Q S Disc uss the lim itations of control .

ff
.\ns. lt is human na ture to r esist a nd rese nt co n trol e orts. A n umber of
. . f tro l systems. These pro ble
pn.' ,' '-·;'1s also hinde r the e ffe ctive ness o con ms
..-..1:i N identified as u nder -
1. Quantification - It is quicke r to measure the performance of
~h ose e ven ts th a t can b e quan ti 1e
·[· d . Hence , easy problems receive too
. much
t-tdght w hile difficult-to-measure items are not given enough attention.
2. Long-run results are unpredictable-Stoner and freeman
write that s hort run factors are often overemphasized at th e expense of long-
run fa ctors. It is noted that long-term growth may not be given the attention
rhey n eed by the controi system.
3. No control on external factors - Control has one limitation
that it cannot be exercis~d over external conditions like consumer behaviour,
changing demands, fashion, competition, government policies, etc. Managers
can control only the internal factor<: ~ike johs 1 work relationships, commands,
materials, structure of organisation, etc .
4 . Difficulty in setting s tandards-Controls cannot be exercised
v.1ithou t standards or norms. Setting physical standards for productivity,
empioyee work, w~g~s, expenses, materials or quality is very easy. But to set
standards for non-measurable work a nd [Link] ~s employee morale,
human behaviour, enthusiasm; satisfaction, sincerity, goodwill of the concern
. . '
etc is very difficult task. Hence, these cannot be co ntrolled in the absence of
sta11c~rds.
 5. Difficulty in fhdn
9 responsibility-Many times, a particular work
i{onne d b Y a number of
1spe l persons due to the inter-functional processes. 1.n
r1laf\Y cases, e~p oyees have joint performances. But in case of any mistake,
. difficult to fix Particular respons1.6.11.1ty on particular person and the contra l
;t 1s
i:,ecomes ineffective.
6. Limits of conective action-Many times deviations are found,
but it becomes difficult to take corrective action in time. Solution may not be
irnplemented vvhen it is expensive or when it is resisted by subordinates. In
such situations, control system fails.
7 • Time ~onsumi~g --.. Sometimes, control technique proves time-
consuming and complex. It may delay results. It may lead to unnecessary
wastage of money and efforts.
, 8. Hurting freed9m- The control technique can be ojected if people
feel that their freedom of functioning is curtailed or much restrictions are
imposed upon them. _ • .... __ _~
., d uyv•. . ' l\.ll.:h . ' ~v1-11~
.(',se l .cuss the Process of ContrOIh restnctions are
.r Ds ight· h
~,9, ch step. Mention about two •g ting the si
ea I most effecti\le 8111fic~nce of
,ontr0 · tnetbods f
. . . o overall
conttoI 1s an ongoing process Ith
1 \ f
~~ • h me or leve s o control system
· as some subparts R
phe L>'• s, any cont l . egardJess
, d. . r'l'lental steps - ro Process has f
1

· o o.i•· if our
~ (1) [Link]~t o goals and standards
(2) Measurement of perforn:ance
(3) Comparing performance against standards
(4) Taking corrective atiion
t.€.stablishment of Go als and Standards
The first step in the control process is to establ'15h l
· ks • goa , plan, or a
d
dard or other yar stic against which subsequent perf .
stan onnance will be
corn pared. These standards are ~e specific objectives against which progress
canbe measured. These are set 1n the planning stage.
Generally, perlormance standards serve three important purposes-
(a) Standards reflect expected and planned results. They helµ
employees understand what is expected o~ them and how their
work will be evaluat
(b) They provide a b asis for finding deviations from fixed targets.
(c) They help reduce the potential negative effects of goa\
Standards can be of several types. Basica\\yl they may be
.
quantitative or qualitative. Q uant1ta. ti ve standards deal with nun1bc1:
 ~-
quantity o r unils may further be dnssiOed as physical sta.n<lards, cost standards ~
reve standards, capital slondards, ond time standa rds . Quolltatiue standar~ ,
deal wilh a ttitudes , behavio1Jr, Image, growth or relatio nships. 1
To be effec tive, contro l sf·nndards must possess certnln f~tures,.
(i) S tandards should be stated in qunntitative terms and should be
con·ecling measurable . (i i) They should be consistent, economic and
understandable , (iii) They should be realistic expectations for performance,
(iv) They should be related to the organisational goals, (v) They should be
based on past perforrnance projected into the future, (vi) They should identify
key areas and strategic points for control. They should [Link] on results.
They must be flexible and acceptable by all.
{vii) They should be objective and developed through detailed studies.
They should be r 2lated to the performance of specific individuals.
Griffin s-::ates that a final aspect of establish_ing standards is to identify
performance indicators. Performance indicators are measures of performance
that provide information that is directly relevant to what is being controlled. It
is also important for the controlling manager lo decide a rongE" of tolerable
deviation within which no1mal performance should lie.
2. Appraisal of Petfonnance
Onc.e performance standards have been established, actual performance
of work must be measured. Performance measurement is a constant activity
for most organisations. Performance measures must be valid and realistic.
Employee performance is measured daily, weekly or mor:ithly. It is often
measured in terms of quality, or quantity of output.
The common n1ethods used by managers to measure actual performance
are personal observation, statistical reports, oral reports, and written reporls. A
combination of these may increase the reliability of information. Besid~, what
we measure is more critical to the control process than how we measure. The
wrong criteria can result in harmful consequences. The performance of some
activities is difficult to measure in qua ntifiable terms. Hence, qualitative
performance measures can be used in such cases.
3. Comparing Performance against Standards
The third step in the control process is comparing measured perfom1anc..
against established standards. Perfonnance may be. higher than , lower than
or equal to the standa rd.
This step dete rmines the degree of variation bet\l.1een actual perfoimance
and the standard. Some variation in perfo rmance can be expe cted in all
activities. Bu.t so me devt'ati on s are c ·ti . . .
n ca 1an d s1gn1ficant. Hence , ma nag ers
,,,u st de ter mi ne which devi· ati ons are Criti I
son ina . ca an d nee d to be corrected . ln this
sta ge of co mp ari nag ers are
'
the variation. concerned with the size and direction of
'
I I I
1. Establish 2. Measure 3. Compare 4. Evaluate
Standards Perfonnance
➔ 4 performance
~
perfonnance
. · and standards and take
action
.

' I I
Maintain the Correct the Change
status quo deviation standards

St ep s In the Co ntr ol Pr oc ess

4 . Taking Co rr ec tiv e Action
p In th e co ntr ol pr oc ess is tak ing co rre cti ve ac tio n.
Th e fin al ste
ic condition for effective control.
Taking ap pro pri ate corrective action is a bas
ma na ge r mu st fin d the rea l cau se bef ore taking action . For this, a careful
Th e
ess ary . It req uires ma na ge r's ana lyt ic an d diagnostic skills. After
an aly sis is nec
ari ng pe rfo rm an ce ag ain st con tro l sta nd ards, on e of three actions ca n
co mp
be ta ke n-
n performance essentially
( 1) Maintaining th e sta tu s qu o- W he
·
ma tch es the sta nd ard , no acti.<;>n is ne ed ed .
.
Co rr ec t th e de via tio n- W he n the re ha s be en de fic ien t
(2)
ed on the pa rt of the
perfo nn ance, a corrective action is requir
e changes in strategy,
ma nager. Such co rre ctive actions might includ
Pl .'O ~m es an d the
structure , comp ensation policies, or training
replac em en t of employees.
rk sta nd ard wa s set up too
(3 )' Revise th e sta nd ar d - If the wo
uld be revised. lf the
high or too low at the begin ning, it sho
st.b e ch an ge d .
circumstances h ci-12 ch anged, sta nd ards mu
1rious Techniques of Co nt ro l.
 upe J und e r-
T lw~'-· 11w1'1od s o nd r.;ch niqu cs ec,11 t,., gro con trol .
( 1) Gcn t~rn l 01 ...,th o<fs nnd ( 2) S p e c lo I ,ne t hod s of
o f Con trol
( 1 ) G~n ~rn l T\?c hnl qur s or rne tf,o ds
1 . Pcr so nnl o lHwrvn tlo n
1)11,•1·1 p1.~rH111 .,I '-'onl<.lcl and ob~<'
rvl'll ion is An eHecliv~ rnea n-; lo
manau1~r o r a sup ervi sor can
dhJ ck the peif onnonce o f sub orclinat~s. Tht!
work met hods and their results.
p~ii odic allv ol>serv<' his suborJ inales, thei r
ence. Obc;t.?rvation lea<.h; 1,,
His mere prc?scnce can exert a con trol ling inOu
es lo perf orm well. The o
eva luat ion of wor k It encourages employe
Hai ma nn obs erv es, "Alt hou gh persona
l observa ti, >1 1 is ~me consumin~l
n is nn subi;hh.1te for it in the
and might lool< ine{{jcient on the surface , ther
con trol o f the activities of the sub ord inates."
2 . Set ting exa mp fes
ept. " Bei ng an
It is said thdt " an exa mple is alw ays better than prec put
leader, the mdnage r should
exa mpl e helps con trol results. ln his role as
inates. He must share the wor k
his idea l beh avio ur in dire ctin g his subord
with subordinates. A man age r can teach by
his actions and beh avio ur.
3 . Rec ord s and re por ts
con trol va!uc . They can
Records and reports have considerable
fon nance and results. But they
pro vide a goo d means for measuring the per
erous, bur den som e and time-
can also hin der the wor k if they are too num
consuming.
4. Pol ic ies and pro ced ure s
t <?xp eriences of ma ny
Policies and pro ced ures refle ct the pa.s
use in con trol ling the beh avio ur
man age rs. The y are guides for managers to
"Th ey are one kin d of fee d-
and o utp ut of workers. Glu e ck say s ,
pro vide a mea ns of self -co ntrol.
for wa rd con tro l dev ice . " Policies can
atio n and con trol . Glo ver wri tes ,
The y are a prim ary inst rum ent o f coordin
can on gov ern ing business
"A bus iness policy is an establis hed guia!ing
acti vitie s. "
5 . Ch arts and ma nua ls
und erstan din g abo ut the
O rga nisa tion al cha rts pro vide a clear
n and func tion s. Pro gress charts
rela tio nsh ip and the gro upi ng o f pos itio
;:,erform ance of its em plov ees
per mit eac.h dep artm ent to m eas ure the
cas t per form anc e and facilitate
aga inst pns t results. T hese hel p fore
le. Var iou s typ es of ma nua ls also
com parison with the com pan y as a who
.
ser ve the pu rpo se of ma nagement con trol
6 . Sta ndi ng rules and lina ita tio ns
:.'\nd pro , .ib1t
By esta blishing rules, the ma nagers can con trol
ng o rders tell en1ployecs wha t tu
undesirable activities and beh aviour. Sta ndi
 of ~
BB A . Fo un da tio n an ng e m en t / 273
co ndlU·o ns. U·kew,se . sta d.
d o un de r gi ve n set of """II
• n in g proc. edures S~ 0 ut the
{ en ts. In ca s~ w h
se qu en ce o evki er e su bo rdinates ar e g1v.-.n a m ple I d
· • on m a ng , .1t .IS de si ra bl e l 1
• d ecis1 n
nd w h~ h Ihorey
in
pr es s perm ·ISSo ~ ac e de fin ite limits be yo c
1
m ay no t go w ith ou t ex io n.
ns
7 . W ri tte n in st ru ct io
ro ug h circul 1 ers bulleti tes, etc. are also
W rit te n instructions th ar ett W. ns
_ , no
an ce
us ed to ch ec k th e su
bo rtl in at e's pe rfo rm ould be
m ay be no m isu nd •rstanttdi~n instructions sh
gi ven dearly so th at th er e
e n ng about their purp ose_
8 . C en su re
to control • but it may be very effecti· ve .m
It is negative ap pr oa ch
io ns . It ls an y fo nn of criticism or disa pprova1· It may be
certain si tu at With
· d ·d · l c1~r th e ca reIess employees. It should be us ed
re_i>n m an or n tru e ing, otherwise it can [Link] a dangerous [Link].
wtSdom an d under.;tand
9 . D is ci pl in ar y ac tJ on hen a n emp1oyee
su re is a sim pl e fo nn of disciplinary action · W
C en , may be
• ak
s~ .es. or ha s ~c om e a chronic absentee
r~peatedly m ~ es mi
ar y ac tio n ag ai ns t him. Jn serious matters
1sc1plm
given a w ar ni ng of d co nt ro l their irregular behaviour
'.
su sp e~ de d to te a
em pl oy ee s ca n be SC iplin ary ac tio n will occur may also crea
th at dt
So m et im es, th e th re at
controlling influence.
10 . C on tr ol un it control
it or 'c on tr ol se ct io n' is a recent device to
T he co nt ro l un tio n. It is sometimes called th
e
ce of th e or ga ni sa
th e overalJ pe rf or m an It su pp lie s th e facts to top man agemen t
de pa rt m en t.
m an ag em en t co nt ro l ie nt ad m in istratio n. It may recomm
end
ly an d ef fic
to m ak e po ssible o rder si ng op er at in g efficiency. It establishes
fo r in cr ea
m et ho ds an d w ay s s di re ct iv es, methods and policies
.
co ns ta nt ly re vi ew
st an da rd s of w o rk . It
vi ce s
11 . So ci aJ co nt ro l de bu siness organisations are in
et ho ds ex ist in g in
So m e so ci al co nt ro l m m ong social control device
s,
la tio ns or sa nc tio ns . A
th e fo rm of ru le s, re gu s, c us to m s, conventions , unwrit
ten
nd , ar e no rm
ac co rd in g to McFarla pr es tig e sy ste ms, etc. T h~ e are
es , st at us an d
Ja ws , ha bi ts , pr ac tic w hi ch ch eck the behavtour of
rm in ed va lu es
or ga ni sa tio na lly de te
em pl oy ee s.
tr I the behaviou r. These may
12 . Rewards o G lly these are in
po si tiv e way s to co n
R ew ar ds ar e th e " k s. enera , sharing or
" to em pl oy eebe
al th an yo u lo ee nefits . profit
be as si m pl e as a ve rbn, p ay syst em s, em p Y
th e fo rm o f pr om ot io
 otho, lncenllv ~i: Rownrd Is fh1l<ed w ith p nrformo nce and motivat ion . It is
olso 1v lot1-?d w ith pe ifo mionce ovoluotl o n one! w orl< sntlsfnc llon. It helps in
ochl~vi ng the work tn ilJ<ilh! In nccordl"ll 1cg-wllh thEi preset Ati,ndar d<;.
13 . Budgc> Ctt
provide an effective
l311dgP IS illl3 p lans In 11umerlc al fo rm . Th<ly can
means of controll ing operations. Actual performance ls measured and
cornpared against budgeted sta ndards. Budgets are sometimes binding llnd r
the manage r Is expected to bring performance in line with the budget when 1
deviatio ns occur. Budget stands as a limitatio n on the activities falling
within its scope.
14. Accou nting
Accounting is a significant device of control. It lays down for
recording the business transactions and also serves as a controlling measure
for day-tod ay business operations. The accoun ting system can help in
checkin g the past figures and deciding the best action to be foil owed in the
future.
15. Intern al auditin g
Internal auditing is a n examination of how well an organisation is
functioning. It involves a careful look at operations compa red with plans. It
is concer ned with finding out the effectiveness of manag ement' s policies .
Lampe rti and Thurst on write, "It issues no orders, originates no
transac tions, but is e verywhere as a searching, apprais ing, and open
evaluat ing function, with the object of helping those who do issue orders or
o riginate transac tions." Theo .Haima nn says, "It is a type of control
which functio ns by measuring and evaluating the effectiveness of other
types of control."
16. Statis tic al data
Statistical figures is a popula r method of manag ement control.
These are often used in control areas such as produc t.i on plannin g,
invento ry control , quality control, process contro l, etc.
17. Break -even analys is
Break -even analys is is a useful tec hniqu e of contro l. lt shows
the relatio nship of diffe:e nt volume s, costs, sales prices, and sales mix to
p rofits. The b reak e ve n point is that level of volume at which revenue
exactly equals total cost. It is a good d iagnost ic tool. It helps to identify the
minim um sales volume require d to preven t a loss or to achiev e established
profit objecti ves.
 J8 . Se lf-c on trol
se unlesc:; Its employees
exi sl
G lue ck wr ite s, "/\n en terpri
c,111110 1
urs thro11gh
m«n1 en o u gh self-control lo d
o wh at is cxpr>cted of the m. " ILocc
o serve to
proper ori e_nta tio n and tra ining . Emplo y<l••s' wo rl< altitudes als
reinforce the ir self-c ontrol.
ol .
II. Sp ec ial Te ch niq ue s of Co ntr the
l1n iqu es m ain ly inc lud e
So me sp ec ial co nt ro l tec
Jo llo wl ng -
1. Hu ma n as se t ac co un tin g
recog niz ed tha t an org an isa tio n's employees ofte n are its
It is we ir
ts associated with recruiting, selecting
most valuable assets. Today, the cos
tra ini ng em plo ye es are tre ate d as expense items rather than
an d 's human
ne nts . Re ns la Llk er t su gg es ts tha t an organisation
invesb e times pay-roll exp enditures.
usu all y ha ve a va lue of thr ee to fiv
resources s, this technique of hu ma n
ol the co st of hu ma n res ou rce
Thus, to co ntr in
lop ed . It seeks to mo re accurately reflect
r ass et
financ
acc
ial
ou
ter
nti
ms
ng
the
is
im
"' . St an da rd co sti ng
de
pa
ve
ct of ma na ge ria l decisio ns co nc erning employees.

ard co sti ng is a spe cia l tec hn ique of co st co ntrol. In this

Sta nd ts
ter ial s, lab ou r, overh ea ds a_n d other comp on en
I., system , sta nd ard s for ma
comp are d with the standard costs to
r of total cos t are
var ian
laid
ces
do
. Th
wn
is
. Ac
me
tua
tho
l
d
cos
foo
ts are
,se s att en tion on controllable costs.
determine
3. Ca sh flo w an aly sis
the me tho d of fin an cia l an d ca sh co ntrol. Altho ugh a firm
Th is is
ten tial for ea rni ng pro fits , wi tho ut ca sh il ca nn ot op erate
ma y ha ve gre at po
sh flo w a na lys is is an ass ess me nt of the ca sh so urc es available
ve ry Jon g. Ca
ing.
to a firm , the ir uses, an d the ir tim
4. M an ag em en t informa tio n sy
ste m ·
de vic e of co ntr o llin g the va rio us asp ec ts of the ma na ge me nt
ft is a ou t
ss. It is de ve lop ed to co lle ct, pro ces s, an d distribute inform ati on ab
pro ce
firm to its ma na ge rs an d oth ers . It enabl es ma na gers
the op era tio ns o f the
im pro ve the ir job pe rfo rm an ce . ·
to ma ke be tte r de cis ion s an d to
5. Cy be rn et ic co nt ro l sy ste m .
re lat ive ly a ne w tec hn iq ue of co nt ro l. It is ba sed on
Th is is de viatio ns
t a uto matically de tec t an d correct
self-r eg ula tin g pro ce du res tha
tiv en es s levels.
from pl an ne d a ctivities an d eff ec
dit ion to the ab ov e typ es o f co ntr ol me tho ds , ce rtain ad va nced
In ad
es are als o us ed in mo de m bu siness or ganisations. Th e~ e
contr ol tec hn iqu
include th e fo llo wi ng -
 I I 'l~i..lll .. <.'onlrol s v~t,•111<;
,, /\b n,'l•1"•n,·11I /\udll .
., 1 - •~vnhintlo n nnd Hovlcw Tec hniques (PEHl)
, , 1 I\ ltll ,111 ll 111' ,-
If C1i tk11l I '.Ith M Pllll 1 0 (C PM )
! , Op,,..-,lllll 1' H es<'Ol't' h
<• I inco1 I l<i ._,gron,ml n g
7 Simulnlio n
S . Queueing Theory
9. G arnes Theory
10. Programme Budgeting
Principl es of Control
Q.11. Write in brief the Principl es of Con_trol. . .
Ans. Harold Koontz has described the following pnnc,ples of control-
1. Principle of assuran ce of objectiv e - The purpose of control
is to detect potential or actual deviation from plan~ early enough fo permit \ C
effective corrective action. This principle requires that controls mUst
contribute to the achievem ent of mis purpose.
2. Principl e of efficien cy of control s - The techniques of
control should not become costly, complex and burdensome. Control \
techniques are efficient when they detect the causes of deviations from
plans with a minimum of costs and undesire d consequ ences.
3. Princip le of control respons [Link] - This principle requires
that the primary responsibility for the exercise of control rests in the
manager charged with the execution of plans .
4. Princip le of future control - This principle says that control
like planning must be forward-looking. Control must be directed towards
the future if it is to be effective.
5. Princip le of direct control- Indirect controls aim at catching
errors, often after the fact. This principle states that whereve r possible,
direct controls should be used which a im at preventi ng errors, rather than
finding errors.
6. Princip le of reflect, on of plans- If controls are designed to
reflect the specific nature and structure of plans, they will serve the interests
of the organisation and its managers.
7. Princip le of organis ational suitabi lity- According to this
principle , controls must fit_a manager's authorit y area and must be tai\c:,red
to the organisation structure . .
8 . Princip le of individ uality of contro ls - Controls must be
consiste nt with the needs of the individu al concern ed.
9. Principle of standa rds - Effective control requires objective,
accurate, and [Link] standar ds.
 ( Cri tl I E tive control
JO . P ri n c ip le o c a 1· llbo ln t. co n tro - Hec
th I m o re atte nt io n m ust os e fa ct or s cnucal
to
•11itcS a .e gi ve n to th
ance ag ai n st p la ns
>:;f3Jsing p e rfo rr n ip le _ Th ·
. . mo re a
J1 . Ex c e p ti o n p ri n c
l ff is p n n c1 ple h old s th at the
1o ag cr co nc e n tr at es his co nt ro ex ce pt io ns , th e more effi cient
.,: orts o n
be th e re su lt s o f his co n tr ol • Thee manc1g s ho uId co nc er n himself only
,11 er
1•
ific an t d ev ia ti o n s.
,,ii th sign
2 . P ri n c ip le o f flexibility o tr o ls - Accordi
ng to th is
1 f c o n
ple , co n tr o ls m u st b e flexibl to m ee t the un fo re se en changes
princi e en o u g h
of pl an s.
f a c ti C he n deviations
1 3 . P ri nc ip le o u ho n - ~ nt ro l is justified only w s.
thro d action
are corrected in time 9 ap p ro p n at e pl an ni ng an
f A G o o d C o n tr o l S y st e m O R
o
C h a ra c te ri ~ ti c s ff e c ti v e C o n tr o ls
e m e n ts F or E
Requu
t o f a g o o d C o n tr o l syst e m?
re q u ire m e n
Q.1 2. What a re th e OR
o f a n E ff ec ti v e C on tr o l sy st e m?
e n ti a ls
W h a t a re th e e ss OR
p la n s a n d p o si ti o n s in th e
ld b e ta il o re d to e rs o n a li tie s a n d
to
' ' C o n tr o l sh o u In d iv id u al p
ru c tu re, to
o rg a n is a ti o n st ff e c ti v e n e ss." D isc u ss
.
e e d s fo r e
sp e c if ie d n OR
e to e n su re a n ef fe ct iv e c o n tro l
n s c a n y o u g iv
W h a t su g g e st io n?
anisatio
sy st e m in an org OR
ir em -e n t o f ef fe c ti v e managem en t
qu
th e nature and re
V D is c u ss
c o n tr o l sy st e m . ad eq u at e an d effective control
A ll su cc es sf u l m a n a gers employ nform to plans.
'\ n s . ities a n d resu lts co
that activ haracteristic s -
t ,ystems to m akee csuore ntrol sy st e m s h a
ve th e fo ll o w in g c
f' E ff e c ti v
gned
1 . S p e c ia ll y d e si ec ia ll y d es ig n ed for the specific task
ues must b e sp should reflec t the
All c o n tro l techniq . C o n tr o l sy st em s
e rs o n s th e y a re in te n d ed to serve to fo llo w. Controls must
and p a re d es ig n ed
n s a n d o rg an is at io n structure th e y th ei r p ersonalities, a n d to
p la n a g e rs a n d
o b e ta il o re d to th e individ u a l m a
a ls s.
e e d s fo r ef fi ci en cy a n d effectivenes
th e n
le e n o meaning .
2. Understandab b y em p lo y ee s h av
o n tr o ls th a t c a n n ot be u n d e rs to o d n d an d m a y ca u se
C u n d e rs ta
s a re difficult to
Com plica ted c o n trol sy st em
 unnecessary mistakes, frustrate employees and are ignored. Hence, control
tools should be common and more widely used.
3. Economical
A control system must be economically justified. Costs of control
should result in a. net increase in benefits. The ratio of cost to benefits must
be low for the control system to be justified. Many hidden costs of control
such as work time and di;traction of effort must be considered in advance.
To minimize costs, only necessary controls, which are essential to produce
results, must be imposed. It must be cost-effective.
4. Related to decision centres
Controls should be related to "decision centres" that are accountable
for performance. Hicks and Gullett suggest, "Whatever and wherever
the decision centre, a manager must have appropriate control infonnation
so that corrective action can be taken when necessary."
5. Pointing to deviations and corrective action
Controls should discover variations from desired performance nonns
as quickly as possible. They should report results as rapidly as is practical.
Effective controls also suggest what action should be taken to correct the
deviation. They should specify "if-then guidelines" or may suggest several
possible areas for corrective action. It is then manager's duty to decide the
'action' that will solve the problem.
6 . Selective or Strategic controls
Managers cannot control everything that goes on in a firm. On the
other hand, in every organisation there are certain key measures, activities
or points that are linked to success. Hence, controls should cover the
critical activities within the organisation. Unimportant checks should not be
established. Employees should not be closely and unnecessarily watched by
supervisors. Managers should pay adequate attention only to key and
strategic control points.
7. Flexible
Control systems should be flexible enough to adapt to changing
conditions. Without a sufficient degree of 0exibilit-y, controls will not be able
to meet the requirements of new situations. Theo Haimann says, "A good
control system must keep pace with the continuously changing pattern of a
dynamic business world." Mescon suggests, "Controls, like plans, have to
be flexible enough to absorb change."
8 . Accurnte
Accuracy in control system is vital as it p rovides the basis for future
actions. Good decisions made on faulty data solve nothing. Hence,
 an d must be ba sed on correct ana
lysis. n
. f m,ation must be accurate .~
:ct ive controi system is always reliab le and produces valid da ta.
;ff
9. Ti me ly e to allow the manager to take
Co ntrols must report deviations in tim
e act ion . This me an s tha t pe rfo rmance information mu st. be
correctiv best information h~ ~,ttle
sed , an d eva lua ted quickl y. Th e
collected, proces to
ue if it is ou tda ted . Tim elin ess in control is no t high spe ed , bu t it tstrol
val
· · · th ey beco me sen·ous· He nc e , a good con
correct def1c1enc1es bef ore
t get s rel eva nt inf orm ati on at the pro pe r times before a
system is on e tha
crisis occurs.
10 . Ju sti fie d an d ac ce pt ab le
ols mu st be ac ce pt ab le to op er ati ng pe rso nn el. People
Co ntr be
ent exc ess ive con tro ls. If con tro ls are to be accepted, they must
res
rel ate d to me ani ng ful go als an d employees sho uld feel tha t the y
justified,
rta nt sta ke in it. Da vid Ho lt sa ys , "In control, sta nd ard s
have an impo ld
st be att ain ab le, an d the me tho ds use d to evaluate performance sh ou
mu
foster harmony, no t cynicism."
11 . Si mp le an d re ali sti c
e mo st effect ive con tro ls are the simplest on e that will serve the
Th
ich the y are est abl ish ed. Co mp lex controls lead to confusion.
purpose for wh at
ly, co ntr ol sys tem s sho uld inc orp orate realistic expectations ab ou t wh
Similar
she d. Th ey sho uld be com pat ible with organisational realities.
can be accompli
12 . Im pa rti al an d co or din ate d
sh ou ld be im par tia l. Pa rtia lity in control sys tem ma y
Controls
ini tia tiv e, hu rt mo ral e, an d create dissatisfaction am on g the
throttle an d
plo ye es. Als o, co ntr ols mu st be integrated with on e an oth er
em
th pla ns so tha t co rre cti ve act ion s be co me me aningful.
co ord ina ted wi
13 . Fo cu s on re su lts ,
e fin al ob jec t of the co ntr ol pro ces s is no t to collect inf orm ati on
Th ain
rm an ce no rm s, or ide nti fy pro ble ms . It is to cre ate results or att
set pe rfo
He nc e, co ntr ols mu st foc us on 'real ob jec tiv e.' Th ey mu st be
ob jec tiv es.
to be effective.
int eg rat ed with ma nage me nt goals
14 . Jo in t en de av ou r
ou ld no t be im po sed on the su bo rdi na tes . All co nc ern ed
Co ntr ols sh
a pa rti cip ati on in the est ab lis hm en t of co ntr ol sys tem . It
sh ou ld be giv en
nt en de av ou r. Ul ric h an d Bo oz ha ve sa id , "T he
sh ou ld be a joi by the
tiv en ess of a co ntr ol sy ste m is in a lar ge me as ur e de ter mi ne d
eff ec an c
to wh ich it ha s be en inc orp ora ted int o da ily rou tin es
ex ten t
ec ted by it."
ex pe cta tio ns of the pe rso nn el aff