THE SYSTEM AND PROCESS

OF CONTROLLING
Management Functions@RC
Introduction
• Control is the process of comparing actual performance with
established standards, for the purpose of taking action to correct
deviations.
• Planning, organizing, coordinating, and staffing and directing are only
preparatory steps for getting the work done; it is only through the
process of control that management is able to maintain the
"equilibrium between ends and means, output and effort."
• It is the process by which managers assure that resources are
obtained and used effectively and efficiently in the accomplishment
of the organization's objectives (Robert Anthony).
Introduction
• It is the process of regulating organisational activities so that actual
performance conforms to expected organisational standards and
goals (Newman).
• Thus, controlling means that managers develop
(i) appropriate standards
(ii) compare ongoing performance against those standards and
(iii) take steps to ensure that corrective actions are taken when necessary.
• A good controlling system is generally designed to keep things from
going wrong, not just to correct them afterwards.
BASIC CONTROL PROCESS
Traditional control models suggest that
controlling is a four-step process:
1. Establishment of standards: Standards are the targets against
which subsequent performance will be compared. Control
standards are broadly divided into two categories:
Quantitative standards: These are generally expressed in physical or
monetary terms. Such standards are set up in respect of production, finance,
sales, etc., where results can be measured in exact quantitative terms.
Qualitative standards: Standards of quality are based on the level of
perfection desired in respect of certain intangible items such as goodwill,
employee morale, industrial relations, etc., tests, surveys and sampling
techniques are used to prove human attitudes and drives in respect of above
items before specifying a limit.
Traditional control models suggest that
controlling is a four-step process:
2. Measurement of actual performance: The second step in control
process is the measurement of actual performance. Here, the
actual performance of employee is measured against the standard
fixed for his job.
Where standards are expressed in numerical terms, measurement does not
create problems. Performance of a worker in terms of units produced in a
week could be easily measured against the standard output for the week. On
the other hand, measuring the performance of a personnel manager (where
standards cannot be set in precise terms) is not easy.
Measurement of performance is more difficult at the higher levels of
management. E.g. Performance of a personnel manager can be indirectly
gauged on the basis of number of strikes organised during his/her tenure, say
5 years, man-days lost during his/her period etc.
Traditional control models suggest that
controlling is a four-step process:
3. Comparison of actual performance with standard: The comparing
step determines the degree of variation between actual
performance and the standard. Some variation in performance can
be expected in all activities. It is, therefore, important to determine
the acceptable range of variation.
Deviations in excess of this range become significant and receive manager’s
attention. All such deviations may be due to errors in planning, defective
implementation or careless performance of the operatives.
As a matter of fact, only major or exceptional deviations should be
communicated to top management in the form of reports. This is known as
‘management by exception’.
Traditional control models suggest that
controlling is a four-step process:
4. Taking corrective action:
The last and final step in the control process is taking corrective action, when
required. Corrective steps are initiated by managers with a view to rectify the
defects in actual performance.
If actual performance for example, falls short of standards due to non-availability
of materials, managers try to procure these materials and thus sets things in
order.
If it is due to poor results shown by employees, it could be rectified through the
introduction of attractive incentive plans. Thus, a corrective action may involve a
change in methods, rules, procedures etc.
Sometimes, variations might occur due to an unrealistic standards. That is, the
goal may be too high or too low. In such cases, managers try to set things in order
by revising the standards altogether.
TYPES OF CONTROL
A. Feedforward Controls
• Also known as Proactive control, Preliminary control or Preventive
control
• The control system anticipates problems that the management
encounters in future.
• Predictive control is also frequently termed as 'feedforward control’.
• Predictive control attempts to anticipate problems or deviations from
the standard, in advance of their occurrence. It is, thus, a more
aggressive, proactive approach to control, allowing corrective action
to be taken ahead of the occurrence of the problem.
• One notable characteristic of feedforward control is that it anticipates
problems and permits action to be taken before a problem occurs.
B. Concurrent control
• It is also called 'real time’ control
• Concurrent control techniques immediately consider any problem
and analyse it to take necessary and corrective steps before any major
damage is done.
• Also known by another name 'steering controls' and occur while an
activity is taking place.
• The navigator of an aircraft who adjusts the aircraft's movements is
an example of concurrent control.
• When you ride a bicycle, you must adjust your steering constantly,
depending on the turns in the road, obstacles, changes in the terrain
to keep your vehicle upright and move toward your destination.
C. Feedback control
• Also known as Historical or Post-control
• Feedback control enables managers to use information on past
performance to bring future performance into line with planned
objectives.
• Critics of feedback control argue that it is like closing the gate after
the horse is gone. Because corrective action is taken after the fact,
costs tend to pile up quickly while problems and deviations persist.
• On the positive side, feedback control tests the quality and validity of
standards. Standards that prove impossible to reach should be made
more reasonable. Those that prove too easy need to be toughened.
The Control Process
Thank You!