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Chapter 15: Productivity Through Quality Control Systems

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Explain the four steps in the control process. ... Basic information for financial control ... Participation and teamwork are used to tackle significant problems ... – PowerPoint PPT presentation

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Title: Chapter 15: Productivity Through Quality Control Systems


1
Chapter 15Productivity Through Quality Control
Systems
0
2
Learning Objectives
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  • Define organizational control and explain why it
    is a key management function.
  • Describe differences in control focus, including
    feedforward, concurrent, and feedback control.
  • Explain the four steps in the control process.
  • Contrast the bureaucratic and decentralized
    control approaches.
  • Describe the concept of total quality management
    and major TQM techniques.
  • Explain the value of open-book management and the
    balanced scorecard approaches to control in a
    turbulent environment.

3
Managerial and Quality Control
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  • Control is a critical issue facing every manager
    in every organization today
  • Quality control
  • Office productivity
  • Basic systems
  • allocating financial resources,
  • developing human resources,
  • analyzing financial performance, and evaluating
    overall productivity

4
Organizational Control
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  • The systematic process through which managers
    regulate organizational activities to make them
    consistent with expectations established in
  • Plans
  • Targets
  • Standards of Performance

5
Organizational Control
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  • Managers need to decide
  • What information is essential
  • How will they obtain that information
  • How they can/should respond

6
Three Types of Control
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  • Feed forward
  • Preliminary or preventive control
  • Concurrent
  • Assesses current work activities
  • Rules and regulations
  • Ensure that work activities produce the correct
    results
  • Feedback
  • Focuses on the organizations outputs also
    called post-action or output control

7
Organizational Control Focus
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Exhibit 15.1
8
Feedforward Control
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  • Preliminary or preventive control
  • Identify and prevent deviations
  • Forecasting trends and managing risk

9
Concurrent Control
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  • Monitors ongoing activities to ensure consistency
  • Assesses
  • Current work activities
  • Relies on performance standards
  • Includes rules and regulations

10
Feedback Control
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  • Focuses on outputs
  • Post action or output control
  • Establish Standard of Performance
  • Measure Actual Performance
  • Compare Performance to Standards

11
Feedback Control Model
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Exhibit 15.2
12
Budgetary Control
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  • Most commonly used method of managerial control
  • Expense budgets
  • Revenue budgets
  • Cash budgets
  • Capital budgets
  • Process of setting targets
  • Top-down budgeting
  • Bottom-up budgeting
  • Monitor results and compare to budget


13
Responsibility Center
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  • Organizational unit under the supervision of a
    single person who is responsible for its activity

14
Financial Statements
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  • Basic information for financial control
  • Balance sheet- shows firms financial position
    with respect to assets and liabilities at a
    specific point in time
  • Income statement- summarizes the firms financial
    performance for a given time interval
    (profit-and-loss statement)

15
Control Philosophies
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  • Bureaucratic control
  • rules
  • policies
  • hierarchy of authority
  • reward systems
  • written documentation
  • Decentralized control
  • cultural values
  • traditions
  • shared beliefs
  • trust

16
Lean Manufacturing
  • Cut Waste
  • Improve Quality
  • Problem Solving
  • Highly Trained Employees
  • Employee Empowerment
  • Think Lean
  • Stop Production Lines

17
Measuring Productivity
  • Organizations output of products and services
    divided by its inputs
  • Total Factory Productivity
  • Partial Productivity

18
Total Quality Management (TQM)
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  • Organizationwide commitment to infusing quality
    into every activity through continuous
    improvement
  • Quality circles
  • Benchmarking
  • Six Sigma
  • Reduced cycle time
  • Continuous improvement

19
TQM Success Factors
0
  • Tasks make high skill demands on employees
  • TQM serves to enrich jobs and motivate employees
  • Problem-solving skills are improved for all
    employees
  • Participation and teamwork are used to tackle
    significant problems
  • Continuous improvement is a way of life

20
Trends in Quality Control
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  • International Quality Standards
  • Economic Value-Added (EVA)

21
Control Systems for Turbulent Times
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  • Open-Book Management
  • sharing financial information and results with
    all employees
  • Balanced scorecard
  • comprehensive management control system

22
The Balanced Scorecard
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Exhibit 15.9
23
New Workplace Concerns
  • Corporate Governance
  • Undercontrol
  • Overcontrol

24
A New ApproachBalance Scorecard
Financial Performance
Internal Business Processes
Customer Service
Exhibit 15.10
Learning and Growth
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