Development of internal control methodology by using statistical methods of variability assessment of material flow business processes

Abstract

Variability or instability is one of the key features of any process, including business processes of material flow internal control. Variability is a characteristic of all natural systems and technical processes. The objects which properties can be characterized via certain parameters arise at the output of any process. The article discloses the feasibility of using the statistical methods in the internal control system of business entities; in this case the focus is on the method of identifying the causes of variability using control charts of various types (Shewhart control charts) as a prime tool. The view points regarding variability of famous academic economists who researched the business process management issues are also considered. Authors’ classification of business process variation on types of material flow internal control with the allocation of controlled and uncontrolled variation is taken as the basis of the proposed application. The method of using control charts in estimating the efficiency of material flow internal control business processes is described in detail.