Chapter 5

Controlling
 Definitions
• Control consists in verifying whether everything occurs in
conformity with the plans adopted, the instructions issued and the
principle established. Its object is to point out the weakness and
error in order to rectify them and prevent reoccurrence. It operate
on everything, i.e., things, people and action: – Henry Fayol.

• Controlling is the measuring and correcting of activities of

subordinates to ensure that events conform to plans. – Koontz and
O’ Donnell.

• Thus control is fundamental management function that ensures

work accomplishment according to plans. It implies measurement
of actual performance, comparing it with the standards set by plans
and correction of deviations to ensure attainment of objectives
according to plans
 Nature of Controlling
1. Control is based on planning.
2. Control Process is Universal function of management.
3. Control is a Continuous Process.
4. Control is Forward Looking.
5. Control Involves Measurement.
6. Control is Goal Oriented.
7. Action is the essence of control.
8. Control has an objective.
Relationship b/w Planning & Controlling
• There is close inter-relationship between planning and
control functions of management.
• Planning is the basis of control. Control implies the
existence of certain standards against which actual
results may be evaluated.
• Planning provides such standards, where there is no
plan there is no basis for control.
• Planning initiates the process of management, Control
completes the process.
• Without plans control is blind for when one does not
know where to go, one cannot judge whether one is
not the right track or not.
 Importance
• Managerial Accountability
• Effective Implementation of Plans
• Facilitating Decision-Making
• Accomplishing organizational Goals
• Bringing in Coordination and Team Spirit
• Facilitating Effective Supervision
• Efficient Use of Resources
• Boosting the Morale of Employees
• Bringing Order and Discipline into the Organization
• Essence of Action
 Process of Controlling
Step # 1. Establishment of Standards: Standards represent the criteria against which actual performance is
measured. Standards serve as the benchmarks because they reflect the desired results or acceptable
level of performance. Control standards may be of the following kinds:
(a) Quantitative Standards: These standards are set in physical or monetary terms.
(b) Qualitative Standards: There are certain areas in which it is not possible to set standards in quantitative
terms.

Step # 2. Measurement of Performance: Measurement of performance should be accurate and reliable. It

should be clear, simple and objective.

Step # 3. Comparing Performance with Standards: The third major step on the control process involves the
comparison of actual performance with standard performance. Such comparison will reveal the deviation
between actual and desired results. Comparison is easy where standards have been set in quantitative
terms.

Step # 4. Analysis of Deviations: All deviations need not be brought to the notice of top management. A
range of deviations should be established and only cases beyond this range should be reported.

Step # 5. Take Corrective Action:

The final step in the control process is taking corrective action so that deviations may not occur again and
the objectives are achieved. Corrective action may be- (a) revision of standards, (b) change in the
assignment of task, (c) training of employees, (d) improvement in the techniques of direction, etc.