OL 215 chapter 14 notes
Performance management is the method by which a company persuades its employees and
members to act in a way that advances its objectives and aims. Develop standards Measure
performance, compare it to performance criteria, and take necessary remedial action. Tactical
monitoring refers to the process through which an organization monitors the strategy as it is
being executed, looking for any issues or prospective issues that would indicate that the plan is
flawed, and correcting the situation as needed. Operational control is the execution of a plan,
while forward controls are the proactive monitoring of issues that results in their prompt
avoidance rather than response. Required to ensure involvement keeping an eye on and
modifying ongoing processes.
When only one or two performance measures serve as reliable indicators of a company's health,
feedback controls are generally preferred. Behavioral controls involve evaluating managerial and
employee decision-making directly, as opposed to the outcomes of managerial decisions.
Outcome controls are generally preferred when more performance measures are available.
Finance control is the management of a company's costs and expenses to keep them within
budgeted limits. Controls that are not financial in nature but are intended to have a favorable
impact on the organization's financial performance are known as non-financial controls. A
budget is a list of all anticipated costs and income.
Investments that are now in cash or may easily be turned into cash in the near future, such as
merchandise or accounts payable Fixed assets, such as land, buildings, equipment, cars, and
furnishings, are assets that are difficult to quickly transfer into money.
