Essay - Importance of Management Control Introduction: Doing Business Is Simply Mathematics...

Importance of Management Control

Introduction:

Doing business is simply mathematics by other means - all a question of keeping equ*****tions in balance on both sides. Labor must be balanced with capital. Resources ***** allocation. Customers with services or goods. Workers ***** rewards.

The only way that such balances can be instituted and maintained is through a system ***** m*****nagement control. At the heart of any well-run business operation ***** a sound ********** of ***** ***** overall operating strategy. This paper looks at the importance of management control to the running of any business and examines how the process of control has changed with the introduction of the internet.

The effectiveness ***** ***** management control system is subject ***** a number of different factors. This means ***** even the best designed management ***** system will not be useful unless it is properly employed. Variations in ***** ***** of systems result from:

Management's attitudes, beliefs, and practices;

***** structure ***** accountability;

***** and scope of the governing body and management committees; and Degree of external oversight.

Elements of Control System: Detector, Assessor, Effector

***** management control system contains a ***** of ***** elements. While they may take various different specific forms within a ***** business, they can also be described on a more abstract level.

***** first essential element ***** a detector. ***** is simply a series on intern*****l *****s that allows a company to detect or sense irregularities and problems as so***** ***** ***** crop up and before they have begun to affect clients or customers. The next essential step of management control is an assessing element. This element ensures that the exact nature ***** the problem that has been *****ed c***** be ascertained. *****se two *****s are ***** *****low:

Firms need to establish a mechanism to ensure that they have internal accounting controls and risk management controls. Supervisors need to establish a mech*****nism to ensure ***** the entities they regulate ***** internal accounting controls and risk ***** *****. The supervisory mechanism need not prescribe specific and detailed controls, but rather provide general guidance to firms.

***** control systems must also have "effec*****rs," which are mechanisms that allow not ***** for *****s to be identified but also ***** them to be resolved or removed. This element of the management control system is described below:

Firms ***** supervis*****s need to determine ***** controls ***** set and moni*****red at the senior management level ***** a firm; responsibility for monitoring controls is cle*****rly defined; and senior management promotes a culture of controls at all levels ***** a firm.

And, fin*****y, none of these three elements of management control ***** be of any use whatsoever ***** they are linked with each other and with other elements of the company through a viable communications network.

The s*****tware tool ***** helped to improve efficiency in project work by allowing different systems to 'talk' to one a*****her. The passing of information between systems has meant there is less re-keying of *****.

Mr. McCombie added: "We can download information