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Lecture 7

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4 views19 pages

Lecture 7

Uploaded by

monaa.mohamed517
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Lecture 7

Controlling
Learning Objectives
1. Explain the nature and importance of
control.
2. Describe the three steps in the control
process.
3. Explain how organizational and employee
performance are measured.
4. Know how to be effective at giving
feedback.
5. Describe tools used to measure
organizational performance.
What is Controlling?

 Controlling – The process of


monitoring activities to ensure that
they are being accomplished as
planned and of correcting any
significant deviations.
 The Purpose of Control
To ensure that activities are completed
in ways that lead to the
accomplishment of organizational
goals. 3
Why is Controlling Important?

 the final link in management functions:


– Planning – controlling let managers know
whether their goals and plans are on target
and what future actions to take.
– Empowering employees – controlling
provide managers with information and
feedback on employee performance.
– Protecting the workplace – controlling
enhance physical security and help minimize
workplace disruptions.
3
The Planning–Controlling Link
The Control Process

The Process of Control


1. Measuring actual performance.
2. Comparing actual performance
against a standard.
3. Taking action to correct deviations
or inadequate standards.
 The control process assumes that
performance standards already
exist, and they do.
 They’re the specific goals created
during the planning process. 3
The Control Process
The Control Process
Step 1: Measuring Actual Performance

 How We Measure –  What We Measure: Control


sources of information: Criteria
• Employees
• Personal observation
 Satisfaction
• Statistical reports
 Turnover
• Oral reports  Absenteeism
• Written reports • Budgets
 Costs
 Output
 Sales

what is measured is probably more critical to the control process


than how it’s measured.
The Control Process

Step 2: Comparing Actual Performance Against the


Standard:
 Determining the degree of variation between actual
performance and the standard.
 Range of variation – the acceptable parameters of
variance between actual performance and the standard.
Significance of variation is determined by:
• The acceptable range of variation from the standard
(forecast or budget).
• The size (large or small) and direction (over or
under) of the variation from the standard (forecast
or budget). 3
Acceptable Range of Variation

Deviations outside this range need attention.


The Control Process
Step 3: Taking Managerial Action
 Need for Action = Desired Performance – Actual Performance
 Courses of Action
1. “Doing nothing: Only if deviation is judged to be
insignificant.
2. Correcting actual (current) performance
• Immediate corrective action to correct the problem at
once.
• Basic corrective action to locate and to correct the source
of the deviation.
• Example of Corrective Actions: Change strategy,
structure, compensation scheme, or training programs;
redesign jobs; or fire employees 3
The Control Process

3. Revising the standard


 Examining the standard to assure whether or not
the standard is realistic, fair, and achievable.
 Upholding the validity of the standard.
 Resetting goals that were initially set too low or
too high.
 if performance consistently exceeds the goal, then
a manager should look at whether the goal is too
easy and needs to be raised.
 Managers must be cautious about revising a
standard downward.
3
What Is Organizational
Performance?
What Is Performance?
Performance is the end result of an activity

What Is Organizational Performance?


The accumulated end results of all of the
organization’s work processes and activities

3
Organizational Performance
indicators
1. Organizational Productivity
 Productivity: the overall output of goods and/or
services divided by the inputs needed to generate
that output.
 Output: sales revenues
 Inputs: costs of resources (materials, labor expense,
and facilities)
 productivity is a measure of how efficiently
employees do their work.
 The management of an organization seeks to
increase this ratio.
3
Organizational Performance
indicators
2. Organizational Effectiveness
 Measuring how appropriate organizational
goals are and how well the organization is
achieving its goals.

3
Tools for Measuring Organizational
Performance
1. Feedforward Control
A control that prevents anticipated problems
before actual occurrences of the problem.
2. Concurrent Control
A control that takes place while the monitored
activity is in progress. Ex: Direct supervision:
management by walking around.
3. Feedback Control
A control that takes place after an activity is done.
Corrective action is after-the-fact, when the
problem has already occurred.
Tools for Measuring Organizational
Performance
Advantages of feedback controls:
Provide managers with information on the
effectiveness of their planning efforts.
Enhance employee motivation by
providing them with information on how
well they are doing.
Types of Control
Questions

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