CHAPTER SEVEN
CONTROLLING FUNCTION
7.1. Introduction
Organizational resources are limited. Their acquisition & use are critical to the survival of the
organization. Controlling is the last management function and it affects or is affected by the other four
functions. Planning, organizing, staffing & directing must be monitored to maintain their effectiveness
& efficiency. Efficiency and effectiveness are the measures of performance. Mangers review
performances of employees daily, weekly, and monthly to determine actual performances.
7.2. Definition of Controlling
Controlling is an important concept and process in management. In the past managers believed that the
necessity of control arose only when something went wrong. Then, the object of control was to find out
the person responsible for these events and take actions against him. This is only negative view of
control. In modern management, the primary object of control is to bring to light the mistakes or
variations as soon as they appear between performance and standard laid down and then to take steps to
prevent such variations in future. The control is aimed at results and not people as such. Its purpose is
to assure that intended results occur and not those particular workers are reprimanded. Only a
continuous control (and not occasional and emergency control) can achieve the objective.
According to Brech, “Controlling is checking current performance against predetermined standards
contained in the plans, with the view to ensuring adequate progress and satisfactory performance”. In
the words of George R. Terry, “Controlling is determining what is being accomplished, that is,
evaluating the performance and if necessary, applying corrective measures so that the performance
takes place according to plans”. To draw an analogy, it is like a thermostat in an air conditioning
system which ensures that predetermined temperature is maintained.
The concept of controlling is often confused with lack of freedom. The opposite of control is not
freedom but chaos or anarchy. Control is fully consistent with freedom. In fact, they are interdependent.
Without control freedom cannot be sustained for long. Without freedom control becomes ineffective.
Both autonomy (freedom) and accountability are embedded in the concept of control.
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7.3. The Purpose of Controlling
The purpose of controlling is to determine whether people & the various parts of an organization are on
target, achieving the progress towards their objectives that they planned to achieve.
Management control is a systematic effort
o to design information feedback systems,
o to set performance standards with planning objectives
o to compare actual performances with those predetermined standards,
o to determine whether there are any deviations & to measure their significance, &
o to take any action required to assure that all organizational resources are being used in the most
effective & efficient way in achieving organizational objectives.
7.4. Control Characteristics
Control characteristics help managers in designing a control system. The most important characteristics
of control are
Easy to understand
Acceptance by members of the organization
Control is an end function (management function): Without proper and effective control,
management process is incomplete and wasteful. Therefore, it is essential for every organization
that wishes to survive and grow. It is essentially a checkup measure.
Control is a continuous process: Control is a dynamic activity and is never ending process. As
long as organization exists, control continues to exist.
Control is mainly a forward-looking: Control aims at the future. Past experience, however, is the
criteria for future standards. Control is not only checking the current performance but also
providing guidelines for future demands.
Control is a universal function: Control is essential at all levels of organization. As planning is
done at all level, control is also undertaken simultaneously.
Control is a normative and positive force: Control is a normal means to achieve desired results. It
is used in organizations in a most effective way.
Control guides behavior: Control system helps guiding and integrating employer’s behavior
toward broader organizational goals. In the absence of provision of control, least will be
accomplished.
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Control allows all organization to cope with uncertainty: Effective control system anticipates any
shift in task and preferences of clients and directs the organization to modify it production or
service to meet their requirements.
7.5. Types of Controls
Based on the nature of work & work flow, various types of control have been developed. There are
three basic types of control.
A. Feed-forward Controls
Proactively can be defined; as the monitoring of problems in a way that provides their timely
prevention, rather than after the fact reaction. In management, this is known as feed-forward control; it
addresses what we can do ahead of time to help our plan succeed. The essence of feed-forward control
is to see the problems coming in time to do something about them. For instance, feed-forward controls
include preventive maintenance on machinery and equipment and due diligence on investments.
1. Feed-forward controls are future directed: they are designed to detect and anticipate deviations
from standards at various points.
2. Such preventative controls focus on establishing conditions that will make it difficult or
impossible for deviations from norms to occur. Examples include locks, bars on windows,
safety equipment, safety procedures, job descriptions, job specifications, inductions, and
orientation.
B. Concurrent Controls
The process of monitoring and adjusting ongoing activities and processes is known as concurrent
control. Such controls are not necessarily proactive, but they can prevent problems from becoming
worse. For this reason, we often describe concurrent control as real-time control because it deals with
the present. An example of concurrent control might be adjusting the water temperature of the water
while taking a shower.
1. Sometimes known as “in-process” or “steering” controls, these controls apply to processes as
they happen.
2. Readouts and audible warnings mark this type of control.
C. Feedback Controls
Finally, feedback controls involve gathering information about a completed activity, evaluating that
information, and taking steps to improve the similar activities in the future. This is the least proactive of
controls and is generally a basis for reactions. Feedback controls permit managers to use information on
past performance to bring future performance in line with planned objectives.
1. These post-performance controls focus upon the end results of the process.
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2. The information obtained is used for corrective purposes.
3. Adjustments and/or corrections follow the feedback input
7.6. Processes of control
Feedback provides information on the progress of the various levels of plan or individual performance
to management, i.e., it reports the progress as planned & it indicated the changes required in the plan.
The initial view of control process reveals that it consists of three basic steps applicable to any person,
items or processes being controlled. They are
1. Establishment of standards- Standards are the plans or the targets which have to be achieved in
the course of business function. They can also be called as the criterions for judging the
performance. Standards generally are classified into two-
Measurable or tangible - Those standards which can be measured and expressed are called
as measurable standards. They can be in form of cost, output, expenditure, time, profit, etc.
Non-measurable or intangible- There are standards which cannot be measured monetarily.
For example- performance of a manager, deviation of workers, their attitudes towards a
concern. These are called as intangible standards.
2. Measurement of performance: The second major step in controlling is to measure the
performance. Finding out deviations becomes easy through measuring the actual performance.
Performance levels are sometimes easy to measure and sometimes difficult. Measurement of
tangible standards is easy as it can be expressed in units, cost, money terms, etc. Quantitative
measurement becomes difficult when performance of manager has to be measured. Performance of
a manager cannot be measured in quantities. It can be measured only by-
- Attitude of the workers,
- Their morale to work,
- The development in the attitudes regarding the physical environment, and
- Their communication with the superiors.
3. Comparison of actual and standard performance- Comparison of actual performance with the
planned targets is very important. Deviation can be defined as the gap between actual performance
and the planned targets. The manager has to find out two things here- extent of deviation and cause
of deviation. Extent of deviation means that the manager has to find out whether the deviation is
positive or negative or whether the actual performance is in conformity with the planned
performance. The managers have to exercise control by exception. He has to find out those
deviations which are critical and important for business. Minor deviations have to be ignored.
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Major deviations like replacement of machinery, appointment of workers, quality of raw material,
rate of profits, etc. should be looked upon consciously. Therefore, it is said, “If a manager controls
everything, he ends up controlling nothing.” For example, if stationery charges increase by a minor
5 to 10%, it can be called as a minor deviation. On the other hand, if monthly production decreases
continuously, it is called as major deviation. Once the deviation is identified, a manager has to think
about various cause which has led to deviation. The causes can be-
a. Erroneous planning,
b. Co-ordination loosens,
c. Implementation of plans is defective, and
d. Supervision and communication are ineffective, etc.
2. Taking remedial actions- Once the causes and extent of deviations are known, the manager
has to detect those errors and take remedial measures for it. There are two alternatives here-
a. Taking corrective measures for deviations which have occurred; and
b. After taking the corrective measures, if the actual performance is not in conformity with
plans, the manager can revise the targets. It is here the controlling process comes to an
end. Follow up is an important step because it is only through taking corrective
measures, a manager can exercise controlling.