Controlling

• Controlling


  One of the important functions of a manager to ensure that activities in an organisation are performed as per the plans and organisational goals are achieved
• Planning and controlling


  Planning and controlling are inseparable twins of management. Planning is a prerequisite for controlling and controlling improves future planning
• Performance standards


  Criteria against which actual performance would be measured
• Standards can be set in both quantitative as well as qualitative terms
• Standards should be flexible enough to be modified whenever required
• Measurement of performance should be done in an objective and reliable manner
• Measurement of work should be done during the performance wherever possible
• Controlling process


  1. Setting performance standards

  2. Measurement of actual performance

  3. Comparing actual performance with standards

  4. Analysing deviations

  5. Taking corrective action
• Controlling


  • Ensures actual activities conform to planned activities
  • Helps in accomplishing organisational goals
  • Helps in judging accuracy of standards
  • Ensures efficient utilization of resources
  • Boosts employee morale
  • Creates an atmosphere of order and discipline
  • Coordinates different activities
• Controlling suffers from certain limitations
• Organisation has no control over external factors
• Control system may face resistance from employees
• Controlling can be a costly affair, especially for small organisations
• It is not always possible to set quantitative standards of performance
• Critical point control


  Focusing control on key result areas critical to the success of the organisation
• Management by exception


  Only significant deviations beyond the permissible limit are brought to the notice of management
• Traditional techniques of managerial control

  • Personal observation
  • Statistical reports
  • Breakeven analysis
  • Budgetary control
• Modern techniques of managerial control

  • Return on investment
  • Ratio analysis
  • Responsibility accounting
  • Management audit
  • PERT and CPM
  • Management Information System
• Planning and controlling


  Planning initiates the process of management and controlling completes the process
• Plans are the basis of control and without control the best laid plans may go astray
• Controlling is looking back while planning is looking ahead
• An effort to control everything may end up in controlling nothing
• Management audit serves as an effective technique of controlling
• Management by exception facilitates delegation of authority and increases employee morale
• Critical point control and management by exception help in identifying critical problems that need timely action
• Deviations may have multiple causes like unrealistic standards, defective process, inadequacy of resources, structural drawbacks, organisational constraints and environmental factors
• Corrective action might involve training of employees, assigning additional resources, revising standards, etc.