MGMT300 Ch.6- Controls and Control Systems
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30 terms
Terms | Definitions |
|---|---|
 Control | the process of measuring performance and taking action to ensure desired results |
| control process | 1. objecties and standards 2. measuring actual performance 3. compares resulst with objectives 4. takes necessary action |
| management exception | the practice of giving attention to situations that show the greatest need |
| organizations | are open systems that interact with environemtn with input, throughput and output controls |
| preliminary controls | solve problmes before they occur |
| steering controls | solve problems while they're occuring |
| post action controls | solve problems after they occur |
| internal control | -motivated employees exercise self-control in their work -participation in planning work and having a sense of purpse facilitate motivation |
| Bureaucratic control | involves policies, proceddures, budgets and supervison to influence behavior |
| clan control | uses the organiztions culture to influence behavior |
| market control | influence that market competition has on organizational decisions such as price, prdocut modification and expansion |
| management by objective (MBO) | superior and subordinate jointly plan objectives |
| improvement objectives | state goals for improvemnt in measurable terms ex: "increase sales by 5%" |
| peronal development objectives | focus on person growth "learn a second language" |
| quality control | increasingly important for global competion ISO certificatioin, TQM,, continuous improvemnt |
| ISO certification | audits verify quality standards |
| total quality management (TQM) | -commitment to quality -striving for zero defects |
| continous improvement | kaizen -always searching for new ways to improve work quality and performnace |
| project management | responsibility for planning and control projects |
| project managment tools | Gantt charts CPM/PERT Charts |
| Inventory controls | reduces inventory costs |
| economic order quantity (EOQ) | pre-determined amount of inventory is ordered when current inventory reaches a certain level |
| Just-in-Time scheduling (JIT) | -inventory arrives exactly when needed for prodcution sale |
| Breakeven point | when revenues equal costs |
| Breakeven analysis | calculates the point at which sales revenues cover costs breakeven point = fixed costs/ (price-variable costs) |
| liquidity | measure ability to meet short term obligaions -current raitoin- current asses/ current liabilites -quick ration- current asses- inventory/ current liabilites -higher is better: you want more assests and fewer liabilites |
| leverage | measures use of debt - debt ratio= total debts/total assets lowever is better: you wnat fewer debts and more assets |
| asset management | measures asset and inventory efficiency - asset turnover= slaes/ total assets -inventory turnover= sales/ average inventory higher is better: you wnat more sales and fewer assests or lower inventory |
| profitabilty | -net margin= net prfot after taxes/ sales -return on asses (ROA)= Net profit after taxes/ total assets -return on equity (ROE)= net income/ owners equity higher is better: you want as much profit as possible for sales, assest and equity |
| balanced score card | start with the organization mission and vision to build goals and performanc measrue for -financial performance -customer satisfaction -internal process improement -innovaton and learning This and financial rations strengthen organizational controls |
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