Paucity of Control Systems-The Case of AAA Digital Solutions

Case Code: CLFIN032 Case Length: 3 Pages Period: Pub Date: 2022 Teaching Note: Available

Price: Rs.200 Organization : AAA Digital Solutions Industry :Technology & Communications Countries : India Themes: Management of Information Systems,Decision Support Systems, Planning & Control

Abstract

Amit, Aravind, and Akanshka, started an online digital marketing business AAA Digital Solutions after completing their post-graduate studies. After two years of operations, they found that the company was incurring losses, resulting in a decline in the amount of their capital.

Once they started analyzing the facts, they found that not only had there been a decline of their capital in the business because of some transactions, but that they had also ended up spending from their own pockets on the business They were unable to figure out what had actually happened during the past two- year period of their business operations.

The present case study can be helpful in understanding the need for a management control system in a business organization and the process and philosophy behind designing and managing controls either in a small or a large scale business organization. The concepts of management control can be discussed in the context of the difficulties faced by Amit, Aravind, and Akanshka in running their business.

Issues

• The need for management control systems.
• The application of the Cybernetic Approach for Management Control Systems.
• The Philosophy of Management By Objectives in Designing and Managing Management Control Systems.

Introduction

After completing a post graduate degree in management, Amit, Aravind, and Akansha wanted to start their own business venture. Amit's father was a businessman, while the fathers of Aravind and Akansha were employed in public sector companies. Amit’s father responded positively to the proposal. He told Amit that he was ready to give him any assistance that he required and asked him to go ahead. Aravind's father and Akansha's father were not too keen about their children venturing into business, as they were concerned about the risks involved. The trio finally convinced their parents and got their approval to start a business. But they did not have any idea what business they would set up.

Akansha had an engineering background and was technically competent in data analysis and web designing. Aravind was from a science background, and had good communication and inter-personal skills. Amit, who had often accompanied his father to office, had good knowledge about managing finances and administrative activities.

Keywords

Control Systems; Management Control ; Management Control Systems; Cybernetic Approach; Management by Objectives; Efficiency of Management Control Systems; Effectiveness of Management Control Systems; Need and Designing of Management Control Systems; Benefits of a Management Control Systems;

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