Foundations

of Control

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Control is the management function that involves monitoring activities to ensure that they’re being accomplished as planned and correcting any significant deviations.

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 CONTROLLING AS A
MANAGEMENT FUNCTION
– A process of monitoring performance and taking action to
ensure desired results.
– It ensures right things happen, in the right ways, and at the
right time.
– Makes overall directions of individuals and groups are
consistent with short and long range plans of the
organisation
– It helps maintain compliance with essential organizational
rules and policies.
FEATURES/CHARACTERSTICS OF CONTROLLING

• Fundamental Function of •Goal/results oriented

management. • Universal
• Pervasive process •Action oriented
• Continuous process. •Wide scope-Quantity, quality,
• Flexible and dynamic process. cost, time etc.
• Future oriented. • Protects the work place
• Planning and controlling
closely related.
 The Control Process
1. Measuring actual performance
2. Comparing actual performance
against standard
3. Analyze deviations
4. Taking action to correct
deviations or address inadequate
standards

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Basis of Standards
• Sales, production stock etc.
Quantity
• Raw materials, finished goods, service,
Quality employee satisfaction etc

• Material, labor and other expense

Cost
• Times cousumed in production of good,
Time service/ process time
Factors to be considered while setting standards
• Standards should be attainable
• Standards should be fixed for all key areas
• In accordance with the goal of the organization
• As much as possible, standards should be expressed in quantitative
terms
• Standards should be precise and understandable
• Should be focused on attainment of results and not on procedure and
policies
• Standards should be flexible according to the situation
• Should be set in consultation with employees
• Deviation tolerance limit should be prescribed
Measuring Performance
Sources of information:
• Personal observation
• Statistical reports
• Oral reports
• Written reports
• sampling

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Factors to be considered measurement of actual
performance

• Unit /criteria of measurement should be same as were set at the time

of setting standard
• Fact and figures of the performance should be as far as possible , real-
time and true
• Figures should be continuously prepared
• Time of measurement of performance should be neither too short,
nor too long
Comparing Performance to Standards

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Criteria for Measurement

What managers measure is probably more important to the

control process than how they measure.

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Comparing Performance to Standards
Steps involved
• Finding out the extent of deviation
• Identifying the cause of deviation

In situations where standards are not quantified, measures like

observations and inspections can be used

It is important to analyze both negative as well as positive deviations

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 Analyzing Deviations
• Deviation come out in comparison with actual performance
• Check if deviation is within the tolerance limit
• If deviation is large(positive or negative), causes of the same should be
identified and fixed
• Standards are also reviewed. If found wrong, these will be revised and new
standards will be formed.

• Some of the causes of deviations can be inefficiency of employees, strikes,

shortage of material, break down of machinery, natural calamity or wrong
standards about sales, profit, cost etc.
Correcting Performance

• Immediate corrective action

• Basic correction action

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Revising Standards

If performance consistently exceeds the goal,

then the goal may need to be raised.

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When does control take place?

Eg. Mc donalds Eg. digital media Eg. Financial

Preventive airline ads, computerized control measures
maintenance control

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Controlling Workplace Violence

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Concurrent Control

Control that takes place while a work activity is

in progress.

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Feedback Control

Control that takes place after a work activity is

done.

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Control activities in different
organizational locations and
functional areas
What gets controlled?
Keeping Track of an Organization’s Finances: Ratio Analysis

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Keeping Track of an Organization’s Finances:
Budget Analysis
Budgets are used for both planning and controlling.

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Keeping Track of an Organization's Information

Management information system (MIS):

A system used to provide management with
needed information on a regular basis.

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Keeping Track of Employee Performance

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Contemporary
issues in control.

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Contemporary Issues
1. National/cultural differences
2. Workplace concerns

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National Differences

• Use of technology as control measures for global

organization
• Technologically advanced vs not technologically advanced
countries.
• Impact of laws of various countries

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Controlling Technology Usage

Is my work computer really mine?

Do I have a right to privacy at work?

14-28