the nature and significance of control

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THE NATURE AND SIGNIFICANCE OF CONTROL &

CONTROL PROCESS

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THE NATURE AND SIGNIFICANCE OF CONTROL

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Control consist in verifying whether everything occurs in conformity with the plan adopted, the instructions issued and the principles established. It has for it’s object to point out weakness and errors in order to rectify them and prevent recurrences.

‘HENRI FAYOL’

What is CONTROLLING????????

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Controlling is measuring and correcting of activities of subordinates to ensure that events confirms to plan.

‘ KOONTZ & O’DONNELL’

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Objective Elements Responsibility Spheres Inevitable & Dynamic activity Forward looking Inter-dependence

NATURE OF CONTROL

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Proper execution of management function. Proper use of human and material

resources. Facilitates decision-making. Maintains discipline. Improve morale. Increases output. Effectiveness.

Significance of Controlling

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To achieve planned objective. To discover and identify deficiency. To develop suitable actions. To provide proper directions.

Objectives of Controlling

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Market control Bureaucratic control Clan control

Approaches to Control

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It is a three step process : • Measuring actual performance ,• Comparing it against a standard • Taking managerial actions to correct

deviations or inadequate standards.

THE CONTROL PROCESS

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Measuring actual

performance

Taking managerial

actions

GOALS AND OBJECTIVES

organizationaldivisional

departmentalindividual

Comparing actual Performance againstStandard.

STEP 1

STEP 3

THE CONTROL PROCESS

STEP 2

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Purpose is to determine the actual performance of an employee.

HOW WE MEASURE? There are four ways;

1. personal observation. 2. statistical reports. 3. oral reports. 4. written reports. In general ,combination these are used by

the manager to get reliable information.

Step 1: MEASURING

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Involves measuring the works in terms of control standards and communicating the appraisal to the persons who can take corrective actions.

Tangible aspects can be measured easily as standards are clear. These can measured in terms of numbers ,quantity ,money , time etc and can easily be compared against standards.

Difficulty arises when it comes to measure intangible aspects , which are measured indirectly ,for example ,company goodwill & reputation is measured on the basis of trend of sales , readiness of creditors ,ease of getting loans ,value of shares in market and so on.

What we measure?

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advantages drawbacks Firsthand knowledge. Proper covering of

work activities.

Easy visualization.

Faster way. Allows feedback.

Comprehensive Formal Easy documentation.

Personal biases. Time consuming.

Limited information.

Ignore subjective issues.

Information can be filtered.

Information can`t be documented.

Time consuming.

Personal observation

Statistical reports

Oral reports

Written reports

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Final step in the control process. Manager can choose from three possible

course of action: FIRST: if results are satisfactory no

corrective action is taken. SECOND: Correction of actual performance. THIRD: Revision of standards.

TAKING MANAGERIAL ACTIONS

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If variation in performance is due to unsatisfactory works ,corrective action is required.

These measures could be changing strategy , changing structures ,compensation practices ,training program ,redesigning jobs ,or firing employees.

Immediate corrective action corrects problems at once to get performance back on track.

Basic corrective action looks at how and why performance has deviated and then proceeds to correct the reasons of deviation.

CORRECTION OF ACTUAL PERFORMANCE

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If the variation was a result of an unrealistic standards i.e. the goals are too high or too low ,then the standards require corrective attention.

But one must keep in mind that it is these standards which are generally blamed for variation even when the main reason is underperformance ,so one must be sure about the fairness and achievability of standards.

REVISION OF STANDARDS

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Control can be implemented before an activity begins: FEEDFORWARD CONTROL.

During the time an activity is going on : CONCURRENT CONTROL.

After an activity has been completed: FEEDBACK CONTROL.

BALANCED SCORECARD: it is performance measurement tool.

BENCHMARKING: a standard setting tool.

TOOLS FOR CONTROLING

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Here managerial actions are taken before a problem arises.

Feed forward control is the most desirable because it prevent problems rather than correcting them when the damage has occurred.

Since it requires timely and accurate information managers generally end up using other types of controls.

FEEDFORWARD CONTROL

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In this type of control problems can be corrected before they become too costly.

The best form of this control is direct supervision , where manager monitors the action of the employees and correct problems as they occur.

Here balanced scorecard method could be used to measure the performance of the employee.

CONCURRENT CONTROL

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Most popular type of control process. Feedback tells how efficient was the

planning . Feedback also enhance employee

motivation. Drawback to feedback control is that till we

apply control waste or damage have already occurred.

FEEDBACK CONTROL

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A performance measurement tool that looks at four areas- financial ,customer ,internal process and people/innovation/growth assets- that contribute to a company’s performance.

With this approach managers should develop goals in each of the four areas and measure to determine if these goals are met.

This scorecard reflect the strategy of the company.

BALANCED SCORECARD

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Benchmarking is the search for the best practices among competitors ,non-competitors or self that leads to their or our superior performance.

Benchmark is the standard of excellence against which to measure and compare the performance of the company.

As a tool of setting standards benchmarking can be used to identify specific performance gap and potential areas of development.

BENCH MARKING

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Thank you.