Chapter 18
CONTROL
- Controlling – means ensuring that actions of organizational members are consistent
with the organization’s underpinning values and standards.
4 steps in the control Process
❖ Step #1: Establish Performance Standards
➢ Identifying and establishing key performance standards by first identifying the most
important activities to be controlled
➢ The three step Value chain is a crucial tool that helps managers identify and establish
key performance standards
▪ Value Chain – is the sequence of activities needed to convert an orgs inputs into
outputs.
▪ This helps design control systems that minimize the costs associated with waste,
overproduction, waiting, transportation, inventory and defects.
➢ There are 3 types of controls
▪ Feedforward controls (inputs) - reduce org problems before they occur though
anticipation and prevention (e.g. proper training and hiring of experienced
personnel for the job, availability and legitimacy of raw material)
▪ Concurrent (conversion) – helps manages identify and correct the problems as they
occur. (e.g. developing quality control systems, detailed job descriptions and
operating procedures)
▪ Feedback Controls (output) – identify and correct problems after they have occurred
so as to avoid future problems. (e.g. exist interviews, monitoring sale for trends and
surprises)
➢ FBL emphasizes controls that can be quantified and written down
➢ TBL – Adds a link between an orgs output and its inputs with consistency on reducing
negative Socio-ecological Externalities (SEE)
▪ Value Loops – How an Orgs inputs are converted into outputs, which in turn are
linked to the org’s future inputs
▪ Value loops draw attention to externalities associated with both inputs and outputs
➢ SET – Includes interpersonal trust, democracy and the flow of empowering information.
❖ Step #2: Monitor Performance
➢ This next step involves the development of Information systems that allow for the
monitoring of performance
▪ Information System – consists of its mechanism that identify, collect, organize and
disseminate information
▪ IS are perhaps most evident in allowing managers to monitor performance
standards
▪ They allow managers to determine what are considered to be valuable information,
vs what’s just data.
• Data – are facts and figures, some of which managers deem to be useful but the
majority are not.
CONTROL
- Controlling – means ensuring that actions of organizational members are consistent
with the organization’s underpinning values and standards.
4 steps in the control Process
❖ Step #1: Establish Performance Standards
➢ Identifying and establishing key performance standards by first identifying the most
important activities to be controlled
➢ The three step Value chain is a crucial tool that helps managers identify and establish
key performance standards
▪ Value Chain – is the sequence of activities needed to convert an orgs inputs into
outputs.
▪ This helps design control systems that minimize the costs associated with waste,
overproduction, waiting, transportation, inventory and defects.
➢ There are 3 types of controls
▪ Feedforward controls (inputs) - reduce org problems before they occur though
anticipation and prevention (e.g. proper training and hiring of experienced
personnel for the job, availability and legitimacy of raw material)
▪ Concurrent (conversion) – helps manages identify and correct the problems as they
occur. (e.g. developing quality control systems, detailed job descriptions and
operating procedures)
▪ Feedback Controls (output) – identify and correct problems after they have occurred
so as to avoid future problems. (e.g. exist interviews, monitoring sale for trends and
surprises)
➢ FBL emphasizes controls that can be quantified and written down
➢ TBL – Adds a link between an orgs output and its inputs with consistency on reducing
negative Socio-ecological Externalities (SEE)
▪ Value Loops – How an Orgs inputs are converted into outputs, which in turn are
linked to the org’s future inputs
▪ Value loops draw attention to externalities associated with both inputs and outputs
➢ SET – Includes interpersonal trust, democracy and the flow of empowering information.
❖ Step #2: Monitor Performance
➢ This next step involves the development of Information systems that allow for the
monitoring of performance
▪ Information System – consists of its mechanism that identify, collect, organize and
disseminate information
▪ IS are perhaps most evident in allowing managers to monitor performance
standards
▪ They allow managers to determine what are considered to be valuable information,
vs what’s just data.
• Data – are facts and figures, some of which managers deem to be useful but the
majority are not.
