Podcast
Questions and Answers
What was the primary mission of management control around the 1920s?
What was the primary mission of management control around the 1920s?
Which of the following best describes management control according to Anthony (1965)?
Which of the following best describes management control according to Anthony (1965)?
What is the main focus of management controllers in modern organizations?
What is the main focus of management controllers in modern organizations?
Which evaluation criteria focuses on the suitability of means in relation to objectives?
Which evaluation criteria focuses on the suitability of means in relation to objectives?
Signup and view all the answers
According to Garmilis, Arnaud & Vignon (1988), what is management control?
According to Garmilis, Arnaud & Vignon (1988), what is management control?
Signup and view all the answers
Which term describes the ability to achieve an objective while aligning with the desired result?
Which term describes the ability to achieve an objective while aligning with the desired result?
Signup and view all the answers
What does efficiency emphasize in the context of management control?
What does efficiency emphasize in the context of management control?
Signup and view all the answers
What has been a significant role of management controllers since the early 1970s in Europe?
What has been a significant role of management controllers since the early 1970s in Europe?
Signup and view all the answers
What does the term 'control' imply in a management context?
What does the term 'control' imply in a management context?
Signup and view all the answers
Which of the following is a primary objective of management control?
Which of the following is a primary objective of management control?
Signup and view all the answers
Who is primarily responsible for ensuring the mastery of management control?
Who is primarily responsible for ensuring the mastery of management control?
Signup and view all the answers
What is the significance of causal analysis in management control?
What is the significance of causal analysis in management control?
Signup and view all the answers
Which of the following concepts is often associated with management control?
Which of the following concepts is often associated with management control?
Signup and view all the answers
What aspect of performance does management control primarily focus on?
What aspect of performance does management control primarily focus on?
Signup and view all the answers
What is the role of a management controller?
What is the role of a management controller?
Signup and view all the answers
Which of the following describes the correct relationship between results and objectives in management control?
Which of the following describes the correct relationship between results and objectives in management control?
Signup and view all the answers
What is the primary purpose of management accounting?
What is the primary purpose of management accounting?
Signup and view all the answers
What function does the balanced scorecard primarily serve?
What function does the balanced scorecard primarily serve?
Signup and view all the answers
What is a budget in the context of management control?
What is a budget in the context of management control?
Signup and view all the answers
What is the role of internal transfer prices in management control?
What is the role of internal transfer prices in management control?
Signup and view all the answers
Which of the following is NOT an element of management control systems?
Which of the following is NOT an element of management control systems?
Signup and view all the answers
Which of these statements best describes conformity in the context of management control?
Which of these statements best describes conformity in the context of management control?
Signup and view all the answers
Which of the following best outlines the corrective actions component of management control?
Which of the following best outlines the corrective actions component of management control?
Signup and view all the answers
What type of performance indicators are used in a balanced scorecard?
What type of performance indicators are used in a balanced scorecard?
Signup and view all the answers
Study Notes
Management Control
- Management control emerged in some large American industrial companies around the 1920s, and in Europe in the early 1970s.
- The primary mission of management control was cost management through cost accounting.
- Today, management controllers are assigned advisory and organizational steering tasks, focusing on performance management.
Content Outline
- General Guidelines
- Definitions of Management Control (Anthony, 1965; Garmilis, Arnaud & Vignon, 1988; Burlaud and Simon, 1997)
- Evaluation Criteria (Relevance, Effectiveness, Efficiency)
- Definition of Control
- Management Control Tools
Definitions of Management Control
- Anthony (1965): The process by which managers ensure resources are obtained and used effectively and efficiently to achieve organizational objectives.
- Garmilis, Arnaud & Vignon (1988): A set of actions, attitudes, tools, and procedures that enable a company to establish long-term, medium, and short-term objectives and ensure their achievement.
- Burlaud and Simon (1997): A system for regulating human behavior in the exercise of their profession, especially within an organization.
Evaluation Criteria
- Relevance: The suitability of the means used in relation to the objectives.
- Effectiveness: The ability to achieve the objective, meaning to attain a result that aligns with the goal.
- Efficiency: The use of the minimum resources necessary to achieve the result.
Management Control Triangle
- The management control triangle is a visual representation of the key elements in management control with objectives at the top, resources on the bottom left and results on the bottom right of the triangle.
- Elements include relevance, effectiveness, efficiency, and resources connected with those elements.
Definition of Control
- Control, in the context of management, refers to mastery, not supervision, analogous to a driver controlling a vehicle.
- Control in management is the ability to master a situation and direct it to the desired direction.
- Management control aims to measure results, comparing them to predetermined objectives to identify whether there is agreement or divergence.
Control - Mastery
- Mastery in management control implies a thorough causal analysis leading to corrective action proposals.
- The goal of management control is to steer the company to stay on its intended path.
Management Control = Mastery of Management
- The key objectives of management control are to measure, analyze, and improve company performance.
- Mastery is achieved through the combined efforts of operational managers and general management.
- The role of the management controller is to assist operational managers and general management by providing tools to set objectives, develop action plans, and monitor performance.
Management Control System
- The management control system entails various elements, including:
- Defining objectives as a trajectory
- Forecasting
- Measuring outcomes
- Comparing outcomes with forecasts
- Taking corrective actions
Management Control Tools
- Management Accounting/Managerial Accounting: Involves the calculation and analysis of costs for improved forecasting, measuring and controlling outcomes.
- Budgets and Budgetary Control: Quantified forecast of objectives and resources for responsibility centers, typically for a short period.
- Balanced Scorecard: Management tools for implementing action plans to achieve objectives, incorporating KPIs for rapid evaluation and providing competitive analysis of the company.
- Internal Transfer Prices: Prices used for valuing transactions within responsibility centers to assess each department's contribution to overall company performance, reflecting market constraints.
Studying That Suits You
Use AI to generate personalized quizzes and flashcards to suit your learning preferences.
Related Documents
Description
Explore the evolution and principles of management control, tracing its history from the 1920s to the present. This quiz covers essential definitions, evaluation criteria, and tools utilized in effective management control. Test your understanding of how management controls can drive performance and efficiency within organizations.
