MGT162 –

FUNDAMENTALS
OF MANAGEMENT

CHAPTER 7 - CONTROLLING
WHAT IS CONTROLLING?
 Monitoring the performance of the
organization and its progress in
implementing strategic and operational
plans.
 Identifying difference between planned
and actual results.
 Taking corrective action
 Ensuring that the organization is moving
toward the achievement of its goals.
 In other words, controlling is the process
of taking preventive or corrective
action to keep things on track
 CONTROL SYSTEM
During the control process, managers set up control systems

 A control system is a set of

mechanisms designed to increase
the probability of meeting
organizational standards and goals
ROLES OF CONTROLS
 Coping with uncertainty
 Detecting irregularities
 Identifying opportunity
 Handling complex situations
 Decentralizing authority
 LEVELS OF CONTROL
 Strategic Control
 Ensure strategic plans are implemented and adjust
plans where necessary
 Top level managers domain

 Tactical Control
 Assessing implementation of tactical plans at
department level, monitoring results and taking
corrective action.
 Involves middle level managers

 Operational Control
 Monitoring day-to-day results and taking corrective
action where necessary
 Responsibility of lower level managers
 THE CONTROL PROCESS

Step 4:
Step 1: Step 3: Step 5:
Compare
Determin Step 2: Measure Determine
performa
e area to Establish actual need for
nce corrective
be standards performa
against action
control nce
standards
ESTABLISHING STANDARDS
 A control standard is a target
against which organization
performance will be compared
 A control standard must be
measurable, specific and
accepted by organizational
members
 It must also be in line with the
organization’s strategic planning
 MEASURE ACTUAL
PERFORMANCE
 Ithelps managers control
the outcomes of their
organizations. 
 Comprises of three elements:
 What to measure
 When to measure
 How frequent to measure
COMPARE PERFORMANCE
AGAINST STANDARDS
 This step involves determining if
actual performance compared to
standards falls within acceptable
limits.
 For example, the standard set for
registering guests in 15 minutes,
therefore, the manager will compare
actual registration of guests against
the standard set.
DETERMINE NEED FOR
CORRECTIVE
 After comparing performance against
control standards, the manager may
take on any of the action below:
 Maintain status quo when the
performance match the standards
(continue as before)
 Correct the deviation
 Change the standards if the control
standard is too high or too low
 TYPES OF CONTROL

Pre-process In-process Post-process

 FEED FORWARD / PREVENTIVE
CONTROL
 Is done at the input level of production -
resources
 The purpose is to predict potential problems
and prevent them from occurring and to
prevent problems at the input levels before
going through the transformation process
 For example, carpenters have their own feed
forward control – “measure twice, cut once”
 Planning and feed forward control are related
but with different process.
 In planning we ask “where we are going”
whereas in feed forward we ask “what we can
do ahead of time to help our plan succeed”
CONCURRENT CONTROL
 Focus is on how inputs are being
transformed into outputs and adjusting
accordingly
 For example, checking the oven
temperature when baking bread and
lowering the temperature if the oven
is too hot
 Primary goal is to spot problems as
they develop and take corrective
action before final results are
achieved
 CORRECTIVE
CONTROL/FEEDBACK CONTROL
 Focus on the outputs of the
organization to measure the result
of certain actions.
 Information is gathered and evaluated
about the completed activity and steps
are taken to improve the activities in
the future
 Feedback control tests the quality and
validity of the objectives and standard
 A corrective action is an action taken
to eliminate the cause of a detected
nonconformity
POTENTIAL BARRIERS TO
SUCCESSFUL CONTROL
Rewards
Inappropri for
ate focus Inefficienc
y

Too
Over
accountab
control
ility
Barri
ers
 CHARACTERISTICS OF
EFFECTIVE CONTROL SYSTEM

Integratio
n with Flexible Accuracy
planning

Timelines Objectivit
s y
CHARACTERISTICS OF EFFECTIVE
CONTROL SYSTEM…CONT
 Integration with planning
 Control should be linked with planning
 The more precise the linkage, the more
effective the control
 Flexible
 The control system itself must be flexible
to accommodate change
 Accuracy
 Information needed for controlling must
be accurate otherwise organization may
make wrong decision
CHARACTERISTICS OF EFFECTIVE
CONTROL SYSTEM…CONT
 Timeliness
 The control system must provide
information as often as necessary
 Information also must be collected and
evaluated quickly to enable managers to
solve problems on time
 Objectivity
 Standards set must be understandable and
measurable.
 A difficult control system will cause
mistake and frustration among both
managers and employees
 END OF CHAPTER 7

Source: Management: Challenges for

Tomorrow’s Leaders by Goodman, Fandt,
Michlitsch and Lewis