Description
A direct service organisation or direct labour organisation (DSO or DLO) is a business unit of a United Kingdom local authority which undertakes work specified by the Local Government Act 1988
Module IX Service Organization
Objectives
• To understand the service organization in general and its characteristics. • To analyze different types and characteristics of service organization like;
Professional service organization Financial service organization Health Care organization Non profit organization
Characteristics of service Organization
•
•
• 1. 2. 3. 4.
For several reasons, management control in services industries is different than the manufacturing industry. There are many factors which affect the management control system of the service organization based on the characteristics of it. The main characteristics of the service organization are as below: Absence of Inventory Difficulty in controlling quality Labor intensive Multi-unit organizations
Professional Service Organization
• Research and development, law firms, accounting firms, health care organizations, engineering firms, architectural firms, advertising agencies are examples of professional service organizations. • There are certain special characteristics of this type of organization like; - Goals - Professionals - Output and input measurement - Small size - Marketing
MCS for Professional service organization
• • • • • Pricing Profit Centers and Transfer Pricing Strategic Planning and Budgeting Control of Operations Performance Measurement and appraisal
Financial Service Organization
• Financial service organization include commercial banks, insurance companies, securities firms etc. • These companies are in business primarily to manage money and some act as an intermediary, risk shifters, traders etc. • The special characteristics of the financial organizations are; - Monetary assets - Time period for transaction - Risk and reward - Technology
Contd.
1. Commercial Banks : General Characteristics Regulatory capital New products Risks Automation Management Control Implications: Interest rates Volume of deposits to cover costs Loan losses Expenses Joint Revenues Accounting systems
Contd.
2. Securities Firms: Management Control Implications: - Customer relationship - Stars and teamwork - Need for rapid information - Focus on short run - Measuring financial performance
3. Insurance Companies:
Management Control Implications - Product Pricing - Sales performance - Expense control - Control of investing
Health Care Organizations
• The health care organizations consists of hospitals, clinics, health maintenance organizations, medical laboratories etc. • The special characteristics of health care organizations are; - Difficult social problems - Change in mix of products - Third – party payers - Professionals - Importance of quality control
Non – profit organizations
• A non profit organization is an organization that can not distribute assets or income, or for the benefits of the members, officers and directors. • The special characteristics are ; - Absence of the profit measure - Contributed capital: plant and endowment capital - Fund accounting - Governance The control system here includes following components: - Product Pricing - Strategic planning and budget preparation - Operation and evaluation
Government Organization
• General characteristics:
Political influences Public information Attitude toward clients More regulations Management compensation Financial Accounting
• Management Control Systems:
- Strategic Planning and Budget Preparation - Performance measurement
doc_930994339.ppt
A direct service organisation or direct labour organisation (DSO or DLO) is a business unit of a United Kingdom local authority which undertakes work specified by the Local Government Act 1988
Module IX Service Organization
Objectives
• To understand the service organization in general and its characteristics. • To analyze different types and characteristics of service organization like;
Professional service organization Financial service organization Health Care organization Non profit organization
Characteristics of service Organization
•
•
• 1. 2. 3. 4.
For several reasons, management control in services industries is different than the manufacturing industry. There are many factors which affect the management control system of the service organization based on the characteristics of it. The main characteristics of the service organization are as below: Absence of Inventory Difficulty in controlling quality Labor intensive Multi-unit organizations
Professional Service Organization
• Research and development, law firms, accounting firms, health care organizations, engineering firms, architectural firms, advertising agencies are examples of professional service organizations. • There are certain special characteristics of this type of organization like; - Goals - Professionals - Output and input measurement - Small size - Marketing
MCS for Professional service organization
• • • • • Pricing Profit Centers and Transfer Pricing Strategic Planning and Budgeting Control of Operations Performance Measurement and appraisal
Financial Service Organization
• Financial service organization include commercial banks, insurance companies, securities firms etc. • These companies are in business primarily to manage money and some act as an intermediary, risk shifters, traders etc. • The special characteristics of the financial organizations are; - Monetary assets - Time period for transaction - Risk and reward - Technology
Contd.
1. Commercial Banks : General Characteristics Regulatory capital New products Risks Automation Management Control Implications: Interest rates Volume of deposits to cover costs Loan losses Expenses Joint Revenues Accounting systems
Contd.
2. Securities Firms: Management Control Implications: - Customer relationship - Stars and teamwork - Need for rapid information - Focus on short run - Measuring financial performance
3. Insurance Companies:
Management Control Implications - Product Pricing - Sales performance - Expense control - Control of investing
Health Care Organizations
• The health care organizations consists of hospitals, clinics, health maintenance organizations, medical laboratories etc. • The special characteristics of health care organizations are; - Difficult social problems - Change in mix of products - Third – party payers - Professionals - Importance of quality control
Non – profit organizations
• A non profit organization is an organization that can not distribute assets or income, or for the benefits of the members, officers and directors. • The special characteristics are ; - Absence of the profit measure - Contributed capital: plant and endowment capital - Fund accounting - Governance The control system here includes following components: - Product Pricing - Strategic planning and budget preparation - Operation and evaluation
Government Organization
• General characteristics:
Political influences Public information Attitude toward clients More regulations Management compensation Financial Accounting
• Management Control Systems:
- Strategic Planning and Budget Preparation - Performance measurement
doc_930994339.ppt