Chapter 19 Flashcards
Managers use a variety of measures to monitor performance:
Controlling work processes, regulating employee behavior, systems for financial success, developing human resources, evaluating profitability.
Feedback control model:
Established standards of performance, measure actual performance, compare performance to standards, take corrective action.
The balanced scoreboard:
Balanced perspective of company performance, integrates various areas of the organization, managers record/analyze/discuss metrics, serves as core management-control system.
Hierarchical control:
Monitoring behavior through rules, policies, reward systems, and written documentation.
Decentralized controls:
Based on values and assumptions, rules are only used when necessary.
Open-book management:
Decentralized philosophy, gets employees thinking like owners, information sharing and teamwork, allows employees to see financial state, sees how job fits into organizational success.
Total quality management (TQM):
Infuse quality into every aspect of business, all day-to-day activities. Became popular in the US in the 1980s, focuses on teamwork/collaboration/identifying improvements, goal is zero defects.
Total quality management techniques:
Quality circles, benchmarking, six sigma, quality partnering, continuous improvement.
Budgetary control:
Setting targets and monitoring expenditures, budget list planned and actual expenditures, budgets are associated with a division.
Budgets managers use:
Expense budget, revenue budget, cash budget, capital budget, zero-based budget.
Balance sheet:
Shows firms financial position.
Income statement:
Profit-and-loss statement highlights firms financial performance.
Interpreting the numbers:
Financial analysis is ratios and statistics. Review is profits, assets, sales, and inventory.
Corporate governance:
Goes beyond systems and rules from the top to safeguard shareholders, ensures accountability, fairness, and transparency in all its dealings.
