MODULE 5

COORDINATION AND CONTROL

COORDINATION
CONCEPT

• IT REFERS TO THE DELIBERATE EFFORT MADE BY A MANAGER TO ENSURE THAT

DIFFERENT INDIVIDUALS, TEAMS, AND DEPARTMENTS WORK IN HARMONY
TOWARD A COMMON ORGANIZATIONAL OBJECTIVE. SINCE MODERN
ORGANIZATIONS HAVE INCREASINGLY SPECIALIZED FUNCTIONS.

• COORDINATION ACTS AS THE “BINDING FORCE” THAT UNIFIES ALL ACTIVITIES.

• IT INVOLVES ALIGNING ALL EFFORTS, REMOVING CONFLICTS, INTEGRATING

DIVERSE RESOURCES, AND CREATING SMOOTH WORKFLOW.

• SIMPLY PUT, COORDINATION ENSURES THAT EVERYONE WORKS TOGETHER

EFFICIENTLY AND EFFECTIVELY WITHOUT CONFUSION OR CONFLICT.
NEED FOR COORDINATION

1. UNITY OF DIRECTION
2. SMOOTH WORKFLOW
3. INTEGRATION OF DEPARTMENTS
4. MANAGING INTERDEPENDENCE
5. HANDLING INCREASING COMPLEXITY
6. CONFLICT REDUCTION
ORGANIZATIONS HAVE MANY DEPARTMENTS AND PEOPLE WORKING ON DIFFERENT TASKS. WITHOUT COORDINATION, THESE ACTIVITIES MAY CLASH, GET
DUPLICATED, OR MOVE IN DIFFERENT DIRECTIONS. COORDINATION KEEPS EVERYTHING ALIGNED AND ENSURES THAT WORK HAPPENS SMOOTHLY AND EFFICIENTLY.

1. UNITY OF DIRECTION
COORDINATION MAKES SURE THAT EVERYONE IN THE ORGANIZATION WORKS TOWARD THE SAME GOAL. EACH DEPARTMENT MAY HAVE DIFFERENT RESPONSIBILITIES,
BUT THEIR EFFORTS SHOULD SUPPORT THE OVERALL PURPOSE OF THE ORGANIZATION. IT KEEPS PEOPLE FOCUSED ON THE SAME DIRECTION AND AVOIDS
CONFLICTING PRIORITIES.

EXAMPLE:
IF AN ORGANIZATION AIMS TO INCREASE SALES BY 20%, THE PRODUCTION TEAM MUST PRODUCE ENOUGH STOCK, THE MARKETING TEAM MUST PROMOTE THE
PRODUCT, AND THE SALES TEAM MUST REACH CUSTOMERS. COORDINATION ENSURES ALL THESE EFFORTS SUPPORT THE SAME TARGET.

2. SMOOTH WORKFLOW
COORDINATION HELPS WORK MOVE FROM ONE STAGE TO ANOTHER WITHOUT DELAYS OR CONFUSION. WHEN DEPARTMENTS PLAN TOGETHER AND SHARE
INFORMATION, TASKS DO NOT OVERLAP, AND RESOURCES ARE USED PROPERLY. IT REDUCES REPETITION OF WORK AND PREVENTS AVOIDABLE DELAYS.

EXAMPLE:
IF THE DESIGN TEAM FINISHES A PRODUCT
DESIGN AND IMMEDIATELY INFORMS PRODUCTION, THE MANUFACTURING PROCESS CAN START ON TIME. THIS AVOIDS
WAITING AND KEEPS THE WORKFLOW SMOOTH.

3. INTEGRATION OF DEPARTMENTS
ORGANIZATIONS HAVE SEPARATE DEPARTMENTS LIKE FINANCE, MARKETING, HR, PRODUCTION, AND OPERATIONS. COORDINATION BRINGS THESE DEPARTMENTS
TOGETHER SO THEY FUNCTION AS PARTS OF ONE SYSTEM RATHER THAN WORKING IN ISOLATION. IT ENSURES THAT EACH DEPARTMENT SUPPORTS THE OTHERS.

EXAMPLE:
BEFORE LAUNCHING A NEW PRODUCT, MARKETING PREPARES CAMPAIGNS, FINANCE ALLOCATES MONEY, AND PRODUCTION MAKES THE PRODUCT. ALL
DEPARTMENTS MUST COOPERATE SO THE LAUNCH HAPPENS SUCCESSFULLY.
4. MANAGING INTERDEPENDENCE
MANY ACTIVITIES DEPEND ON OTHER ACTIVITIES BEING COMPLETED FIRST. COORDINATION ENSURES THAT DEPENDENT TASKS HAPPEN IN
THE CORRECT ORDER AND AT THE RIGHT TIME. WHEN DEPARTMENTS RELY ON EACH OTHER, COORDINATION HELPS AVOID CONFUSION
OR DELAYS.
EXAMPLE:
THE SALES DEPARTMENT CANNOT PROMISE DELIVERY DATES UNLESS THE PRODUCTION DEPARTMENT INFORMS THEM WHEN THE
PRODUCTS WILL BE READY. COORDINATION ENSURES BOTH TEAMS STAY UPDATED AND WORK TOGETHER SMOOTHLY.
5. HANDLING INCREASING COMPLEXITY
AS AN ORGANIZATION GROWS, ITS ACTIVITIES BECOME MORE SPECIALIZED. EMPLOYEES FOCUS ON SPECIFIC TASKS, WHICH CAN MAKE
THE WORK MORE FRAGMENTED. COORDINATION BRINGS THESE SPECIALIZED TASKS TOGETHER SO THE ORGANIZATION CONTINUES TO
WORK AS A UNIFIED WHOLE.
EXAMPLE:
A BIG COMPANY MAY HAVE TEAMS FOR ONLINE MARKETING, OFFLINE MARKETING, CUSTOMER SERVICE, AND LOGISTICS.
COORDINATION HELPS THESE TEAMS SHARE INFORMATION AND SUPPORT EACH OTHER.
6. CONFLICT REDUCTION
WHEN DEPARTMENTS OR EMPLOYEES ARE NOT ALIGNED, MISUNDERSTANDINGS AND DISAGREEMENTS CAN OCCUR. COORDINATION
REDUCES THESE CONFLICTS BY ENCOURAGING CLEAR COMMUNICATION, SHARED GOALS, AND TEAMWORK. IT HELPS EVERYONE
UNDERSTAND THEIR ROLE IN RELATION TO OTHERS.
EXAMPLE:
IF THE MARKETING TEAM SHARES ITS CAMPAIGN PLAN WITH THE PRODUCTION TEAM, PRODUCTION KNOWS HOW MUCH TO MAKE. THIS
PREVENTS ARGUMENTS ABOUT DELAYS, SHORTAGES, OR UNREALISTIC DEMANDS.
TYPES OF COORDINATION

Internal Coordination

External Coordination

Vertical Coordination

Horizontal Coordination
COORDINATION IN AN ORGANIZATION CAN HAPPEN IN DIFFERENT WAYS DEPENDING ON WHO IS INVOLVED AND HOW
ACTIVITIES ARE CONNECTED. THE MAIN TYPES OF COORDINATION ARE INTERNAL, EXTERNAL, VERTICAL, AND
HORIZONTAL.

A. INTERNAL COORDINATION
INTERNAL COORDINATION TAKES PLACE WITHIN THE ORGANIZATION. IT ENSURES THAT ALL DEPARTMENTS AND TEAMS
INSIDE THE COMPANY WORK TOGETHER SMOOTHLY. SINCE EVERY DEPARTMENT DEPENDS ON OTHERS, INTERNAL
COORDINATION HELPS AVOID CONFUSION AND ENSURES THAT ALL INTERNAL ACTIVITIES SUPPORT EACH OTHER.

EXAMPLE:
THE HR DEPARTMENT WORKS WITH THE PRODUCTION DEPARTMENT TO PLAN HOW MANY WORKERS ARE NEEDED DURING
PEAK SEASON. BOTH DEPARTMENTS COORDINATE TO MAKE SURE MANPOWER IS AVAILABLE.

B. EXTERNAL COORDINATION
EXTERNAL COORDINATION INVOLVES COOPERATION WITH OUTSIDE PARTIES THAT THE ORGANIZATION INTERACTS WITH.
THESE INCLUDE SUPPLIERS, CUSTOMERS, GOVERNMENT AGENCIES, TRANSPORT COMPANIES, CONSULTANTS, AND EVEN
COMPETITORS. EXTERNAL COORDINATION HELPS THE ORGANIZATION WORK EFFICIENTLY WITH ITS ENVIRONMENT.

EXAMPLE:
A LOGISTICS COMPANY MUST COORDINATE WITH TRANSPORT AGENCIES TO ENSURE TIMELY DELIVERIES TO CUSTOMERS.
C. VERTICAL COORDINATION
VERTICAL COORDINATION HAPPENS BETWEEN DIFFERENT LEVELS OF MANAGEMENT—TOP, MIDDLE, AND LOWER
LEVELS. IT ENSURES THAT INSTRUCTIONS FLOW CLEARLY FROM HIGHER LEVELS TO LOWER LEVELS, AND FEEDBACK
FLOWS UPWARD. THIS TYPE OF COORDINATION HELPS MAINTAIN ORDER AND CLARITY IN THE CHAIN OF
COMMAND.

EXAMPLE:
TOP MANAGEMENT SETS THE ANNUAL TARGETS, MIDDLE MANAGERS BREAK THEM INTO DEPARTMENTAL PLANS,
AND SUPERVISORS GUIDE WORKERS TO ACHIEVE THEM. COORDINATION KEEPS ALL LEVELS CONNECTED.

D. HORIZONTAL COORDINATION
HORIZONTAL COORDINATION TAKES PLACE BETWEEN DEPARTMENTS OR EMPLOYEES AT THE SAME LEVEL IN THE
ORGANIZATION. IT ENCOURAGES TEAMWORK, COOPERATION, AND INFORMATION-SHARING AMONG UNITS
WORKING ON RELATED TASKS.

EXAMPLE:
THE SALES TEAM AND THE MARKETING TEAM PLAN A PROMOTIONAL CAMPAIGN TOGETHER. BOTH WORK AT THE
SAME LEVEL AND COORDINATE TO ENSURE THE CAMPAIGN IS EFFECTIVE.
ESSENTIALS OF EFFECTIVE COORDINATION

Clear Goals

Effective Communication

Proper Leadership

Sound Organizational Structure

Team Spirit

Regular Feedback & Meetings

Integration of Efforts
FOR COORDINATION TO WORK WELL IN AN ORGANIZATION, CERTAIN CONDITIONS MUST BE PRESENT. THESE
ESSENTIALS HELP CREATE SMOOTH, ORGANIZED, AND COOPERATIVE WORKING RELATIONSHIPS AMONG
INDIVIDUALS AND DEPARTMENTS.

1. CLEAR GOALS
EVERYONE IN THE ORGANIZATION MUST KNOW WHAT THEY ARE EXPECTED TO ACHIEVE. WHEN GOALS ARE CLEAR,
EMPLOYEES UNDERSTAND HOW THEIR WORK CONTRIBUTES TO THE OVERALL PURPOSE. THIS REDUCES CONFUSION
AND KEEPS EVERYONE MOVING IN THE SAME DIRECTION.

EXAMPLE:
IF THE COMPANY’S GOAL IS TO LAUNCH A PRODUCT BY 1ST AUGUST, EVERY DEPARTMENT—PRODUCTION,
MARKETING, LOGISTICS, AND FINANCE—WORKS TOWARD THIS SAME DEADLINE.

2. EFFECTIVE COMMUNICATION
COORDINATION IS SUCCESSFUL WHEN INFORMATION FLOWS FREELY AND ACCURATELY. EMPLOYEES MUST SHARE
UPDATES, REPORTS, AND FEEDBACK REGULARLY TO AVOID MISUNDERSTANDINGS. GOOD COMMUNICATION
ENSURES THAT EVERYONE STAYS INFORMED AND ALIGNED.

EXAMPLE:
A DAILY MORNING MEETINGHELPS THE TEAM UPDATE EACH OTHER ABOUT PROGRESS AND CHALLENGES,
ENSURING EVERYONE KNOWS WHAT NEEDS TO BE DONE.
3. PROPER LEADERSHIP
A GOOD LEADER BRINGS PEOPLE TOGETHER, GUIDES THEM, AND MOTIVATES THEM. STRONG LEADERSHIP CREATES UNITY AND HELPS
RESOLVE CONFLICTS. LEADERS PLAY A MAJOR ROLE IN ENCOURAGING COOPERATION AMONG TEAM MEMBERS.

EXAMPLE:
DURING A BUSY SEASON, A TEAM LEADER ORGANIZES TASKS, CLARIFIES RESPONSIBILITIES, AND MOTIVATES THE TEAM TO WORK
TOGETHER TO MEET DEADLINES.

4. SOUND ORGANIZATIONAL STRUCTURE

A CLEAR STRUCTURE WITH DEFINED ROLES, RESPONSIBILITIES, AND REPORTING RELATIONSHIPS HELPS AVOID CONFUSION. WHEN
EVERYONE KNOWS WHO THEY REPORT TO AND WHAT THEY ARE RESPONSIBLE FOR, COORDINATION BECOMES EASIER.

EXAMPLE:
IF THE MARKETING MANAGER CLEARLY KNOWS THEY MUST COORDINATE WITH THE PRODUCTION MANAGER BEFORE LAUNCHING A
CAMPAIGN, WORK BECOMES ORGANIZED AND SMOOTH.

5. TEAM SPIRIT
COORDINATION IMPROVES WHEN EMPLOYEES TRUST EACH OTHER AND WORK AS A TEAM. TEAM SPIRIT REDUCES COMPETITION AND
INCREASES COOPERATION, HELPING EVERYONE WORK TOWARD COMMON GOALS.

EXAMPLE:
EMPLOYEES VOLUNTEERING TO HELP A COLLEAGUE COMPLETE A TASK BEFORE A DEADLINE SHOWS STRONG TEAM SPIRIT AND
IMPROVES COORDINATION.
6. REGULAR FEEDBACK & MEETINGS
REGULAR REVIEWS AND MEETINGS HELP IDENTIFY PROBLEMS EARLY, SHARE UPDATES, AND MAKE NECESSARY
ADJUSTMENTS. THIS KEEPS WORK ON TRACK AND ENSURES THAT EVERYONE REMAINS ALIGNED.

EXAMPLE:
WEEKLY PROGRESS MEETINGS ALLOW MANAGERS TO REVIEW ACHIEVEMENTS, DISCUSS ISSUES, AND PLAN THE
NEXT STEPS TOGETHER.

7. INTEGRATION OF EFFORTS
COORDINATION REQUIRES ALL DEPARTMENTS AND INDIVIDUALS TO COMBINE THEIR EFFORTS. WHEN EVERYONE’S
WORK IS SYNCHRONIZED, THE ORGANIZATION FUNCTIONS SMOOTHLY AND ACHIEVES ITS GOALS EFFICIENTLY.

EXAMPLE:
FOR AN EVENT IN A COMPANY, THE HR TEAM MANAGES VOLUNTEERS, THE FINANCE TEAM HANDLES THE BUDGET,
AND THE OPERATIONS TEAM HANDLES LOGISTICS. THEIR COMBINED EFFORTS MAKE THE EVENT SUCCESSFUL.
DIFFICULTIES IN COORDINATION

Diverse Goals

Specialization

Size of the Organization

Geographical Distance

Human Differences

Poor Communication

Resistance to Change
EVEN THOUGH COORDINATION IS ESSENTIAL, MANAGERS OFTEN FACE CHALLENGES WHILE TRYING TO BRING PEOPLE AND
DEPARTMENTS TOGETHER. THESE DIFFICULTIES ARISE BECAUSE ORGANIZATIONS ARE MADE UP OF DIFFERENT INDIVIDUALS, DIFFERENT
GOALS, AND DIFFERENT WORKING STYLES.
1. DIVERSE GOALS
EACH DEPARTMENT HAS ITS OWN GOALS AND PRIORITIES. SOMETIMES THESE GOALS DO NOT MATCH PERFECTLY WITH THE GOALS OF
OTHER DEPARTMENTS OR THE ORGANIZATION AS A WHOLE. THIS CREATES CONFUSION AND MAKES COORDINATION DIFFICULT.
EXAMPLE:
THE PRODUCTION DEPARTMENT MAY WANT TO MAKE PRODUCTS IN LARGE QUANTITIES FOR EFFICIENCY, WHILE THE MARKETING
DEPARTMENT MAY WANT SMALL BATCHES TO TEST CUSTOMER RESPONSE. THESE DIFFERENT GOALS CAN CREATE CONFLICT.
2. SPECIALIZATION
AS ORGANIZATIONS GROW, TASKS BECOME MORE SPECIALIZED. EMPLOYEES FOCUS ON THEIR SPECIFIC AREA AND MAY NOT FULLY
UNDERSTAND HOW THEIR WORK AFFECTS OTHER DEPARTMENTS. THIS CREATES A “SILO MENTALITY,” MAKING COOPERATION HARDER.
EXAMPLE:
A DESIGNER MAY FOCUS ONLY ON CREATING ATTRACTIVE DESIGNS, BUT MAY FORGET TO CHECK WHETHER THE PRODUCTION TEAM
CAN MANUFACTURE THE DESIGN EASILY.
3. SIZE OF THE ORGANIZATION
LARGE ORGANIZATIONS HAVE MANY EMPLOYEES, MANY LEVELS OF MANAGEMENT, AND SEVERAL DEPARTMENTS. THE BIGGER THE
ORGANIZATION, THE HARDER IT BECOMES TO KEEP EVERYONE COORDINATED AND INFORMED.
EXAMPLE:
A MULTINATIONAL COMPANY WITH OFFICES IN 10 COUNTRIES MAY STRUGGLE TO MAKE SURE ALL BRANCHES FOLLOW THE SAME
GUIDELINES AND DEADLINES.
4. GEOGRAPHICAL DISTANCE
WHEN OFFICES OR TEAMS ARE LOCATED IN DIFFERENT CITIES OR COUNTRIES, COMMUNICATION BECOMES CHALLENGING. TIME DIFFERENCES, CULTURAL
DIFFERENCES, AND PHYSICAL DISTANCE ALL MAKE COORDINATION MORE DIFFICULT.

EXAMPLE:
AN INDIAN TEAM WORKING WITH A TEAM IN THE USA MAY FACE DELAYS BECAUSE THEIR WORKING HOURS DO NOT MATCH.

5. HUMAN DIFFERENCES
PEOPLE HAVE DIFFERENT PERSONALITIES, ATTITUDES, WORKING STYLES, AND LEVELS OF MOTIVATION. THESE DIFFERENCES SOMETIMES CAUSE MISUNDERSTANDINGS OR
DISAGREEMENTS, WHICH MAKE COORDINATION DIFFICULT.

EXAMPLE:
SOME EMPLOYEES PREFER FAST-PACED DECISIONS, WHILE OTHERS ARE MORE COMFORTABLE WITH SLOW AND CAREFUL PLANNING. THIS DIFFERENCE CAN CREATE
FRICTION WHEN WORKING TOGETHER.

6. POOR COMMUNICATION
IF INFORMATION IS NOT SHARED PROPERLY OR IS MISUNDERSTOOD, COORDINATION SUFFERS. INCORRECT OR INCOMPLETE COMMUNICATION LEADS TO MISTAKES,
DELAYS, AND CONFLICT.

EXAMPLE:
IF THE SALES TEAM DOES NOT INFORM THE PRODUCTION TEAM ABOUT AN INCREASE IN ORDERS, THE PRODUCTION TEAM MAY NOT PREPARE ENOUGH STOCK ON
TIME.

7. RESISTANCE TO CHANGE
EMPLOYEES MAY FEEL UNCOMFORTABLE WITH NEW IDEAS OR NEW WAYS OF WORKING. WHEN PEOPLE RESIST CHANGE, IT BECOMES HARDER TO COORDINATE NEW
PROCESSES OR SYSTEMS.

EXAMPLE:
WHEN A COMPANY INTRODUCES NEW SOFTWARE, SOME EMPLOYEES MAY REFUSE TO USE IT OR TAKE A LONG TIME TO ADJUST, SLOWING DOWN COORDINATED
WORK.
Basis Direction Coordination

Meaning Guiding and supervising people Harmonizing activities and efforts

Focus People Activities

Nature Executive/leadership Integrative

Timing Mainly during execution Throughout all functions

Levels Involved Middle & lower levels All levels

Leadership, motivation,
Elements Synchronization, cooperation
communication

Objective Improve employee performance Achieve unity of action

CONTROL
CONCEPT

CONTROL IS THE PROCESS OF

CHECKING WHETHER ACTUAL
PERFORMANCE MATCHES THE PLANNED
PERFORMANCE.

IT INVOLVES SETTING STANDARDS,

MEASURING WORK, COMPARING
RESULTS, AND TAKING ACTION TO
CORRECT PROBLEMS. IN SIMPLE
WORDS, CONTROL MAKES SURE THAT
WORK IS GOING THE WAY IT SHOULD.
NEED FOR A CONTROL SYSTEM

Accuracy of Operations

Achievement of Goals

Efficient Use of
Resources

Identifying Deviations

Adapting to Changes

Facilitates Coordination
ORGANIZATIONS NEED CONTROL TO STAY ON TRACK, AVOID MISTAKES, AND ACHIEVE THEIR GOALS. WITHOUT
CONTROL, ACTIVITIES MAY DRIFT AWAY FROM PLANS.

1. ACCURACY OF OPERATIONS
CONTROL ENSURES THAT TASKS ARE PERFORMED CORRECTLY AND ACCORDING TO PLAN. IT HELPS MAINTAIN ACCURACY
AND CONSISTENCY IN WORK.

EXAMPLE:
QUALITY CHECKS IN A FACTORY ENSURE THAT ALL PRODUCTS MEET THE REQUIRED STANDARDS.
2. ACHIEVEMENT OF GOALS
CONTROL KEEPS THE ORGANIZATION FOCUSED ON ITS GOALS. BY REGULARLY REVIEWING PERFORMANCE, MANAGERS
ENSURE THAT TARGETS ARE REACHED.

EXAMPLE:
A SALES MANAGER TRACKS WEEKLY SALES TO ENSURE THE TEAM IS MOVING TOWARD THE MONTHLY SALES TARGET.
3. EFFICIENT USE OF RESOURCES
CONTROL HELPS AVOID WASTE OF TIME, MONEY, MATERIALS, AND MANPOWER. IT ENSURES RESOURCES ARE USED
WISELY.

EXAMPLE:
MONITORING ELECTRICITY USAGE IN A COMPANY HELPS REDUCE UNNECESSARY COSTS.
4. IDENTIFYING DEVIATIONS
CONTROL HELPS SPOT DIFFERENCES BETWEEN ACTUAL AND PLANNED PERFORMANCE EARLY. THIS ALLOWS TIMELY
ACTION TO CORRECT ERRORS.
EXAMPLE:
IF CUSTOMER COMPLAINTS INCREASE, THE MANAGER NOTICES THE DEVIATION AND INVESTIGATES THE CAUSE
IMMEDIATELY.
5. ADAPTING TO CHANGES
THE BUSINESS ENVIRONMENT CHANGES CONSTANTLY. CONTROL HELPS THE ORGANIZATION ADJUST TO NEW CONDITIONS,
DEMANDS, AND CHALLENGES.
EXAMPLE:
IF A NEW COMPETITOR ENTERS THE MARKET, THE COMPANY MAY CHANGE ITS PRICING STRATEGY AFTER REVIEWING
PERFORMANCE.
6. FACILITATES COORDINATION
CONTROL KEEPS ALL DEPARTMENTS ALIGNED BY MAINTAINING UNIFORM STANDARDS AND SHARED PERFORMANCE
EXPECTATIONS. THIS IMPROVES COOPERATION AMONG TEAMS.
EXAMPLE:
PRODUCTION AND SALES TEAMS COORDINATE BETTER WHEN BOTH TRACK PROGRESS THROUGH SHARED PERFORMANCE
REPORTS.
STEPS IN THE CONTROL PROCESS
1. SETTING PERFORMANCE STANDARDS
• STANDARDS = TARGETS OR EXPECTATIONS.
• THEY TELL EMPLOYEES WHAT RESULT IS EXPECTED.

• CAN BE QUANTITATIVE (NUMBERS → UNITS PRODUCED, SALES, COST) OR QUALITATIVE (SERVICE

QUALITY, BEHAVIOUR, MOTIVATION).

• STANDARDS SHOULD BE CLEAR, REALISTIC, AND FLEXIBLE BECAUSE BUSINESS CONDITIONS CAN
CHANGE.

2. MEASURING ACTUAL PERFORMANCE

• MEASURING HOW MUCH WORK IS ACTUALLY DONE.

• MUST USE THE SAME UNITS AS THE STANDARDS (E.G., UNITS, COST, TIME).
• CAN BE DONE THROUGH OBSERVATION, REPORTS, SAMPLE CHECKING, ETC.

• BOTH QUANTITY AND QUALITY SHOULD BE MEASURED.

• EXAMPLE: REDUCING COST BUT LOWERING QUALITY IS HARMFUL.

3. COMPARING ACTUAL PERFORMANCE WITH STANDARDS
• CHECK IF ACTUAL PERFORMANCE = STANDARDS, BETTER THAN STANDARDS, OR BELOW STANDARDS.
• IF PERFORMANCE MATCHES THE STANDARDS → CONTROL PROCESS ENDS HERE.

4. ANALYSING DEVIATIONS
• DEVIATION = DIFFERENCE BETWEEN ACTUAL AND PLANNED PERFORMANCE.

RARELY WILL THEY MATCH EXACTLY.

TO HANDLE DEVIATIONS, MANAGERS USE TWO TOOLS:

A) CRITICAL POINT CONTROL (CPC)

FOCUS ON IMPORTANT AREAS (KEY RESULT AREAS – KRAS) THAT AFFECT THE WHOLE BUSINESS.

EXAMPLE: A SMALL CHANGE IN PRODUCTION COST IS MORE IMPORTANT THAN A BIG CHANGE IN STATIONERY
COST.

B) MANAGEMENT BY EXCEPTION (MBE)

MANAGERS FOCUS ONLY ON MAJOR DEVIATIONS BEYOND THE ALLOWED LIMIT.

EXAMPLE: IF THE ALLOWED DEVIATION IS 5% AND COST DEVIATES BY 2% → IGNORE; IF 10% → TAKE ACTION.
5. TAKING CORRECTIVE ACTION
• FINAL STEP: FIX THE PROBLEM BASED ON THE CAUSE.
• IF DEVIATION IS SMALL → NO ACTION NEEDED.
• IF DEVIATION IS LARGE → TAKE NECESSARY STEPS.
• LACK OF RESOURCES → PROVIDE RESOURCES
• SKILL PROBLEMS → GIVE TRAINING
• EVERY DEVIATION NEEDS A DIFFERENT CORRECTIVE ACTION.

TYPES OF DEVIATIONS
1. POSITIVE DEVIATION
ACTUAL PERFORMANCE BETTER THAN THE STANDARD.
2. NEGATIVE DEVIATION
ACTUAL PERFORMANCE LESS THAN THE STANDARD.
3. NO DEVIATION
ACTUAL = STANDARD.
BENEFITS OF CONTROLLING

IMPROVES PERFORMANCE
ENSURES GOAL ACHIEVEMENT
REDUCES WASTE AND COSTS
ENHANCES COORDINATION
FACILITATES DELEGATION
IMPROVES QUALITY
ENCOURAGES ACCOUNTABILITY
CONTROLLING IS AN ESSENTIAL PART OF MANAGEMENT BECAUSE IT HELPS ENSURE THAT WORK IS DONE
PROPERLY AND GOALS ARE ACHIEVED. A GOOD CONTROL SYSTEM PROVIDES MANY ADVANTAGES TO THE
ORGANIZATION.

1. IMPROVES PERFORMANCE
CONTROLLING HELPS EMPLOYEES STAY FOCUSED ON THEIR TASKS. WHEN PEOPLE KNOW THEIR WORK WILL BE
CHECKED AND EVALUATED, THEY TEND TO BE MORE CAREFUL AND RESPONSIBLE. REGULAR MONITORING
ENCOURAGES EMPLOYEES TO IMPROVE THEIR SPEED, ACCURACY, AND QUALITY OF WORK.

EXAMPLE:
IF EMPLOYEES KNOW THEIR MONTHLY PERFORMANCE WILL BE REVIEWED, THEY ARE MORE LIKELY TO MEET
DEADLINES AND AVOID MISTAKES.

2. ENSURES GOAL ACHIEVEMENT

CONTROL ENSURES THAT ALL ACTIVITIES CONTRIBUTE TO THE ORGANIZATION’S GOALS. BY COMPARING ACTUAL
PERFORMANCE WITH THE STANDARDS, MANAGERS CAN SEE WHETHER THE ORGANIZATION IS MOVING IN THE
RIGHT DIRECTION. IF NOT, THEY CAN TAKE STEPS TO CORRECT IT.

EXAMPLE:
IF A COMPANY WANTS TO REDUCE DELIVERY TIME FROM 5 DAYS TO 3 DAYS, CONTROL HELPS CHECK WHETHER
THE NEW TARGET IS BEING MET AND WHAT IMPROVEMENTS ARE NEEDED.
3. REDUCES WASTE AND COSTS
THROUGH REGULAR MONITORING, CONTROL HELPS IDENTIFY AREAS WHERE RESOURCES ARE BEING WASTED. THIS SAVES MONEY,
TIME, AND EFFORT. BY REDUCING INEFFICIENCY, THE ORGANIZATION CAN OPERATE AT A LOWER COST AND MAKE BETTER USE OF ITS
RESOURCES.

EXAMPLE:
IF A FACTORY FINDS THAT TOO MUCH RAW MATERIAL IS BEING WASTED, IT CAN TAKE CORRECTIVE ACTION SUCH AS IMPROVING
TRAINING OR BUYING BETTER-QUALITY TOOLS.

4. ENHANCES COORDINATION
CONTROL CREATES UNIFORM STANDARDS ACROSS DEPARTMENTS (LIKE COMMON REPORTING FORMATS, SHARED DEADLINES, OR
QUALITY RULES). THIS HELPS DIFFERENT TEAMS WORK TOGETHER SMOOTHLY BECAUSE EVERYONE FOLLOWS THE SAME GUIDELINES.

EXAMPLE:
IF ALL DEPARTMENTS SUBMIT WEEKLY PROGRESS REPORTS IN THE SAME FORMAT, MANAGERS CAN EASILY COMPARE PERFORMANCE
AND COORDINATE ACTIVITIES.

5. FACILITATES DELEGATION
MANAGERS FEEL COMFORTABLE DELEGATING TASKS WHEN A GOOD CONTROL SYSTEM EXISTS BECAUSE THEY KNOW PERFORMANCE
WILL BE MONITORED. THIS REDUCES FEAR OF WORK BEING DONE INCORRECTLY AND INCREASES TRUST IN EMPLOYEES.

EXAMPLE:
A MANAGER ASSIGNS A PROJECT TO A TEAM LEADER BECAUSE THEY KNOW CONTROL REPORTS (LIKE DAILY UPDATES) WILL HELP
TRACK PROGRESS.
6. IMPROVES QUALITY
CONTROL SYSTEMS SUCH AS INSPECTIONS, AUDITS, AND QUALITY CHECKS HELP MAINTAIN CONSISTENT
STANDARDS. THIS ENSURES THAT PRODUCTS AND SERVICES MEET CUSTOMER EXPECTATIONS.

EXAMPLE:
A HOTEL USES REGULAR ROOM INSPECTIONS TO MAKE SURE CLEANLINESS STANDARDS ARE FOLLOWED FOR
EVERY GUEST.

7. ENCOURAGES ACCOUNTABILITY
WHEN EMPLOYEES KNOW THAT THEIR WORK IS TRACKED AND EVALUATED, THEY TAKE GREATER RESPONSIBILITY
FOR THEIR ACTIONS. CONTROL HELPS IDENTIFY WHO PERFORMED WELL AND WHO NEEDS IMPROVEMENT.

EXAMPLE:
IF ATTENDANCE IS TRACKED ELECTRONICALLY, EMPLOYEES BECOME MORE PUNCTUAL BECAUSE THEY KNOW
THEIR RECORDS ARE MONITORED.
ESSENTIAL FEATURES OF A GOOD CONTROL
SYSTEM

1. ACCURACY AND TIMELINESS

2. FLEXIBILITY
3. ECONOMICAL
4. SIMPLE AND UNDERSTANDABLE
5. FOCUS ON CRITICAL AREAS
6. FORWARD-LOOKING
FOR THE CONTROL SYSTEM IN AN ORGANIZATION TO WORK PROPERLY, CERTAIN FEATURES MUST BE PRESENT.
THESE ESSENTIALS ENSURE THAT CONTROL IS USEFUL, EFFICIENT, AND PRACTICAL FOR MANAGERS AND
EMPLOYEES.

1. ACCURACY AND TIMELINESS

FOR CONTROL TO BE EFFECTIVE, THE INFORMATION COLLECTED MUST BE CORRECT AND AVAILABLE WHEN
NEEDED. IF THE DATA IS INACCURATE, MANAGERS MAY MAKE WRONG DECISIONS. IF THE INFORMATION
COMES TOO LATE, THE OPPORTUNITY TO CORRECT THE PROBLEM MAY BE LOST.

EXAMPLE:
A PRODUCTION MANAGER NEEDS REAL-TIME DATA ABOUT MACHINE BREAKDOWNS. IF THE BREAKDOWN
REPORT COMES AFTER TWO DAYS, NOTHING CAN BE CORRECTED IMMEDIATELY, AND DELAYS CONTINUE.

2. FLEXIBILITY
A GOOD CONTROL SYSTEM MUST BE FLEXIBLE ENOUGH TO ADAPT TO CHANGES IN THE ENVIRONMENT.
BUSINESS CONDITIONS, TECHNOLOGY, AND CUSTOMER NEEDS CHANGE FREQUENTLY. THE CONTROL SYSTEM
SHOULD BE ABLE TO ADJUST TO NEW SITUATIONS WITHOUT BECOMING OUTDATED.

EXAMPLE:
IF A COMPANY SHIFTS FROM MANUAL WORK TO AUTOMATION, ITS OLD CONTROL METHODS (MANUAL REPORT
WRITING OR WEEKLY REVIEWS) MUST CHANGE TO NEW, FASTER, TECHNOLOGY-BASED METHODS.
3. ECONOMICAL
CONTROL SHOULD NOT BE MORE EXPENSIVE THAN THE BENEFITS IT PROVIDES. A CONTROL SYSTEM THAT COSTS
TOO MUCH REDUCES EFFICIENCY INSTEAD OF IMPROVING IT. MANAGERS MUST CHOOSE SIMPLE AND COST-
EFFECTIVE METHODS, ESPECIALLY IN SMALL ORGANIZATIONS.

EXAMPLE:
A SMALL SHOP OWNER USES A SIMPLE SPREADSHEET TO TRACK DAILY SALES INSTEAD OF PURCHASING COSTLY
ACCOUNTING SOFTWARE.

4. SIMPLE AND UNDERSTANDABLE

THE CONTROL SYSTEM MUST BE EASY TO UNDERSTAND AND USE. COMPLICATED FORMS, TOO MANY STEPS, OR
TECHNICAL LANGUAGE WILL CONFUSE EMPLOYEES AND LEAD TO ERRORS. A SIMPLE SYSTEM HELPS EVERYONE
FOLLOW IT CORRECTLY.

EXAMPLE:
A RESTAURANT USES A SIMPLE DAILY CHECKLIST FOR HYGIENE AND SAFETY INSTEAD OF LONG, DIFFICULT
FORMS.
5. FOCUS ON CRITICAL AREAS
CONTROL SHOULD FOCUS (KRAS)—THE MOST IMPORTANT PARTS OF PERFORMANCE
ON KEY RESULT AREAS
THAT AFFECT THE GOALS OF THE ORGANIZATION. MANAGERS SHOULD NOT WASTE TIME CHECKING EVERY
SMALL DETAIL. INSTEAD, THEY MUST CONCENTRATE ON THE AREAS THAT MATTER MOST.

EXAMPLE:
IN A HOSPITAL, CONTROLLING PATIENT SAFETY AND TREATMENT QUALITY IS MORE IMPORTANT THAN CHECKING
MINOR ADMINISTRATIVE TASKS EVERY DAY.

6. FORWARD-LOOKING
EFFECTIVE CONTROL SHOULD NOT ONLY IDENTIFY PAST PROBLEMS BUT ALSO HELP PREVENT FUTURE ONES.
MANAGERS MUST USE CONTROL INFORMATION TO PREDICT ISSUES AND ACT BEFORE THEY HAPPEN. THIS KEEPS
THE ORGANIZATION PREPARED FOR FUTURE CHALLENGES.

EXAMPLE:
IF CUSTOMER COMPLAINTS START INCREASING, MANAGERS ANALYZE THE TREND AND TAKE ACTION BEFORE THE
PROBLEM BECOMES SERIOUS AND AFFECTS THE COMPANY’S REPUTATION.
PROBLEMS IN CONTROLLING

DIFFICULTY IN SETTING STANDARDS

RESISTANCE FROM EMPLOYEES
INFORMATION OVERLOAD
DELAYED REPORTING
UNCONTROLLABLE EXTERNAL FACTORS
COST OF CONTROL SYSTEMS
EVEN THOUGH CONTROLLING IS IMPORTANT, MANAGERS FACE SEVERAL CHALLENGES WHEN TRYING TO MONITOR
PERFORMANCE OR CORRECT DEVIATIONS. THESE PROBLEMS ARISE BECAUSE ORGANIZATIONS OPERATE IN COMPLEX
ENVIRONMENTS AND INVOLVE HUMAN BEHAVIOR, TECHNOLOGY, AND MANY EXTERNAL FACTORS.

1. DIFFICULTY IN SETTING STANDARDS

SOME ASPECTS OF WORK CANNOT BE EASILY MEASURED. WHILE IT IS SIMPLE TO SET NUMERICAL STANDARDS FOR SALES OR
PRODUCTION, IT IS DIFFICULT TO SET CLEAR STANDARDS FOR THINGS LIKE EMPLOYEE MORALE, CREATIVITY, TEAMWORK, OR
CUSTOMER SERVICE QUALITY. WHEN STANDARDS ARE UNCLEAR, COMPARISON BECOMES DIFFICULT.

EXAMPLE:
A MANAGER CAN MEASURE THE NUMBER OF CALLS HANDLED BY A CUSTOMER SERVICE AGENT, BUT IT IS HARD TO MEASURE
HOW POLITE OR FRIENDLY THE PERSON WAS DURING THE CALL.

2. RESISTANCE FROM EMPLOYEES

EMPLOYEES SOMETIMES SEE CONTROLLING AS INTERFERENCE OR MISTRUST. THEY MAY FEEL THAT CONSTANT CHECKING
MEANS THE MANAGER DOES NOT TRUST THEM. THIS CAN CREATE FEAR, STRESS, OR DISSATISFACTION. SUCH NEGATIVE
FEELINGS MAKE EMPLOYEES LESS WILLING TO COOPERATE WITH THE CONTROL SYSTEM.

EXAMPLE:
IF A SUPERVISOR CHECKS EVERY SMALL DETAIL OF AN EMPLOYEE’S WORK, THE EMPLOYEE MAY FEEL MICROMANAGED AND
BECOME DEMOTIVATED.
3. INFORMATION OVERLOAD
MODERN ORGANIZATIONS GENERATE A LARGE AMOUNT OF DATA. MANAGERS MAY RECEIVE MORE INFORMATION THAN
THEY CAN PROCESS. TOO MUCH INFORMATION MAKES IT DIFFICULT TO IDENTIFY WHAT IS IMPORTANT AND WHAT IS NOT. THIS
SLOWS DOWN DECISION-MAKING.

EXAMPLE:
A MARKETING MANAGER RECEIVES DAILY REPORTS ON SALES, SOCIAL MEDIA PERFORMANCE, CUSTOMER FEEDBACK,
COMPETITORS, AND TRENDS. IT BECOMES HARD TO FOCUS ON THE MOST IMPORTANT DATA.

4. DELAYED REPORTING
IF REPORTS REACH MANAGERS TOO LATE, CORRECTIVE ACTION BECOMES INEFFECTIVE. DELAYED INFORMATION MEANS THE
PROBLEM HAS ALREADY GROWN OR THE OPPORTUNITY TO FIX IT HAS PASSED. THIS REDUCES THE USEFULNESS OF CONTROL.

EXAMPLE:
IF A WEEKLY PRODUCTION REPORT IS SUBMITTED AFTER 10 DAYS, MANAGERS CANNOT IMMEDIATELY FIX DELAYS OR PREVENT
LOSSES.
5. UNCONTROLLABLE EXTERNAL FACTORS
SOME PROBLEMS ARISE DUE TO EXTERNAL FACTORS THAT THE ORGANIZATION CANNOT CONTROL. THESE
INCLUDE GOVERNMENT POLICIES, ECONOMIC CHANGES, NATURAL DISASTERS, INFLATION, OR SUDDEN MARKET
SHIFTS. EVEN WITH THE BEST CONTROL SYSTEM, MANAGERS CANNOT PREVENT THESE INFLUENCES.

EXAMPLE:
IF THE GOVERNMENT SUDDENLY CHANGES TAX RULES, THE COMPANY’S FINANCIAL PERFORMANCE MAY DROP,
AND NO INTERNAL CONTROL SYSTEM CAN STOP IT.

6. COST OF CONTROL SYSTEMS

IMPLEMENTING A CONTROL SYSTEM REQUIRES MONEY, TIME, SOFTWARE, AUDITS, TRAINED PERSONNEL, AND
ADMINISTRATIVE WORK. FOR SMALL ORGANIZATIONS, THESE COSTS MAY BE TOO HIGH. A CONTROL SYSTEM
THAT IS TOO EXPENSIVE REDUCES OVERALL EFFICIENCY RATHER THAN IMPROVING IT.

EXAMPLE:
A SMALL CAFÉ MAY NOT BE ABLE TO AFFORD ADVANCED INVENTORY CONTROL SOFTWARE AND MUST RELY
ON MANUAL TRACKING INSTEAD.
1. BUDGETARY CONTROL
CONCEPT
BUDGETARY CONTROL MEANS PREPARING BUDGETS FOR DIFFERENT DEPARTMENTS AND COMPARING
ACTUAL PERFORMANCE WITH THESE BUDGETS TO IDENTIFY DEVIATIONS.

WORKING EXAMPLE
THE MARKETING DEPARTMENT RECEIVES A BUDGET OF ₹50,000 FOR MONTHLY PROMOTIONS.
IF ACTUAL SPENDING IS ₹62,000, THE MANAGER FINDS OUT WHY EXPENSES INCREASED AND TAKES
CORRECTIVE ACTION.

ADVANTAGES
HELPS CONTROL UNNECESSARY EXPENSES.
PROVIDES CLEAR FINANCIAL TARGETS FOR DEPARTMENTS.
HELPS MANAGERS PLAN FUTURE SPENDING BETTER.
DISADVANTAGES
BUDGETS MAY BECOME UNREALISTIC OR OUTDATED.
EMPLOYEES MAY FEEL RESTRICTED DUE TO TIGHT BUDGETS.
TOO MUCH FOCUS ON COST-CUTTING MAY REDUCE CREATIVITY.
2. STANDARD COSTING
CONCEPT
STANDARD COSTING SETS A “STANDARD COST” FOR MATERIALS, LABOUR, OR OVERHEAD. ACTUAL
COSTS ARE THEN COMPARED TO STANDARD COSTS TO IDENTIFY VARIANCES.

WORKING EXAMPLE
STANDARD COST TO PRODUCE ONE CHAIR = ₹800.
ACTUAL COST = ₹950.
THE MANAGER INVESTIGATES REASONS SUCH AS HIGHER MATERIAL PRICES OR WASTAGE.
ADVANTAGES
HELPS CONTROL PRODUCTION COSTS.
IDENTIFIES INEFFICIENCIES QUICKLY.
USEFUL FOR SETTING PERFORMANCE BENCHMARKS.
DISADVANTAGES
STANDARDS MAY NOT REFLECT REAL MARKET CONDITIONS.
FREQUENT UPDATES REQUIRED, WHICH CAN BE TIME-CONSUMING.
WORKERS MAY FEEL PRESSURED BY STRICT STANDARDS.
3. BREAK-EVEN ANALYSIS
CONCEPT
BREAK-EVEN ANALYSIS CALCULATES THE SALES LEVEL WHERE TOTAL REVENUE EQUALS TOTAL COST
(NO PROFIT, NO LOSS).
WORKING EXAMPLE
A BAKERY FINDS THAT TO COVER ALL COSTS, IT MUST SELL 500 CUPCAKES EACH MONTH.
SELLING MORE THAN 500 CUPCAKES RESULTS IN PROFIT.
ADVANTAGES
HELPS MANAGERS DECIDE PRICING AND SALES TARGETS.
USEFUL FOR NEW BUSINESSES TO ESTIMATE VIABILITY.
SIMPLE AND EASY TO UNDERSTAND.
DISADVANTAGES
ASSUMES ALL COSTS ARE KNOWN AND CONSTANT (NOT ALWAYS TRUE).
DOES NOT CONSIDER MARKET CHANGES OR UNEXPECTED EXPENSES.
NOT SUITABLE FOR MULTIPLE-PRODUCT FIRMS WITHOUT ADJUSTMENTS.
4. INSPECTION
CONCEPT
INSPECTION INVOLVES CHECKING PRODUCTS OR PROCESSES TO ENSURE THEY MEET QUALITY
STANDARDS.

WORKING EXAMPLE
A SUPERVISOR CHECKS 10% OF SHIRTS MADE IN THE FACTORY TO ENSURE STITCHING AND
BUTTONS ARE CORRECT.

ADVANTAGES
ENSURES PRODUCT QUALITY.
REDUCES CUSTOMER COMPLAINTS.
HELPS DETECT DEFECTS EARLY.
DISADVANTAGES
TIME-CONSUMING PROCESS.
INCREASES COST DUE TO ADDITIONAL MANPOWER.
CANNOT CHECK EVERY SINGLE ITEM, SO SOME DEFECTS MAY BE MISSED.
5. TIME-EVENT OR GANTT CHARTS

CONCEPT
A GANTT CHART SHOWS TASKS AND TIMELINES, HELPING MANAGERS COMPARE PLANNED SCHEDULE
VS. ACTUAL PROGRESS.

WORKING EXAMPLE
A PROJECT SCHEDULED FOR 10 DAYS IS DIVIDED INTO TASKS (RESEARCH, WRITING, CHECKING).
THE MANAGER CHECKS THE CHART DAILY TO ENSURE THE TEAM IS ON TRACK.
ADVANTAGES
EASY TO UNDERSTAND VISUAL TOOL.
HELPS IN PLANNING AND SCHEDULING WORK.
SHOWS DELAYS CLEARLY AND ALLOWS CORRECTIVE ACTION.
DISADVANTAGES
BECOMES COMPLEX FOR LARGE PROJECTS.
NEEDS REGULAR UPDATING.
MAY NOT SHOW TASK DEPENDENCIES WELL.
6. PERSONAL OBSERVATION
CONCEPT
A MANAGER DIRECTLY OBSERVES EMPLOYEES, MACHINES, OR PROCESSES TO EVALUATE
PERFORMANCE.

WORKING EXAMPLE
A STORE MANAGER WATCHES HOW SALES STAFF TALK TO CUSTOMERS TO ASSESS CUSTOMER
SERVICE QUALITY.

ADVANTAGES
PROVIDES FIRSTHAND, REAL-TIME INFORMATION.
HELPS IDENTIFY PROBLEMS QUICKLY.
BUILDS BETTER MANAGER–EMPLOYEE UNDERSTANDING.
DISADVANTAGES
TIME-CONSUMING FOR MANAGERS.
EMPLOYEES MAY BEHAVE DIFFERENTLY WHEN OBSERVED (HAWTHORNE EFFECT).
MAY LEAD TO BIAS IF NOT DONE OBJECTIVELY.
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