Managerial Monitoring of a Single Data Stream (Classic Reprint) - Tapa blanda

Excerpt from Managerial Monitoring of a Single Data Stream

The next section of this paper outlines a general framework for describing the monitoring function of management. Monitoring is characterized as a decision of whether or not to intervene in a situation. The decision is made by comparing the subjective probability that the situation is in need of intervention, determined from the monitored data and personal judgement, with a threshold probability determined from the relative costs and benefits of intervening. In subsequent sections, normative cost investigation models, which prescribe the determination of the subjective probability and the threshold probability, are reviewed with an aim toward selecting from them that which is descriptive of managerial monitoring behavior. Unfortunately, not all of the theory is descriptively valid.

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Excerpt from Managerial Monitoring of a Single Data Stream

Much of management activity involves monitoring: scanning and surveying situations for which there is a potential need for corrective action. The purpose of monitoring is to routinely assess this potential and thereby to indicate when managerial intervention is required. If there is never a need for corrective action, then there is never an economic benefit to monitoring, for payoffs are obtained only through actions which improve the economic circumstances of the firm.

Monitoring involves the gathering and assessment of information. It is what Simon calls the intelligence phase of decision making [1977] and what Pounds calls the process of problem finding. [1969] Monitoring is differentiated from other managerial information processing activities by its purpose, to routinely assess the potential need for corrective action. Routine implies a repetitive and somewhat structured activity. Corrective action suggests that the situation is being guided toward some target or goal.

This paper is an inquiry into the design of information systems to support managerial monitoring functions. The guiding paradigm in this effort is provided by information economics theory. As Treacy [1981] has observed, economics models of information value concentrate upon only the choice phase of decision making.

About the Publisher

Forgotten Books publishes hundreds of thousands of rare and classic books. Find more at www.forgottenbooks.com

This book is a reproduction of an important historical work. Forgotten Books uses state-of-the-art technology to digitally reconstruct the work, preserving the original format whilst repairing imperfections present in the aged copy. In rare cases, an imperfection in the original, such as a blemish or missing page, may be replicated in our edition. We do, however, repair the vast majority of imperfections successfully; any imperfections that remain are intentionally left to preserve the state of such historical works.