example 2007 - Homework Assignment for 4D1165 Behavioural...

Homework Assignment for 4D1165
Behavioural Management Control Year 2007
Part I: The Homework Questions
This, the first section, of my homework assignment contains the twenty
homework questions that have been handed out to us students
throughout the course, along with the answers I’ve composed in order of
answering these.
1. One of the causes of management control problems is lack of
direction . Why does this problem exist?
Lack of direction , a fundamental element in many dysfunctional
organizations, constitutes one of the primary needs for management
control. Employees are likely to perform in an unsatisfactory manner
unless expectations and functions are clarified. Flaws in encouragement
and surveillance may loosen the strings between employee and
employees, resulting in confusion. Confusion, in this context, involves
having people do the wrong things; consequentially leading to decreased
productivity.
Leo’s Four-Plex Theatre , the first case discussed in class, illustrates the
severe effects that a lack of direction may cause. As the personnel of the
theatre were unaware of procedures, uninformed about regulations and
seemingly, not well instructed on how to perform simple tasks, mistakes
occurred. Two lines from the case text make this obvious: (1) The cash
counts revealed, almost invariably, less cash than the amounts that should
have been collected.
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(2) Tickets of the wrong color or with the wrong
dates in the stub boxes .
Bill Reilly, the manager of Leo’s Four-Plex Theatre , could have solved
many of the profitability issues stemming from lack of direction , by the
implementation of a relatively cheap control system (as a method to
inform and direct the workers).
2. What is the controllability principle ?
The controllability principle […] states that people should be held
accountable for what they contro l
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. People at decision making positions,
where rewards (monetary or non-monetary) and punishments are the
results of the organization’s performance, project or individual
performance, should, according to the above sentence, not be affected by
activities which they cannot affect. Results control may be effective in
enhancing individuals will to achieve goals and can hence increase the
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K. A. Merchant & W. A. Van der Stede. Management Control Systems , Pearson Education Limited, 2003: p 18.
2
K. A. Merchant & W. A. Van der Stede. Management Control Systems , Pearson Education Limited, 2003: p 460.
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overall effectiveness of many workplaces. The controllability principle can
be interpreted as the criteria for success of these programs. It’s most
important that the areas measured are controllable and provide
information about what actions were taken to produce the acquired
results. The logic behind the principle is clear, since people being punished
for actions beyond their control will soon lose interest and motivation in
the organization.