Controlling Unit 9

Management Development Page No. 136

Unit 9 Controlling
Structure
9.1 Introduction
9.2 Definitions of Control
9.3 Necessity of Control
9.4 Steps of Control
9.5 Features of Control
9.6 Characteristics of Good Control Procedure
9.7 Exercise
Learning Objectives
After studying this unit, you will be able to:
Explain the steps of Control.
List out the features of Control.
Explain the characteristics of Good Control Procedure.
9.1 Introduction
Control is one of the important functions of management. The managerial
functions of control consists in a comparison of the actual performance with the
planned performance with the object of discovering if all is proceeding according
to plan and if not, why.
9.2 Definitions of Control
According to Koontz and ODonnell, control implies measurement of
accomplishment against the standard and the correction of deviations to assure
attainment of objectives according to plans.
In the words of Henry Fayol, in an undertaking, control consists in verifying
whether everything occurs in conformity with the plan adopted, the instructions
issued and principles established. It has for object to point out weaknesses and
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errors in order to rectify them and prevent their recurrence. It operates on
everything things, people, actions.
9.3 Necessity of Control
Control is an essential feature of all business activities. Effective control of men,
materials, machines and money is essential for the proper running of any
business. To measure performance, to adjust to the changing environment, the
efforts of individuals and enterprises must be channelised in the desired
directions. Control is necessary to ascertain the deviations and to guide the
development of the factory towards the chosen goals.
9.4 Steps of Control
Each plan of control consists of five basic steps. They are:
1) Establishment of plan or standard: Control cannot exist unless there are
some kinds of plan or standard. Plans and standards set the level for
achievement and accomplishment. Plan or standard may be quantitative,
qualitative or monetary. Examples of quantitative standards are units of
finished products, units of man-hours, number of rejections. Examples of
qualitative standards are skill, leadership, ability, discipline. Examples of
monetary standards are costs, revenue and investments.
2) Keeping a record of actual performance: Accurate and authentic records
of performance must be maintained in order to institute control procedures.
3) Appraisal and evaluation of actual or expected performance against set
plans or standards: Evaluation involves two activities: (a) measurement of
performance in concrete or numerical terms; (b) comparison with set plan or
standard. Measurement or performance is the more difficult of these two.
Qualitative standards like efficiency and morale are hard to measure. When
actual performance meets planned performance, the manufacturing situation
is said to be in control. When performance fails to meet the plan, the
situation is considered out of control.
Another aspect of evaluation is the prediction of possible failure.
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4) Finding out strategic control points: In the industrial production processes,
it may not be feasible to measure and evaluate performance at every small
step. Finding out strategic control points means finding out the exact places
or spots where the performance should be evaluated in order to obtain the
best results at the least cost.
5) Provision for taking corrective steps against deviation of performance
from plan or standards: The first four steps are concerned with fact finding.
They provide data, facts or statistics which point to the need for action and
also indicate the directions in which corrective measures should be taken.
Effective control cannot tolerate needless delays, excuses, endless
compromises or excessive exceptions. Generally speaking, plans and
standards of schedules and budgets should not be changed to meet failures
in performance. Corrective action is of two kinds; (a) remedial and
(b) preventive.
Preventive measures are always preferable.
9.5 Features of Control
The following are the important features of control:
1) Control is not the beginning of the process of management but an end
function. It is a follow-up of the other functions of management. It works on
the basis of a plan and judges how the different factors men, materials,
machinery and money are organised and co-ordinated for the best
performance.
2) It is mainly forward looking. A manager cannot control the past. But he
reviews the past events and applies the benefits of previous experience to
make improvements in future.
3) Control is a dynamic process. As plans and objectives may change according
to the needs of the situation, control must also adjust itself to them. The
control system should be flexible.
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4) Like planning, control is a continuous activity. According to Koontz and
ODonnell, just as a navigator continuously takes readings to ascertain
where he is relative to a planned course, so should the business manager
continually take reading to assure himself that his enterprise or department is
on course.
5) Control is exercised at all levels of management though its nature and
degree differ according to the level. While overall control and supervision are
in the hands of the board of directors, the activity of the departments are
controlled by departmental heads.
6) Control is identified with individuals. Control may be directly related to
material, process or even finance, but ultimately there is some human being,
whoever he may be, that is responsible for the defect in material
shortcomings of the process or financial laps.
7) Control does not necessarily mean curtailment of the rights of the
subordinates. It is not the same thing as interference as M.P. Follet had
pointed out long ago.
9.6 Characteristics of Good Control Procedure
The following are the essential requisites of a good control procedure:
1) Simplicity: Control system should be as simple as possible. The fewer the
forms or records, easier the system to operate. Simple systems are also
easily understood by people.
2) Low cost: Control system should not be very expensive.
3) Adequate and timely information: Enough information should be gathered
for making decisions. Economic balance should be maintained in the cost of
information and its value. Information should be obtained at the appropriate
time.
4) Flexibility.
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5) Permit management by exception: Those situations that require corrective
action are brought to the immediate attention of the management or
supervisory personnel. Ordinary situations may be handled by the person in
charge.
6) Force planning and correction: A control system should be so designed as
to force managers to look ahead. Good control plans should foster better
planning for future operations. Corrective action by signalling failures should
be brought to the notice of the next higher level of management.
From the point of view of operations, control activities can be classified into
several categories. The most important among them are: (1) control over
policies, (2) control over procedures, (3) control over organisation, (4) control
over personnel, (5) control over product, (6) control over product line, (7) control
over production, (8) control over stock or inventory, (9) control over quality,
(10) control over wages and salaries, (11) control over sales, (12) control over
prices, (13) control over overall performance.
9.7 Exercise
1) Define control and explain the different steps of Control.
2) Explain the features of Control.
3) List out the characteristics of good control procedure.
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References:
1. Principles and Practice of Management T. N. Chhabra
2. Principles of Business Management Sherlekar and Sherlekar
3. Industrial Engineering and Management Khanna
4. Industrial Management Thukaram
5. Principles of Management B. S. Raman