Elements of Management Planning & Control Systems

Elements of Management Planning & Control Systems

Planning Control Coordination

Projects Effective ways of attaining desired future state

Provides guidelines to managers for day to day decisions Continuous process

Control
Measuring Performance against Predetermined Objectives and Standards Communicating results to managers Calculating deviations from set objectives and targets Frame all possible alternatives to correct indicated variances Choose and implement the best alternative Appraise the corrective action and improve future planning and control cycles

Coordination
An effect that occurs when managerial functions of planning and control are accomplished Synchronisation of individual actions so that each subdivision of an entity effectively works towards the common objectives.

Management Planning & Control system

Set Goals

Examine alternatives

Evaluate Performance

Implement Plan

Budgeting as a tool for Management Planning & Control

Communication of goals and targets Coordination to maximise utilisation of scarce resources Measurement of success Motivation rewards and Punishments

Application of Budget
Outputs Sales Projections required Production Inputs Raw Material & Manpower Facilities Production capacity Cash Needs cashflow predictions Control

Time Frame
Short Range 3 , 6 or 12 months or a business cycle Long Range Strategic Plans Forecasted Profit & loss statements and Balance Sheets for a number of years

Budgeting Process
Budget Sales - Pricing decisions, Demand forecasting, cost recovery, profit margins Budget Production outputs, inputs,overheads Budget cost of goods sold Budget admin and selling expenses Budget Profit & loss account & Balance Sheet Cash Budget