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Turner Construction Company Project Management Control Systems Case Study

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Management Control System Project

...Management control systems provide information that is intended to be useful to managers in performing their jobs and to assist organizations in developing and maintaining viable patterns of behaviour. Any assessment of the role of such information therefore requires consideration of how managers make use of the information being provided to them. management control describes a feedback process of planning, objective setting, monitoring, feedback and corrective action to ensure that outcomes are in accordance with plans. Two attempts have been made in the past to link this framework with strategy. The first is Anthony’s ( 1965, 1988) - strategies are taken as given and management control systems motivate, monitor and report on their implementation. Another attempt to couple strategy and management control can be seen in the concept of strategic control. Strategic control has been described as a system to assess the relevance of the organization’s strategy to its goals, and when discrepancies exist, to highlight areas needing attention. My research indicates that management control systems are not only important for strategy implementation, but also for strategy formation. I define management control systems, therefore, to recognize that these systems are more than devices of constraint and monitoring: management control systems are the formalized procedures and systems that use information to maintain or alter patterns in organizational activity. Using this definition, these...

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Turner Construction

...Turner Construction faces the problem of whether or not to release the contingency reserve of $500,000 to the owner of the construction project they are working on. At this point, the project is 80% complete and the owner thinks it is far enough along that there won’t be any major expenses from this point out that will require Turner to have to use the contingency money. He is adamant about getting this money as he has some other loans to pay down. The territory manager is also feeling some pressure from upper management to release the contingency reserve because they can report this as additional earnings. Turner took a $200,000 loss on a sale and they could use this to counter that loss. Tuner Construction is the largest general building contractor and construction management company in the United States. They don’t have the cheapest prices for their project so they have to gain competitive advantages in other ways. One of the ways they do this is through the Indicated Outcome Report or IOR. This report allows them to easily manage risk and at any time provide themselves and the owner of the project with a prediction on the cost to complete the project. How much of this detail they decide to share with the owner depends on how well they know the owner’s line of thinking about the project and how much he/she wants to be involved. Another important piece regarding the IOR is how it is created. Tuner does not allow the managers directly working on each project to......

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Management Control Systems

...IDEAL management control system? Management control is a process of assuming that resources are obtained and used effectively and efficiently in the accomplishment of the organization’s objectives. It is a fundamental necessity for the success of a business and hence from time to time the current performance of the various operations is compared to a predetermined standard or ideal performance and in case of variance remedial measures are adopted to confirm operations to set plan or policy. Some of the features of MANAGEMENT CONTROL SYSTEM are as follows: ➢ Total System: MANAGEMENT CONTROL SYSTEM is an overall process of the enterprise which aims to fit together the separate plans for various segments as to assure that each harmonizes with the others and that the aggregate effect of all of them on the whole enterprise is satisfactory. ➢ Monetary Standard: MANAGEMENT CONTROL SYSTEM is built around a financial structure and all the resources and outputs are expressed in terms of money. The results of each responsibility centre in respect to production and resources are expressed in terms of a common denominator of money. ➢ Definite pattern: It follows a definite pattern and time table. The whole operational activity is regular and rhythmic. It is a continuous process even if the plans are changed in the light of experience or technology. ➢ Coordinated System: It is a fully coordinated and integrated system. ➢ Emphasis: Management control......

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Vershire Company Control System

...VERSHIRE COMPANY ANALYSIS RUDDY FERBIANTO MANAGEMENT CONTROL SYSTEM INTERNATIONAL-BATCH62 Vershire Company has several division and one of the largest one is the alumunium can division. This division is one of the biggest can manufacturers in United States. However, the market characteristics in which the customers loyalti is low and entry barriers does too. One of the Vershire’s strategies is to have lean production system along with tight control over their plants,budgets, and performance to have process efficiency. There are several strengths and weaknesses in Vershire’s planning and control system. Strengths | Weaknessess | * The divisional managers are required to make 5 years-expenditures and two years-market forecast in order to be able to predict the future decisions and goals. * Between corporate controllers, divisional managers, and plant managers have good work-process relationship. The corporate controllers visit each plan to have input from plant managers. * Divisional managers are given full control over their divisiona excepts in the areas of raising capital and labor relations * The orgnizational structures are quite direct in decision making system. Starts from plant managers to division managers and then straight foward to corporate level. Even, corporate levels can go directly to plan managers. | * The sales forecast is made in corporate level using asumption. The divisional managers do not have any participation in making sales......

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Management Control System

...ijcrb.webs.com OCTOBER 2010 VOL 2, N O 6 INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS Management Control System Hamed Armesh Faculty of Management ,MMU,Malaysia Listed in ULRICH S Dr. Habibollah Salarzehi , Dr.Baqer Kord Faculty of Management, University of Sistan and Baluchestan Abstract A management control systems (MCS) is a system which gathers and uses information to evaluate the performance of different organizational resources like human, physical, financial and also the organization as a whole considering the organizational strategies. Finally, MCS influences the behaviour of organizational resources to implement organizational strategies. Keywords: Management , Control , Systems 1. Introduction To introduce this topic and understanding the importance of management control system we know that In the present globalised world, organisations need to use management control systems that go beyond the strategies that focus on acquisition of technology and logistics which are not sufficient to give the organisation sustained long-term competitive edge over its competitors. Management Control Systems (MCS) as defined by Anthony (cited by LangfieldSmith, 1997) is the process by which managers ensure that resources are obtained and used effectively and efficiently in the accomplishment of the organization s objectives . MCS is a system used in an organization which collects and uses information to evaluate the performance of the organizational......

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Role of Project Management Information Systems in Project Management.

... ROLE OF PROJECT MANAGEMENT INFORMATION SYSTEMS IN PROJECT MANAGEMENT. INTRODUCTION 1. Background of Management Information Systems The concept of Management information system (MIS) has been in existence as early as the 19th Century. Works of majorly were in the form of tabulated cards which could be counted and sorted commonly referred to us punch – cards. The punch-cards still remembered by many, could capture elements of information keyed in on punch-card machines; the cards were then processed by other machines some of which could print out results of tallies. Each card was the equivalent of what today would be called a database record, with different areas on the card treated as fields.  The initial idea of MIS was to process data from the organization and present it in the form of reports at regular basis. The system was largely capable of handling the data from collection to processing. It was more impersonal requiring each individual to pick and choose the processed data and use for his requirements. This concept was further modified when a distinction was made between data and information. Information is a product of analysis of data. However the data could be analyzed in different ways producing different shades and specification of information as a product. It therefore demanded that the system concept be an individual oriented since each individual has different orientation. This concept was further modified that the system should present information in......

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Cost Control in Design Process of China’s Construction Project

...Cost Control in Design Process of China’s Construction Project Abstract As the ruthless competition in China’s construction industry, construction project requires a win-win method to acquire the maximal benefit and simultaneously to maintain the quality for keeping the place with the market. One method commended, cost control, especially in the design process, plays a very important role in the project procedure and financial management. This article presents the main implements of cost control utilizes in different aspects of construction and certain skills to control cost in design processes of construction project. These implements and skills could be very helpful for China’s construction companies to optimize their design process and offer beneficial influence to the following steps, increases the percentage of successful project in all projects; thereby to promote the development of the company and the whole industry. Key words: Design Process; Construction project; Cost control 1. Introduction Nowadays in China, the competition within construction industry is continuously increasing, and the profit spaces are limiting. As all the investment always expect for the maximal benefit, if a company want to keep the profit and position in the market in such complicated environment, the best method for it is applying cost control to the project. Cost control in financial management is an important aspect of project management over the whole life of projects.......

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Turner Construction Company: Project Management Control System

...Turner Construction Company: Project Management Control Systems 1. What is Turner’s business strategy? Their greatest competitive advantage is providing accurate information to the owners, creating a partnership. Turner’s business strategy is to build on this partnership to ensure repeat business. They keep the customer informed on every milestone in the project and use the IOR to communicate financial updates and construction progress. They have proven time and time again that their expert management knowledge and delivery saves the developer time and money in the end. 2. What contingencies could invalidate the strategy? This strategy is compromised with how and when Turner decides to release capital. If Turner decides to release the contingency funds, they may never see them again. There is no guarantee those dollars will be committed back to the project. If Turner releases the savings to please the owner and an unforeseen problem arises; the construction company will have to use money from their earnings to cover any potential issues. This will damage the company’s profits and is in clear violation of their strategy. If Turner decides to hold onto the savings it runs the risk of upsetting the owner. This is in violation of their strategy to create a partnership with the owner. 3. Does the IOR system force managers to address contingencies? The report generates a “best-effort” prediction of the total expected cost and earning contributions of a completed project...

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Management Control System

...management control system targets. Therefore, conventional management control systems focus on getting better operational efficiency. But as operational efficiency is no longer adequate to create sustainable competitive advantages, management control systems must be expanded to managerial practices that cultivate employee cooperation and creativeness in the discovery and development of new business opportunities. This is especially the case in the high-tech industries that are at the faced with the challenges of globalisation and employee teams must combine efficient communication with creativity. ``Project managers and product designers in software and other industries thus need to find ways to divide up products and tasks so that even teams of many of clever people can work and communicate efficiently as well as creatively'' (Cusumano, 1997). Simons (1987 and 1990) argued that control systems is in four categories, namely i. ii. iii. iv. Diagnostic control systems Boundary control systems Interactive systems Belief systems. These four different management control systems are identified recently by companies as effective categories of controlling system, companies must apply them in a way that maximizes operational effectiveness without limiting employee creativity. This task can be accomplished by using diagnostic measures as a way to improve operational effectiveness and the other three types of control measures as a way to mitigate its negative effects on employee......

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Management Control Systems of Glaxosmithkline

...Abstract Management control systems are tools to aid management for steering an organization toward its strategic objectives and competitive advantage. Management controls are only one of the tools which managers use in implementing desired strategies. However strategies get implemented through management controls, organizational structure, human resources management and culture. In this paper we will discuss how management control system is implemented in various sectors of an pharmaceutical company ie. “GlaxoSmithKline Bangladesh Limited”. GlaxoSmithKline Bangladesh Limited carries with it an enviable image and reputation for the past 6 decades. A subsidiary of GlaxoSmithKline (GSK) is one of the world’s largest research-based pharmaceutical and healthcare companies GSK Bangladesh, continues to be committed to improving the quality of human life by enabling people to do more, feel better and live longer. The Company’s principle activities include secondary manufacture of pharmaceutical products and marketing of vaccines, pharmaceutical and healthcare products. GlaxoSmithKline Bangladesh Limited implements many control systems to attain their strategic objectives and competitive advantages. Some models that GlaxoSmithKline uses to make their activities and resources effective & efficient, for their employee performance evaluation and to enhance the overall performance of the organization will be discussed in this paper. Management Control Systems ......

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Project Control Systems Integration

...together provide a total Enterprise project management system. The Science of Project Management: Project Controls Systems Integration by Frederick Cramer, Susanne Keller, Christopher Law, Thomas Shih, and Britton Wolf G The concepts in this article were applied to the ECP-1 Facility, Overall Winner of the 2010 Facility of the Year Awards. For further information on this project, see “Case Study: Genentech’s ECP-1 Bacterial Manufacturing Facility, Overall Winner, 2010 Facility of the Year Awards” in the March/April 2011 issue of Pharmaceutical Engineering. Project Controls Systems Integration Background enentech is among the world’s leading biotech companies with multiple products on the market and a drive to discover, develop, manufacture, and commercialize new medicines to treat patients with serious or life-threatening medical conditions. In 2005, Genentech was ramping-up a build program due to increased demand for existing and new medicines about to come to market. By that time, Genentech had grown from a small biotech company with less than 3,000 employees in 1995 to more than 9,000 employees. It quickly became apparent that an ad hoc approach to project management of capital construction projects would no longer be sufficient. To keep pace with growth, an intensive effort was launched to investigate and then implement a set of integrated tools and approaches to facilitate project planning and execution. ......

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Handbook-Project-and-Construction-Management

...2011 HANDBOOK For project and construction management – Fundamental concepts “Project coordination” From tender to 5 years inspection - Construction Management - final version Københavns Erhvervsakademi and VIA University College, Horsens August 2010 00. Introduction 00 Introduction This handbook is primarily intended for the use by students in their final semester of the constructing architect education - specializing in construction management. Construction management aims at a future career as a construction or project manager working for a contractor. The handbook will also be useful as a guide for small and medium sized contractors. The handbook is a joint venture between lecturers in construction management at VIA University College in Horsens (Vibeke Kragh, Benny Olsen, and Henrik Kopp) and KEA - Københavns Erhvervsakademi (Eva Weincke, Kaj Torben Hansen, Benny Lennart Bay, Anders Christensen and Lone Lykke Larsen). Consequently, the handbook will contain requirements for documentation and other examples that are not necessarily relevant to contractors, but are deemed relevant for students. The handbook is based on practical examples from a fictive contractor. In this context, relevant aspects from ‘real-life’ contractors will be included. The booklet is based on project coordination showing the progress in the construction process. The sections follow project phases from tender to handing over - in a main contractor contract. As......

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Management Control System

...process. Marketing and advertising can help illustrate the features and can sometimes delay encroachment by the competition. But in the long run (probably less than a year), successful differentiation depends on product development and R&D. 8.2 The Planning Process Planning can be accomplished in a variety of ways. Figure 8.1 "The Planning Process (Adapted from May)" presents a typical model of the strategic planning process.Adapted from May (2010). The mantra is an often-repeated phrase that provides the basis for the existence of the company. It is a slogan, a watchword, a byword, or a motto that breathes life into the firm’s existence. The mantra is not a replacement for the mission statement. The mission statement is an overall view of the business at an abstract level. It describes what the company does and why it exists and how it satisfies customer needs. The mission statement can also include a statement reflecting whether the company will focus on product differentiation and niche markets, focus on being price-competitive, or focus on both. The mantra and the mission are rarely static but ever-changing and emerging throughout the life of the firm. The essence of the planning process consists of looking-inside and looking-outside analysis. Analysis involves both introspection and extrospection. The internal and external organization environments are examined using a number of analytical approaches, several of which are included in Table 8.1 "Orientations of......

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Project Management and Control

...Department of Computing, Engineering, and Technology The Life cycle (Environmental and Economic) Assessment of Complex Building Construction Project A Critical Reference Report Project Management and Control ENGM91 Assignment 1 Name: Manoj Rajendran Student ID: 149142740 1. Introduction Environmental issue has become economically important from the civil construction project. Especially in complex building project. As the construction field in need of resources like steel, cement, and power generation, it could definitely affect the eco-friendly system. Hence the sustainability of environmental and economic assessment should be conduct in entire life cycle of building construction project (Chan-joong Kim, 2015)The economic, social development and environmental protection are the major aspects of sustainability in building industry, which represents the impact of using raw material. Moreover the developed countries like Europe and USA has the findings that building operation contributes more to greenhouse gas emissions (B. De Meester, 2008). The usage of energy intensive elements is right from the start of the building which gives more importance to the development of environmental sustainability. But it is highly concern......

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Cost Control in Construction Projects

...Construction Project Controls: Cost, Schedule, and Change Management UP-201 September 2004 CURT Owner Member Companies Abbott Laboratories Air Products & Chemicals, Inc. Ameren American Electric Power Baxter Healthcare Corporation Boeing Company Caterpillar Inc. Citigroup ConocoPhillips DTE Energy The Dow Chemical Company E.I. Dupont De Nemours & Company Eastman Kodak Company Ernst & Young ExxonMobil Chemical Company FMC Corporation FirstEnergy Corporation General Electric Company General Mills, Inc. General Motors Corporation HCA Healthcare Corporation Hercules, Inc. Honda of America Mfg., Inc. IBM Intel Corporation Johnson & Johnson Kansas City Power & Light Company The McGraw-Hill Companies MeadWestvaco Corporation Merck & Company, Inc. Owens Corning PSEG Power, LLC Pfizer, Inc. The Procter & Gamble Company Rohm and Haas Shell Global Solutions (U.S.), Inc. Southern Companies Sunoco, Inc. TECO Tampa Electric Company Toyota Motor Mfg. North America Tyco International U.S. Army Corps Of Engineers U.S. General Services Administration The University Of Cincinnati Associate Member Companies Alberici Group, Inc. BE&K Bechtel Egizii Electric, Inc. Fluor Corporation Hunt Construction Group Jacobs Engineering Group Rudolph/Libbe Companies The Shaw Group, Inc. Tetra Tech FW Inc. Turner Construction Company Zachry Construction Corporation Association Associate Members Associated Builders and Contractors (ABC) Associated General Contractors of America (AGC) Mechanical......

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Turner Construction's Portland, Oregon office wanted to streamline their RFI and submittal processes as well as document management, so team members could spend less time organizing and more time building.

Introducing Procore

Driven by a need to reduce administrative workloads and increase communication among project team members, Turner Construction Co. Portland staff began piloting Procore on their smaller projects in March 2015. The goal was simple: streamline processes so team members can focus their time on what they do best—building.

"Our team was really open to the change, because we weren't happy with having to use multiple programs to complete tasks," says Jenessa Frey, a project engineer, who advocated for Procore after seeing its success in the company's San Diego office.

Jenessa's team was the first to use the software for the company's 101 Building project, a three-story creative office building under construction in downtown Vancouver, Washington. So far, the team has been able to use Procore for functions that previously required four separate platforms—including Prolog Converge, PlanGrid, and an in-house document storage system. Procore also serves them as the "one-stop shop" for project subcontractors to submit and access project-related documentation. "Procore streamlines everything," she says.

Since Procore allows users to immediately access, update, and share project documents, team members no longer have to hop around different platforms to submit an RFI, view a drawing, and then access a punch list item. Also, Turner employees no longer need to spend time manually transferring data from one program to another to keep everyone informed. Everything is in one place.

Plus, as Procore is cloud-based, Jenessa's team can access other projects and work from home without having to worry about connecting to a virtual private network. "That's a big benefit for us."

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