mini project 3

The Hands of the Clock as the Control Hierarchy of Accounting System

What has hands but no feet, a face but no eyes, tells but does not talk? Yes, the answer is a clock. The clock is an instrument for measuring, indicating, and maintaining the time. The clock face displays the time through the use of a fixed number dials and moving hands. The dial is numbered one to twelve indicating the hours in a 12-hour cycle, and the shortest hour hand makes two revolutions in a day. The longer minute hand shows minutes and makes one revolution every hour. The longest second hand makes one revolution per minute and it tells seconds. The functions of the three hands can be paralleled in the management control hierarchy: strategy control, management control, and performance control.

Firstly, the hour hand represents the strategy control. The hour hand performs the plan action designed to guide the movement of the minute hand. At the same tine, it indicates hours, which is the most important unit of time. Comparing with strategy control, which is the vital part of control hierarchy and the highest level of managerial actives. It specifies how an organization accomplishes its objectives by matching its own capabilities with the opportunities in the marketplaces. Thus, Strategic management provides overall direction to the organizations, and it is formulated by the Board of directors and performed by the organization's Chief Executive Officer (CEO). It is a long term plan, which extensively premeditates and practically rehearses the management control and performances control. For the skills of management graduates in the 21st century, strategy control should be more emphasize on how a company will compete and the opportunities its employees should seek and pursue. Strategy is about the choices, which directly affects the outcomes. A better strategy may lead organizations to operate well, stabilize in difficult conditions, and lower competitions. Therefore, Company works in formulating strategy should provide comprehensive information about the structure of organizations and the sources of competitive advantage. On the other hand, strategy control is an ongoing process. It has to adapt to new technology, new competitors, and changed environments (economic, financial, social, and political).

Furthermore, the minute hand represents the management control. It moves depend on the hour hand and controls the movement of the second hand. It is a connecting link between the preceding level (hour hand) and the following level (second hand). Similar like the management control of 21st century, it coordinates and controls the activities of different departments in order to achieve the strategy. Its functions include setting standards, measuring actual performances, and correcting errors. On the standard aspect, managers need feedback information, such as production feedback and customer feedback, which helps to set norms and standards. The standards need not to be provide complete information, it just be a sample which suggests the operations. The next step is managers compare actual performances with the standards. By comparison, company is able to get frequency distribution about their products. Finally, if there are some differences between the actual outputs and the norms, this means that the business operation is not feasible, and managers have to check and correct the deviation from the standard.

Most importantly, the second hand represents the performance control, and its movement follows the guidance of both the hour and the minute hands. Just like performance control, this includes activities of the organization to ensure that the strategy and the management are consistently being met in an effective manner. It is the basic step of managerial activities. For the 21st century skills of management graduates, it does not only focus on performance of the organization, but also activities of each department. These activities such as improving quality and reducing cost for production department, advertising products for market department, and providing guarantee for customer department. Overall, achieving maximum performance is the method to get the organizational effectiveness.