ECM Chapter 8
Terms
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- Controlling
- managers evaluate whether the organization's strategy and structure are working as intended, how to be improved, how to be changed if not working.
- How to determine how efficiently they are using resources
- managers must be able to accurately measure how many units of inputs (raw materials, human resources, etc) are being used to produce a unit of output
- Successful Innovation
- takes place when managers create an organizational setting in which employees feel empowered to be creative, and where authority is decentralized to employees
- Control Systems
- formal target-setting, monitoring, evaluation, and feedback systems that provide mgr's with info about how well the org's strategy and structure are working
- Feedforward Control
- control that allows mgrs to anticipate problems before they arise
- Concurrent Control
- Control that gives managers immediate feedback on how efficiently inputs are being transformed into outputs so that mgrs can correct probs as arise
- Feedback Control
- Control that gives managers information about customers' reactions to goods and services so that corrective action can be taken if necessary
- Control Process Step 1
- Establish the standards of performance, goals, or targets against which performance is to be evaluated (operating costs)
- Control Process Step 2
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Measure actual Performance
1. the actual outputs
2. the behaviors themselves - Control Process Step 3
- Compare actual performance against chosen standards of performance
- Control Process Step 4
- Evaluate the result and initiate corrective action if the standard is not being achieved
- output control mechanisms of control
- financial measures of performance, organizational goals, operating budgets
- behavior control mechanisms of control
- direct supervision, management by objectives, rules and standard operating procedures
- organizational culture/clan control mechanisms of control
- values, norms, socialization
- Operating budget
- a budget that states how managers intend to use organizational resources to achieve organizational goals.
- Three components that are the essence of effective output control
- objective financial measures, challenging goals and performance standards, and appropriate operating budgets
- 3 mechanisms of behavior control
- direct supervision, management by objectives, and rules and standard operating procedures
- Management by objectives
- a goal setting process in which a mgr and her subordinates negotiate goals and objectives for subs to achieve and then evaluate the extent to which being achieved
- Bureaucratic Control
- control of behavior by means of a comprehensive system of rules and standard operating procedures
- problems of bureaucratic control
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1. too many rules
2. people stop thinking for themselves - organizational control
- the set of values, norms, standards for behavior, and shared expectations that influence the ways in which indiv and groups interact and achieve goals
- Clan Control
- the control exerted on individuals and groups in an organization by shared values, norms, standards for behavior, and expectations