1. Overall Strength: in general, the article provides structure to a concept that is very intangible by: (a) describing the nature and the functions of control; (b) segregating the MCS into categories: core control system, organizational structure, and organizational culture; (c) illustrating how to apply the control model (satisfied my approach) (d) provides a basis for designing and evaluating the system. The manner, in which the model is presented, with its use of figures, further emphasizes the structure of the model. See below on further emphasis on parts (a) -(c).
(a) Strength: (put something about the definition) One of the four functions of control is to motivate people to treat the organization’s goals as their own. Thus,
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This is reverse order is a better match with the schematic representation of MCS (Figure 1) as well as the pervasive impact culture and structure has on the core control system. This echoes Flamholtz’ statement that “culture is the starting point of designing the MCS”.
Conclusion: As such, the MCS should have been initially detailed using this reverse order for consistent presentation as well as acting as a catalyst to the planning subsystem of the core control system. In doing so, goals can be set in accordance to the company culture and structure. This enables management to influence the behaviour of more employees by providing clear goals. This makes for a better feedback system because it includes the information of the various departments/divisions and all levels of employment. This allows for attainable goals and prevents the imposition of unrealistic goals, MBO, and the likelihood of fraudulent reporting. To further prevent fraudulent reporting, the measurement subsystem should rely equally on the accounting system as well as non-financial measures (balanced score card).
2. Application of the Flamholtz’ model to “Birch Paper Company”
(a) Description of the Firm: Birch Paper Company is a medium-sized manufacturing organization, which produces white and kraft papers and paperboard. The firm has a successful decentralization policy which has increased company profits, improved Birch’s overall competitive
This research paper is based on the development and implementation of completely integrated performance management system. The organizations are enjoying many benefits by implementing the performance management system. It has helped in improving the productivity of employees in most of the organizations. It is to be understood that apart from advantages, the system also carries some disadvantages. It is time consuming and there are chances of biases entering into the system.
The control structure is the means used to ensure that organization members are doing what they are supposed to do; it describes the nature of and methods for communication in an organization. Due to lack of a structural job design and absence of coordination within departments and lack of autonomy employees are irresponsible and do not perform the task to
The design and implementation and objectives of company controls are not adequate to meet the control objectives. The control environment control objective is ineffective. This control objective lacks a written policy on ethical conduct, is lacking oversight from the board of directors and audit committee, lacks a consistent style and philosophy from management, and lacks a strong commitment to competence. The risk assessment control objective is effective but lacks any antifraud program and controls. The information and communication control is ineffective. A virus has been detected and is affecting the files of the company. This control is lacking a strong IT department. The general controls financial reporting control objective is effective but is weak in detecting or preventing material misstatement. The monitoring control objective is ineffective; this control has need of an internal auditor.
As mentioned the author attempted to accomplish the above goal through a field study where the management control systems on a restaurant chain was assessed. That being said in order to determine if the motivation of the article was achieved is to analyze the
The second aspect of management used to investigate the issue is Controlling. Control is a concern that is facing every manager in every organisation today. Many businesses continually look to improve relationships between all levels of staff in order for a healthy working environment. To effectively control a business the organisation requires information about
A concept we learned about in Business Leadership that relates to the main point in this book is control systems. We looked at the importance of control in management and learned about various different systems. In this book, systems are shown to greatly help customer service. Systems are predetermined ways to get a specific result and still ensure consistency. Andrew, the plant manager said “Systems give you a floor, not a ceiling”. Thus, a system is the sort of thing you build on, a starting point. An external control measure, for example, involves
The next lever, the management control process, consists of four sections. The first of these is programming, which must come from strategy and be monitored to remain consistent with the firm’s objectives. The second process is budgeting, which need to fit with strategy formulation and programming. The last two of the four sections is measuring and reporting. These two sections focus on the “need for activities that measure and report both financial and nonfinancial information” . The measuring and reporting of a firm’s management control can be related to budget information and the motivation process. What a firm spends to drive motivation, and the amount of motivation that comes from it, can create contrasting cultures that needs information to why that is the result. Since this lever can be manipulated quickly, it is one that managers should focus on.
Controlling is monitoring the performance of the organization, identifying deviations between planned and actual results, and taking corrective action when necessary. With all these four functions that are involved in the process of management, if all are followed correctly the organization will be properly ran and will have few complications.
Is the last process of management operations, which depends on the imposition of control and control of the workflow through control and ensure its implementation.
The four functions of management, planning, organizing, leading, and controlling, are very essential in building strong organizations and even stronger more effective teams. Planning, organizing, leading, and controlling are the functions of management. These function activities must be preformed by all managers regardless of their industry level, title, or the task they have at hand. These four management skill are used when ever a project or a task is at hand. Even in the field we are working in, many of us may have been using the four management functions and not noticed what they were, or we may have been a part of a team that was lead by the functions of management and not noticed what was
The third is motivation, which supplies motivation for employees to develop and grow in the job by providing benchmarks during the year. The fourth is accountability, which creates accountability for employees and managers/supervisors. This will help all employees prioritize competing projects or initiatives for each individual or department. Managers conduct initial performance planning discussing with employees and provide direction through coaching sections. After the performance planning discussion, employee’s drafts performance plan for the manager’s review. This planning discussion is followed up by the employee finalizing his or her draft with his or her manager. Overall, managers/supervisors at each level develop specific goals that support department or team goals which in turn support the corporate and function/operational group scorecard metrics.
The purpose of this paper is to analyze a case study related to issue of control and how organizations can utilize different approaches of control in order to improve quality and performance in all arenas, domestic and global. The focus of this case revolves around Lincoln Electric, an Ohio based company that has set the bar for how to develop and implement a successful management system. This paper will use the Lincoln Electric case analysis to present recommendations on how managers can use control methods to enhance employee performance, increase employee participation and empowerment, and improve organizational quality in
COSO cites the control environment of the organization as the foundation of any internal control structure. The control environment reflects the overall attitude or actions of the board of directors, management, and others concerning the importance of internal controls in the organization. This overall attitude of upper management sends a message to the rest of the organization referred to as the “tone at the top.”For example, if upper management stresses high-quality products, a strong positive message is sent to the organization. This would create a strong internal control environment. On the other hand, if upper management has a reputation of looking the other way regarding policy violations, a negative message is
This paper determines the effects contextual factors have on the design of Management Control Systems. The paper firstly discusses what is meant by “Management Control Systems” and what is expected of “Management Control Systems”. Contingency-based research is outlined and five key contextual variables are identified for discussion. The five factors (external environment, technology, structure and size, strategy and national culture) are assessed to determine their impact on design and implementation of management control systems.
A good control system provides timely information to the manager which is very much useful for taking various decisions. Control simplifies supervision by pointing out the significant deviations from the standards of performance. It keeps the subordinates under check and brings discipline among them.