Strategic Management: Formulation and Implementation

The Management Control

Process for operating activities has four phases: programming, budget preparation, execution, and evaluation.

Programming is the process of deciding on the major programs that the organization will undertake to implement its strategies and the approximate amount of resources that will be devoted to each.

Budget preparation. An operating budget is the organization's financial plan for a specific period, usually one year.

Execution and evaluation. During the year managers execute the program or part of a program for which they are responsible. Reports on responsibility centers show both budgeted and actual information. They are used as a basis for control. The process of evaluation is a comparison of actual amounts with the amounts that should be expected of actual circumstances.

Management Control Of Projects

A projects is a set of activities intended to accomplish a specified end result of sufficient importance to be of interest to management (for example: construction projects, research/development projects, and motion picture productions).

In a project, and in each of its components, the focus is on three aspects: (1) its scope (that is, the specifications for the end product), (2) its schedule (that is, the time required), and (3) its cost.

In actual operations, project managers engage in both planning activities and control activities. They control when they act to improve effectiveness and efficiency.