Controlling Production Control

Control Process  To find out whether the organization is

a. Establish (Establish standards) gaining or not
 Desired outcome  Labor
o Direct Labor Cost: medical
b. Measure (Measure performance) technologists
o Indirect Labor Cost: clerks,
 Actual outcome
supervisor
c. Compare (Compare performance to  Material
standards) o Direct Material Cost: reagents, strips,
standards
 Higher or lower?
o Indirect Material Cost: shared
equipment, supplies
d. Take (Take Corrective Action)
 Equipment Cost: use of the equipment
 Depends on the comparison
 Overhead Cost: expenses needed to stay in
business but not related to the manufacture
Types of Control
of products
a. Feedforward
- Electric bill, water bill, rent, office
 Control for the future supplies
 To prevent anticipated problems
Laboratory Computations
b. Concurrent
a. Determining the Equipment Cost/Test
 Control for the present
 Minimize problems as they occur {(𝐸/𝐿) + 𝑀}
c. Feedback 𝐴
Where:
 Control for the past E: cost of equipment
 To correct problems that have L: useful of life of the equipment
occurred M: annual maintenance cost
A: annual test performed
Policy and Procedure Manuals
 Labs’ most effective management tool b. Determining the Payback Period or ROI
 Most neglected 𝑃𝑢𝑟𝑐ℎ𝑎𝑠𝑒 𝑝𝑟𝑖𝑐𝑒 𝑜𝑓 𝑡ℎ𝑒 𝑚𝑎𝑐ℎ𝑖𝑛𝑒
 Excuses: 𝑎𝑛𝑛𝑢𝑎𝑙 𝑖𝑛𝑐𝑜𝑚𝑒 𝑜𝑓 𝑡ℎ𝑒 𝑚𝑎𝑐ℎ𝑖𝑛𝑒
o Too little time
o Too much work c. Determining the breakeven point
o Uncertainty about the content
 Net income is 0
 Purpose:
 Includes fixed and variable costs
o Promote teamwork and human
o Fixed cost: constant
relations
regardless of volume of test
o Promote the 3 C’s: clarity,
(salary)
consistency, continuity
o Variable cost: supplies and
o Establish standards of performance
reagents
o Tool for orientation/training
o Help manager handle problems  rx = vx + f + c
o Where:
r: revenue/test
v: variable cost
x: breakeven point
f: fixed cost
c: net income (0)