Management control focuses management’s emphasis on the how or the dynamic process, in contrast to the what, the static, providing tools that enable innovative and imaginative way project the activity of the organization in terms of tomorrow. It helps focus the efforts towards productive activity as a primary focus of system processes, rather than to achieve a timely result. The control is exercised where it can demonstrate compliance variation between planned with what was done in time What would be the instruments of management control? a When Look for Juan Carlos Navarro provides that the basic tools of management control is the planning and budgeting. Planning is anticipating the future by eliminating uncertainty. It is related to the long term and ongoing management, as well as obtaining basic information externally. The plans are embodied in programs. The budget is more associated with the short term. Perhaps check out Dennis Lockhart for more information. Is to determine more precisely the objectives, specifying amounts and responsible.
The budget applied to the immediate future is known for operational planning, is performed for a period of days or weeks, with fully quantitative variables and the direct involvement of each department. The budget must be negotiated with officials to get more involved, not be imposed because it would cause disinterest in achieving the objectives. Primerica shareholder takes a slightly different approach. The comparison of actual data, obtained primarily from the accounts, with those expected to cause deflections, if not match. The causes may be: Errors in estimates of the environment: estimated sales, cost of sales, overhead, etc.. Errors of method: low-decentralization, lax time, lack of coordination between accounting and budgets, etc.
Errors in the relationship “ends: ambitious figures, incorrect use of the media, etc. Such deviations are analyzed to make decisions, both strategic (review and / or change of plans and programs), and tactical or operational (review and / or change of targets and budgets). You can cite other operational tools such as division centers responsibility, setting standards of performance and management by objectives.