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Management and Organization Behavior

Management and Organization Behavior. MGMT 3140 Managerial Control. Twins. Planning Control. Types of Business Controls. Bureaucratic control Market control “Clan control” (organization culture). Steps in a Control Procedure. Steps in a Control Procedure.

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Management and Organization Behavior

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  1. Management and Organization Behavior MGMT 3140 Managerial Control

  2. Twins • Planning • Control

  3. Types of Business Controls • Bureaucratic control • Market control • “Clan control” (organization culture)

  4. Steps in a Control Procedure

  5. Steps in a Control Procedure • Setting performance standards (plan) (speed) • Measuring performance (measure speed) • Comparing actual to plan • Taking action to correct problems and reinforce success

  6. Common Standards • Sales level • Profit level • Number of customers • Number of orders • Project completion dates (step/milestones dates) • Quality measures • Time to resolve issues • Costs (both variable and fixed) • Return on Investment

  7. Measuring Performance • Financial reports (most common) • Balance sheet • Income statement • Cash flow • Project reviews • MBWA • Phone calls, visits • Surveys

  8. Principle of Exception • Quality • 5 pieces per 1000? • Old fashioned standard…

  9. Three Approaches • Feedforward (system design) • Concurrent • Feedback

  10. Six Sigma • A statistically based control tool to analyze processes, identify problems or opportunities, make changes, then compare results to insure obtaining the desired improvement

  11. Audits • Internal • External • Accounting • Other

  12. Budget Controls • Most common general control • Reason for “managerial accounting” • Must consider cycles, seasons • Can be (and often is) specific projects

  13. Common Budgets • Sales • Production • Cost • Cash • Capital • Master (profit plan)

  14. Making Budgets • Top down • Bottom up • Combination is most common today

  15. Importance • Balance sheet • Profit and Loss statement

  16. Balance Sheet Keys • Liquidity • Investment (ROI) • Debt • Quality of assets • Intangibles

  17. Designing Bureaucratic Controls • Make sure that controls don’t bring about unethical behavior • Modern control systems

  18. More on Controls • Use valid standards • Use a team approach • Watch the “deadly sins (Hammer, Deming) • Provide good base information and feedback • Balanced scorecard

  19. Market Control • Impact on all • Freedman • Transfer price

  20. Clan Control (Culture) • People what to use their brains • Empowerment • “A fish rots at the head first”

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