Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc. FOM 7.1 Chapter 7 Foundations of Control

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc. FOM 7.2 Learning Outcomes Define control Describe three approaches to control Explain why control is important Describe the control process Distinguish among the three types of control (continued)

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc. FOM 7.3 Learning Outcomes (continued) Describe the qualities of an effective control system Identify contingency factors in the control process Explain how controls can become dysfunctional Describe how national differences influence the control process (continued)

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc. FOM 7.4 Learning Outcomes (continued) Identify the ethical issues in employee monitoring Describe how an entrepreneur controls for growth

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc. FOM 7.5 Control Process of monitoring activities to ensure that what is being accomplished matches plans and corrects significant deviations

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc. FOM 7.6 Planning- Controlling Linkage Planning OrganizingLeading Controlling

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc. FOM 7.7 Purpose of Controls Measuring Performance Measuring Performance Comparing to Standards Comparing to Standards Taking Corrective Action Taking Corrective Action Goals and ObjectivesOrganizationalDivisionalDepartmentalIndividual

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc. FOM 7.8 Approaches to Control Market Bureaucratic Clan

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc. FOM 7.9 The Control Process Identify Causes Correct Performance Variance Acceptable? Revise Standard Attained? Standard Acceptable? Yes No Compare Performance to Standard Measure Performance Objectives Standard Do Nothing

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc. FOM 7.10 How Do Managers Measure? Personal observations MBWA (management-by- walking about) Statistical reports Oral reports Written reports

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc. FOM 7.11 What Do Managers Measure? Information Operations Finances People

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc. FOM 7.12 Discrepancies Between Goals and Performance Acceptable Upper Limit Standard Acceptable Lower Limit Acceptable Range of Variation t t+1 t+2 t+3 t+4 t+5

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc. FOM 7.13 CanuckBrew’s Sales for July (in hundreds of cases) Propeller Big Rock Ale Okanagan Spring Garrison Oland’s Export McAuslan’s Granville Island Unibroue’s Nelson After Dark Total Cases 1, , ,464 (162) (20) (5) (15) Brand Standard ActualOver (Under)

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc. FOM 7.14 Do Nothing TakingManagerialAction Immediate/BasicCorrectiveAction Revise the Standard

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc. FOM 7.15 Input ProcessesOutput Three Types of Control Feedback Control Anticipates problems Concurrent Control Corrects problems as they happen Feedback Control Corrects problems after they occur

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc. FOM 7.16 Feedback Control Meaningful information Enhance employee motivation

Flexibility Qualities Of An Effective Control System Strategic Placement Understandability Reasonable Criteria EFFECTIVE CONTROL SYSTEM Timeliness Multiple Criteria Corrective Action Accuracy Economy Emphasis on Exceptions FOM 7.17 Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc.

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc. FOM 7.18 Contingency Factors in Control Systems Organization Size Position and Level Degree of Decentralization Organizational Culture Importance of an Activity Small Large Informal, personal management Formal, personal management High Low High Low Open Closed High Low Contingency VariableControl Recommendations Many complex criteria Few, easy-to-measure criteria Increased number of controls Reduced number of controls Informal, self-control Formal, external controls Comprehensive controls Loose, informal controls

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc. FOM 7.19 Adjusting Controls for National Differences Technology and the Comparability of Data Distance and the Formality of Controls

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc. FOM 7.20 Dysfunctional Controls Inflexible Controls Unreasonable Standards

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc. FOM 7.21 Contemporary Issues in Control Rights that manager has to monitor employee behaviour Rights that manager has to control private lives of employees. Employers MAY be able to control employee behaviour outside the work environment

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc. FOM 7.22 You and Your Computer Employers can read your Employers can listen to your phone calls Employers can monitor your work by computer

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc. FOM 7.23 Employee Theft Ranges from embezzlement to fraudulent filing of expense reports to equipment removal Nearly 85% of all organizational theft and fraud is committed by employees Ready availability of information technology has made employee stealing an escalating problem

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc. FOM 7.24 InformEmployees Written Policy Monitor for Business Reasons Control and Ethics

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc. FOM 7.25 Entrepreneurs Controlling for Growth Plan for growth Organize for growth Control for growth

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc. FOM 7.26 Entrepreneurs Managing Downturns Recognizing crisis situations Things can turn worse Exit the venture Business evaluation