Foundation of Control MGT Principles of Management and Business

Objectives ✤ Explain the nature and importance of control ✤ Describe the three steps in the control process ✤ Discuss the types of controls organizations and managers use

What is Control? And Why? ✤ Control: is the management function that involves monitoring activities to ensure that they’re being accomplished as planned and correcting any significant deviations ✤ Why is control important? 1. Goals: to ensure that what employees are supposed to do is being done and goals are being achieved. 2. Empowering: to provide information and feedback on employee enforcement and minimize the chance of potential problems 3. Organization and assets: to protect organization and assets against threats (like natural disasters, financial pressure and scandals, workplace violence, supply chain disruptions, security breaches, and even possible terrorist attacks)

Planning-Controlling Link Planning Goals Objectives Strategies Plans Organizing Structure Human Resource Management Leadership Motivation Leadership Communication Individual and Group Behavior Controlling Standards Measurements Comparison Actions

The Control Process ✤ Definition ✤ A three-step process of measuring actual performance against a standard, and taking managerial action to correct deviations or to address inadequate standards

The Control Process GoalsStandard Measure actual performance Revise standard Correct performance Identify cause of variation Do nothing Is standard being attained? Is variance acceptable? Is standard acceptable? Compare actual performance with standard Yes No

How Do We Measure? ✤ Four common sources of information frequently used to measure performance: ✤ Personal observation ✤ Statistical reports ✤ Oral reports ✤ Written reports

MBWA ✤ Management by Walking Around (MBWA): when a manager is out in the work area interacting with employees

Range of Variation ✤ Range of Variation: the acceptable parameters of variance between actual performance and a standard t t + 1 t + 2 t + 3 t + 4 t + 5 Acceptable range of variation Standard Acceptable upper limit Acceptable lower limit

How to Correct Actual Performance? ✤ Immediate Corrective Actions: corrective action that addresses problems at once to get performance back on track ✤ Basic Corrective Actions: corrective action that looks at how and why performance deviated before correcting the source of deviation

When Does Control Take Place? Definition How it works Feedforward Control Control that takes place before a work activity is done Anticipate problems Concurrent Control Control that takes place while a work activity is in progress Correct problems as they happen Feedback Control Control that takes place after a work activity is done Corrects problems after they occur

Learning Outcomes ✤ Control is important because it helps us make sure that the organization goals are better attained and that organizational assets are well maintained ✤ The control process is a three-step process of measuring actual performance against a standard, and taking managerial action to correct deviations or to address inadequate standards ✤ The company needs to take different control actions and at different times depending on the need for a corrective action