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Flashcards in Chapter 16 Deck (41):
1

What are the steps in the control process?

1 establish standards
2 Measure performance
3Compare performance to standards
4 Take corrective action if necessary
5 If yes, take corrective action, perhaps revise standards, or
If no, continue work progress and recognize success

2

Planning

You set goals and decide how to achieve them

3

Organizing

You arrange tasks, people and other resources to accomplish the work

4

Leading

You motivate people to work hard to achieve the organizations goals

5

Controlling

You monitor performance, compare it with goals, and take corrective action as needed

6

1Establish Standards is best measured...
What is performance standard

When they can be quantifiable
Desired performance level for a given goal

7

2Measure performance

Usually obtained from written reports, oral reports, and personal observations

8

3Compare performance to standards

Managment by exception- control principle that says managers should be informed of a situation only if data show a significant deviation from standards

9

4 Take corrective action if necessary

Make no changes
Recognize and reinforce positive performance
Take action to correct negative performance

10

What are the three levels of control?

Strategic
Tactical
Operational

11

Strategic control

Monitoring performance to ensure that strategic plans are being implemented and taking corrective action as needed

12

Tactical control

Monitoring performance to ensure that tactical plans-those at the divisional or departmental level- are being implemented

13

Operational control

Monitoring performance to ensure that operational plans -day to day goals- are being implemented and taking corrective action when necessary

14

What are the six areas of control

Physical
Human Resources
Informational
Financial
Structural
Cultural

15

Bureaucratic control

An approach to organizational control that is characterized by use of rules and regulations, and formal authority to guide performance

16

Decentralized control

An approach to organizational control that is characterized by informal and organic structural arrangements

17

What is the balanced scoreboard

It gives top managers a fast but comprehensive view of the organization via four indicators
1 customer satisfaction
2Internal processes
3innovation and improvement activities
4financial measures

18

The four perspectives of the balanced scorecard

1 financial perspective: profitability, growth, shareholder values
2 customer perspective: priority is taking care of the customer
3 Internal Business perspective: quality, employee skills, and productivity
4 Innovation and learning perspective: learning and growth of employees

19

Strategy Map

Visual representation of the four perspectives of the balanced scorecard that enables managers to communicate their goals so that everyone in the company can understand how their jobs are linked to the overall objectives of the organization

20

What are the barriers to effective measurement

Objectives are fuzzy
Managers put too much trust in informal feedback systems
Employees resist new measurement systems
Companies focus too much on measuring activities instead of results

21

Budget

Formal financial projection

22

Incremental budgeting

Allocates increased or decreased funds to a department by using the last budget period as a reference point
Only incremental changes in the budget request are reviewed

23

Fixed budgets

Allocates resources on the basis of a single estimate of cost

24

Variable budgets

Allows the allocation of resources to vary in proportion with various levels of activity

25

Zero-based budget

Each new period must be justified for starting back from a zero base

26

What are the two financial statements

Balance sheet: summarizes an organizations overall financial worth- asserts and liabilities- at a specific point in time
Income statement: summarizes an organizations financial results-revenues and expenses- over a specified period of time

27

Three ratios involved in ratio analysis

Liquidity ratios
Debt management ratios
return ratios

28

Liquidity ratios

Indicate how easily a firms asserts can be converted to cash

29

Debt management ratios

Degree to which a firm can meet its long term financial obligations

30

Return ratios

How effective management is generating a return or profit

31

What is an audit

Formal verification or an organizations financial and operational systems

32

What is the difference between and internal and external audit?

External is performed by outside experts
Internal is performed by organizations own professional staff

33

What is the PDCA Cycle

Plan
Do
Check
Act

34

What is total quality management (TQM)?

A comprehensive approach - led by top management and supported throughout the organization - dedicated to continuous quality, improvement, training, and customer satisfaction

35

W. Edwards Deming to improve quality

Quality should be aimed at the needs of the consumer
Companies should aim at improving the system, not blaming workers
Improved quality leads to increased market share, increased company prospects, and increased employment
Quality can be improved on the basis of hard data, and using the PDCA cycle

36

What are the core TQM principles?

People orientation: Deliver customer value
Improvement orientation: strive for continuous improvement

37

RATER scale

Enables customers to rate the quality of a service along dimensions:
Reliability- dependable, accurate, consistent
Assurance- employees knowledge, courtesy, trustability, confidence
Tangibles- physical facilities, equipment, appearance of personnel
Empathy- caring and individualized attention to customers
Responsiveness- willingness to provide prompt service and help customers

38

What are some TQM Techniques

Outsourcing
Reduced Cycle time
ISO 9000 and 14000 Series
Statistical process control
Six sigma and lean six sigma

39

What are the keys to successful control systems

Strategic and results oriented
Timely, accurate, and objective
Realistic, positive, and understandable, and encourage self control
Flexible

40

What are barriers to control success

Too much control
Too little employee participation
Overemphasis on means instead of ends
Overemphasis on paperwork
Overemphasis on one instead of multiple approaches

41

Productivity

Output/Inputs
output: goods and services
input: labor, capital, materials, energy