Business Management Controls

Business Management Controls: A guide

JOHN KYRIAZOGLOU
Copyright Date: 2012
Published by: IT Governance Publishing
Pages: 375
https://www.jstor.org/stable/j.ctt5hh486
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  • Book Info
    Business Management Controls
    Book Description:

    Business Management Controls: A Guide describes the various types of controls in all core business functions and outlines several frameworks (including BSC) for designing and implementing those controls. A selection of illustrative case studies, together with some key recommendations throughout the book, offer the reader further help and guidance on applying these controls within their own business, regardless of its size.This book is aimed at anyone wanting to control and improve the assets, transactions, operations, systems activities and investments of their organisation. They will learn how to develop more streamlined and successful working practices and enable, facilitate and protect their own business operation in a more effective way with this essential guide.

    eISBN: 978-1-84928-429-5
    Subjects: Management & Organizational Behavior

Table of Contents

  1. Front Matter
    (pp. 2-4)
  2. FOREWORD
    (pp. 5-10)
    Marilyn M Helms

    Business Management Controlsis a practical guide and reference for the business person who needs to implement, or improve, business controls. This hands-on guide is clearly organised and arranged by functional business area. John Kyriazoglou has written a detailed overview of controls in a complete, easy-to-follow format. This book is a great companion toIT Strategic and Operational Controls(2010), and extends his work and expertise beyond information technology, to the entire organisation.

    As a professor of strategic management, and a frequent consultant to entrepreneurial ventures, including those at various stages of new venture creation, this book is a detailed...

  3. PREFACE
    (pp. 11-19)
    John Kyriazoglou
  4. ABOUT THE AUTHOR
    (pp. 20-21)
  5. ACKNOWLEDGEMENTS
    (pp. 22-23)
    John Kyriazoglou
  6. Table of Contents
    (pp. 24-29)
  7. CHAPTER 1: BUSINESS MANAGEMENT CONTROLS FRAMEWORK
    (pp. 30-54)

    ‘The companies that survive longest are the ones that work out what they uniquely can give to the world, not just growth or money, but their excellence, their respect for others, or their ability to make people happy. Some call those things a soul,’ is a famous quote by management guru, Charles Handy. But how are all these to be achieved by organisations, in the most optimal way?

    Controls, managers, internal control frameworks, business management controls, and performance and compliance measures, are the most crucial components towards reaching these goals, and making companies most beneficial to all.

    Business management controls,...

  8. CHAPTER 2: ENTERPRISE GOVERNANCE CONTROLS
    (pp. 55-77)

    ‘The only man I know who behaves sensibly is my tailor; he takes my measurements anew each time he sees me. The rest go on with their old measurements and expect me to fit them,’ is a famous quote by George Bernard Shaw.

    This provides the inspiration for managers to be on top of things:

    1 To establish the governance, administration, strategic, operational and compliance mechanisms and controls, so that they can drive strategic and operational performance for better results.

    2 To measure properly, with specific types of compliance and performance measures, at each business function level, to ensure that...

  9. CHAPTER 3: RISK AND COMPLIANCE CONTROLS
    (pp. 78-92)

    ‘It’s a major milestone. The settlement puts new responsibilities on Microsoft®and we accept them. I am personally committed to full compliance. We are committed to being a responsible industry leader,’ is a famous quote by Bill Gates, the American founder of Microsoft®. Both of these quotes provide the motivation for managers to manage the potential risks facing their company, and to be compliant with all rules and regulations affecting their business operations.

    You can manage your risks, and be compliant with rules and regulations, by using the risk and compliance controls discussed in this chapter.

    The purpose of risk...

  10. CHAPTER 4: STRATEGIC MANAGEMENT CONTROLS
    (pp. 93-111)

    ‘However beautiful the strategy, you should occasionally look at the results,’ is a famous quote by political leader, Winston Churchill. But how are results to be achieved by organisations (private and public, small, medium and large, etc.) in the most effective way? These, I think, may be facilitated and achieved by control frameworks, governance, risk, compliance, strategic and operational management controls, performance measures and compliance indicators, etc, for all business activities of organisations. Strategic management controls and measures are discussed in this chapter. Operational controls and measures which complement the execution of the strategy of the organisation are discussed in...

  11. CHAPTER 5: FINANCIAL MANAGEMENT AND ACCOUNTING CONTROLS
    (pp. 112-127)

    ‘The only man I know who behaves sensibly is my tailor; he takes my measurements anew each time he sees me. The rest go on with their old measurements and expect me to fit them,’ is a famous quote by George Bernard Shaw. This provides the inspiration for managers to be on top of things:

    1 To establish the governance, administration, strategic, operational and compliance mechanisms and controls, so that they can drive strategic and operational performance for better results.

    2 To measure properly, with specific types of compliance and performance measures at each business function level, to ensure that...

  12. CHAPTER 6: CUSTOMER SALES AND PRODUCTION MANAGEMENT CONTROLS
    (pp. 128-148)

    ‘Being busy does not always mean real work. The object of all work is production or accomplishment, and to either of these ends there must be forethought, system, planning, intelligence, and honest purpose, as well as perspiration. Seeming to do is not doing,’ is a famous quote by Thomas Edison, the American inventor (1847–1931). This provides the motivation for managers to:

    1 Establish the customer sales and production management functions, so that they can drive, and achieve, strategic and operational targets, and for better results.

    2 Measure properly, with specific types of compliance and performance measures, the performance of...

  13. CHAPTER 7: IT GOVERNANCE CONTROLS
    (pp. 149-171)

    ‘It is important that organisations recognise the differences in the types of employees who commit each type of crime, as well as how each type of incident evolves over time: theft or modification for financial gain, theft for business advantage, IT sabotage, and miscellaneous (incidents that do not fall into any of the three above categories),’ was quoted in a recent Carnegie-Mellon study.⁷⁸ This provides the motivation and inspiration for IT managers to be more proactive, effective, and efficient, in protecting the IT assets and the information systems, resources and processes of the modern enterprise (private or public organisation). IT...

  14. CHAPTER 8: BUSINESS DATA MANAGEMENT CONTROLS
    (pp. 172-192)

    Business data are at the nucleus of your business activities, and the main source of your business information systems. Business data from your business records (paper or digital), are expressed in paper or digital documents, and are processed and maintained by recordkeeping systems.

    A record, in business terms, is an item or collection of data, which may contain: a set of fields in a database related to one entity, data about business transactions, medical history and treatments of persons, personal data of people, minutes of meetings, music, video, pictures, other forms of digital information, etc.

    A document is ‘any concrete...

  15. CHAPTER 9: BUSINESS INTELLIGENCE AND ESPIONAGE CONTROLS
    (pp. 193-212)

    The most critical assets in the 21stCentury for private and public enterprises, for business entities and organisations in general, for the global society, and for the economy (local, regional, national, international), are not of physical nature (equipment, machines, installations, plants), or of financial nature (money, credit or other financing instruments), or of computer software nature. The most critical assets are the knowledge and ideas (concepts) that exist in the brains of people, which are stored in classical paper files, computerised systems (personal and corporate), multimedia devices, electronic messages, network servers, back-up devices, digital records, CAD, and other office automation...

  16. CHAPTER 10: BUSINESS PERFORMANCE MANAGEMENT FRAMEWORKS
    (pp. 213-232)

    ‘Every discourse, even a poetic or oracular sentence, carries with it a system of rules for producing analogous things and thus an outline of methodology,’ is a famous quote by Jacques Derrida.115It is, therefore, paramount that in order for organisations to be controlled and managed in the most effective way, a framework, as we concluded inChapter 1, as well as an associated methodology, is required for best results. The most used frameworks are presented next. A BSC methodology for implementing controls is discussed inChapter 11.

    In the current business environment, regardless of the type and size of...

  17. CHAPTER 11: IMPLEMENTING BUSINESS MANAGEMENT CONTROLS
    (pp. 233-252)

    ‘Thinking is easy, acting is difficult, and to put one’s thoughts into action is the most difficult thing in the world,’ is a famous quote by the German poet, Johann Wolfgang von Goethe. This cautions us, and informs us of the difficulties in implementing any pre-designed actions on any issue in everyday life. We should, therefore, be aware of all difficulties, and the critical issues, in implementing controls systems with any approach, such as the BSC, noted next.

    In practical terms, as I explained inChapter 1, the internal controls system is a system of integrated elements (people, structure, processes,...

  18. CHAPTER 12: ROLES AND RESPONSIBILITIES OF PARTICIPANTS IN BUSINESS MANAGEMENT CONTROLS
    (pp. 253-271)

    ‘Efficiency is doing things right; effectiveness is doing the right things,’ is a famous quote by management guru, Peter Drucker. But how are these to be enabled, facilitated and achieved, without losing control of the organisation, and taking into consideration the impact of the organisation to society? Corporate governance, as well as roles and responsibilities of the various participants in the affairs of the organisation, are a major contributor to the execution of corporate management controls, according to practice and various research studies.

    Organisations are established, and run, by people with the support aspects, review activities, and facilitation tools of...

  19. CHAPTER 13: HUMAN FACTORS IN APPLYING BUSINESS MANAGEMENT CONTROLS
    (pp. 272-293)

    ‘All human actions have one or more of these seven causes: chance, nature, compulsion, habit, reason, passion, and desire,’ is a famous quote by Aristotle. But how these human factors are used to implement controls by you, your managers, and your employees in your company, in the best way, is quite a difficult and tedious job. This gives us the motivation to describe the characteristics of these human factors, and what they may mean for the implementation effort of the business management controls for your company.

    Controls, as we have discussed so far, have to do with your formal policies...

  20. CHAPTER 14: BUSINESS AND IT CONTINUITY MANAGEMENT CONTROLS
    (pp. 294-310)

    ‘I always tried to turn every disaster into an opportunity,’ is a famous quote by John D Rockefeller. Research conducted by Professor Daniel Diermeier of the Kellogg School of Management,148supports this, and suggests, according to Professor Diermeier, ‘that when disaster strikes, a company becomes not just an anonymous provider of goods and services, but a member of the community’. This provides us with the motivation to analyse and present ways and means to companies, of all types and sizes, to plan for recovering from disasters, and to get their operations up and running in the quickest time possible.

    Business...

  21. CHAPTER 15: CASE STUDIES: APPLYING BUSINESS MANAGEMENT CONTROLS TO MITIGATE FRAUD AND OTHER RISKS
    (pp. 311-340)

    The 21stCentury, according to the noted management thinker John Elkington,162is primarily focused on evolution: corporate, technological, economic, political and, above all, cultural evolution. At the corporate level, organisations will need to operate on the basis of the triple bottom-line principle, in order to be more responsible, socially and economically. This principle guides the companies to operate with full regard to values, transparency, environment-safe products and services, symbiotic partnerships, long-term view of developments, and increased corporate governance. But all companies and organisations do not seem to operate on these principles. The international business landscape is full of corporate fraud...

  22. CHAPTER 16: AUDITING BUSINESS MANAGEMENT CONTROLS
    (pp. 341-348)

    The principal objective of auditing (external and internal) is to review, and appraise, the adequacy, reliability and effectiveness of internal control within systems. External auditing relates, primarily, to the annual independent financial audit conducted for the protection of the stockholders of publicly traded companies. Internal auditing relates to the work executed by the internal audit function of the organisation which evaluates the business management controls established by the management of the organisation165to: achieve the organisation’s objectives, ensure the economical and efficient use of corporate resources; ensure compliance with established company policies and procedures, and external laws and regulations; safeguard...

  23. CHAPTER 17: CONCLUSION
    (pp. 349-361)

    Managers are employed to make decisions, good, bad, or of no relevance. A decision is a choice made between alternative courses of action, in a situation of uncertainty. There are various decision-making methods, techniques, models and tools that can assist a manager during the decision-making process, such as:

    1 The Vroom-Yetton-Jago decision model

    2 The Kepner-Tregoe matrix

    3 OODA loops

    4 Grid analysis

    5 Paired comparison analysis

    6 Pareto analysis

    7 Decision trees

    8 Risk analysis

    9 Cost/benefit analysis

    10 Break-even analysis

    11 Cash flow forecasting

    12 Six thinking hats, etc.170

    What is, however, of paramount importance, is that good...

  24. APPENDIX
    (pp. 362-371)
  25. ITG RESOURCES
    (pp. 372-375)