A N G E L A T H O M P S O N , S E P S 3 0 2CHAPTER 6:CONTROLLING
CHAPTER OUTCOMES
• Describe the Control Process• Contrast Two Types of Corrective Action• Compare Preventive, Concurrent, & Corrective• Explain how a Supervisor can Reduce Cost• List the Characteristics of an Effective Control
System
CHAPTER OUTCOMES
• Explain Potential Negatives that Controls can Create• Explain Just-in-Time Inventory Systems• Explain Value Chain Management• Identify the Ethical Dilemmas in Employee
Monitoring• Explain Employee Theft and its Effects on
Organizations
IMPORTANT TERMS
• Basic Corrective Action
• Cause-Effect Diagram• Concurrent Control• Control by Exception• Control Chart• Control Process• Corrective Control• Flow Chart• Immediate Corrective
Action • Just-in-time Inventory
System (JIT)• Preventive Control• Range of Variation• Scatter Diagram• Supply Chain
Management• Value Chain
Management
THE CONTROL PROCESS
THE CONTROL PROCESSWhat is the Control Process?
THE CONTROL PROCESSWays to Measure Actual Performance
Personal Observation
THE CONTROL PROCESSWays to Measure Actual Performance
Statistical Reports
THE CONTROL PROCESSWays to Measure Actual Performance
Oral Reports
THE CONTROL PROCESSWays to Measure Actual Performance
Written Reports
THE CONTROL PROCESSWhat to Measure in an Actual Performance
THE CONTROL PROCESSHow do you compare results with standards?
Determining Acceptable Ranges
Goal Actual +/-
Machine A 5 4 -1
Machine B 7 3 -4
Machine C 8 9 +1
Machine D 7 7 0
27 23 -4
Which Machine has an Acceptable Range?
THE CONTROL PROCESSHow do you compare results with standards?
Special Measurement Tools: Cause and Effect Diagrams
Fishbone Diagram
THE CONTROL PROCESSHow do you compare results with standards?
Special Measurement Tools: Flow Charts
Event 1
Event 2
Event 3
Event 4
Event 5
THE CONTROL PROCESSHow do you compare results with standards?
Special Measurement Tools: Scatter Diagrams
THE CONTROL PROCESSHow do you compare results with standards?
Special Measurement Tools: Control Charts
TYPES OF CONTROLSPREVENTATIVE, CONCURRENT, & CORRECTIVE
TYPES OF CONTROLSWhat is Preventative Control?
TYPES OF CONTROLSWhat is Concurrent Control?
TYPES OF CONTROLSWhat is Correct Control?
THE FOCUS OF CONTROLWHAT TO CONTROL
THE FOCUS OF CONTROL
Direct LaborIndirect LaborRaw Materials
Support SuppliesUtility
MaintenanceWaste
What Cost to Control
THE FOCUS OF CONTROL
• Step 1: Improve Methods
• Step 2: Level the Work Flow
• Step 3: Minimize Waste
• Step 4: Install Modern Equipment
• Step 5: Invest in Employee Training
• Step 6: Make Cuts Selectively
Cost Reduction Programs
THE FOCUS OF CONTROLPaying Attention to Inventory
Just-In-Time Inventory System
THE FOCUS OF CONTROL
Value Chain Management
vs.
Supply Chain Management
THE FOCUS OF CONTROLCharacteristics of Effective Controls
• Timeliness
• Economy
• Flexibility
• Understandability
• Reasonable Criteria
• Critical Placement
• Emphasis on the Exception
THE FOCUS OF CONTROLWhen Controls Create Problems
Employee Resistance
THE FOCUS OF CONTROLWhen Controls Create Problems
Misdirection of Effort
THE FOCUS OF CONTROLWhen Controls Create Problems
Ethics and Control Devices
CONTEMPORARY CONTROL ISSUES
CONTEMPORARY CONTROL ISSUES
Employee Theft on the Rise?
CONTEMPORARY CONTROL ISSUES
Sarbanes-Oxley Act
Link to SEC Article
KNOWLEDGE CHECK
• Go to the following URL to take a brief quiz on what you have learned today.
https://testmoz.com/292136
• The quiz is worth 50 points.
• This quiz must be completed by 11:59pm, Monday May 5, 2014
• Good Luck!