Management Control

•  Why Management –  If not you, who?

•  What is Management? •  What Needs to be Done? •  Who Will do It? •  Framework for Management

Decision Making

Balancing Control & Flexibility

Limited Resources

Money

Time People

4 Key Management Activities

Planning

Controlling Organizing

Directing

4 Key Management Activities

•  Planning –  Setting goals, developing work maps, showing how these

goals can be accomplished

•  Organizing –  Bringing together resources, determining effective ways of

accomplishing goals, integrating resources

•  Directing –  Ensuring that work functions are performed, identifying who

will do given tasks and motivating people to do them

•  Controlling –  Feedback of results, follow-ups, making adjustments where

needed

Top Management Work

•  Technical Skill –  Ability to use knowledge, methods, techniques, and

equipment necessary for the performance of tasks

•  Human Skill –  Ability and judgment in working with and through people

including and understanding of motivation and effective leadership

•  Conceptual Skill –  Ability to understand the complexities of the overall

organization and how the various parts fit together, interact and contribute to or inhibit the organizations effective operation

Who Will Do The Work?

•  Problems: –  One-man-band syndrome

•  One person ends up doing everything •  Ineffective way to run a business

–  Fire Fighting •  All attention is devoted to the biggest

problem at the time •  May fail to allocate time to the performance

of other important functions

Motivating Employees

•  Theory X –  Tell employees what to do –  Punish for work not done

•  Theory Y –  Involve employees in

designing their work –  Reward for work

accomplished

Management By Exception

MBE: •  Routine decisions and actions are

handled through policy guidelines •  Only exceptions, deviations, or

emergencies are routed up through the management hierarchy

Management Control

Four-Step Approach:

1.  Identify goals 2.  Develop work plans 3.  Anticipate problems 4.  Establish performance evaluation criteria

Step #1: Identify Goals

Examples: •  I want to achieve $_______ in sales over the next

five years. •  I want to develop _______ new products during

the next operating period. •  I want to add _______ new customers over the

next 18 months. •  I want to penetrate the _______ market.

Step #2: Develop Work Plans

•  Select the best route for arriving at your goal –  What are you going to do? –  What must you do to get there? –  What specifically needs to happen before the

goals can be accomplished?

•  Specific Plan –  Ex. Add a new salesperson

•  Recruit à Select à Hire à Orient à Train à Adds to your objective

Step #3: Anticipate Problems

•  Proactive vs. Reactive –  Anticipating problems gives you the opportunity

to prepare

•  Contingency Planning –  Decide what will be done if it does not work out –  Also plan what will be done if the business grows

too fast

3 Problems With Business Success

1. Compression of Time 2. Compression of People 3. Compression of Money

Step #4: Establish Evaluation Criteria

•  Communication between management and employees

•  Follow up on what has been done •  Review what still needs to be done

Organizational Mapping

•  Functional/Task approach –  Map out tasks –  Assign time to tasks –  Map out staff –  Assign tasks to staff –  Compare total task time to total staff

time

Q&A