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Chapter 7

Management

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6 views

Chapter 7

Management

Uploaded by

የገጠር ልጅ
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Chapter: - 7

Controlling
Definition: Control is a primary goal-oriented function of management in an
organization. It is a process of comparing the actual performance with the set standards of
the company to ensure that activities are performed according to the plans and if not
then taking corrective action.

Controlling is performed at the lower, middle and upper levels of the management.

Importance of Controlling
The following are some factors contributing to the importance of
controlling:

a) Decentralization of authority
Since managers at every level of an organization have to exercise
control, the controlling process leads to decentralization. This, in turn,
enables middle and lower level managers to have some autonomy in
making decisions. An organization that distributes authority at every
level always works smoothly and efficiently.

b) Increasing managerial abilities


By enabling all managers to possess the autonomy to make decisions,
controlling enhances their managerial abilities. With these skills,
managers can further their organization’s goals by adapting to diverse
situations and problems. Furthermore, this also helps managers grow
and develop at an individual level by giving them new experiences.

c) Using resources effectively


The most important function of controlling is to compare actual
performances with expected results. This, in turn, helps managers
understand where they are lacking and how they can improve their
performances. Using this knowledge, managers can use all available
resources optimally and prevent their wastage.

d) Facilitating coordination
In every business organization, managers and employees always have to
coordinate and work with each other collectively. Controlling improves
this coordination by basically demarcating all activities and efforts into
fixed boundaries. It brings together all the resources of an organization
and enables its personnel to work together with unified efforts.

e) Structuring human behavior


Since all organizations have to depend on humans for functioning, they
need to regulate human behavior of their employees. Controlling
rationalizes this human behavior and prevents employees from
behaving arbitrarily and badly. It basically does so by providing for
sanctions in case employees do not prescribe to expected standards of
behavior. For example, managers often take disciplinary action against
employees who take unauthorized leaves.

f) Achieving efficiency and effectiveness


A good control system can always greatly boost an organization’s
efficiency and effectiveness. It generally does this by identifying
deficiencies in an organization’s functioning and suggesting
improvement measures. Managers use control to achieve their targets in
this manner.

Process of Controlling
Control process involves the following steps as shown in the figure:
• Establishing standards: This means setting up of the target which needs to be achieved
to meet organizational goals eventually. Standards indicate the criteria of
performance.
Control standards are categorized as quantitative and qualitative
standards. Quantitative standards are expressed in terms of money. Qualitative
standards, on the other hand, includes intangible items.

• Measurement of actual performance: The actual performance of the employee is


measured against the target. With the increasing levels of management, the
measurement of performance becomes difficult.
• Comparison of actual performance with the standard: This compares the degree of
difference between the actual performance and the standard.
• Taking corrective actions: It is initiated by the manager who corrects any defects in
actual performance.
Controlling process thus regulates companies’ activities so that actual performance
conforms to the standard plan. An effective control system enables managers to avoid
circumstances which cause the company’s loss.

Types of control
There are three types of control viz.,

• Feedback Control: This process involves collecting information about a finished task,
assessing that information and improvising the same type of tasks in the future.
• Concurrent control: It is also called real-time control. It checks any problem and
examines it to take action before any loss is incurred. Example: control chart.
• Predictive/ feed forward control: This type of control helps to foresee problem ahead of
occurrence. Therefore action can be taken before such a circumstance arises.
In an ever-changing and complex environment, controlling forms an integral part of
the organization.

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