Saturday, February 8, 2014

Identifying Control Problems

Executive Reality Checks: Top managers periodically work at lower-level jobs to become more aware of operations.
Internal Audits: Independent appraisals of organizational operations and systems are conducted to assess effectiveness and efficiency.

Symptoms of Inadequate Control

An unexplained decline in revenues or profits
A degradation of service (customer complaints)
Employee dissatisfaction
Cash shortages caused by bloated inventories or delinquent accounts receivable
Idle facilities or personnel
Disorganized operations
Excess costs
Evidence of waste and inefficiency (scrap, rework)

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