BUSINESS

MANAGEMENT

Dr. Chitra Joshi

Asst. professor
PIMR Indore
• Control is an essential function of management in every organization. The management
process is incomplete and sometimes useless without the control function.

• In the management context, 'control" refers to the evaluation of performance and the
implementation of corrective actions to accomplish organizational objectives.

• Some people confuse 'control' with 'supervision.' Supervision is a part of control; it helps
identify deviations from the established standards of performance.

• Thus, control ensures that what is done is what is included. Control must be exercised by
everyone in the organization, from the lop level to the bottom level.
Thus, control ensures that what is done is what is included.
Control must be exercised by everyone in the organization, from
the lop level to the bottom level.

According to Robert J. Mocklcr.

"Management control is a systematic effort to set performance
standards with planning objectives, to design information feedback
systems, to compare actual performance with these predetermined
standards, to determine whether there arc any deviations and to
measure their significance, and to take any action required lo
assure that all corporate resources arc being used in the most
effective and efficient way possible in achieving corporate
objectives.”
CHARACTERISTICS OF CONTROL

1) Managerial Function
2) Continuous Process
3) Forward Looking
4) Necessary At All Levels Of Management
5) Actions Is The Essence Of Control
6) Positive And Constructive Approach
7) Wide Scope
8) Tool To Achieve Organizational Goals
9) Not An Interference
10)Remedial Activity
1) Coping with Uncertainty In today's turbulent business environment, all
organizations must cope with change. When organization goals are
established, they are based on the knowledge available at that point of time.

2)Detecting Irregularities Control systems help managers detect

undesirable irregularities, such as product defects, cost overruns, or rising
personnel turnover.

3) Identifying Opportunities Control also helps managers identify areas in

which things arc going better than expected, thereby alerting management
to possible future opportunities.
4) Handling Complex Situations Another important factor contributing to
the need for a control mechanism is the growing complexity of today's
organizations.

5) Decentralizing Authority Controls also help managers decentralize

authority. With the help of controls, managers can allow their subordinates
to take decisions while ensuring that the ultimate authority remains in their
hands.

6) Minimizing Costs When implemented or practiced effectively, control

also helps reduce the costs and boost the output of an organization
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LEVELS OF CONTROL

1) Strategic Control

Strategic control involves monitoring critical environmental factors to

ensure that strategic plans are implemented as intended, assessing the
impact of strategic plans, and adjusting such plans when necessary. Top-
level managers usually view things from an organizational perspective and
are concerned with strategic issues. They usually have a long-term focus
except in situations involving unstable environmental conditions and/or
intense competition which necessitate shorter reporting
2) Tactical Control

Tactical control focuses on assessing the implementation of tactical plan at

department levels, monitoring associated periodic results, and taking
corrective action when necessary. Middle-level managers are concerned
with department-level goals and objectives, and programs and budgets.
They concentrate on medium lime frames and therefore use weekly,
fortnightly, and monthly reporting cycles in their \ Middle-level managers
exercise tactical control to test the impact of tactical ii of their departments
on the organizational environment.
Middle-level managers exercise operational control by monitoring critical
aspects of the implement operational plans. They are also involved in
strategic control to a certain extent. because they provide information to
top-level managers on strategic issues.
3) Operational Control

Operational control involves overseeing the implementation of operational

monitoring day-to-day results, and taking corrective action when necessary.
Lower-level managers concerned with schedules, budgets, rules, and specific
individual output requirements make use of operational control. Using
operational control a lower-level manager provides feedback regarding the
tasks being carried out on a day-to-day basis (in the very near term) in order to
achieve the short-term and long-term goals of the organization
Types of Control:
CONTROL PROCESS
1) Determining Areas to Control
It is quite expensive and virtually impossible to control each and every
aspect of an organization's activities. Moreover, employees resent having
every move of theirs being controlled by their superiors or the management.
Therefore, before initiating the control process, the manager must determine
the major areas that need to be controlled.

2) Establishing Standards
Constitute the foundation of the control process. They slate the criteria on
the basis of which employee performance and related behavior can be
evaluated. Thus, establishing standards is an essential part of the control
process.
3) Measuring Performance

Once standards arc established, the actual performance must be measured. A

manager must decide how to measure the actual performance and how
frequently it is necessary to do so. The measurement of performance against
standards should be done on a forward-looking basis. Measuring
performance on such a basis helps managers detect deviations in their early
stages. They can, then, be countered by appropriate action. If performance
standards are clearly established and means for exactly determining what
subordinates are doing arc available, evaluating the expected or actual
performance becomes fairly easy.
4) Comparing Performance against Standards

In this stage, the performance measured in step 3 is compared with the

standards established in step 2. Such a comparison enables managers to
determine whether actual performance meets the standards established
(predetermined or planned performance). Managers often perform the task of
comparison on the basis of information provided in reports. These reports,
which may be presented in an oral or written form or generated by a
computer, summarize planned versus actual results
5) Recognizing Good or Positive Performance

Managers should not always be preoccupied with finding solutions to

important problems; they should also find the time to recognize/e and
acknowledge good or positive performance by subordinates when their
performance meets or exceeds the established standards. Recognition may be
in the form of an oral remark, such as "well done," for a routine achievement,
or substantial rewards in the form of pay hikes, bonuses, or training
opportunities for major achievements or consistent good work.
6) Taking Corrective Action when Necessary

When a significant discrepancy occurs between the actual output or

performance and planned or predetermined performance standards, specific
actions must be taken to correct the situation. Managers must first determine
the cause of the deviation from the standard, then take the required action to
remove or minimize the cause of deviation.
Techniques or Methods of Control
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