Effective management control systems

In short, the accuracy of control systems goes a long way to prevent damaging outcomes. If no remedial action is taken, controls are not necessary.

Controls should be such that all people who are affected by it are able to understand them fully and accept them. The standards set for control purposes also play a role in determining action plans and functional strategies.

It is very important to have effective controls at each of these three stages.

Effective Control System: 8 Major Characteristics | Management

Moreover, at times the standards set by management may be perceived as being unreasonable or unfair. The focus should be on those areas where failures cannot be tolerated and the costs in time and money are excessive. For control to be effective it must report deviations in time to allow management to take corrective action.

For instance, a production manager may report that production goals are not being met because he does not have even manpower to work with. The resources that will have to be spent may not return an equal or larger amount so as to justify control in some cases.

This means it has overall data acquisition and data processing capabilities that management can adapt to changing conditions. This would eliminate unnecessary and uneconomic supervision, marginally beneficial reporting and a waste of managerial time.

Effective Control System (9 Principles of Designing Effective Control System)

If information about such problems does not reach management in a timely manner, then such information may become useless and damage may occur. This usually happens when one control leads to another.

The main purpose of control is taking remedial action to set right the deviations. In most cars the information received by higher management is inaccurate.

8 Essential characteristics of effective control system

To achieve such objectivity, control systems must be transparent and measure parameters that are relevant to the business. Since control systems are important indicators of progress and are the basis for corrective reactions, care has to be taken to ensure that control measurements are accurate.

Matching controls to plans and position Control techniques should reflect the plans they are designed to follow.

Effective Control System: 8 Major Characteristics | Management

An effective control system not only checks for and identifies deviation but also is programmed to suggest solutions to correct such a deviation. The control process should be simple so that it can be easily understood and applied.

Such control systems are effective when they limit deviations from the strategic plan and alert management when deviations are large enough to endanger the plan. Complexity can also result when control users focus on the mechanics and techniques of control to the complete neglect of the purposes of controls.

Thus the costs of the control system have to be weighed against the benefits it can return. Managers need the information that will tell them how the plans for which they are responsible are progressing. Overview[ edit ] Management control systems are tools to aid management for steering an organization toward its strategic objectives and competitive advantage.

9 Characteristics of an Effective Control Systems – Explained!

Such control systems are effective when they limit deviations from the strategic plan and alert management when deviations are large enough to endanger the plan. Effective Control System-Engineering Modern industries use control systems which are a blend of various technologies including electronics, hydraulics, pneumatics and mechanics.

The quality of this blend determine factors like: functionality, reliability and price. Effective Management Control deals with a critical but relatively neglected and misunderstood aspect of organizational effectiveness: the process of controlling the behavior of people in organizations.

The issue of organizational control and the design of an optimal control system is essential. A management control system (MCS) is a system which gathers and uses information to evaluate the performance of different organizational resources like human, physical, financial and also the organization as a whole in light of the organizational strategies pursued.

The following are the essential or basic requirements of an effective management control system. Suitable: The control system must be suitable for the kind of activity intended to serve.

Apart from differences in the systems of control in different business, they also vary from department to department and from one level in the organization to the other.

Such control systems are effective when they limit deviations from the strategic plan and alert management when deviations are large enough to endanger the plan.

8 Essential characteristics of effective control system Effective management control systems
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9 Characteristics of an Effective Control Systems – Explained!