Organizational Change and Control Processes

Comparing actual performance to predetermined standards and taking corrective action if needed.

A structured process for setting goals at different organizational levels, from corporate to individual employees.

The ability to manage both continuous improvement and adapt to unexpected changes effectively.

The process of identifying, making, implementing, and evaluating changes in an organization.

Comparing the organization's performance to industry benchmarks or best practices.

The process of monitoring and regulating how effectively an organization and its members are performing activities to reach organizational goals.

Formal systems that set targets, monitor performance, evaluate results, and provide feedback to managers about how well the organization's strategy and structure are working.

Measured by how effectively resources (labor, materials, etc.) are used to produce a unit of output.

Measured by how well the organization is achieving its goals.

These controls focus on outputs or results, often measured quantitatively.

These controls focus on employee behaviors and actions, often measured qualitatively.

A type of organizational control that emphasizes shared values, beliefs, and norms to guide employee behavior.

The ability to adapt and change in response to internal or external pressures to maintain effectiveness.

A management approach where managers and subordinates set specific goals, regularly review progress, and evaluate performance based on achieving those goals.

A comprehensive system of rules and standard operating procedures that guide employee behavior and ensure consistent actions.

The shared set of beliefs, expectations, values, norms, and work routines that influence how members of an organization interact and achieve goals.

A culture that fosters positive values and norms, helping an organization grow, adapt, and achieve its goals efficiently.

A culture characterized by values and norms that fail to motivate or inspire employees, leading to stagnation and potential failure.

A framework that measures organizational performance across four key areas: financial, customer service, internal processes, and learning & growth.

A financial metric that measures how effectively an organization uses its resources. It is calculated by dividing operating profit by total sales.

Measures how efficiently managers create value from assets, indicating how quickly inventory is sold and how long it takes to collect payments from customers.

Measures the ability of an organization to meet its short-term debt obligations. Common measures are Current Ratio and Quick Ratio.

A measure of the amount of debt used to finance assets. It's calculated by dividing total debt by total assets.

A financial metric that reflects the business's ability to meet its short-term liabilities. It is calculated by dividing current assets by current liabilities.

A measure of an organization's profitability, calculated by dividing net profit by the total investment cost of assets.

Measures how well an organization can meet its interest obligations. It is calculated by dividing earnings before interest and taxes (EBIT) by interest expense.

A measure of an organization's ability to pay short-term liabilities without relying on its inventory. It is calculated by subtracting inventory from current assets and dividing by current liabilities.

Leverage Ratios

How effectively managers are turning over inventory. Measured by dividing the cost of goods sold by the average inventory.

A goal that challenges but is attainable, pushing managers to improve without being unrealistic.

A plan outlining resource allocation and usage to achieve organizational goals effectively and efficiently.

Managers actively monitor and guide employee actions, providing instruction and taking corrective action as needed.

Goals should be specific, difficult but attainable, pushing managers to their full potential.

A measure of how efficiently managers collect revenue from customers to pay expenses. Calculated by dividing average accounts receivable by average daily sales.

Three key components are essential for effective output control: objective financial measures, challenging goals and performance standards, and appropriate operating budgets.

Output control can encounter problems if standards are not motivating or lead to inappropriate behaviors to achieve goals.

The process where managers try to improve employees' understanding and response to changing situations, ensuring they can make informed decisions about adapting to new challenges.

The driving force behind any change within an organization. This force can come from internal or external sources like market pressures, technological advancements, or even internal conflicts.

Lewin's theory suggests that two opposing forces - driving forces and restraining forces - influence change. When these forces are balanced, there's no change. Change occurs when driving forces are stronger, pushing for change, or when restraining forces are weakened, reducing resistance.

This stage involves preparing the organization for change - getting people to understand the need for change. It might involve creating a sense of urgency, building a vision for the future, and overcoming resistance through communication and education.

The actual implementation of the change. This stage involves introducing the new practices, processes, or structures, and providing support to employees to help them adapt and adjust to the new way of working.

The final stage of change, where the new behaviors are integrated into the organization's culture and become the new norm. This involves reinforcing the change through rewards and recognition, making it sustainable.

A fast, top-down management approach to change, where leaders identify the problem, design solutions, and swiftly implement the changes throughout the organization.

A slower, more collaborative approach to change, where everyone, from top to bottom, works together to develop and implement change plans.