Control Systems at Computer Solutions Ltd - Case Study Example

Table of Contents Introduction 2 Broad Aspect of Control 2 Reasons for having management control functions 2 Control Issues Missing in Computer Solution Ltd 5 Control Measures to be implemented by Computer Solution Ltd 7 Conclusion 10 References 11 Introduction This report analyzes the control system which is required in Computer Solutions Ltd as the lack of control system has affected the performance of the organization and is slowly moving downwards. The fact that Computer Solutions Ltd hasn’t been able to develop a proper control process has provided the required freedom where people have started to act in the way they prefer and has also resulted in negligence on many parts. This requires development of a control process which will be analyzed in the case. In addition to it the report will also analyze the different control issues which have been identified by Valerie and provide solutions to deal with it. Thus, the report concentrates on the control aspect and looks towards formulation of strategy through which better management control will be highlighted. Broad Aspect of Control Control form an important aspect for business as having a properly formulated control strategy ensures that the business is able to put the resources in the best possible manner. Control helps to understand the manner in which the different resources of the business is being used and helps to provide a framework through which effectiveness is gained in the use of resources (Jerome, 2012). A properly developed control process helps to check the actual process and deviations can be found out based on which proper strategies for the future can be developed. This would thereby ensure that the business is able to gain effectiveness and ensure maximum possible use of the different resources. Reasons for having management control functions A properly developed management control function helps the business in a number of ways as it helps to formulate strategies through which better control over the business can b exercised and thereby helps to find out a strategy through which best possible use of resources becomes possible. Some of the different reasons which have been identified for having a management control function is as It helps to improve the operational aspect of the business as having a control function provides an opportunity to check the progress and based on it the required changes can be made so that the operations of the business gains effectiveness. This can be seen in case of Computer Solutions Ltd as the lack of proper control measures created a situation where despite having all the resources at the disposal the business was not able to gain efficiency (Jerome, 2012). This was due to the fact that managers took things at ease, the financials which was shown didn’t match with the actual figures, the sales people were not willing to work unless special incentives were provided, and the entire working scenario was such that the overall aspect of business prospects were ignored. Having a properly developed control system could have helped to ensure that operational efficiency were achieved and would have ensured that the resources which Computer Solutions Ltd could have been used in the best possible manner. It helps in proper allocation of resources and thereby helps to find out the future needs and requirements of the business. This thereby helps to make planning for the future and ensures that the business is able to develop strategies regarding the future (Jerome, 2012). This was clearly seen in case of Computer Solutions Ltd as roles and responsibilities which were allocated to different people were not carried out correctly. The sales team didn’t look to work unless special incentives were provided. The financial director figures didn’t match with the actual figures clearly highlights that despite having the resources the allocation was not effective. This was further matched by the fact that in the past few years the business was able to perform in a fantastic way but the lack of management control resulted in a creation of a situation where the important aspect of allocating resources were clearly avoided. It helps the business to find out the different gaps which is present in the working condition. This thereby provides an opportunity to make the changes so that the chances of losses can be reduced and the business is able to maintain the required gains in the business (Jerome, 2012). This can be clearly seen in case of Computer Solutions Ltd as the sales team processed orders after 30 days which resulted in the market credit to be around 60 days showing that the gaps which was evident was not filled. Further another situation highlights that customers whom services were provided were billed incorrectly which had thereby impacted their belief on the company and even made people fear that the company was not genuine. This clearly brings forward the fact that the gaps which were present and evident were not filed. This could have been easily filled if a properly developed management control would have been placed and would have ensured that the overall effectiveness of the business would improve. It helps in the overall effectiveness of the business and helps to ensure that the strategies which are being implemented are as per plan. This thereby ensures that the business is able to work on the different needs and requirements and based on it develop the business fundamentals in such a manner that business process improves. This could have been applied in case of Computer Solutions Ltd as the different gaps which were present in the overall business phenomenon would have been filled (Akrani, 2011). This can be seen in case of Computer Solutions Ltd as the lack of proper control measures created a situation where despite having all the resources at the disposal the business was not able to gain efficiency. This was due to the fact that managers took things at ease, the financials which was shown didn’t match with the actual figures, the sales people were not willing to work unless special incentives were provided, and the entire working scenario was such that the overall aspect of business prospects were ignored. Having a properly developed management control system could have thereby brought the required changes and would have ensured that the business would have understood the different necessities and ensured effectiveness in carrying out the business Thus, management control system would have helped Computer Solution Ltd and George to bring about the required transformation through which better use of resources would have become possible. This would have ensured that Computer Solution Ltd would have been able to control their business better. This would further require identifying the different control system which was lacking and identifying the different system which has to be implemented so that overall effectiveness in carrying out the business would have been achieved. This would have thereby ensured that the business process would have developed and would have ensured best possible use of resources. Control Issues Missing in Computer Solution Ltd Computer Solution Ltd performance has continuously being dipping which have been entirely because of the lack of proper control measures issues which are missing. The lack of proper control issues has thereby affected the efficiency through which the resources were used and will require developing and formulating strategies through which overall gains can be achieved. Some of the control issues which has been identified by Valerie as missing in Computer Solution Ltd are as Human Resource Control: Computer Solution Ltd lacks the effectiveness in controlling the different human resources as can be seen from the fact that the employees come late to the office and leave early, the employees instead of working play games on computer and wait to work until they are provided with extra incentives to support them. This has resulted in the squandering of the human resources and has affected the mechanism through which the business will be able to gain efficiency in using the human resources effectively Operational Control: Computer Solution Ltd lacks proper controls related to the operations of the business (Akrani, 2011). This has made people answer calls only in evenings when special benefits are provided to them. The lack of proper operations has also resulted in people being negligent to work and working in a manner which they see fit. This is further supported by the fact that even after receiving orders from customers they are processed after 30 days and the money is collected after 60 days showing the lack of operational control over the business. This has impacted the overall potential and growth of the business and has created a situation where the business is not able to gain from operations Lack of Financial Control: Computer Solution Ltd hasn’t looked to develop strategies which will be aimed at proper financial management (Adams, 2013). This has thereby affected the credit period which was previously 30 days and has been transformed to 60 days. Further, there is lack of coordination between the finance director and the finance department as the financial figures provided by them don’t match. The degree of carelessness can be seen from the fact that customers are billed and charged for different products and services which they haven’t consumed and has impacted the brand image. This has created suspicion in the minds of the customer regarding the authenticity with which the different activities are carried out and has thereby made it difficult to think of a mechanism through which better control can be exercised Lack of control in relation to security: Computer Solution Ltd also lacks proper security measures which will preserve the vital resources and information (Adams, 2013). Since, all people are allowed to access all areas has resulted in many valuable equipments missing. The stock register shows those products are available but in reality the truth is opposite. This has thereby impacted the risk and made people doubt whether the private information will be preserved or will be leaked. This will have a negative impact on the overall growth potential and would result in diluting the brand image. Computer Solution Ltd thereby finds itself in such a situation where the lack of control measures has affected their business and despite having the required resources at their disposal the business is not able to gain the same effectiveness. This has created a problem associated with the manner in which business future will be decided and requires formulation of control measures based on different control theories so that better use of resources becomes a reality. This will help to bring a change in the fortunes of Computer Solution Ltd and will provide an opportunity through which better growth in the future can be ascertained. Control Measures to be implemented by Computer Solution Ltd Computer Solution Ltd based on the different areas where they are lacking need to formulate strategies and measures which takes care of different deficiencies and helps to formulate strategies through which the objective of the business will be achieved. Some of the control measures which Computer Solution Ltd should aim towards implementing are as Feedforward Control: These measures of control will look towards putting different regulations on the different resources so that they are used in the best manner and will help to achieve business efficiency (Barnatt, 2013). This control will help Computer Solution Ltd to set standards based on which the different operations of the business will be evaluated. It will thereby help people to understand the areas they need to achieve and will act as a binding through which the resources will be used. This would ensure that people come to the office on time and don’t leave early as it will be recorded. Even people coming to work and not working and engaging their time in other activities will be notified and will act as a binding stone through which people will be forced to work and carry out the activities in the most positive manner thereby ensuring that the different resources of Computer Solution Ltd are used in a proper manner. Concurrent Control: This control looks at developing regulations for the ongoing activities so that the transformation process ensures that the resources are used in the correct manner (Barnatt, 2013). This will thereby help to bring a check in the current working style of Computer Solution Ltd. It will ensure that the sales department continue to work with the same effectiveness and the market credit reduces from 60 days to 30 days. This control will ensure that the financials are verified and correct and complete information is provided so that the business doesn’t face a financial problem. This mechanism would thereby help to bring a complete change in the use of resources and would direct the business management to improve in areas through which growth for the future becomes possible. Feedback Control: This type of control focuses on working on the different feedbacks which have been received and looks at making the required transformation so that business process efficiency is gained (Barnatt, 2013). This control will help Computer Solution Ltd to understand the market needs and requirements as understanding the customer will provide the direction based on which the future needs and requirements will be processed. This would thereby help to find out and develop the different fundamentals through which Computer Solution Ltd will be able to transform the working culture into a positive one Preventive Control: This control will be designed to ensure that the irregularities which the business is facing are removed (Control. 2013). This will help to understand the manner in which Computer Solution Ltd is lacking the aspect of security and will be able to develop the basic fundamentals through which business process solutions which is aimed towards better preventive measures will be achieved. This would help to ensure that Computer Solution Ltd is able to use the resources and preserve the different vital resources in the most effective manner Detective Control: This control are held to find out the irregularities which the business is facing and looks at formulating strategies through which it can be removed. Computer Solution Ltd can use it and develop a process of physical verification, auditing and other so that the authenticity of the different information which is provided can be gauged (Control. 2013). This will help to reduce the chances of frauds and will help to develop a framework based on which different business objectives will be achieved Computer Solution Ltd thereby need to look towards implementing the above mentioned control measures so that better effectiveness is the use of resources is achieved and the business through it is able to gain operational efficiency. This will also help to use the resources in the best possible manner and will provide a framework through which the working of the business can be improved. Conclusion Proper control measures acts as an important point in determining the success as it helps to gain operational efficiency and ensures best possible use of resources. This report shows the control system which is required in Computer Solutions Ltd as the lack of control system has affected the performance of the organization and is slowly moving downwards. The fact that Computer Solutions Ltd hasn’t been able to develop a proper control process has provided the required freedom where people have started to act in the way they prefer and has also resulted in negligence on many parts. This requires development of a control process which will be analyzed in the case. In addition to it the report will also analyze the different control issues which have been identified by Valerie and provide solutions to deal with it. Working and developing the required controls will help to gain operational efficiency and ensure that the goals are easily achieved. References Adams, D. 2013. What Are the Four Types of Strategic Control? Retrieved on Oct 10, 2013 from http://smallbusiness.chron.com/four-types-strategic-control-14720.html Akrani, G. 2011. Controlling Techniques: 10 Types of Techniques for Controlling. Retrieved on Oct 10, 2013 from http://kalyan-city.blogspot.com/2011/05/control-techniques-10-types-of.html Barnatt, R. 2013. Strategic Management: Formulation & Implementation. Retrieved on Oct 10, 2013 from http://www.strategic-control.24xls.com/en104 Control. 2013. Are there Different Types of Internal Controls? Retrieved on Oct 10, 2013 from https://www4.vanderbilt.edu/internalaudit/internal-control-guide/different-types.php Jerome, W. 2012. 8 different types of control in management suggested by William Travers Jerome III. Retrieved on Oct 10, 2013 from http://www.preservearticles.com/2012051932637/8-different-types-of-control-in-management-suggested-by-william-travers-jerome-iii.html Read More