Podcast
Questions and Answers
What are the two management systems that are linked to operative planning and control?
What are the two management systems that are linked to operative planning and control?
Strategic planning and organization development.
It is safe to omit any of the major parts of a company's management systems.
It is safe to omit any of the major parts of a company's management systems.
False (B)
Which of the following does NOT need to be clearly understood when making a business plan?
Which of the following does NOT need to be clearly understood when making a business plan?
- Specific strategies to be followed
- The structure of the organization
- The expected profits of the company (correct)
- Responsibilities within the organization
Operative planning and control are the only steps required for successful management in a multi-industry company.
Operative planning and control are the only steps required for successful management in a multi-industry company.
What is the primary reason for the effectiveness of a multi-industry company?
What is the primary reason for the effectiveness of a multi-industry company?
Operative planning and control primarily focus on long-term planning.
Operative planning and control primarily focus on long-term planning.
Which of the following is NOT a major part of operative planning?
Which of the following is NOT a major part of operative planning?
Strategic planning is a necessary but not sufficient condition for effective short-term planning.
Strategic planning is a necessary but not sufficient condition for effective short-term planning.
Operative planning is a synonym for budgeting.
Operative planning is a synonym for budgeting.
What two financial consequences are planned for in operative planning?
What two financial consequences are planned for in operative planning?
Which of the following is a crucial element in operative planning and control?
Which of the following is a crucial element in operative planning and control?
What is the first stage of operative planning?
What is the first stage of operative planning?
The basic task of preliminary balancing is to check the basic balance between market needs and company possibilities.
The basic task of preliminary balancing is to check the basic balance between market needs and company possibilities.
What is the main task of preliminary balancing?
What is the main task of preliminary balancing?
Detailed planning can be effective without preliminary balancing.
Detailed planning can be effective without preliminary balancing.
What is the first step in the preliminary balancing of a sawmill's production?
What is the first step in the preliminary balancing of a sawmill's production?
A sawmill's production capacity is the only factor that limits the company's growth.
A sawmill's production capacity is the only factor that limits the company's growth.
What are the two main factors that determine the production mix for a sawmill?
What are the two main factors that determine the production mix for a sawmill?
Preliminary balancing in a multi-production company consists soleley of balancing log supply with sawmilling capacity.
Preliminary balancing in a multi-production company consists soleley of balancing log supply with sawmilling capacity.
What is the most crucial factor to balance in a large, integrated company?
What is the most crucial factor to balance in a large, integrated company?
Preliminary balancing is only relevant for companies that have a centralized domestic marketing function.
Preliminary balancing is only relevant for companies that have a centralized domestic marketing function.
What is the next stage of operative planning after preliminary balancing?
What is the next stage of operative planning after preliminary balancing?
Which of the following is NOT a key aspect of planning logging activities?
Which of the following is NOT a key aspect of planning logging activities?
It is always advisable to plan for every single action regardless of its importance.
It is always advisable to plan for every single action regardless of its importance.
What is the first step in planning sawmilling activities?
What is the first step in planning sawmilling activities?
The goal of logging planning is solely to maximize the harvest of logs.
The goal of logging planning is solely to maximize the harvest of logs.
What is a key aspect to consider when planning sawmilling operations?
What is a key aspect to consider when planning sawmilling operations?
Plywood production planning focuses primarily on maximizing the quantity of plywood produced.
Plywood production planning focuses primarily on maximizing the quantity of plywood produced.
Board product manufacturing planning is fundamentally different for chipboard, hardboard, and particleboard.
Board product manufacturing planning is fundamentally different for chipboard, hardboard, and particleboard.
It is not necessary to plan for further processed products if the company produces a variety of basic wood products.
It is not necessary to plan for further processed products if the company produces a variety of basic wood products.
What is the key challenge in planning production for custom-ordered products?
What is the key challenge in planning production for custom-ordered products?
It is always best to follow a set of standardized forms when planning for specific businesses.
It is always best to follow a set of standardized forms when planning for specific businesses.
What is the key challenge in planning production when demand exceeds production capacity?
What is the key challenge in planning production when demand exceeds production capacity?
Sales planning is less important in a high-demand market than in a competitive market.
Sales planning is less important in a high-demand market than in a competitive market.
Which of the following is NOT a key aspect of sales and marketing planning?
Which of the following is NOT a key aspect of sales and marketing planning?
The role of sales planning is the same in a competitive market and a high-demand market.
The role of sales planning is the same in a competitive market and a high-demand market.
What is the main role of sales planning in the forest industry?
What is the main role of sales planning in the forest industry?
Which of the following is NOT a key aspect of maintenance planning?
Which of the following is NOT a key aspect of maintenance planning?
Planning for action in administration is primarily focused on management of human resources.
Planning for action in administration is primarily focused on management of human resources.
What is the primary focus of controlling actions?
What is the primary focus of controlling actions?
Graphic forms are more informative than numerical reports.
Graphic forms are more informative than numerical reports.
What is the key task of reporting in the head office?
What is the key task of reporting in the head office?
The value of reporting lies solely in the quantity of information provided.
The value of reporting lies solely in the quantity of information provided.
What are the two main parts of financial planning?
What are the two main parts of financial planning?
The primary purpose of a balance sheet is to track the company's daily revenues and expenses.
The primary purpose of a balance sheet is to track the company's daily revenues and expenses.
The profit and loss account mainly reflects the company's profitability for a specific time period.
The profit and loss account mainly reflects the company's profitability for a specific time period.
Which of the following is NOT a key aspect of management accounting?
Which of the following is NOT a key aspect of management accounting?
What is the primary purpose of using a coding system?
What is the primary purpose of using a coding system?
A functional organization structure makes it more challenging to implement a management accounting system.
A functional organization structure makes it more challenging to implement a management accounting system.
Profit centers in a company should ideally only produce a single product.
Profit centers in a company should ideally only produce a single product.
Budgeting is a straightforward process in a multilevel corporation.
Budgeting is a straightforward process in a multilevel corporation.
What are the three main types of corporation-level budgets?
What are the three main types of corporation-level budgets?
The company's overall budget should be based on a standardized template.
The company's overall budget should be based on a standardized template.
Head Office budgets are typically prepared at the same time as company budgets.
Head Office budgets are typically prepared at the same time as company budgets.
What is the primary focus of the consolidated budget?
What is the primary focus of the consolidated budget?
The need for detailed management accounting information is independent of the company's size and organizational structure.
The need for detailed management accounting information is independent of the company's size and organizational structure.
The decimal system is the most effective method for structuring account codes.
The decimal system is the most effective method for structuring account codes.
What is the primary purpose of a cost-center code?
What is the primary purpose of a cost-center code?
It is only necessary to use one type of coding system for both official and managerial accounting systems.
It is only necessary to use one type of coding system for both official and managerial accounting systems.
The format of budget reports should mirror that of budgets.
The format of budget reports should mirror that of budgets.
Graphical representations are not as effective as numerical reports for analyzing performance.
Graphical representations are not as effective as numerical reports for analyzing performance.
An organization's purpose and strategy are inseparable from its human resource management practices.
An organization's purpose and strategy are inseparable from its human resource management practices.
What is the primary goal of human resource management?
What is the primary goal of human resource management?
Individuals are the sole responsibility for reaching performance targets.
Individuals are the sole responsibility for reaching performance targets.
Political, economic, and cultural forces have a significant impact on how an organization operates.
Political, economic, and cultural forces have a significant impact on how an organization operates.
Flashcards
Operative Planning & Control
Operative Planning & Control
The short-term planning and control of actions and their financial consequences within a company.
Strategic Planning
Strategic Planning
Long-term planning that sets the overall direction of the company.
Organization Development
Organization Development
Improving the structure and processes within the organization.
Budgeting
Budgeting
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Preliminary Balancing
Preliminary Balancing
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Production Capacity
Production Capacity
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Material Supply
Material Supply
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Demand Expectations
Demand Expectations
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Logging Activities Planning
Logging Activities Planning
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Sawmilling Planning
Sawmilling Planning
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Profit & Cost Centre Accounting
Profit & Cost Centre Accounting
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Product Profitability Accounting
Product Profitability Accounting
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Financial Accounting
Financial Accounting
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Management Accounting
Management Accounting
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Budgeting Procedure
Budgeting Procedure
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Chart of Accounts
Chart of Accounts
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Profit & Cost Centre Codes
Profit & Cost Centre Codes
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Sales Budget Allocation
Sales Budget Allocation
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Human Resource Management (HRM)
Human Resource Management (HRM)
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Motivated Employees
Motivated Employees
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Purpose & Strategy
Purpose & Strategy
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Political Forces
Political Forces
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Economic Forces
Economic Forces
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Cultural Forces
Cultural Forces
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Study Notes
Operative Planning and Control
- Operative planning and control are crucial management tools for company management, serving as the foundation for operational success. Effective planning enables companies to navigate complex environments, respond swiftly to market changes, and optimize resources efficiently.
- They have close links to other management systems, notably strategic planning and organizational development, which ensures that all levels of the company align with overarching goals and objectives. Integrating these systems allows for more coherent decision-making and resource utilization across various departments.
- Clear strategies are essential for effective operative planning, as they guide the organization in determining its priorities, allocating resources, and setting measurable goals. Clear and attainable strategies also enhance communication and coordination within the organization.
- Organizational structure and responsibilities must be well defined before planning operations, as this clarity prevents overlaps in duties and fosters accountability among team members. A transparent hierarchy also facilitates efficient decision-making and implementation of plans.
- Absence of any of these components can lead to company management issues, such as goal misalignment, wasted resources, and employee confusion. Such pitfalls can hinder overall performance and compromise the company’s competitive edge.
- Operative planning involves two major parts: planning of actions and financial consequences, which requires not only the establishment of what activities to undertake but also an understanding of how these actions affect the overall financial health of the organization.
- Operative planning is usually short-term or annual planning, focusing on immediate objectives and necessary adjustments to meet market demands, thereby ensuring that the organization remains agile and responsive.
Preliminary Balancing
- Essential to check market demand against production capability before detailed planning, this verification ensures that the company's operations align with actual market conditions, thereby reducing the risk of overproduction or stock shortages.
- This analysis considers raw material availability, production capacity, and sales potential, allowing companies to make informed decisions about scaling operations up or down based on realistic assessments of each factor.
- The key is finding balance between sales needs, production possibilities, and raw material supply, which necessitates continuous monitoring and adjustment as external conditions change, promoting sustainable growth.
- Example: A sawmill must understand its production limits given its raw material supply and potential market demands; this understanding not only aids in optimal production scheduling but also contributes to cost control and customer satisfaction.
- This preliminary balancing is used to create a comprehensive picture of the following year's sales and production, enabling the company to set practical goals and allocate resources effectively to meet those targets.
Planning of Actions
- Logging activities need meticulous planning for logging areas, contractor use, transportation, and target species, which ensures that operations are executed efficiently while adhering to environmental regulations.
- Sawmill operations involve log allocation based on species and time periods, considering utilization levels, to maximize the value derived from timber resources and to ensure that production schedules are met.
- Plywood and board product manufacturing require detailed plans for raw material supply, production volume, and distribution, along with a yearly production plan and resources. This comprehensive approach minimizes waste and aligns production with market demands.
- Furthermore, processed products (joinery, doors, furniture) planning focuses on customer orders and the specific needs of each item, which helps to optimize inventory levels and enhance customer satisfaction through responsive production practices.
Sales and Marketing
- In operative planning of sales and marketing, preliminary balancing must find realistic sales levels, considering domestic and export markets to identify the best opportunities for growth and customer engagement.
- Product mix, customer groups, and sales strategies are also part of this process, allowing the company to tailor its offerings to diverse market segments and capitalize on emerging trends or customer preferences.
Financial Planning and Control
- Financial planning is essential for integrating operational plans relevant to profitability and cash flow; effective financial management enables companies to maintain liquidity, invest in growth opportunities, and sustain operations even during economic downturns.
- This involves two main components: financial and management accounting, each serving distinct purposes within the organization to facilitate transparency and accountability.
- Financial accounting (balance sheet and profit and loss statement) is used for official purposes, tracking company funds, providing stakeholders with accurate information about the company’s performance and facilitating compliance with regulatory requirements.
- On the other hand, management accounting is more flexible, providing internal information on profitability and costs connected to individual departments/units, which aids in strategic decision-making and operational improvements.
- These two accounting systems must work together closely to run companies effectively; the synergy between financial insights and management considerations allows for a more comprehensive view of the company’s health and helps pinpoint areas for operational enhancements.
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Description
Test your understanding of operative planning and control in management. This quiz covers key concepts such as market demand, production capabilities, and the importance of organizational structure. Assess your knowledge on how these elements impact effective management strategies.
