Managing the Control Process

Introduction to Management
Kirana Mulyacantika
Iftor Fabrian
Alifiarosa Astari R
Ardhya Prili Hapsari
Mary Amela Audya

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The Nature of Control

According to EFL Brech:
Control is checking current performance against predetermined standards contained in the plans, with a view to
ensure adequate progress and satisfactory performance.
Control is The regulation of organizational activities in such
a way as to facilitate goal attainment.
Management control refers to the process by which an
organization influences its subunits and members to behave
in ways that lead to the attainment of organizational
objectives

The Purpose of Control

Control is one of the four basic management functions. The
control function, in turn, has four basic purposes.
Adapt to environmental change

Limit the accumulation of error

Control helps the organization

Cope with organizational complexity

Minimize costs

Types of Controls
Areas of Control
Physical resources
Human resources
Information resources
Financial resources

Strategic
control
Structural
control

Levels of Control
Responsibilities for Control
Manager
Controller
Operating Employees

Operations
control

Financial
control

Steps in the Control Process

1

Establish

Measure

standards

performance

Compare

4
Determine need

performance
against standards

for corrective
action

Maintain the

Correct the

Change

status quo

deviation

standards

Forms of Operations Control

Feedback
Inputs

Transformation

Outputs

Preliminary control

Screening control

Postaction control

Focuses on inputs

Focuses on how

Focuses on outputs

to the organizational

inputs are being

from the organiza-

system

transformed into

tional system

outputs

Financial Control
Control of financial resources as they flow into the
organization, are held by the organization, and flow out of the
organization.
Budgetary Control
Budgets may be established at any organizational level.
Budgets are typically for one year or less.
Budgets may be expressed in financial terms, units of output, or other
quantifiable factors.

Types of Budgets
Financial Budget
Operating Budget
Nonmonetary Budget

 Developing Budgets in Organization

Operating unit
budget requests

Division budget
requests

Organizational budget

Prepared by budget
committee

Approved by budget
committee, controller,
and CEO

Structural Control
Organizational Control
Bureaucratic Control
Employee compliance
Strict rules, formal controls,
rigid hierarchy
Directed toward minimum
levels of acceptable
performance
Tall structure, top-down
influence
Directed at individual
performance
Limited and formal

Dimension
Goal of control approach

Degree of formality

Performance expectations

Organization design

Reward system

Participation

Clan Control
Employee commitment
Group norms, culture,
self-control
Directed toward enhanced
performance above and
beyond the minimum
Flat structure, shared
influence
Directed at group
performance
Extended and informal

Strategic Control
Control aimed at ensuring that the organization is maintaining an
effective alignment with its environment and moving toward
achieving its strategic plan.
Focuses on structure, leadership, technology, human resources, and
informational and operational systems.
Focuses on the extent to which an implemented strategy achieves the
organizations goals.

International Strategic Control

Focuses on whether to manage the global organization from a
centralized or decentralized perspective.
Centralization creates more control and coordination, whereas
decentralization fosters adaptability and innovation.

Managing Control in Organizations

Characteristics of Effective Control

Integration with Planning

Flexibility
Accuracy
Timeliness
Objectivity

Resistance to Control

Over control
Inappropriate Focus
Rewards for Inefficiency
Too much accountability