Types of Control

There are basically four types of controls, each type being determined primarily
by the time period in which the control is applied in relation to the operation being
performed. These are:
1. Pre-controls: These controls are also known as ‘feed-forward’ controls
and are basically preventive in nature. The control takes place before work
is performed. In this regard, management creates policies, procedures and
rules aimed at eliminating behaviour that can cause undesirable work results.
These controls are designed to eliminate the cause of any deviation that
might occur later in the process. For example, a thorough quality control on
the input raw materials would be considered as a feed-forward control.
This would eliminate problems in production or output that could be due to
faulty raw materials. Similarly, if a student is doing poorly in a course at the
beginning of a semester, he should not wait until the end of the term to make
changes in his study habits. He must make adjustments before it is too late.
These controls are meant to make sure that performance objectives are
clear and all resources are available at the time when needed in order to
attain these objectives.
2. Steering controls: The key feature of these controls is the capability to
take corrective action, when the deviation has already taken place but the
task has not been completed. Some of the examples are inflight corrections
of off-course airplanes and guided missiles or steering the car into the lane
when it is off the lane.
The great advantage of steering control is that corrective actions can be
taken early. An early start with steering controls increases the chances that
we will achieve a favourable outcome. For example, the sooner the failing
student gets tutoring in his course the better are his chances of passing the
course.
3. Yes/No controls: These controls are designed to check at each check
point whether the activity should be allowed to proceed further or not.
These controls are necessary and useful where a product passes sequentially
from one point to another, with improvements added at each step along the
way. These controls stop errors from being compounded. Quality control
checkpoints where inspection would determine whether the activity should
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continue or not is an example. Safety checks and legal approvals of contracts
before they can be executed are other examples of yes/no controls.
The underlying aim of this type of control is to make sure that some
predetermined standard is met before an activity is allowed to continue.
For example, a student may not be allowed to go to the next grade unless
he passes the previous grade. A car may not be allowed on the road unless
it passes inspection. Assuming the control is well designed, it helps to achieve
conformity with the set standards. Yes/no controls can be very time
consuming and in addition raise a possibility of misuse. For example, a car
inspection can take a whole day even if there is nothing wrong with it. The
abuse can occur when the basis for yes/no controls are not clearly defined
or sharply limited. For example, a chairman of a department can deny a
professor his promotion if one of the criterion for yes/no control is ‘research’
which is not clearly defined or measurably quantified.
4. Post-action controls: Also known as ‘feedback’ control, post-action
controls measure results from completed actions. The results of the
completed activity are compared with pre-determined standards and if there
are any deviations, corrective action can be taken for future activities. For
example, a restaurant manager may ask you how you liked the food after
your dinner and take your suggestions into account to improve the meals.
These controls help explain as to what really happened during the process
of achieving the output. For example, if the actual expenses for office supplies
exceed the budgeted expenses for a given year, then the reasons for such a
difference can be investigated and in the light of this feedback the budget
for the following year can be revised or controlled.
One advantage of feedback control is that it enhances employee motivation.
People want information as to how well they have performed and feedback
control provides this information
9.2.2 Control Process
According to Robert J. Mockler:
‘Management control is a systematic effort to set performance standards with
planning objectives, to design information feedback systems, to compare actual
performance with these pre-determined standards, to determine whether there
are any deviations and to measure their significance, and to take any action
required to assure that all corporate resources are being used in the most effective
and efficient way possible in achieving corporate objectives.’
Mockler’s definition divides the process of control into four steps. These steps
are:
Establishing Standards
The control process begins with the establishment of standards of performance
against which organizational activities can be compared. These are levels of activities
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established by management for evaluating performance. These standards must be
clearly specified and understood by all organizational members without ambiguity.
They should be defined in measurable terms, wherever possible, such as physical
units produced per period of time, profit to be made per unit and so on. Vaguely
worded standards or general goals such as ‘better skills’ or ‘high profits’ are difficult
to interpret and hence lead to confusion and conflict. For example, the goal of a
real estate broker may be to sell four houses per month. He can then plan the
month and monitor his performance. Similarly, a vice-president incharge of
production may have a goal of keeping the production cost within assigned budget
over a period of time. In attaining such a goal, he will be able to monitor the costs
and take corrective action wherever it is necessary. As another example, a college
professor may have a goal of covering ten chapters from a book over a period of
one semester. He can plan his schedule of teaching accordingly to meet that goal.
These precisely stated standards, goals and objectives facilitate ease in
communication to all persons and this makes the control process easier to monitor.
There are situations where it is not possible to quantify standards such as in
the case of high morale, community relations, discipline or creativity. In such cases,
all efforts should be made to fully understand these qualitative goals and design
control mechanisms that would be useful in measuring performance in these
situations. Most of these control mechanism would be subjective in nature and
decisions would be made on the basis of experience, analytical observations and
intuitive judgements. Some of the quantitative standards against which performance
can be measured are:
1. Time standards: The goal will be set on the basis of time lapse in
performing a particular task. It could be units produced per hour, number
of pages typed per hour or number of telephone calls made per day.
Managers utilize time standards to forecast work flow and employee
output. Standard employee output also determines the extent of financial
incentive plans.
2. Cost standards: These standards indicate the financial expenditure
involved per unit of activity. These could be material cost per unit, cost
per person, cost of distribution per unit and so on. Budgets are established
to reflect these costs and they provide monetary check-points for
comparing actual costs with budgeted costs.
3. Income standards: These relate to financial rewards received for a
particular activity. Examples would be sales volumes per month, sales
generated by a sales person per year and so on.