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Inappropriate standards (or targets):
This is a problem arising from deficiencies in planning. If not enough time and resources are devoted to setting accurate standards in the first place, and if they are not kept up to-date, subsequent performance is highly likely to deviate from what was expected.
Mis-measurement of actual results: Scales may be misread, the pilfering of wastage or materials may go unrecorded, items may be wrongly classified (as material X3 say, when material X8 was used in reality), or employees may make ‘cosmetic’ adjustments to their records to make their own performance look better than it really was.
Implementation breakdown:
This means that for a variety of causes employees will not always implement the plan in the way that was intended. The classic example is the purchase of raw materials at a lower than budgeted price, causing quality problems for production. Such problems may arise whether employees act with the best intentions or whether they deliberately take their own course because they do not agree with the plan. They may also be caused by poor communications or inadequate training.
Criticism of Material Requirement Planning
Illustration of Standard error of estimate The production manager of XYZ Company is concerned about the apparent fluctuation in efficiency and wants to determine how labour cos
Discuss the different roles played by the qualitative and quantitative approaches to managerial decision making
The firm's require holding cash may be attributed to the three motives specified below: The transaction motive The precautionary motive The speculative motive.
State Factors determining Working Capital requirement.
case study on payroll system
Determine the Internal factors of pricing decision 1) Organization factor: pricing decision occur on two level in the organization. Overall price strategy is dealt with by to
PERMANENT ABANDONMENT OF PREMISES A company may find it more profitable to concentrate its output in some factories by closing down others. The decision, in this instance, is
Disadvantages of the cost accounting: 1. It is unnecessary: it is argued that maintenance of the cost records is not necessary and involves duplication of work. It is based o
Budgets An essential planning component is budgeting. Budgets sketch the financial plans for an organization. There are number of budget types. Operating Budgets -- A plan
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