Sistem target-setting, monitoring, evaluation, dan feedback formal yang memberikan informasi kepada manajer bagaimana efektif dan efisiennya strategi dan struktur organisasi berfungsi

Proses dimana manajer mengendalikan dan mengatur bagaimana efisien dan efektifnya organisasi dan seluurh anggotanya dalam menjalankan aktivitas dan mencapai tujuan organisasinya Membantu manajer mencapai: the four building blocks of competitive advantage.

Input Stage Output Stage Conversion Stage Feedforward ControlConcurrent ControlFeedback Control

Establish the standards of performance is to be evaluated Measure actual performance Compare actual performance against chosen standards of performance Evaluate the result and initiate corrective actions

Control OutputBehavior Clan Financial measures of performance Organizational Goals Operating Budget Direct Supervision Management by Objecive Rules and standard Operating Prosedures Values Norms Socialization

Financial Performance 1 Profit Ratio How efficiently managers are using the organizational resources to generate profit Return on Investment (ROI) Operating Margin = Net profit before taxes Total assets = Total Operating Profit Sales Revenue

Financial Performance 2 Liquidity Ratios Measure how well managers have protected organizational resources to be able to meet short-term obligation Current Ratio Quick Ratio = Current Assets Current Liabilities = Current Asset - Inventory Current Liabilities

Financial Performance 3 Leverage Ratio Measure the degree to which managers use debt (borrow money) or equity (issue new share) to finance ongoing operation Debt-to-assets Ratio Time-covered Ratio = Total Debts Total Assets = Profit before interest and taxes Total interest charges

Financial Performance 4 Activity Ratio Measure how well managres are cretaing value from organizational assests Inventory Turnover Time-covered Ratio = Cost of Good Sold Inventory = Current accont receivable Sales for period devided by days in period

1 3 2 Corporate-level managers set goals for individual divisions that will allow the organization to achieve corporate goals Divisional-level managers set goals for each function that will allow the division to achieve its goals Functional level managers set goals for each individual worker that will allow the function to achieve its goals SMART goals Specific – Measurable – Attainable – Realistic - Timely Organizational Goals

Blueprints state how that state how managers intend to use organizational resources to achieve organizational goals Operating Budgets

Organizational structure by itself does not provide any mechanism that managers and non managerial employee to behave in ways that make the structure work One method of motivating employee Types: Direct Supervision, Management by Objective, and Bureaucratic Control

Direct Supervision Actively monitor and observe the behavior of their subordinates Teach subordinates the behavior that are appropriate and inappropriate Intervene to take corrective actions as needed Lead by examples

Management by Objective (MBO) A goal setting process in which a manager and each of his/her subordinates negotiate specific goals and objectives for the subordinates to achieve and then periodically evaluate the extent to which the subordinate is achieving those goals.

Management by Objective (MBO) Specific goals and objectives are established at each level of organization Managers and their subordinates together determine the subordinate’s goal Managers and their subordinates periodically review the subordinate’s progress toward meeting goals

Bureaucratic Control Control of behavior by means of a comprehensive system of rules and standard operating procedures Make employees’ behavior predictable Behavior Control

The control exerted on individual and groups in an organization by shared value, norms, standards of behavior and expectation Function: To shape the behavior of organizational member to ensure they are working toward organizational goals and to take corrective actions if those goals are nit being met To keep organizational members focused on thinking about wahat is best for their organization in the future and to keep them looking for new opportunities to use organizational resources to create value

The movement of organization away from its present state to increase its efficiency and effectiveness Need to improve operations Need to respond to new events Managers must balance the need for an organization to improve the way it currently operates and the need for it to change in response to new, unanticipated events

Kurt Lewin’s Force-Field Theory of Change Force for Change Resistance for Change Level of Performance P 1 P 2 Change Revolutionary Rapid Dramatic Broadly Focused Evolutionary Gradual Incremental Narrowly focused (Bottom-up Change)(Top-down Change)

Managing Change ASSESS THE NEED FOR CHANGE Recognize that there is a problem Identify the source of the problem DECIDE ON THE CHANGE TO MAKE Decide what the organization’s ideal future state would be Identify obstacles to change IMPLEMENT THE CHANGE Decide whether the change will occur from the top-down or form the bottom-up EVALUATE THE CHANGE Compare pre-change performance with post- change performance Use banchmarking