CONTROLLING

BY – Ayisha Bhandari

FUNDAMENTALS OF CONTROLLING

CONTENTS

  • Concept of controlling.
  • Features of controlling.
  • Controlling and other functions.
  • Types of control.
  • Need of control.
  • Steps in controlling.
  • Establishment of control standards.
  • Measurement of performance.
  • Comparison between performance and standards and the communication.
  • Correction of deviation from the standards.
  • Essentials of Effective Control system-

CONCEPT OF CONTROLLING-

“Control is any process that guides activity towards some pre-determined goal. The essence of the concept is in determining  whether the activity is the achieving desire  results”

  • Contol,or Controlling is one of the managerial functions like planning, organizing, staffing and directing.
  • It is the process of gathering and feeding back information about performance so that decision makers can compare actual results with planned results and decide what to do about any apparent discrepancies or problems.
  • It helps to check errors and take corrective measures so that the deviation from standards are minimized and goals of the organization are achieved in a desired manner.

TYPES OF CONTROL-

Feedforward Control-

Whenever a process is performed, two factors are very critical namely the inputs and outputs. Here we take into account the various deficiencies of process well in advance,so that these can be cured or controlled at initial stages.

The active anticipation and prevention of problems, rather than passive reaction.

Concurrent Control or Real time control-

Monitoring and adjusting ongoing activities and processes.

Feedback Control-

Checking a completed activity and learning from mistakes.

Very heavy cost is involved

Results into customer dissatisfaction.

NEED OF CONTROL-

  • Adjustment in operations :
  • Objectives – basis of control.
  • Adjustment done through control.

 

  • Policy verification :
  • Policies generate the need for control.
  • Managers set certain policies which become the basis and reason for control.
  • Verify the quality of policies.
  • Managerial responsibility :
  • Managerial responsibility – created through assignment of activities to various individuals.
  • Starts at the top level and goes down to the bottom level.
  • Manager is responsible for the ultimate performance of his subordinates.
  • Psychological pressure :
  • Psychological pressure on individuals to perform better.
  • Rewards and punishment based on the performances.
  • Coordination in action :
  • Coordination is achieved through proper performance.
  • Manager coordinates the activities of his subordinates to achieve the organizational goals.
  • Organizational efficiency and effectiveness :
  • Proper control ensures organizational efficiency and effectiveness.
  • Control system – brings the organization closer to its objectives.

STEPS IN CONTROLLING-

  • Control is reciprocally related to planning :
  • Draws attention to situations where new planning is needed.
  • Provides data upon which plans can be based.
  • Various steps in control process which are necessary in its relationship to planning :
  • Establishment of control standards.
  • Measurement of performance.
  • Comparison between performance and standards and the communication.
  • Correction of deviation from the standards.
  • 1. ESTABLISHMENT OF CONTROL STANDARDS
  • Plans – goals, objectives, targets to be achieved. Actual results are measured against them.
  • Precision :
  • Great precision – Standards are set in quantities.
  • g. Physical – Volume of products, man hour.
  • Monetary – Costs, revenues, investment.
  • Less precision – Standards are in qualitative terms.
  • g. Human relations.
  • It is also important to decide the level of achievement which will be regarded as good or satisfactory.
  • Desired level of performance – reasonable , feasible, some amount of flexibility , stated in terms of range (maximum and minimum).
  • 2. MEASUREMENT OF PERFORMANCE
  • Involves measuring the performance in the work in terms of control standards.
  • Methods of measuring performance :
  • Quantitative – Physical and monetary terms, easily and precisely measurable.
  • g. Production units, sales, volume, profits etc.
  • Qualitative – Intangible, cannot be measured precisely.
  • g. Human relations etc.
  • Techniques – Psychological tests, opinion surveys.
  • Measurement must be (i) clear, simple and rational, (ii) relevant, (iii) direct attention and efforts, (iv) reliable, self announcing, and understandable without complicated interpretation or philosophical discussions.

3. COMPARING ACTUAL AND STANDARD PERFORMANCE

  • Steps :
  • Finding out the extent of deviations.
  • Identifying the causes of such deviations.
  • Accurate standards and accurate measurement of actual performance are very important for clear revelation of variations.
  • Required standards achieved :
  • No further managerial action is necessary.
  • Control process is complete.
  • Required standards not achieved :
  • Extent of variation may differ from case to case, depends upon the type of activity.
  • Strict compliance with standards or permissible limit of variation.
  • g. Engineering products – a very minute variation may be significant.
  • When the deviation between standard and actual performance is beyond the prescribed limit, an analysis is made of the causes of such deviation.
  • Controllable factors – Person concerned will take necessary corrective action.
  • Uncontrollable factors – Person concerned cannot be held responsible.
  • Communication of data to the person who can take corrective action.
  • 4. CORRECTION OF DEVIATIONS
  • Organization is not a self – regulating system.
  • Actions should be taken to maintain the desired degree of control in the system or operation.
  • Control actions :
  • Review of plans and goals and change therein on the basis of such review.
  • Change in the assignment of tasks.
  • Change in existing techniques of direction.
  • Change in the organization structure.
  • Provision for new facilities.

Essentials of Effective Control system-

Integration with Planning-

the more control is linked to planning, the more effective the control system.

Flexibility

the control system must be flexible enough to accommodate change.

Accuracy

Inaccurate information results in bad decision making and inappropriate managerial actions.

Timeliness

A control system should provide information as often as necessary.

Objectivity

A control system must be free from bias and distortion

CONCLUSION

  • Controlling can help your organization:
  • Improve productivity and insights.
  • Reduce costs through increased flexibility.
  • Support changing industry requirements.
  • Provide immediate access to enterprise information

 

REFERENCES:

  • Prasad L M, Principles of management,
  • Koontz, Principles of management, Tata Mc Hill
  • Stoner, Freeman and Gilbert Jr, Management, Prentice Hall of India
  • wikipedia.com
  • slideshare.net