Chapt

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Nature and 26
Process of
Controlling
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MANAGEMENT text and cases, V S P Rao, V Hari Krishna
26 Nature and Process of
Controlling
It is only through the process of control that management is able to
maintain the "equilibrium between ends and means, output and effort."
A properly designed system of control alerts managers of the existence
of potential problems and allows them to take corrective actions, when
necessary. The basic purpose of a well-designed control system is to
ensure that results are achieved according to plan. Control is not just
score-keeping. It is not just plotting the course and getting locations
reports. It is, rather, steering the ship.

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26 Nature and Process of
Controlling
Controlling
Controlling means that managers develop (i) appropriate standards (ii)
compare ongoing performance against those standards and (iii) take
steps to ensure that corrective actions are taken when necessary. A
good controlling system is generally designed to keep things from going
wrong, not just to correct them afterwards.

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26 Nature and Process of
Controlling
Features
The following are the features of controlling:
 Control is a positive force
 Control is a continous process
 Control is forward looking
 Control process is universal
 Control process is dynamic
 Control is goal-oriented
 Delegation is the key to control
 Control is based on planning

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26 Nature and Process of
Controlling
Importance of Control
The management process is incomplete and, sometimes, meaningless
without control function. Targets remain on paper, people tend to use
resources recklessly and managers find everything chaotic. The absence
of control could be very costly and unproductive. A good system of
control, however, puts an end to all of these and offers the following
advantages:
1. Achievement of goals
2. Execution and revision of plans
3. Brings order and discipline
4. Facilitates decentralisation of authority
5. Promotes coordination
6. Cope with uncertainty and change

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26 Nature and Process of
Controlling
Limitations
Setting control points over important areas is not easy. It is
expensive, takes lot of time and effort on the part of managers.
Certain areas can be measured precisely. But many areas,
unfortunately, defy measurement in quantitative terms.

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26 Nature and Process of
Controlling
The Control Process
The process of control involves the following steps:
 Establishment of standards
 Measurement of actual performance
 Comparison of actual performance with standard
 Taking corrective action

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26 Nature and Process of
Controlling
Characteristics of an Effective Control System
Effective control systems tend to have certain qualities in common.
These can be stated thus:
1. Suitable
2. Simple
3. Selective
4. Sound and economical
5. Flexible
6. Forward-looking
7. Reasonable
8. Objective
9. Responsibility for failures
10. Acceptable
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26 Nature and Process of
Controlling
Types of Control
Depending on the time at which control is applied, controls are of
three types:

 Feedback control (Historical or Post-control)

 Concurrent control

 Predictive or Feedforward control

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26 Nature and Process of
Controlling
Dimensions of Control
Managers, focus attention on key or critical areas which have a
significant bearing on the performance of various departments in an
organisation. The following ways have been found to be relevant in
this regard:
1. Critical or strategic point control
2. Management by exception (MBE)

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26 Nature and Process of
Controlling
Resistance to Control
There is a natural resistance to controls, because controls take away a
certain amount of individual freedom. Employees tend to view controls in
a negative way, due to various reasons:
 Over-control
 Inappropriate controls
 Unachievable standards
 Unpredictable standards
 Rewards for inefficiency
 Uncontrollable variables

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26 Nature and Process of
Controlling
Overcoming Resistance to Control
There are means that managers can use to reduce negative reactions,
namely:
 Employee participation
 Justifiable controls
 Precise and understandable standards
 Realistic standards
 Timely communication of findings
 Accurate findings
 Assuring support
 Positive reinforcement

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