Supervision

1. Saigon Institute of Technology Supervision CHAPTER 6 DESIGNING AND IMPLEMENTING CONTROLS

2. Chapter Outcomes • Describe the control process • Contrast two types of corrective action • Compare preventive, concurrent, and corrective control • Explain how a supervisor can reduce costs • List the characteristics of an effective control system • Explain potential negatives that controls can create • Explain what is meant by the term just-in-time inventory systems • Describe what is meant by the term value chain management • Identify the ethical dilemmas in employee monitoring • Explain what is meant by employee theft and its effect on the organization

3. Controlling • Management functions • Planning • Organizing • Leading • Controlling

4. Control Process Performance standards Measure actual performance Compare results with standards Take corrective action Results

5. Control Process (cont) • Measure actual performance • Methods • Personal observation • Statistical reports • Oral reports • Written reports • What to measure • Establish criteria based on goals

6. Control Process (cont) • Compare results with standards • Determine acceptable range of variation • Special measurement tools • Cause-effect diagrams • Flow charts • Scatter diagrams • Control charts

7. Control Process (cont) • Take corrective action • Immediate • Right now • Basic • Gets to root cause  permanent elimination

8. Type of Controls • Preventive control • Anticipate & prevent undesirable outcomes • Concurrent controls • Take place while activities are in progress • Corrective controls • Feedback after an activity is finished to prevent future deviations

9. Focus of Control • Costs • Inventories • Quality • Safety • Employee performance

10. Cost Control • Cost categories • Direct labor costs • Indirect labor costs • Raw material costs • Supportive supplies costs • Utility costs • Maintenance costs • Waste costs

11. Cost Control (cont) • Cost reduction program • Improve methods • Level the work flow • Minimize waste • Install modern equipment • Invest in employee training • Make cuts selectively

12. Inventory Control • Why control inventory? • Just-in-time (JIT): inventory items arrive when they are needed • Kanban

13. Value Chain Management • Value chain management • Supply chain management

14. Quality Control • Why control quality? • Needed at multiple points • Comprehensive quality control: includes preventive, concurrent, & corrective controls

15. Characteristics of Effective Controls • Timeliness • Economy • Flexibility • Understandability • Reasonable criteria • Critical placement • Emphasis on the exception

16. Problems Created by Controls • Employee resistance • Misdirection of effort • Ethics and control devices

17. Contemporary Control Issues • Employee theft • Sarbanes-Oxley Act