TOPICS TO COVER

Þ
What is controlling and why it is important?
Þ
The control process
Þ
Controlling for organizational and employee performance
Þ
Tools for measuring organizational performance
 WHAT IS
CONTROLLING?
 Controlling:

Management function that involves monitoring,

comparing and correcting work performance.

MONITORING (over view)

COMPARING (look out for the

differences)

CORRECTING (do changes in your plan

or idea)
 WHY
CONTROLLING
IS IMPORTANT?
Importance of controlling:

The importance of a control function can be seen in three

specific areas:
1. Planning
2. Empowering employees
3. Protecting the workplace
Importance of controlling:

• CONTROLLING MOTIVATES EMPLOYEES

• CONTROLLING MAKES THE EFFICIENT USE OF

RESOURCES

• CONTROLLING CREATES DESCIPLINE IN AN

ORGANISATION
THE CONTROL
PROCESS
 The Control Process:

The Control Process involves the following:

1. Measuring actual Performance

2. Comparing actual performance

against the standard
3. Taking action to correct deviations or
inadequate standards
STEP 1: Measuring Actual Performance

Control
Sources of Information ( HOW) Criteria( WHAT )

•Personal Observations •Employees

•Statistical Reports •Satisfaction

•Oral Reports •Turnover

•Written Reports •Budgets

•Cost
 STEP 2: Comparing actual performance
against the standard

Determining the degree of variation between actual

performance and the standard.

=> Significance of variation is determined by :

• The acceptable range of variation from the standard
( forecast or budget)
• The size ( Large or small ) and direction ( over and
under ) of the variation from the standard
( forecast or budget).
STEP 3: Taking Managerial Action

•Course of Action
Doing Nothing
Only if Deviation is judged to be insignificant
•Correcting actual performance ( current performance)
Immediate corrective response to correct the problem at once.
Basic corrective action to locate and to current the source of the
deviations.
•Corrective Actions
Change the strategy, structure or arrange training programs or redesign jobs.

•Revising the standards

Examine the standards to ascertain whether or not the standards are realistic or
achievable.
CONTROLLING FOR
ORGANISATIONAL
AND EMPLOYEE
PERFORMANCE
What is organizational performance?

Performance => The end result of an activity.

Organization performance => accumulated

end results of all the organizations work
processes and activities
Measures of organizational performance

-organizational productivity

. productivity-overall output of goods or services produced divided by the

inputs needed to generate that output

-output measured by sales revenue

-input measured by the costs of acquiring and transforming the

organizational resources into outputs

.organizational productivity -a measure of how efficiently employees do their

work
What is organizational performance?

Organizational effectiveness:

Measure of how appropriate organizational goals are and how well an

organization is achieving those goals

Industry rankings:

. Ranking determine by specific performance measure

. Example includes: fortune, business week and industry week

TOOLS FOR
MEASURING
ORGANISATIONA
LPERFORMANCE
 Tools for measuring organisation
performance

Tools for measuring organizational

performance are very essential as they
allow us to achieve all the planned
objectives and obtain the success of
the business vision.
 Feedforward control:

•Control that takes place before a work activity begins.

•The goal here is to prevent the problem before it

happens.

•Ensure that:

1. Objectives are clear

2. Proper directions are established
3. Right resources are available
 Concurrent control:

• Focus on what happens during work process

• Monitor ongoing operations to make sure

they are being done according to plan

• Goal is to solve problems as they occurs

Feedback control:

• Take place after work is complete

• Focus on quality of end result
• Goal is solve problems after they occurs
and prevent future one.
• Give managers meaningful information
and enhance motivation
Financial Control:

Financial controls are the

procedures, policies, and means by
which an organization monitors and
controls the direction, allocation, and
usage of its financial resources.
Financial controls are at the very
core of resource management and
operational efficiency in any
organization.
Popular financial ratios:

Liquidity ratios: measure an organizations ability to meet it's current debt

obligation.
 Leverage ratios:

Leverage ratios: examine the organizations use of debt to finance it's assets and
whether it able to meet the intrest payment on the debt.
Activity ratios:

Access how efficiently a company uses it's assets.

Profitability ratios:

measure how efficiently and effectively the company uses it's assets to generate
profits.
 Information control:

Information control managers can use is an MIS,which provide managers with

needed information on a regular basis.Other include comprehensive and secure
controls such as data encryption, system firewalls,data backup and so forth that
protect the organizations information.
 Benchmarking:

. setting goals and measuring productivity based on best industry practice.

. measuring companies product services and practices with those of competitors

or other acknowledged leader.

. involves regularly comparing different aspects of performance with best

practices,

. identify the gap

. finding out the novel method to reduce the gap and improve the situation
THANK YOU

PRESENTED BY:
WANIA BAIG
NIMRAH
SADIA RASHID
SYED AZEEM
ZOHAIB