PRESENTATION ON MANAGEMENT CONTROLLING

PRESENTED BY MALA GUPTA NEHA VERMA PANKAJ SINGHNEERAJ SHARMAAJAY KUMAR

GROUP NAME- MAX WEBER

Max Weber a German sociologist is known as The Father of Bureaucracy.

About 1910 he made a study of different types of business and government organisations and distinguished 3 basic types of administration in them

Leader – orientedTradition – orientedBureaucratic.

Contributions of Max Weber

MANAGEMENT

“Management is a process involving planning, organising, staffing, directing, and controlling human efforts to achieve stated objectives in an organisation.”

“Controlling is checking current performance against predetermined standards contained in plans, with a view to ensuring adequate progress and satisfactory performance.”

E.F.L. Brech

CONTROLLING

Control is a basic function of management Control relates to people , things and actions Control is a continuous process The controlling process aim at taking corrective

measures Controlling on future events Attainment of goal

NATURE OF CONTROLLING

To find out the time consumed in a certain amount of work

To find the available resources and facilities for the performance of different works

To find out weather the desired result have been achieved of the desire quality in the standard time or not

The main object of controlling to get the work done by a manager from his subordinate according to pre- determine standards

OBJECTIVES OF CONTROLLING

Adjustment in operation Verification policy Managerial responsibility Psychological pressure Coordination in action Organisational efficiency and effectiveness Protection against risks Helpful in coordination and motivation

IMPORTANCE OF CONTROLLING

There are three basic steps in a control process. Establishing standards Measuring and comparing actual results against

standards Taking corrective action

CONTROL PROCESS

Desired performance

Implementation of correction

Corrective action plain

Analysis of causes of deviation

Actual performance

Measurement of

performance

Comparison of actual and standard

Identification of deviation

CONTROLLING PROCESS

The control process begins with planning and the establishment of performance objectives.

Performance objectives are defined and the standards for measuring them are set.

ESTABLISHING STANDARDS

There are some standards tend to be following Physical standards Cost standards Revenue standards Capital standards Intangible standards Working practice standards

ESTABLISH OBJECTIVES AND STANDARDS

Measurements must be accurate enough to spot deviations or variances between what really occurs and what is most desired.

Without measurement, effective control is not possible.

The comparison of actual performance with desired performance establishes the need for action

MEASURING AND COMPARING ACTUAL RESULTS AGAINST STANDARDS

To determine the correct causes for deviation. ( poor machinery, inadequate communication system , lack of motivation of subordinates etc.) The remedial action that should be taken depends

on the nature of causes for variation.

TAKING CORRECTIVE ACTION

Past oriented controls – these are known as past – action controls and measure results after the process.

Examples of such controls are most according records inspection of goods and services and area reports etc. Future oriented controls – these are also known as

steering controls or feed – forward controls and are designed to measure results during the process so that can be taken before the job is done on the period is over.

Examples of such controls are cash flow and funds flow analysis , networks planning etc.

TYPES OF CONTROL METHODS

INFORMATION

COMPARISON OF PAST AND FUTURE ORIENTED CONTROLS

INPUTPROCESS

OUTPUTS

PAST – ORIENTE

D CONTROL

FUTURE – ORIENTE

D CONTROL

FEEDBACK

FEEDFORWAR

A control system is need for there purposesTo measure progressTo uncover deviationsTo indicate corrective action

Need for control

Suitable Timely and forward looking Objective and comprehensible Flexible Economical Prescriptive and operational Acceptable to organisation members Reveal exceptions at strategic points Motivate people to high performance

ESSENTIALS OF EFFECTIVE CONTROL SYSTEM

Control over policies Control over organisation structure Control over personnel Control over wages and salaries Control over costs Control over methods and manpower Control over capital expenditure Control over service departments Control over line of products Control over R & D Control over foreign operations Control over external relations Over all control

CONTROL AREAS

These are divided in two types of control techniques1. Old control techniques2. New control techniques

CONTROLLING TECHNIQUES

TRADITIONALCONTROL TECHNIQUES

BUDGETARY CONTROL

RESPONSIBILITY ACCOUNTING

BREAK EVEN ANALYSIS

FINANCIAL STATEMENTS AND RATIO ANALSIS

RETURN ON INVESTMENT

REPORTS

MANAGEMENT AUDITING

PERSONAL OBSERVATION

OLD OR TRADITIONAL CONTROL TECHNIQUES

A budget is a statement of anticipated results during a designated time period expressed in financial and non- financial terms.

BUDGETARY CONTROL

Responsibility accounting can be defined as a system of accounting under which each department head is made responsible for the performance of his department.

RESPONSIBILITY ACCOUNTING

Break even analysis is another control device used in business firms.

it involves the use of chart to depict the overall volume of sales necessary to cover costs.

it is that point at which the cost and revenue of the enterprise are exactly equal.

BREAK EVEN ANALYSIS

BREAK EVEN GRAPH

Financial statements indicate what financial events occurred since the last statement. Depending on the company period covered by a financial statement could be the previous year, previous quarter , or the previous month.

FINANCIAL STATMENTS AND RATIO ANALYSIS

Ratio analysis seeks to extract information from a financial statement in a way that will allow an organisations financial performance or condition to be evaluated.The ratios must commonly used by organisations are the following –

Liquidity ratios Debt ratios Profitability ratios Operating ratios

RATIO ANALYSIS

ROI also known as the Du Pont system of financial analysis.

this ratio computed on the basis of capital turnover (sales divided by investment) multiplied by earnings as proportion of sales (profit divided by sales).

RETURN ON INVESTMENT

The following are certain types of reports which are prepared and submitted to the management regularlyTop management reportSales management reportProduction reportSpecial reports

REPORTS

1. INTERNAL AUDITING - internal auditing also called operational control is an effective tool of managerial control.

2. EXTERNAL AUDITING – external auditing is an independent appraisal of the organisation financial accounts and statements.

The purpose of it is to ensure that the interests of shareholders and other outside parties connected with the company are safeguard against the malpractices of the management.

MANAGEMENT AUDITING

Quality control can be applied at two distinct phases of operations statistical quality control of an operation in

processInspection control of raw material semi

finished product & finished products

QUALITY CONTROL

A manager can also exercise fruitful control over his subordinates by observing them while they are engaged in work.

Personal observation helps the manager not only in knowing the workers attitude towards work but also in correcting their work and methods.

PERSONAL OBSERVATION

MODERN CONTROL

TECHNIQUES

PERT & CPMHUMAN

RESOURCE ACCOUNTING

MANAGEMENT INFORMATION

SYSTEM

MODERN CONTROL TECHNIQUES

PERT/CPM is used either to minimise total time , minimise total cost for a given total time , minimise time for given cost or minimise idle resources.

PERT AND CPM

Identification of activitiesSequential arrangement of activities Time estimates of activitiesNetwork constructionCritical path

PROCESS OF PERT/CPM

Human resource accounting is accounting for people as an organisational resource.

It involves measuring the costs incurred by business firms and other organisations to recruit, select, hire, train, and develop human assets.

It also involves measuring the economic valve of people to the organisation.

HUMAN RESOUCE ACCOUNTING

An information system can be any organised combination of people, hardware, software, communication networks, and data resources that collects, transforms, and disestimates information in an organisation.

MANAGEMENT INFORMATION SYSTEM

The management functions of planning, and controlling are widely considered to be the best means of describing the manager’s job, as well as the best way to classify accumulated knowledge about the study of management. Although there have been tremendous changes in the environment faced by managers and the tools used by managers to perform their roles, managers still perform these essential functions.

CONCLUSION

THANK YOU