U3 Controlling Flashcards
control
process of monitoring performance and taking action to ensure the desired results or surpasses performance
Steps in the Control Process
- set goals
- measure results
- Compare results with standards
- take necessary action
problem situation
performance is below expected levels
opportunity situation
- performance is above expected levels
- learn what can be done to achieve this level in the future
internal controls
- Self-administered
- Requires trust between manager and employee
- Subordinate should participate in setting goals
- Theory Y
external controls
Manager exerts control over the subordinate
preliminary controls
- Occur prior to work
- Provide correct instructions and training for employees
- Providing the correct resources
- Requires proactive management
concurrent controls
- Happen while work is occurring
- Mistakes are fixed continuously
- Avoids wasted resources
post-action controls
- Occur after the work has taken place
- Provide information for the future
- Determines rewards
discipline
used to achieve compliance with the organization’s expectations
progressive discipline
considers both the severity and frequency of misbehaviour when applying disciplinary action.
Rules of Employee Discipline
fair, consistent and systematic
Keys to effective discipline
- done immediately
- directed towards their actions
- consistently applied
- informative
- occur in supportive setting
- support something realistic
Merit Pay
- Based on individual achievement
- Reward for performance
- Used to remind poor employees and encourage them to improve
Bonus Pay Plans
- Rewarding an employee when targets are met
- Paying for an outstanding and creative idea
Profit-sharing Plans
Providing the employees with a portion of the profits
gain-sharing plans
Employees receive a portion of the savings or profits for which they contributed
Employees Share Ownership Plans
Employees receive or purchase shares in the company
Share Options
- Employees are given the opportunity to purchase shares at a future date at a fixed price
- Employees will work hard make certain the share price rises
Skills Based Pay Plans
- Employees are paid based on the amount of job-related skills they possess
- Encourages employees to master new skills
Stock Options cons
- When senior management has a large personal stake in a company’s stock value, they may resort to unethical behaviour in order to maximize gains
- Effect on company’s reputation
- Effect on employees
Feed forward Control
- ensures objectives are clear, proper directions are established, and correct resources are available
Output standards
measures performance results in term of quality, quantity, cost, or time
input standards
measures efforts in terms of the amount of work extended in task performance
