Controlling – A Management Function
Controlling – A Management Function Show
Management function of controlling is the process whereby organization sets itself performance objectives and strives to achieve them as best it can over time. It is a method for managing the performance of the organization. It is the process oriented to verify the advancement status of the planned objectives as well as the efficacy and efficiency of the organization through the analysis of the resources, costs and proceeds. Controlling is one of the important functions of management. It pinpoints the deviations on the basis of which management can take corrective actions. Without the function of controlling, work done in the organization is not systematic and as per plans, since the inefficiencies remain undetected. For achieving the objectives and targets, it is necessary that the actual performance is assessed from time to time to ensure that what is being achieved is in conformity with the objectives and targets. This is done through the controlling function of the management. Thus, controlling as a function of management refers to the evaluation of actual performance of work against planned or standard performance and taking the corrective action, if necessary. Controlling function of the management is not to be seen as an activity of the exclusive competence of the administration area, but rather as a process which involves, at the appropriate levels of responsibilities of all the functions of the organization. As with all processes, the controlling function is constituted by different elements which are connected to each other. These elements are (i) the structure (personnel charged of the duty of control), (ii) the tools (general accounting, data analysis, statistical analysis, budgeting, reporting), and (iii) the procedures (coordination, optimization). Different management experts have defined the function of controlling in the following way. “Control of an undertaking consists of seeing that everything is being carried out in accordance with the plan which has been adopted, the orders which have been given, and the principles which have been laid down. Its object is to point out mistakes in order that they may be rectified and prevented from recurring.” – Henri Fayol “Control is checking current performance against predetermined standards contained in the plans, with a view to ensure adequate progress and satisfactory performance, and also recording the experience gained from the working of these plans as guide to possible future needs.” – Brech “Controlling is the measurement and correction of performance in order to make sure that enterprise objectives and the plans devised to attain them are accomplished.” – Harold Koontz “Management is the profession of control.” – Stafford Beer “Management control can be defined as a systematic effort by business management to compare performance to predetermined standards, plans, or objectives in order to determine whether performance is in line with these standards and presumably in order to take any remedial action required to see that human and other corporate resources are being used in the most effective and efficient way possible in achieving corporate objectives.” – Robert J. Mockler “A process in which a person or group or organization determines or intentionally affects what another person, group or organization will do.” A.N. Tannenbaum “The concept of control may be seen as the minimization of idiosyncratic behavior and the promotion of conformity in accordance with explicit plans.” – E. McKenna “Control is a process by which managers ensure that resources are produced and used effectively and efficiently for achieving the goals of the organization.” – AN Anthony “Control is a process through which a characteristic of the system is transformed in order to generate the desired change meant to improve the system”. – Adam Jr. and Ebert “The concept of control represents permanent or periodic analysis of an activity meant to provide improvement measures, but also continuous supervision (moral or material); dominance.” – Dex The concept of control implies the following.
The concept of control does not define only actions, mechanisms, procedures, but also a ‘philosophy’ developed within the organization which allows the activity evolution in accordance with stakeholders’ plans, purposes, and expectations. Controlling is the management function of establishing performance standards, measuring actual performance activities to see if the standards have been met, and taking corrective action. The purpose of controlling is to determine whether people and the various departments of the organization are on target and are achieving the progress toward the objectives that they planned to achieve. While planning determines goals and maps out the necessary strategy and tactics, controlling attempts to prevent failure by providing the means to monitor the performances of individuals, departments, divisions, and the entire organization. Controlling is also critical because organization resources are limited. Their acquisition and use are critical to the survival of the organization. Hence the organization cannot set resources in motion toward a goal without monitoring the progress of the resources. Hence the organization operates with monitoring of the performance of employees, the expenditure of funds, or the production of goods. Controlling affects and is affected by the other four functions of the management. Controlling is an instrument for planning, accounting, analysis and control of the status of the operations within an organization. It is used for decision-making on the basis of a system for data collection and processing, which is a system of constant assessment from different points of organizational departments, organizational branches, managers and employees. The processing comprises accounting, analysis and control as an integrated function. It requires (i) increase of the level of knowledge of the specialists within the organization and activation of their intuitive and logical awareness, which promotes flexibility of the management system and attain the objectives of the organization at the same time, (ii) formation of a controlling system which is to become the basis for the timely improvement of the informational and methodical support of organizational management and to minimize the probability of an occurrence of collapses between the needs of the environment and opportunities of the organization to satisfy the same, (iii) creation of instruments in the field of prediction of the efficiency of the interaction of the controlling and the management within the organization, of the choice of the rational direction of their development and the analysis of the production processes and realization of the produce of the organization. The controlling function of the management acts through the following phases in sequence (fig 1).
Fig 1 Phases in the controlling function Thus, controlling involves (i) knowing the nature, quantum and time frame of the work, (ii) comparing the performance with the plan, (iii) analyzing deviation, if any, (v) taking corrective steps, and (vi) suggesting revision of plans, if necessary. The following are the basic characteristics of controlling function.
Due to these characteristics, controlling (i) helps in achieving the targets, (ii) helps in taking corrective action on time, (iii) helps in monitoring and improving employees performance, (iv) helps in achieving better coordination, (v) helps in better planning, (vi) helps in minimizing errors, (vii) facilitates decision making, and (viii) simplifies supervision. Types of controls and control systems There are three types of control. They are (i) feed forward controls, (ii) concurrent controls, and (iii) feed-back controls. These are described below.
Control systems are the composite feed forward, concurrent, and feed-back controls. Control system can consist of a combination of any two or more controls. Any combination of these controls is used to accommodate various management control needs. Further controls can be grouped according to three general classifications namely (i) the nature of the information flow designed into the system (open- or closed-loop control), (ii) the kind of components included in the design (man or machine control systems), (iii) the relationship of control to the decision process (organizational or operational control). The control process is generally a three step process of measuring actual performance, comparing it against a standard, and taking managerial action to correct deviations or inadequate standards. Requisites of effective controls The following are the requisites of effective controls.
Monitoring of controls Controls are required to be monitored to determine the degree of organizational impact that they have, both on people and on systems. When controls are developed, employees may resent them as unnecessary, strict, or demeaning. Employee involvement in the design and implementation of the control is critical to reduce or eliminate anxiety and resentment. Controls also need to be monitored to limit the potential impact on organizational patterns and systems because controls can have side effects. One potential answer for management is to use program evaluation techniques to monitor the system. One technique, before-and-after comparison, looks at the environment before and after the system is installed to note any differences and why they occurred. Other potential options include time trend data comparisons, comparisons between affected and unaffected parts of the organization, and controlled experimentation. In determining the impact of controls on various parts of the organization, questions need to be asked in the areas of goals, structure, decision-making, and human relations. Management need to know the impacts of controls. Controls can generate support or antagonism. Involving employees in the design of controls can help ensure support. Controls that employees believe are equitable seldom encounter resistance. When ensuring the effectiveness of controls, management can use these techniques namely (i) conducting before-and-after comparisons, (ii) surveying the employees affected by the controls, (iii) performing controlled experiments, and (iv) updating the controls when necessary or as required. Controls are effective as long as (i) they do what they are intended (prevent deviation, diagnose deviations, treat deviations, or provide information for future planning), and (ii) they do not create organizational problems that result in costs greater than the benefits of the control devices. Controls are effective only as long as they do what they are intended to do. When the control devices are designed, they are with a certain set of expectations and under specific circumstances. If these circumstances and expectations change within the organization, the control devices need to be reviewed and possibly updated or replaced. The instant changes are planned or occur in operations, managers should begin to examine how adequate the present controls will be for these changes. Controls need to be current. Again, controls need to be monitored for the degree of impact they have on people and organizational patterns and systems. It should be expected that control systems will affect employees and organizational operations, but extreme changes should be avoided. If employees resent control, they will limit the effectiveness of the control. If a control device has side effects on the organizational patterns and systems, it can impact morale, timeliness of decisions, and the decision-making environment Controls can play five important roles in organizations. These are as follows.
Which functions of management standards are compared with actual?Controlling refers to the function of evaluating and assessing the progress of the work done. It involves setting a specific criteria or standards for the work and then comparing the actual work with the set standards.
In which of the following management function actual performance of an employee is compared with standard performance?Answer: The management function which helps in finding out that the actual production of a worker is less than the set target is known as controlling. Here, comparing actual performance with standards or appraisal of performance is the step involved in the process of controlling.
What is the process of comparing actual performance with the standards and taking corrective action?The process of comparing actual to planned performance and taking corrective action is called controlling.
What is required if the deviation are found between standard and actual performance?Ans. Immediate managerial attention is required if the deviations go beyond the acceptable range in important areas. After the analysis of deviations and their causes, the task is to remove the hurdles from the actual work plan.
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