MANAGEMENT CONTROLE
LES 1: INTRO
Cursusmateriaal: 2 boeken aanschaffen!!!
Examen: 4 types vragen (term verklaren/open/…)
Opnames: ja
Synonyms:
1. Performance measurement and management (= prestatie meten van wie
beslissingsbevoegdheid heeft/obv wat verwacht wordt)
2. Strategy Exectution
3. Stragety Implementation
4. Goal Congruence (=doelcongruentie, doel ligt in lijn met doelstelling vd organisatie)
CONTENT
Part 1: Management control and management control systems
Part 2: The environment and strategy of organizations
Part 3: Management’s control and the organization’s internal structure
Part 4: The management control process
Part 5: DOEN WE NIET
Chapter 1: Introduction to management control
1.1 MANAGEMENT CONTROL
- Systematic process by which the org higher-level managers influence the lower-level
managers to implement the organization’s strategies
- Decentralization = single most important reason for org to need management control
systems
1.2 NEED FOR CONTROL
a) Decentralized managers do NOT automatically understand goals/strategies of higher-
level managers, nor how to contribute to these goals/strategies
Goals = realise profit, be in the world’s top 3, create EBITDA , …
→ Triple P = Profit/People/Planet or even Prosperity/People/Planet
→ ESG = Environment/Social/Governance
Strategy = corporate strategy or business unit strategy
→ corporate = in welke sectoren willen we actief zijn
→ business unit = hoe differentiëren/onderscheiden we ons tov concurrenten
b) Decentralized managers do NOT automatically agree with organizational
goals/strategies developed by high-level managers
→ Individuele doelstellingen niet altijd gelijk!
, c) Decentralized managers do NOT automatically have the resources needed to act with
organizational goals/strategies developed by higher-level managers
→ resource allocation belangrijk!
1.3 FIRM SIZE
Klein bedrijf: makkelijker
Groot bedrijf: moeilijker!
Vb Examenvraag: hoe kan de bottom up functie bijdragen aan 1. ?
1.4 MANAGEMENT AND CONTROL
Management control can be understood as part of the overall managerial function:
1. Planning
2. Organizing
3. Staffing
4. Leading
5. Controlling
, Hoe hoort management control hier thuis?
→ het integreert verschillende dimensies om strategie te implementeren
→ het connecteert verschillende levels in de hiërarchie (zie slide 21!)
→ het gaat over tools en technieken (niet enkel theorie): budget en een variantie-
analyse, strategy map and BSC…
1.5 ACCOUNTING AND CONTROL
Management control can be understood as an activity that uses management accounting
information:
1. Scorecard keeping (performance measurement)
2. Attention directing (verbonden met scorecard keeping)
3. Problem solving
Connection between management accounting and management control
→ importance of money (as overall measure of org performance)
→ importance of the accounting system (to satisfy information needs of stakeholders)
1.6 HUMAN BEHAVIOR
Desired behaviors of decentralized managers
We need undestanding of behavior of people in an organization:
a) Managers are motivated by goals they are asked to achieve (= target setting)
b) Managers are motivated by rewards they may get from efforts (= beloning)
c) Managers are motivated by the social context in which they work
→ Inspelen op effort, direction of effort and persistence of effort
Motivation by goals → positive effect on effort
→ goals are clear and directional
→ goals are not too distant
→ achievement of goals is valued positively
!!! Attention points !!!
→ goals should be aligned with strategy
→ MULTIPLE goals reduce clarity and direction
→ goals can be seen as a threat
Motivation by rewards → rewards are prices paid for products and services of managers
→ variation in their dependence on output
→ controlled by labor laws
→ variety across firms and functions
!!! Attention points !!!
→ rewards should not be seen as a fixed salary
→ rewards may enhance internal competition
→ performance and rewards should ideally be matched in time (bonus when needed)
, Motivation by social context → intrinsiek proberen motiveren
→ External factors: work ethics
→ Internal factors: culture, style, tone-at-the-top
!!! Attention points !!!
→ culture explains control differences
→ culture explains that org are not easily changed
→ culture can be used as a control
Chapter 2: Designing management control systems
2.1 OBJECTS
Control of individual manager
Control of the management team the manager is part of
Control of the unit that the management team supervise
Control of all units with management teams
Control of the whole organization
2.2 ELEMENTS OF CONTROL
Vb 1: Temperatuur controleren in een woning
→ 1. Detector = thermometer
→ 2. Assessor = vergelijk temperatuur met wat het moet zijn
→ 3. Effector = zal aanpassingen doorvoeren (indien nodig)
➔ volledig geautomatiseerd proces
Vb 2: Snelheid van een auto
→ 1. Detector = snelheid atm gemeten door snelheidsmeter
→ 2. Assessor = vergelijk met de standaard = de snelheidslimiet
→ 3. Effector = melding krijgen, remmen!
➔ niet volledig geautomatiseerd proces
Vb 3: Management controle in een organisatie
→ 1. Detector = rapportering
→ 2. Assessor = een standard/target, een budget, een variantie-analyse…
→ 3. Effector = bijsturen, behavior alteration
LES 1: INTRO
Cursusmateriaal: 2 boeken aanschaffen!!!
Examen: 4 types vragen (term verklaren/open/…)
Opnames: ja
Synonyms:
1. Performance measurement and management (= prestatie meten van wie
beslissingsbevoegdheid heeft/obv wat verwacht wordt)
2. Strategy Exectution
3. Stragety Implementation
4. Goal Congruence (=doelcongruentie, doel ligt in lijn met doelstelling vd organisatie)
CONTENT
Part 1: Management control and management control systems
Part 2: The environment and strategy of organizations
Part 3: Management’s control and the organization’s internal structure
Part 4: The management control process
Part 5: DOEN WE NIET
Chapter 1: Introduction to management control
1.1 MANAGEMENT CONTROL
- Systematic process by which the org higher-level managers influence the lower-level
managers to implement the organization’s strategies
- Decentralization = single most important reason for org to need management control
systems
1.2 NEED FOR CONTROL
a) Decentralized managers do NOT automatically understand goals/strategies of higher-
level managers, nor how to contribute to these goals/strategies
Goals = realise profit, be in the world’s top 3, create EBITDA , …
→ Triple P = Profit/People/Planet or even Prosperity/People/Planet
→ ESG = Environment/Social/Governance
Strategy = corporate strategy or business unit strategy
→ corporate = in welke sectoren willen we actief zijn
→ business unit = hoe differentiëren/onderscheiden we ons tov concurrenten
b) Decentralized managers do NOT automatically agree with organizational
goals/strategies developed by high-level managers
→ Individuele doelstellingen niet altijd gelijk!
, c) Decentralized managers do NOT automatically have the resources needed to act with
organizational goals/strategies developed by higher-level managers
→ resource allocation belangrijk!
1.3 FIRM SIZE
Klein bedrijf: makkelijker
Groot bedrijf: moeilijker!
Vb Examenvraag: hoe kan de bottom up functie bijdragen aan 1. ?
1.4 MANAGEMENT AND CONTROL
Management control can be understood as part of the overall managerial function:
1. Planning
2. Organizing
3. Staffing
4. Leading
5. Controlling
, Hoe hoort management control hier thuis?
→ het integreert verschillende dimensies om strategie te implementeren
→ het connecteert verschillende levels in de hiërarchie (zie slide 21!)
→ het gaat over tools en technieken (niet enkel theorie): budget en een variantie-
analyse, strategy map and BSC…
1.5 ACCOUNTING AND CONTROL
Management control can be understood as an activity that uses management accounting
information:
1. Scorecard keeping (performance measurement)
2. Attention directing (verbonden met scorecard keeping)
3. Problem solving
Connection between management accounting and management control
→ importance of money (as overall measure of org performance)
→ importance of the accounting system (to satisfy information needs of stakeholders)
1.6 HUMAN BEHAVIOR
Desired behaviors of decentralized managers
We need undestanding of behavior of people in an organization:
a) Managers are motivated by goals they are asked to achieve (= target setting)
b) Managers are motivated by rewards they may get from efforts (= beloning)
c) Managers are motivated by the social context in which they work
→ Inspelen op effort, direction of effort and persistence of effort
Motivation by goals → positive effect on effort
→ goals are clear and directional
→ goals are not too distant
→ achievement of goals is valued positively
!!! Attention points !!!
→ goals should be aligned with strategy
→ MULTIPLE goals reduce clarity and direction
→ goals can be seen as a threat
Motivation by rewards → rewards are prices paid for products and services of managers
→ variation in their dependence on output
→ controlled by labor laws
→ variety across firms and functions
!!! Attention points !!!
→ rewards should not be seen as a fixed salary
→ rewards may enhance internal competition
→ performance and rewards should ideally be matched in time (bonus when needed)
, Motivation by social context → intrinsiek proberen motiveren
→ External factors: work ethics
→ Internal factors: culture, style, tone-at-the-top
!!! Attention points !!!
→ culture explains control differences
→ culture explains that org are not easily changed
→ culture can be used as a control
Chapter 2: Designing management control systems
2.1 OBJECTS
Control of individual manager
Control of the management team the manager is part of
Control of the unit that the management team supervise
Control of all units with management teams
Control of the whole organization
2.2 ELEMENTS OF CONTROL
Vb 1: Temperatuur controleren in een woning
→ 1. Detector = thermometer
→ 2. Assessor = vergelijk temperatuur met wat het moet zijn
→ 3. Effector = zal aanpassingen doorvoeren (indien nodig)
➔ volledig geautomatiseerd proces
Vb 2: Snelheid van een auto
→ 1. Detector = snelheid atm gemeten door snelheidsmeter
→ 2. Assessor = vergelijk met de standaard = de snelheidslimiet
→ 3. Effector = melding krijgen, remmen!
➔ niet volledig geautomatiseerd proces
Vb 3: Management controle in een organisatie
→ 1. Detector = rapportering
→ 2. Assessor = een standard/target, een budget, een variantie-analyse…
→ 3. Effector = bijsturen, behavior alteration
