Management Control System and how it is Utilized

Management control system is a system which collects and uses data to evaluate the performance of different organizational resources like human, information technology, financial and also the organization as a whole considering the organizational strategies; it also must be able to manage goals and results. It is an interdisciplinary focus concerned with management in achieving the best quality. The key elements of a management control system are measuring organizational performance, comparing the criteria of what is being done against company’s expectation, and procedures for obtaining and evaluating data. I read a case called No Excuse Management, by T.J. Rodgers, best utilized management control systems.

According to the case, Cypress had 1,400 employees, and each employee had to set their own goals and report whether or not they achieved them. Rodgers knew what data was being collected, who was collecting it, and how it would be generated and measured. By doing this Cypress effectively could research past goals to predict if they would meet future goals. The information technology that Cypress used was the center of this measurement. It gave Rodgers and Cypress a measure in percentage, numbers that were easier to compare, and the amount of goals that were becoming delinquent. T.J. Rodgers kept tabs on the probability by getting goals accomplished by having weekly staff meetings. By having these meetings and using such an advance system Rodgers could set solid criteria.

The performance appraisal process of the management control system of Cypress was identified as a problem and strategically solved. Cypress set up a way to keep the employees motivated as well as let them know how their performance was being tracked. It was a very intelligent idea for the focal groups, along with the reviews from the goal system to rank employees. Because of the direct relationship of performance appraisal and goal setting, Cypress was able to manage goals and evaluate their employees on a more efficient level.