CONTROLLING

-With Live Example

A Group Presentation by:

1.Harshad Katikar
2.Aniket Ghodke
3.Atul Chavan
4.Amar Nikam
5.Sandeep Ekande
Robbins et al., Fundamentals of Management, 4th Canadian Edition 1
©2005 Pearson Education Canada, Inc.
 Control

Process of monitoring
activities to ensure that what is
being accomplished matches
plans and corrects significant
deviations

Robbins et al., Fundamentals of Management, 4th Canadian Edition 2

©2005 Pearson Education Canada, Inc.
 Definition Of Control

Henry Fayol: Control consists in verifying

whether everything occurs in conformity
with the plan adopted, the instructions
issued and the principles established.
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 Definition Of Control

 Koontz and O’Donnell: Controlling implies

measurement of accomplishment against the standard
& the correction of deviations to assure attainment of
objectives according to plans.
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 Characteristics :
1. Continuous process.
2. Flexible and dynamic process.
3. Future oriented.
4. Planning and controlling are closely related.
5. Function of management.
6. Essence of control is action.

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 Controlling Planning

Planning-
Controlling
Linkage

Leading Organizing

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 Purpose of Controls
Goals and • Measuring Performance

Objectives
• Comparing to Standards
Organizational
Divisional
Departmental
• Taking Corrective Action
Individual

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 The Control Process
Standard Yes
Compare Do Nothing
Attained?
Performance
to Standard No

Objectives Variance Yes

Do Nothing
Acceptable?

Measure No
Standard Performance
Standard Yes Identify
Acceptable? Causes

No
Correct
Revise
Performance
Standard

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 What Does A Manager
Measures?

• Information
• Operations
• Finances
• People

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 How Do Managers Measure
Performance?

• Personal
observations
– MBWA
(management-by-
walking about)
• Statistical reports
• Oral reports
• Written reports

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 Discrepancies Between Goals and
Performance

Acceptable
Upper Limit

Acceptable
Standard Range of
Variation

Acceptable
Lower Limit

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 Do Nothing

Taking Immediate/Basic
Managerial Corrective
Action Action

Revise
the Standard
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 Three Types of Control

Input Processes Output

Feed forward Concurrent Feedback

Control Control Control
Anticipates Corrects problems Corrects problems
problems as they happen after they occur

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©2005 Pearson Education Canada, Inc.
 Control Techniques:
“The tools, closely related to recent
advances in planning techniques, have brought
the systems approach to problem of control a
recognition that better planning is of no avail
without better control.
- Koontz and O’Donnel.
Control techniques may be broadly classified into
two categories:-
1. Traditional control techniques.
2. Advance control techniques.
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 Traditional Control
Techniques:-
a)Personal observation.
b)Statistical reports and analysis.
c) Break-even analysis.
d)Budgetary control.
e)Cost control.
f) Production control.
g)Inventory control.
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©2005 Pearson Education Canada, Inc.
Advance control techniques:-
a. Management Audit.
b. Return On Investment.
c. Responsibility Accounting
d. Programme Evaluation and Review Techniques
(PERT).
e. Critical Path Method (CPM).
f. Management Information Systems (MIS).
g. Zero-based Budgeting.
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 Feedback Control

• Meaningful
information
• Enhance employee
motivation

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 Qualities Of An Effective
Control System
Corrective Accuracy
Action
Multiple Timeliness
Criteria
EFFECTIVE
Emphasis on CONTROL
Economy
Exceptions SYSTEM

Strategic
Placement Flexibility

Reasonable
Understandability
Criteria
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 Contingency Factors in Control Systems
Contingency Variable Control Recommendations

Small Informal, personnel management

Organization Size
Large Formal, personnel management

High Many complex criteria

Position and Level
Low Few, easy-to-measure criteria

High Increased number of controls

Degree of Decentralization
Low Reduced number of controls

Open Informal, self-control

Organizational Culture
Closed Formal, external controls
High Comprehensive controls
Importance of an Activity
Low Loose, informal controls
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 Dysfunctional Controls

Inflexible Unreasonable
Controls Standards

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 Contemporary Issues in Control
• Rights that manager has to monitor
employee behavior
• Rights that manager has to control private
lives of employees.
• Employers MAY be able to control
employee behavior outside the work
environment

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 You and Your Computer
• Employers can read your e-mail
• Employers can listen to your phone calls
• Employers can monitor your work by
computer

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 Employee Theft
• Ranges from embezzlement to fraudulent
filing of expense reports to equipment
removal
• Nearly 85% of all organizational theft and
fraud is committed by employees
• Ready availability of information
technology has made employee stealing
an escalating problem

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 Control and Inform
Ethics Employees

Written Policy

Monitor for
Business Reasons
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 Entrepreneurs Controlling for
Growth
• Plan for growth
• Organize for growth
• Control for growth

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 Entrepreneurs Managing
Downturns

• Recognizing crisis situations

• Things can turn worse
• Exit the venture
• Business evaluation

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 Limitations of Controlling:-

1.External factors cannot be controlled.

2.Determinants cannot be controlled.
3.Responsibility cannot be fixed.
4.Difficulty in finding out causes of
variation.
5.Determination of standard is difficult.
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©2005 Pearson Education Canada, Inc.
 MUKESH AMBANI
-Chairman, Reliance Industries
•Mukesh Ambani (April 19, 1957 Aden, Yemen) is the
chairman, managing director and the largest shareholder
of Reliance Industries, India's largest private sector
company and a Fortune 500 Company.
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©2005 Pearson Education Canada, Inc.
• Mukesh Ambani joined Reliance in 1981

• Took over Reliance Industries on 18 July 2005

• Initiated backward integration from textiles into polyester

fibres and further into petrochemicals.

• He directed and led the creation of the world's largest

grassroots petroleum refinery at Jamnagar

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• Mukesh Ambani has set up the largest and
most complex information and
communications technology initiative in the
world in the form of Reliance Infocomm
Limited.

• Successfully developed RIL from the 51%

stake he held after the split.

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 The combined market capitalisation of the
four Mukesh Ambani Group companies --
RIL, Reliance Petroleum (RPL), IPCL and
Reliance Industrial Infrastructure Ltd (RIIL)
has crossed the Rs 400,000 crore mark.
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• On 26th Sept 2007, he was declared 4th
richest person in the world, next to Carlos
Slims, Bill Gates and Warren Buffet

• Is worth a staggering Rs. 2,20,463 or $ 55.8

million

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• Before the split the annual turnover was
estimated at $12bn. After it, on the basis of
the 51% stake in RCC he generates an
annual turnover of US $19.976 billion and
profit of $2.033 billion.
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 BAJAJ AUTO LIMITED

• Bajaj Auto Limited (BAL) is the fourth largest 2-

wheeler and the largest 3-wheeler manufacturer in
the world. BAL is also the second-largest
manufacturer and the largest exporter of two
wheelers in India. It has manufacturing plants at
Pune and Aurangabad in India and has plans for
setting up plants in Indonesia and Brazil
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 BAL’S GROWTH
• During August 2006, Bajaj Auto reported motorcycle
sales of 1,80,570 units, a growth of 21%.

• Total 2-wheeler & 3-wheeler sales grew by 11% from

1,86,802 units in 2005 to 208,163 units in 2006.

• The total 2-wheeler exports jumped 112% while 3-

wheeler exports also increased by 59%.

• The Management believes that the motorcycle

industry would touch 10 million units by 2010, which
would further intensify BAL’s growth in its two-
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wheeler segment.
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 ACHIEVEMENT AREA

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 CONCLUSION

• Thus, we can conclude that control

whether managerial or otherwise is an
important principle and part of modern
management.

• It is a vital link between the goals set, the

performance put in, and the goals
achieved.
Robbins et al., Fundamentals of Management, 4th Canadian Edition 37
©2005 Pearson Education Canada, Inc.
 BIBLIOGRAPHY
• Internet:
Google, Wikipedia.

• Organizational Behavior & Principles& Practices Of Management

- Prof. Ujagare

• Organizational Behavior & Principles & Practices Of Management-

- Dr P.C.Pardeshi.

• The Times Of India

• Fundamentals Of Management- Robbins

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 THANK YOU !!!

YOUR QUESTIONS ARE WELCOME

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