CONTROLLING

Members:
Chezka Frias
Johanne Langusta
Katrine Tunay
Sandrey Paolma
Anthon Clavel
Jason Chua
Red Ordoyo
 What is Controlling?
 Control, or controlling, is one of the managerial functions like
planning, organizing, staffing and directing. It is an important
function because it helps to check the errors and to take the
corrective action so that deviation from standards are minimized
and stated goals of the organization are achieved in a desired
manner.
 According to modern concepts, control is a foreseeing action
whereas earlier concept of control was used only when errors were
detected. Control in management means setting standards,
measuring actual performance and taking corrective action.
Limitations of Controlling :
The defects of limitations of controlling are as following:’’

1) Difficulty in Setting Quantitative Standards:

- it becomes very difficult to compare the actual performance with the
predetermined standards, are not expressed in quantitative terms. This is especially
so in areas of job satisfaction, human behavior and employee moreale.

2) No Control on External Factors:

- An organization fails to have control on externa factors like technological
changes, competition, government policies, and changes in taste of consumers etc.

3) Resistance from Employees:

- often employees resist the control systems since they consider them as curbs on
their freedom.

4) Costly Affair:
- Controlling involves a lot of expenditure, time and effort, thus it is costly affair.
Manager are required to ensure that the cost involved in installing and operating a
control system should not be more than the benefits expected from it.
 In 1916, Henri Fayol formulated one of the first
definitions of control as it pertains to management:
 Control of an undertaking consists of seeing that
everything is being carried out in accordance with the
plan which has been adopted, the orders which have
been given, and the principles which have been laid
down. Its object is to point out mistakes in order that
they may be rectified and prevented from recurring.
FIVE MAJOR ROLES OF CONTROLLING
1. Coping with Uncertainly
- It is the unexpected changes in such areas as customer demand,
technology, and available of materials. As the uncertainties arise, the
manager if better able to monitor the specific activities and to react quickly
to those significant changes in the environment.
2. Detecting Irregularities
- Detecting Undesirable irregularities such as poor quality, cost overrun,
rising of personnel turnover can often save a great deal of time, money and
can prevent minor problems from mushrooming into major ones.
3. Identifying Opportunities
- A manager must be alert to identify certain opportunities in an
organization. It helps highlight the situation in which things are going better
the expected. It develop a successful strategies on how to improved things.
4. Handling Complex Situation
- As organizations grow larger and engage in more complex
situation or projects, control enhance coordinate. It helps
managers to keep track to all major elements to be sure that
they are all synchronized.

5. Decentralizing Authority
- Another major role of control is affording managers to
disperse a function and a power from higher authority to major
ones. A manager can foster decision making and give orders at a
lower levels in an organization but still maintain a handle on
progress.
According to EFL Brech:
 - Control is checking current performance against pre-determined
standards contained in the plans, with a view to ensure adequate
progress and satisfactory performance.

According to Harold Koontz:

 - Controlling is the measurement and correction of performance in
order to make sure that enterprise objectives and the plans devised
to attain them are accomplished.

According to Stafford Beer:

 - Management is the profession of control.
Characteristics
 Control is a continuous process
 Control is a management process
 Control is forward looking
 Control is closely linked with planning
 Control is a tool for achieving organizational activities
 Control is an end process
 Control compares actual performance with planned performance*
 Control point out the error in the execution process
 Control minimizes cost
 Control achieves the standard
 Control saves time
 Control helps management monitor performance
 Compares performance against standards
The importance of Controlling
1.) Accomplishing or Organizational
2.) Judging Accuracy of Standards
3.) Making Efficient Motivation
4.) Improving Employee Motivation
5.) Ensuring Order and Discipline
6.) Planning

The four basic elements in a control system:

 the characteristic or condition to be controlled
 the sensor
 the comparator
 the activator
The Control Process
Step 1. Establishment of Standard.
Standards are the criteria against which actual performance will be measured.
Standards are set in both quantitative and qualitative terms.

Step 2. Measurement of actual performance

Performance is measured in an objective and reliable manner. It should be
checked in the same unit in which the standards are set.

Step 3. Comparing actual performance with standards.

Step 4. Analysis the cause of deviations.

Step 5. Taking corrective action.

 Measuring
Actual
Performance

Comparing
Taking
actual
Managerial
performance
Action
with standards
Types of Control
1. Feedforward Control
- is the regulations of inputs to ensure that they meet the standards
necessary for the transformation process. Inputs that can be subject to feed-
forward control include materials, people, finances, time, and other resources
used by an organization. Also calle preliminary control, precontrol, preventive
control, or steering control.

2. Concurrent Control
- Involves the regulation of ongoing activities that are part of the
transformation process ensure that they conform to organizational standards.
The emphasis here is on identifying difficulties in the productive process that
could result in faculty output. Sometimes called screening or yes-no control.

3. Feedback Control
- is a regulation exercised after a product or service has been completed to
esure that the final output meets organizational standards and goals. Feedback
control sometimes called post action control or output control, fulfils a number
of important functions.
 Input Process Output

• Feedforward • Concurrent • Feedback

control controls control
• Anticipates • Corrects • Corrects
problems problems problems
as they after they
happen occur
MANAGERIAL APPROACHES TO IMPLEMENTING
CONTROLS

1. MARKET CONTROL
- Involves the use of price competition to evaluate output. Managers compare profits and
prices to determine the efficiency of their organization. In order to use market control,
there must be a reasonable level of competition in the goods or service area and it must
be possible to specify requirements clearly.

2. BUREAUCRATIC CONTROL
- Is the use of rules, policies and hierarchy of authority, written documentation, reward
systems, and other formal mechanisms to influence employee behavior and assess
performance.

3. CLAN CONTROL
- Represents cultural values almost the opposite of bureaucratic control. Clan control relies
on values, beliefs, corporate culture, shared norms, and informal relationships to regulate
employee behaviors and facilitate the reaching of organizational goals.
THE BASIC CONTROL PROCESS
1. ESTABLISHMENT OF STANDARDS
2. MEASUREMENT OF PERFORMANCE
3. CORRECTION DEVIATION
THE PRIMARY TYPES OF ORGANIZATION CONTROL
STRATEGIC CONTROL – concerned with tracking the strategy as it is being implemented,
detecting any problems areas or potential problem areas, and making any necessary
adjustments.

FOUR LEVERS FOR STRATEGIC CONTROL

1. BELIEF SYSTEMS
2. BOUNDARY SYSTEMS
3. PERFORMANCE MANAGEMENT SYSTEMS
4. INTERACTIVE MONITORING
KINDS OF CONTROLLING
 Control may be grouped according to three general classifications:
 the nature of the information flow designed into the system (open- or closed-
loop control)
 the kind of components included in the design (man or machine control
systems)
 the relationship of control to the decision process (organizational or operational
control)
Open- and Closed-loop Control

 A street-lighting system controlled by a timing device is an example of

an open-loop system. At a certain time each evening, a mechanical
device closes the circuit and energy flows through the electric lines to
light the lamps. Note, however, that the timing mechanism is an
independent unit and is not measuring the objective function of the
lighting system.
Human and Machine Control

The elements of control are easy to identify in machine systems. For example, the
characteristic to be controlled might be some variable like speed or temperature, and the
sensing device could be a speedometer or a thermometer.
 Organizational and Operational
Control

The concept of organizational control is implicit in the bureaucratic theory of Max Weber.
Associated with this theory are such concepts as "span of control", "closeness of
supervision", and "hierarchical authority". Weber's view tends to include all levels or types
of organizational control as being the same.
Information Flow

Another problem of control relates to the improper timing of information

introduced into the feedback channel. Improper timing can occur in both
computerized and human control systems, either by mistakes in measurement
.
or in judgment
Setting Standards

 Setting the proper standards or control limits is a problem in many systems. Parents
are confronted with this dilemma in expressing what they expect of their children,
and business managers face the same issue in establishing standards that will be
acceptable to employees.