UNIT

8 CONTROLLING
Ekta Motors had set an objectve of seling 1200 cars per year, Mrs Ekta Chawla is the Managing
Director of this organisation with a view to achieving this objective. she worked hard to
formulate plans t e n d or the year it came to light that hardly 870 cars could be sold.
she compared expete and actual results and began to seek the causes of this deviation. sthe
arrived at the concluBion that the goodwill of the organisation had suffered because of the
negligence of the Service Division. She then took a fim decision to improve the performance
level of the service diVISion at all costs

dentify the function oT fmanagerment mentioned in the above article.

Controlling
Mr Sunil Parik has completed M.B.A. course recently.Presentlyhe holds the position of Production
Manager in "Paras Limited". He has planned to accomplish successfully all the functions 0
department.Big tasks were divided into smallactivities. Competent persons were appointed to
carry out e a c h s m a l c t v i t y . Parik also guided h i s subordinates from time to time. Despit

wotne

performarnce. was
He
nis oeEpartnent did not reach the expected level of
doing all this, that it was

about pertormance
the nis department. After due consideration he concluded
of

whether the being was

all because of his own shortcoming. He never bothered to ensure

work

difficult situation.
done according to his plans. This negligence on his part, put the company
in a

been
function of the management has
Study above
the
mentioned
case and identily which
neglected?
Controlling
3 "Madhav Ltd. manutactures steel utensils. Mr Rajesh Khanna is its production manager.
small part of
Work

the in
work
production department has beern divided into several
has been entrusted to a
small
g r o u p of 5 workers. Production
parts. Each
target of each group has

it has also been decided that if the actual

been determined at 1000 units per month. Besides,
50, then this deviation will be looked after by the
production of a group ranges between then it will be brought to
departmental
manager. However, if
the deviation is beyond this limit,
the notice of General Manager,
(a) Which step of controlling process has been shown in the above paragraph?
which particular concept the attention has been focused?
(6) Also state on

(a) Setting of perfornance standardis

10 Deviation tolerance limits

04 is fully John
Michel
sole proprietor
is a Nicaobar. He has started trade after getting M. 8.A degree. He
in

farniliar with all the functions of management. He starts his business with the planning
unctuon of
management. He desires that all his activities should conform to planning. To this
effect,he has adopted a system that keeps a constant watch on all activities of the business.

59
 E u s i n e s s Studios

advere
resuts. t can, therefore,
possibility of
zero this m
elieves that this method
etho
Consequently,
there is
r e s u i t s . Mr
John also
Delieves

applies nos
related to the levels as
well.
method is directly but to all
the
level
management
of to n ue aroresaid paragraph
to any one management
rererred

function of of managemer
ldentify the features of the
functions
nagement as i
a)
(b) Describe the above
mentioned two dertiied
under point (a)
obove. (1-2
Ans. (0) Controllin9
are as under
of controlling
(b) Two features directy concerned with the resuits Be
Goal-oriented
Function: Controling fs 15 evaluated after fnc
and after
0
the r e s u l t s otDtained
that progre5 tindng out the
on the basis of
measures are taken.
corrective
deviation
(o) Pervasive Function: It is the primary functuon of every manager. Managersective cr
al
out this function to keep effectv
and Lower level) carry
Medium level
(Top level,
over their difterent
8551gntnents

manutacturing
electrical goods. Smt. Renu Bala Jhingan ie
"Prakash Limited" is a company
O.5. wIse directiOn, company nas achieved great heioh,
its managing director. By virtue of her
invited her for a lecture. Ihere she got an opportunit
one day
A management institute the story of b
studies. Sne narrated to them
with the students of
management her
dialogue She told them two main things. First, the empioyees Snouid Know that their work is
success.

and progress report prepared.

evaluated
secona, optimum use of human and
physica)
being
resources should be made possible.
function of the management.
(a) ldentify the above said
write two points regarding the importance of the
(b) On the basis of the aforesaid paragraph
functions of management as identified
in point (a) above. 42)
Ans. (e) Controlling
(b) importance of controlling

0 Improving Motivation of Employees: By way of controlling,

an attempt
is made to
that makes all the employees to work with
motivate the employees. It is controlling9
that their work pertormance will be evaluated and
complete dedication. They must kriow
their iaentity in the organisation
their progress report is up to the rmark, they wil have
it
etficient use of human and
(0) Making Efficient Use of Resources: Controlling makes
that no employee delays his
physical resources possible. Under controlling it is ensured
work pertormance deliberately Likewise, wastage in ail the physical resouroes is aso

stopped.
Q. 6. Love and Kush are two friends. Both are MBA (Final year) students. One day. their proresso
called them to class stage for a surprise test. He told that one of them will estap

relationship between any two functions of management. Then, the other one, will Esia
reverse relationship between the same two functions. Both will have to give justiticatio
ere
the relationship explained by them. It was a test carrying 50 marks, Both the studenis
intelligent and skillful. Love was the first to speak.
always
Love sald that in his opinion of the two functions of management selected by himonea
looking ahead (future) and the other is looking back (past).
 andbook of Case
Studies
did love express his
sooner opinion, than Kush
i nin hhisi s reply.
reply. Kush said that the one identified the
(LOve). function stated by Love tofunctions selected by him
opinion, looking back and the other one have been
was looking ahead. stated by him (Love) to havelooking ahead
been looking
back
dentify the functions of the
management discussed in the above
(b) Justify the contraty reiaticOns of paragraph.
management functions as viewed by Love and Kusn.
(a) Planning d n a C o n t r o l l i n g +3)
Ans o
Loves reply and relations tDetween the
functions of
managerment
Planning 1S
LOOKIng Anead wnereas

Plans
Controlling Looking Back:
is
are always fomulated for future and determine the future
course action tor ot
achievement setobjectives. On the contrary, controlling is
of t
it a manager ties to ind out looking back because uncer
after the
as per the standard of not. it is
completion of the work, whether it has been done
thus obviOus that
Controlling lookS DacKward
planning looks ahead (in the tuture ana
(in the past)
) Kush's reply and relationship between the
Planning is Looking back
functions of management
whereas
Controling is Looking ahead:
Kushs reply and
relations between the functions of management. Planning is
looking back Decau5e the plans are tormulated on the basis of the happening in thecaled
pas
or on the
Dasis of eXperience. On the other hand, controlling evaluates the work done
the past but
the corective measures are taken in future. Thus, there
is no
denying the tact
that planning looks backward while
controlling looks ahead.
o7. Mr Sidharth Pandey is the Marketing Manager of 'Swastik Limited". He is a loyal empioyee
of the company. He makes all
possible efforts to enhance the public image of company
products. That is the sole reason of continuous rise in company's sales. Whatever sales target ss
he determines, he realizes much more sales every time. It means that every time there occurs

positive deviation. Mr Pandey remains in constant rapport with Production Manager. He

always endeavours that the products of the company should be of high quality. On account of
maintaining high quality of the products, he is always ahead of his competitors. As a Marketing
Manager, he also fixes price of company's products. While fixing the price he takes special care
that prices
to

adverse impact on the budget of the

ensure
should have no consumers. His main
aim is to present true image of the company and its products in advertisement.

wich step
of controlling
process been to in the above paragraph?
has referred [143]
Ihird step of Controling Process ie. Comparison of actual pertormance with standards has been
Clarify.
discussed.
At this step, actual performance is compared with the standards and deviations are found out
be
scan of two types-0 Negatve Deviation and () Positive Deviation. In controlling
s,Itis important to know the causes of negative deviation but it is not less important to know
the

d0Out the
of positive
causes deviations. Positive deviation
means that the actual pertormance
is
Cre than the standard work. If the information recelved regarding the actual performance being
r e than the standard, the corrective action can help in improving the eficiency in tuture
 B u s i n e s s Studies

General Mils Ltd, His main

of Coconut Oil and
Q 8 M r Stanley Anthony is Production Manager
To explore and analye differene optio
is that prior to doing anything. he ponders over t.him
that is to be undertaken Dy n fauture naa tDecome his habit Be
each and every activitysubordinates under his own hey oo what he wants Inspn
intuenc.
he quickly brings his achieve the exn
fhis department failed to
all this, for the last few months performance of
ervel. This situation put him into lot of worry. To counter this situation, he sought help from some
external specialists. Finaly, he concluded that thee poor pertormance was due to two reason

First, inefficiency of some newly recruited employees and Second, wear and tear of machin
achines
he took the tollowing cofrective action
n order to remove these shortcomings
0 To remove inefficiency of the employees he estabiisned a training centre and e aits
charge to an expert trainer
0) To deal with the wear and tear of machines he decided to replace them with new ones
answer the folowing
questions
the context of the above paragraph,
(a) ldentity. by quoting the lines any two functions concerning management taken by Me Anthony
(O) ldentity the two steps of controlling process mentioned here

(c) ldentify training method. 2-2-

Ans (a) Planning:

To explore and become his habit

anslyse has
Leadership
Besides hi own infiuence

(b) Analyaing deviations

Taking corrective action
(o) Vestibule training
9 Mr Jai Prakash Gupta is the General Manager of "Bhagwati Udyog Pvt. Ltd." With a view to
running his business in a careful manner, he divided all the activities into seven departments
These departments were: Purchate, Marketing. Production Personnel, Finance, Accounting9
and Correspondence. Later on, he realised that occounting and correspondence department
can be merged into tinance department. Ihus, all business activities were divided into five
departments. Mr Gupta 1s now thinking on the lines as to which are the departments. out of
these five that will have signiticant role in the success of the business. After complete analsin
he concluded that marketing. production and finance were the department on which successof
the
business depended. It meant that even of some shortcoming occurred in the
department
of purchase ff would not affect much the the business.
and personnel, success of Thereatte
Mr Guptadetermined deviation tolerance limits of these three main departments. It meant that
t deviation of these departments remains within this tolerance limit, then it will be looked ater

DY the concerned manager. However, in case the deviation is beyond this limit then the same
will be brought to the notice of General Manager
(a) ldentify two functions of the management referred in the above paragraph.

tb) Describe the relevant concepts of identified functiona 12-4

Ars ta) Organising and Controling
(b) 0) Condept relatecd to Organising
 Under it. second step of organising procesie. Depa
() Concept related to Controling
Following twa concepts relsted to cortrolinig heve beer oestrte

Critical Point Control

tmanagement
relors to thatshouid
concnpt cfitsmariagerment
focus wtich
attention criy toilds tretactte
on imponant eted ote
Management By Exception
t refers that princicle of
to organisationsl
control wtich olids shat o y
deviations (ie. exceptona) should tbe brought to the top maregerert sterte
g
Mr Shet its Mareng
o 10 Kitchen saj
uimteo sa
company manufacturing plastio gocds. is

Manager and Mr Sahu, t s Production Manager. Style of workinig of both the m a n a g s

entirely ditterent. Mr Shah set Such standards for ditferent activities of his depiartment ss wer

quite easy to achieve. On the other hand, Mr Sahu set standerds for diferent actvtes of t

department as were very difficuit to achieve. As a result, Marketing departent

e sa
targets very easily,
Mr
Shah and his were very pleased
team with these resulits
But
prevailing in the pro0uction department was quite contrary to it. Mr Sahu was far t e t t d r s

Now he and his team were very much worried.

targets.
(o) Which step of controling process has been discussed in the atove peragrapr
(b) in your opinion, both the managers would have set standards for uhich s c t t e s or tr

departments? Write two standerds each

respective
(o) Of the two managers, one set easily achievable standards whereas the arher set su
aect stua

standards as could be achieved with great difficulty.

In your opinion, tow

would have on the employees?

(d) State in one word, what shouid be the type of standards? 11-2-2-13
Here, first stop of the
controlling process l e Setting cf Performancs Staridierds has teer
A (a)
didcussed
Main standards Of
(b)
Maretg Departent
Sales Volume
Sales Expenses
Main standards of Production Depertment

Quality
Quantity
(c Effect of easily achievable standard

in this situation employees turn lazy (idiel

Effect of those standards which are achieved iwith. dificulty
in this situation employees are worned.
(G) Ressonable

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