Chapter 7 Controlling
Chapter 7 Controlling
Chapter 7 Controlling
CONTROLLING
LEARNING OBJECTIVES
After completing this chapter, students should be able to: Define controlling Explain the controlling process Identify the types of control Discuss the potential barriers to successful control Describe on how to make controlling successful
CHAPTER OUTLINE
Definition of control The controlling process Types of control Potential barriers to successful control Making controlling successful
DEFINITION Control making something happen the way it was planned to happen.
Contd According to Roberto Mockler, controlling is a systematic effort by business management to : Compare performance to predetermined standards, plans or objectives To determine whether performance is in line with these standards and presumably 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 objective
Process of Control
Setting Standards for Performance Whenever possible, the standards should be set in a manner that allows them to be compared with actual performance. Measuring Actual Performance An organization must decide:What to measure. When to measure. How frequently to measure. Comparing Actual Performance with Standards This step involves determining if actual performance compared to standards falls within acceptable limits. Responding to Deviations If the deviation from performance is unacceptable, then corrective action is warranted. If the deviation is acceptable, no correction action is necessary.
Types of Control
Types of Control
There are 3 types of control and what type is used is determined primarily by the work phase in which the control is needed.
3 Types of Control
Preventive/ Feed Forward/ Steering Control Focuses on detecting undesirable material, financial, or human resources that serve as inputs to the transformation process. Concurrent/ Screening Control Focuses on the transformation process to ensure that it is functioning properly. Feedback/ Post Action/ Corrective Control Focuses on discovering undesirable output and implementing corrective action.
Types of Control
Multiple Focal Points Most organizations use several control systems focused on various phases of the transformation process.
When management exerts too much control and too rigid, employee morale tends to be low and frustrated because they think that there is no freedom for them to do a good job.
Although controls can be designed to focus on relatively narrow aspects of an organization, manager must remember that prospective corrective action is not only relation to the specific activity being control but also relation to all other organization units.
Filing of reports
Employees may perceive that management is base on corrective action solely on department records with no regard for extenuating circumstances. If this is the case they may feel pressured to falsify records.
To be effective, a control system must employ all of the steps in the control process.
Effective control systems typically require managers to blend quantitative (objective) and qualitative (subjective) performance measures.
To be effective, organizational controls must be accepted by employees. The control system should motivate workers to recognize standards and act to achieve them.