Chapter seven

Controlling function
 Definition
• Controlling is the process of regulating
organizational activities so that actual
performance conforms to expected
organizational standards and goals.
• It is checking current performance against
predetermined standards contained in the
plans
 Importance of controlling
• Adapting to changing conditions: A properly
designed control system allows managers to
effectively anticipate, monitor, and respond to
often constantly changing conditions.
• Limiting the magnification of errors' small
error or mistake does not adversely affect
organizational operation.
• to determine whether people and the various
parts of an organization are on target,
 The Controlling Process
1. Determine Areas to Control: identify Critical
control points of an organization's operations that
directly affect the success of its key operations,
areas where failures can not be tolerated, and
costs in time and money are greatest.
2. Establishing Standards: Standards are units of
measurements established by management to
serve as benchmarks for comparing performance
levels.
There are three types of standards: performance
standards, corollary standards and standards of
conduct.
 Cont..
3. Measuring Actual Performance:
4. Comparing Performance against Standards:
Comparison between “what is” and the “what
should be.”
5. Taking Corrective Action (on time):The
corrective action to be taken depends up on
the type of deviation that exists.
 Types of Control
1. Preventive/Steering/ Preliminary / Input
Control : Preventive control focuses on the
regulation of inputs to ensure that they meet
the standards necessary for the transformation
process.
2.Concurrent/Screening/ Yes-No/Checking Control:
Concurrent control involves the regulation of
ongoing activities that are part of the
transformational process to ensure that they
conform to organizational standards.
 Cont..
3. Feedback/Post-Action/ Output Control: It is
regulation exercised after the product (goods
or services) has been completed. The
information derived is not used for corrective
action on a project because it has been
completed.
 Cybernetic and Non-cybernetic
Controls
• A cybernetic control system is a self-regulating
control system that, once it is put into
operation, can automatically monitor the
situation and take corrective action when
necessary. E.g. computerized inventory system,
a heating system controlled by a thermostat
• A non-cybernetic control system is a control
system that relies on human discretion as a
basic part of its process.
 Techniques of Control
• Financial controls
• Financial audits
• Budget controls
• Marketing controls
• Human resource controls
• Computers and information controls:…
 Characteristics of Effective Control
System
• Future–Oriented
• Multidimensional
• Economically Realistic/ Cost Effective
• Accurate
• Acceptable to Organization Members
• Timely
• Monitorable
• Focus on Critical Control Points
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