Professional Documents
Culture Documents
Bureaucratic control
Uses formal rules, standards, hierarchy, legitimate
authority. Works best where tasks are certain and
workers are independent.
Market control
Uses prices, competition, profit centers, exchange
relationships. Works best where tangible output ca
be identified and market can be established betwe
parties.
Clan control
Involves culture, shared values, beliefs, expectation
and trust. Works best where there is “no one best
way” to do a job and where employees are
empowered to make decisions.
The Control Process
Set
Measure Determine
performance Compare
performance deviation
standards
Within
Standards
limits
Take
corrective No Yes
action
Continue
work
progress
Bureaucratic Control Systems
Feedback control
Meet once a month where all the groups gather and thrash out issues.
Dabbawallas have a credit society which gets them through money crunches.
External Audit
• Evaluation conducted by one organization, such as a CPA firm, on
another.
Internal Audit
• Periodic assessment of a company’s own planning, organizing,
leading, and controlling processes.
Budgetary Control
udgeting
inancial Ratios
iquidity ratios
everage ratios
rofitability ratios
Downside of bureaucratic control
• ideally, reflects the price that the receiving business unit would
have to pay for that product or service in the marketplace
• business practices
Group Adhocracy
Internal External
Maintenance Positioning
Hierarchy Rational
Control-Oriented
Processes
Management Control In An
Empowered Setting
1.Put control where the operation is
2.Use “real time” rather than after-the-fact
controls
3.Rebuild the assumptions underlying management
control to build on trust rather than distrust
4.Move to control based on peer norms
5.Rebuild the incentive systems to reinforce
responsiveness and teamwork
DESIGNING EFFECTIVE CONTROL
SYSTEMS
•Circle – event
•Arrow –
activity
•Activity times
-numbers
beside the
arrows