Preview

Case 1 Rendell

Better Essays
Open Document
Open Document
1099 Words
Grammar
Grammar
Plagiarism
Plagiarism
Writing
Writing
Score
Score
Case 1 Rendell
MANAGEMENT CONTROL SYSTEMS
“Case Analysis: Rendell Company”

Prepared by:
Martinus Anggi Apriliawan
64-Int-A

MASTER OF MANAGEMENT
FACULTY OF BUSINESS AND ECONOMICS
UNIVERSITAS GADJAH MADA
2015
Rendell Company
Summary by: Martinus Anggi Apriliawan 64-Int-A
1. Introduction
Fred Bevins is the controller of the Rendell Company, a firm that has been profitable for 50 years, but has concerned over its organizational status of his divisional controllers that possibly affected the growth rate of the company to decline considerably.
The corporate control organization was responsible for financial accounting, internal auditing, and analysis of capital budgeting interest. Those functions are divided into each strategic business unit that corresponds to product lines that was led by divisional general manager and divisional controller as an assistant for budgets and performances reports.
Several concerns emerged within the company as functions are colliding and the system are deemed to be biased. Basic task such as budgets and performance reports are viewed as influenced by the relationship between the divisional general manager and the divisional controller. After careful study to another company in Martex, Mr Bevins enthused to reinvent Rendell’s organizational structure. One of the tangible change is to transform the relationship of controller to be more direct, divisional controller should report straight to him instead of the general managers. Nevertheless, arguments arose to reconsider the transformation as other employee such as his assistant, argues that general managers would be reluctant to have a direct relationship because the division controller is perceived as a “front office spy”.
2. Contextual Idea
Management control involves managers taking steps to help ensure that the employees do what is best for the organization. This is an important function because it is people in the organization who make things happen. Management controls are necessary to

You May Also Find These Documents Helpful

  • Good Essays

    The controlling function involves monitoring the firm’s performance to make sure that goals are being, met. Managers need to pay attention to costs versus performance of the organization.…

    • 321 Words
    • 2 Pages
    Good Essays
  • Good Essays

    Hcc Case

    • 620 Words
    • 3 Pages

    The company is divided into four operating divisions (Glasseal, Hermetic Seal, Hermetite and Sealtron) , each of which is run completely independent by a general manager. These managers are responsible for the whole business operated in their division except for the control function, which is run by the division controllers who report directly to Chris Bateman, the CFO. The reason why control is separated from everything else is to ensure that there is autonomy and objectivity on the controller’s judgments: if they were reporting to the division managers and earning bonuses on the same basis than them, they would have an incentive to window dress the accounts and report a better situation than the real one. However, the disadvantage of this separation is that corporate monitoring and recommendations are not well seen by the division managers, who feel that they are being controlled by people who is not working day by day with them.…

    • 620 Words
    • 3 Pages
    Good Essays
  • Powerful Essays

    Daisy Group PLC’s business organisational objective is to be the UK’s number one communications provider. My management and leadership role takes on many styles to meet the needs of different situations when managing a team of 10 credit controllers in order to achieve this business goal. As explained by Goleman (1996) a good leader must be emotionally sensitive to know which styles to adopt depending on the different situation. Within his book 6 styles are outlined, Visionary, Coaching, Affiliative, Democratic, Pacesetting and…

    • 2818 Words
    • 12 Pages
    Powerful Essays
  • Good Essays

    Control function is an assessment of performance against the standards and correction of discrepancy if any to ensure accomplishment of organizational goals. The purpose of controlling is to ensure that all the processes/operations materialize in compliance to the standards. The controlling function of management has a negative connotation when employees feel that they are being micro managed which doesn’t allow them to display their potentials and thus do not feel part of a team. With the rapid growth of technologies, organizations are becoming more complex.…

    • 543 Words
    • 3 Pages
    Good Essays
  • Satisfactory Essays

    Financial Term Worksheet

    • 495 Words
    • 2 Pages

    Controlling, is when a manager detects a problem within the organization and takes the necessary steps to rectify the situation.…

    • 495 Words
    • 2 Pages
    Satisfactory Essays
  • Better Essays

    Management is the practice of overseeing and coordinating the work of others so that the companies goals can be accomplished. The way managers do this is by effectively using an organizations most important resource which is employees. In order to ensure this is accomplished managers assign task and activities to make…

    • 1111 Words
    • 5 Pages
    Better Essays
  • Powerful Essays

    The role of the controller

    • 2460 Words
    • 8 Pages

    Changes in the accounting industry have forced a shift in the role of the controller within the organization. From the controller’s perspective, this paper will seek to identify current issues faced at The Beverage Company. We will uncover issues within internal control systems, investor relations, strategic planning, control of cash, customer credit and collections, inventory control, and provide solutions to resolving them.…

    • 2460 Words
    • 8 Pages
    Powerful Essays
  • Powerful Essays

    “Problems and it’s expected solutions of Human Resources Policies and Practices of Shahajalal Islami Bank Ltd: A Comparative analysis between Shahajalal Islami Bank & Brac Bank Ltd.”…

    • 24605 Words
    • 99 Pages
    Powerful Essays
  • Good Essays

    * The Managing Director, who must do what is best for the overall future of the business…

    • 757 Words
    • 4 Pages
    Good Essays
  • Powerful Essays

    Rendell Case

    • 3782 Words
    • 16 Pages

    Fred Bevins, controller of the Rendeli Company, was concerned about the organizational status of his divisional controllers. In 1985 and for many years previously, the divisional controllers reported to the general managers of their divisions. Although Mr. Bevins knew this to be the general practice in many other divisionally organized companies, he was not entirely satisfied with it. His interest in making a change was stimulated by a description of organizational responsibilities given him by the controller of the Martex Corporation. The Rendell Company had seven operating divisions: the smallest had $50 million in annual sales and the largest over $500 million. Each division was responsible for both the manufacturing and the marketing of a distinct product line. Some parts and components were transferred between divisions, but the volume of such interdivisional business was not large. The company had been in business and profitable for over 50 years. In the late 1970s, although it continued to make profits, its rate of growth slowed considerably. James Hodgkin, later the president, was hired in 1980 by the directors because of their concern about this situation. His first position was controller. He became executive vice president in 1983 and president in 1984. Mr. Bevins joined the company as assistant controller in 1981, when he was 33 years old. He became controller in 1983. In 1980, the corporate control organization was primarily responsible for (1) financial accounting, (2) internal auditing, and (3) analysis of capital budgeting requests. A budgetary control system was in existence, but the reports prepared under this system were submitted to the top manageThis case was prepared by Robert N. Anthony, Harvard Business School. Copyright Haroard Busiress School case 109-033 by the President ald Fellows ofHarvard College.…

    • 3782 Words
    • 16 Pages
    Powerful Essays
  • Satisfactory Essays

    Rendell Case

    • 764 Words
    • 4 Pages

    Discussion Regarding the case, there are some issues that should be answer in order to give clear perspective before determining the appropriate method to organize the relationship between the corporate controller and the divisional controllers. Some issues consist of: 1. What is the organizational philosophy of Martex with respect the controller function? What do you think of it? Should Rendell adopt this philosophy? Analysis: The organizational philosophy of Martex with respect to the controller function is that divisional controller report directly to the corporate controller for transparency of information on budget issues. This indicates that Martex uses a solid line on the organization chart. Obviously, there are pros and cons that relate with the application of this concept. Some advantages using the solid line concept consist of:  Strengthen the division controller role as a part of company’s control system and prevent misleading information or the concealment of unfavorable information by division manager.  Supporting corporate controller in the preparation of…

    • 764 Words
    • 4 Pages
    Satisfactory Essays
  • Powerful Essays

    Portfolio

    • 1003 Words
    • 5 Pages

    Portfolio ini dibuat dengan tujuan agar apabila kita menjadi pemimpin, kita dapat melaksanakan tugas kita dengan baik dan dapat menjadi pemimpin yang baik dan bijaksana.…

    • 1003 Words
    • 5 Pages
    Powerful Essays
  • Powerful Essays

    Term Paper

    • 2667 Words
    • 11 Pages

    Presence of glass ceiling practices in local privet business organizations of Bangladesh and factor responsible for glass ceiling…

    • 2667 Words
    • 11 Pages
    Powerful Essays
  • Powerful Essays

    service quality

    • 11066 Words
    • 45 Pages

    competencies for a manager of multicultural teams. It is argued that a manager of a…

    • 11066 Words
    • 45 Pages
    Powerful Essays
  • Satisfactory Essays

    Control Process

    • 303 Words
    • 2 Pages

    • Controlling is related to each of the other functions of management. Controlling builds on planning, organizing and leading.…

    • 303 Words
    • 2 Pages
    Satisfactory Essays