or operational control.

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 Unit 2: Strategic Management Framework

2.1 Strategic Planning Notes

Strategic planning occurs at top management levels; task control at the lowest levels in the
organization and management control is in between.

Strategic planning focus on long range planning is least systematic; uses the rough approximation
of the future. Whereas, task control focus on short runs operating activities, is most systematic;
uses accurate current data. Management control is in between.

Did u know? Each activity involves both planning and control, but the planning process is
much more important in strategy formulation; the control process is much more important
in task control and the planning and control are of approximately equal importance in
management control.

The relationship of these activities is given below:

Figure 2.1: General Relationship among Planning and Control Functions

Activity Nature of the end product

Strategy Goals Strategies and Policies

Formulation

Management Implementation of Strategies

Control

Efficient and Effective

Task Control
performance of Individual Task

Self Assessment

Fill in the blanks:

1. …………….. focus on long range planning is least systematic; uses the rough approximation
of the future.

2. …………… is one of the several types of planning and control activities in an organization.

2.2 Strategic Formulation

Strategic formulation is the process of deciding the goals of the organization and the strategies
for attaining these goals. Goals describe the broad overall aims of the organization and the term
objectives describe specific steps to accomplish the goals within a given timeframe.

Notes Goals are timeless, they exist until they are changed and they are changed only
rarely. Earning a satisfactory profit or more specifically, a satisfactory return on investment
is an important goal, in others, attaining a large market share is a goal.

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