What is management control?
Updated: Jan 11, 2022
A profession little known to the public and too little used in small businesses, management control is a real decision-making tool and makes allows the optimization of the management of its activity.
Management control in the company
When we start a business, the first finance profession with which we have to deal is the accountant. It is essential for bookkeeping and proper recording of financial information of every business in the accounts. But it can be interesting to know the "connector", the management control.
Management control often appears much later, when the company evolves, the number of customers increases and when we begin to say to ourselves "but where is my income going, how is my turnover evolving?". Management control provides an answer to these questions, it analyzes accounting data, questions market data and thus offers different views of the company's financial data.
The main mission of management control
Management control “responds to a general need, which affects even very small companies: knowing where we are, measuring and evaluating performance, identifying strengths and avenues for improvement, decipher the future, choose a solution, set an objective ”(“ The foundations of management control ”, Editions PUF, author Henri Bouquin).
The main dashboards that management control produces and analyzes are:
- The profit and loss account (PnL),
- The cash flow to monitor and anticipate its cash flow,
- The company's KPIs , specific to each industry, company and issue.
Management control makes the link between the financial data of the accounts and the problems of the Management. But at the same time, it also provides a link between management and its managers. When it is optimized and efficient, it allows the company to have an essential decision-support tool, but also a powerful warning and anticipation system.
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