Академический Документы
Профессиональный Документы
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Traditional techniques
Modern techniques
TRADITIONAL TECHNIQUES
1. Personal observation
2. Budgeting
3. Break-even analysis
4. Financial statement
5. Statistical data & report
6. Setting examples
7. Standard costing
8. Written instructions
PERSONAL OBSERVATION
This is the most traditional method of control.
It helps managers to collect first hand information.
It also creates a psychological pressure on the
employees to perform well as they are aware that they
are being observed personally on their job.
How ever it is very time consuming , & not suitable for
all kinds of jobs.
BUDGETING Meaning-
A budget is a statement
which reflects future
incomes ,expenditures &
profits of the firm.
Benefit of budgeting-
1. Standards of
performance
2. Planning
3. Predicting the future
4. Financial planning
BREAK EVEN ANALYSIS
It deals with the study of the relationship between
costs, volume, & profit.
It determines the probable profit and losses at
different levels of activity.
The sales volume at which there is no profit, no loss is
known as breakeven point.
It can be calculated as ,
Breakeven point=fixed cost/selling price per unit –
variable cost per unit.
FINANCIAL STATEMENT
Financial statements shows financial position of
a firm over a period of time, generally one year.
These are prepared along with last year
statements, so that firm can compare its present
performance with last year’s performance &
improve its future performance.
It offers information on ,
1. Liquidity
2. Financial strength
3. profitability
STATISTICAL DATA & REPORT
Statistical analysis in the form of
averages,percentages,ratios,..etc.
Data can be used for diagramatic representations like
histograms, pie chart, bar graphs..etc.
A Report is a statement that represents data in the
form of information for carrying out the controlling
function.
SETTING EXAMPLES
It is old saying that “example is better than precepts”
Some managers follow this and put good examples of
performance before subordinates and expect the same
from them.
Behaviour and actions of subordinates can be
controlled through exemplary behaviour of the
manager.
STANDARD COSTING
It is a technique of cost control.
Under this technique ,standard costs of
materail,labour,overheads etc. are determined.
Actual cost are recorded and compared with the
standard costs and variances are found out.
Then measures are taken to prevent variances in
future.
WRITTEN INSTRUCTIONS
1. Return on investment.
2. Management audit.
3. Management information system (MIS).
4. PERT/CPM.
RETURN ON INVESTMENT
Investment consists of fixed asset
and working capital used in business.
Profit on the investment is a reward for risk taking.
If the ROI is high then the financial performance of a
business is good and vice-versa.
It also shows the areas where corrective actions are
needed.
MANAGEMENT AUDIT
Management Audit is an evaluation of the
management as a whole. It critically examines the
full management process.
It finds out the efficiency of the management.
Management auditing is conducted by a team of
experts.
The data is analyzed and conclusions are drawn about
managerial performance and efficiency.
MANAGEMENT INFORMATION
SYSTEM
In order to control the organisation properly the
management needs accurate information.
Information is collected continuously to identify
problems and find out solutions.
They need information about the internal working of
the organisation and also about the external
environment.
MIS collects data, processes it and provides it to the
managers.
PERT/CPM
Programme Evaluation and Review Technique (PERT)
and Critical Path Method (CPM) techniques were
developed in USA in the late 50's.
Any programme consists of various activities and sub-
activities.
Importance is given to identifying the critical activities.
by controlling the time of the critical activities, the total
time and cost of the job are minimized.
MCQ
Which among these are the techniques of directing?
Free-rein technique
Delegatory technique
Bureaucratic technique
Feedback technique
________ is the process which deals with the setting up
of standards and taking corrective measures.
Directing
Controlling
Staffing
Organising
Choose the financial control technique from the
following
Management audit
MIS
Financial audit
Critical path analysis
Which among the following are used as a control
techniquei n projects
Management technique
Direct supervision
MBO
Critical path analysis
THANKS