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CHAPTER 18 Be able to define Organizational Control-the systematic process through which managers regulate organizational activities to make them


Be able to define Organizational Control-the systematic process through which managers regulate organizational activities to make them consistent with expectations established in plans, targets, and standards of performance.

Know the steps in the Feedback Control Model-
1) Establish standards of performance-within the organization’s overall strategic plan, managers define goals for organizational departments in specific, operational terms which compare to activities.
2) Measure actual performance-quantitative performance measurements that managers review daily, weekly, or monthly. The measurements should be related to the standards set in the first step.
3) Compare performance to standards-take reports and identify whether performance meets, exceeds, or falls short of standards.
4) Take Corrective Action-the use of formal authority to make necessary changes. They range from working harder, redesigning the production process, or firing of employees.

Be able to define Feedforward Control-control that focuses on human, material, and financial resources flowing into the organization; also called preliminary or preventative control. Happens before process

Be able to define Concurrent Control-Control that consists of monitoring ongoing activities to ensure they are consistent with standards. Happens during process

Be able to define Feedback Control-Control that focuses on the organization’s outputs; also called postaction or output control. Happens after process

Be able to define Bureaucratic Control and identify the following as being associated with it:
1) Rules and Procedures-
2) Management Control Systems
3) Hierarchy of Authority
4) Quality Control Department
5) Selection and Training
6) Technology
Bureaucratic Control-The use of rules, policies, hierarchy of authority, reward systems, and other formal devices to influence employee behavior and assess performance.

Be able to define Decentralized Control and identify the following as being associated with it:
1) Corporate Culture
2) Peer Group
3) Self Control
4) Employees Selection and Socialization
Decentralized Control-The use of organizational culture, group norms, and a focus on goals, rather than rules and procedures, to foster compliance with organizational goals.

Be able to define TQM-Total Quality Management-an organizationwide commitment to infusing quality into every activity through continuous improvement.

Know and understand the following TQM techniques
1) Quality Circles-a group of 6-12 volunteer employees who meet regularly to discuss and solve problems affecting the quality of their work.
2) Empowerment-the delegation of power and authority to subordinates.
3) Benchmarking- the continuous process of measuring products, services, and practices against major competitors or industry leaders.
Outsourcing- the practice of subcontracting manufacturing work to outside and especially foreign or nonunion companies.
4) Reduced Cycle Time-the reduction of the steps or time taken to complete a company process.
5) Continuous Improvement-the implementation of a large number of small, incremental improvements in all areas of the organization on an ongoing basis.

Be able to define ISO 9000-a set of international standards for quality management, setting uniform guidelines for processes to ensure that products conform to customer requirements.

Be able to define EVA-Economic Value Added-a control system that measures performance in terms of after-tax profits minus the cost of capital invested in tangible assets.

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