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CONTROLLING
PRESENTED BY: SHASHANK SHUKLA
Controlling as a Management Function
o Controlling

A process of monitoring performances and taking

action to ensure desired result.

 It sees to it that the right thing happen, in the right

ways, at right time.
Controlling as a Management Function
o Controlling.

Done well, that the overall directions of the

individuals and groups are consistent with short and
long ranges plan.
It helps ensure that the objectives and
accomplishment are consistent with one another
through out an organization.
Controlling as a Management Function
o Controlling.

It helps maintain compliance with essential

organizational rules and policies.
Controlling as a Management Function
o Cybernetic control system.

One that is self contained in its performance

monitoring and correction capabilities.(thermostat)
The control process practice in the organization is not
cybernetic but it does follow similar principles.
The Control Process
Establish objective and standards.

Measures actual performances

Compare results with objectives and

standards.

Take corrective actions.

Establish Objectives and Standards
o The control process begins with planning and the
establishment of performance objectives.
o Performance objectives are defined and the standard
for measuring them are set,
Establish Objectives and Standards
o There are two types of standards:
 Output standards- measures performance results in
terms of quality, quantity, cost or time.
Input standards- measures work efforts that go into a
performance task.
Measuring Actual Performances
o Measurements must be accurate enough to spot
deviation and variances between what really occurs
and what is most desired.
o Without measurement effective control is not
possible.
Comparing Results With Objectives And
Standards
o The comparison of actual performance with desired
performance establishes the need for action.
o Ways of making such comparison include:
Historical / Relative / Engineering
Benchmarking
Taking Corrective Actions
o Taking any action necessary to correct or improve
things.
o Management-by-exception focuses managerial
attention on substantial differences between actual
and desired performances.
Taking Corrective Action
Management by exception can save the managers time
energy and other resources, and concentrate efforts on
areas showing the greatest need.
There are two types of exceptions:
a) Problems- below standard.
b) Opportunities- above standard.
Effective Control
The Best Control in Organization are

o Strategic and result oriented.

o Understandable
o Encourage self control.
Effective Control
The Best Control in Organization are

o Timely and exception oriented.

o Positive in nature
o Fair and objective
o Flexible
Types Of Control
o Preliminary

Sometimes called the feed forward control, they are

accomplished before work activity begins.
They make sure that proper directions are set
and that the right resources are available to
accomplish them.
Types Of Control
o Concurrent

Focus on what happen during the work process. Some

times called steering controls, they monitor on going
operations and activities to make sure that things are
being done correctly.
Types Of Control
o Post action

Sometimes called feedback controls they take place

after an action is completed. They focus on end results,
as opposed to inputs and activities.
Types Of Control
Managers have two broad option with respect to
control.

o They can rely on people to exercise self

control(internal) over their own behavior.
o Alternatively managers can take direct
action(external) to control the behavior of others.
Types Of Control
o Internal Controls

Allows motivated individuals to exercise self-control

in fulfilling job expectations.
The potential for self control is enhanced when
capable people have clear performances objectives and
proper resource support.
Types Of Control
o External Controls

It occurs to personal supervision and use of formal

administrative systems.

Performance appraisal system, compensation and

benefit system, employee discipline systems, and
management by objectives.
Organizational Control Systems
o Management Processes
1) Strategy and objectives.
2) Policies and procedures.
3) Selection and training.
4) Performance appraisal.
5) Job design and work structures.
6) Performance, modeling norms and organization
cultures.
Organizational Control Systems
o Compensation And Benefits

Attract talented employee and retain them.

Motivate people to exert maximum effort in their
work.
Recognize the value of their performance and
contribution.
Organizational Control Systems
o Employee Discipline

Discipline is defined as influencing behavior through

reprimand.
Progressive discipline ties reprimand to the severity
and frequency of the employees infraction.
Positive discipline tries to involve people more
positively and directly in making decisions to improve
their behaviors.
Organizational Control Systems
o Information And Financial

Activity based costing - the true cost of all product

and services.
Economic value added – examine the value added by
all activities.
Understand the implications of key financial
measures of(ratios) organizational performance.
Operations Management And Controls
o Purchasing

Economic Order Quantity

automatic reorder points
Just In Time Scheduling
Operations Management And Controls
o Project Management

Program evaluation and review technique(PERT) –

Identifies and control the many separate events in
complex projects.
Operations Management And Controls
o Statistical Quality Control

Based on the establishments of upper and lower

control limits, that can be graphically and statistically
monitored to ensure that products meets standards.
Advantages of controlling
1) An insurance towards the attainment of enterprises objective.
2) Improve managerial decision making.
3) Maximum production at minimum cost
4) Moral check on employees.
5) Judging managerial competence.
6) Add to delegation and decentralization of authority.
7) Betterment of future performance.
8) Avoiding industrial accidents.
9) Aid to co-ordination.
10) Guide to effective supervision.
Limitation of controlling
1) Difficulty in setting rational standard.
2) No control over external factors.
3) Expensive.
4) Difficulty in pinpointing responsibility for deviation.
5) Resistance to controlling system by employees.
6) Controlling system getting obsolete.
7) A post- mortem of event.
8) Misleading reports by lower managerial staff.