Difference between strategic planning management control and operational control

Outline the difference between Management Control, Strategic Planning and Operational Control along with relevant examples.

Meaning of Management Control:- It is the process of evaluating, monitoring and Controlling the various units of the organization. This process is done to see the effective and efficient allocation and utilization of resources in achieving the predetermined goals.

Management control is carried out by evaluating the performance of each ‘responsibility Centre’ against predetermined performance.

Strategic Planning:- it is the long term planning. It involves strategy formulation which is carried on at the top level of Management. Strategic planning involves secrecy and is not communicated till the decisions are actually taken. Most of the data for planning is derived from the external environment.

Operational Control:- The manager of the responsibility centers managing the tasks effectively and efficiently which are allocated to them. They perform operational Control, to perform these tasks and activities. Operational control is related to the control of activities within the department. Example- Material manager exercise control on the specific activities concerned with the materials.

Let’s Find out the Distinction among Strategic planning, Management Control and Operational Control.

Levels of Management

Strategic Planning:- It is carried on at the top level management.

Management Control:- It is carried on at the middle level management.

Operational Control:- It is Carried on the Bottom level management throughout operating management.

Basis of Information

Strategic Planning– It uses external information for making policy.

Management Control– It is used to generate data within the organization.

Operational Control:- It relies on the data which is Generated by the Management Control.

Evaluation of Performance

Strategic Planning:- It is such a type of planning which is impersonal in nature.

Management Control:- Under this process performance is evaluated against standards determined by managers.

Operational Control:- It closely monitors physical achievement such as labor hours, machine hours, units produced, units sold and units defective.

Focus of Activities

Strategic Planning:- It applies to one aspect at a time from the whole operations of the organization.

Management Control:- It is also concerned with the whole organization. It focused on the potency of organization.

Operational Control:- It is concerned with the specific tasks for the particular department.

Application of Quantitative models

Strategic Planning:- It uses a lot of judgment to derive effectiveness tasks. For the purpose of achieving predetermined tasks.

Management Control:- It has limited options for quantitative models. Which are used for management control.

Operational Control:- It used a lot of quantitative models for taking optimal decisions.

Time of Horizon

Strategic Planning:- It is used for long term time horizons.

Management Control:- It is used for a short span of time horizon.

Operational Control:- It is used day to day activities for achieving effectiveness tasks as per requirement of business.

Mental activity

Strategic Planning:- It involves creative and analytic processes.

Management Control:- It is an administrative and persuasive process.

Operational Control:- It is concerned with the setting of day to day objectives.

Appraisal of Job

Strategic Planning:- It is an extremely difficult task of management.

Management Control:- Its less difficult tasks as compared to Strategic Planning.

Operational Control:- This task asks much time of supervision to make it less difficult.

No. Of person involved

Strategic Planning:- It involves Small number of people. Who operates the task of business.

Management Control:- It includes a large number of persons who manage tasks of business for Controlling purposes.

Operations Control:- It also includes a large number of persons who help to carry out daily task of business.

Conclusion:- Now we can understand Difference between strategic planning management control and operational control. Which are an essential part of business. They are all processes used in the business for the purpose of achieving predetermined tasks. 

Other Management Accounting and Control System Previous year question related to 2016 under Gndu besides the Difference between strategic planning management control and operational control

“Accounting is an Important management Information system”. Discuss this system in light of the users of the accounting information. (2016)

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Difference between strategic planning management control and operational control