1 Flashcards
What is management
Directing activities
Organising resources
Achieving objectives
Influencing others
Reaching predefined goals through work of others
Getting things done
What is control
Process of ensuring that a firm’s activities conform to its plan and that its objectives are achieved.
Control means direction
What are controls
Measurement and information
Controls are a means to an end whereas control is what we want to achieve
What are the different types of controls
Action or behavioural controls
Personnel, cultural and social controls
Results or outputs controls
What are action and behavioural controls
Physical constraints like passwords
Managers develop action plans before any action is allowed
Control may be exercised by monitoring actions and applying rewards or punishments
What are Personnel, cultural and social controls
Encouraging people to adopt particular norms and patterns of behaviour
Selecting people who already display shared beliefs and values
Socialisation, high commitment
What are results or outputs controls
Collecting and reporting information about outcomes of work effort while leaving others to choose means to achieve them
Decentralisation and delegation of authority
What is the control process thermostat metaphor
Manufacturing process – inputs and outputs
Management control – objectives and results then feedback loops
What are some problems with controls. What you measure is what you get
Risk of myopia – what isn’t measured isn’t seen
Risk of gaming – dysfunctional behaviour - encouraging actions detrimental to broader goals
Confusing cause and effect – performance measure isn’t always a good indicator of what is desirable to achieve organisational goals
What is a goal congruence
Using a performance measurement system where maximisation of individual performance maximises organisational performance
What happens if you get goal congruence wrong
When results are only partially specified, people will concentrate only on what is monitored and seek to maximise their individual performance irrespective of whether their actions contribute to organisations objectives, ignore important areas.
When controls motivate employees to engage in behaviour that isn’t organisationally desirable, is the performance measure a good indicator of what helps reach organisational goals
Rigid measures of performance become less appropriate as degree of managerial interdependency and task uncertainty increases
