1. Chapter-3.6 Controlling

2. Controlling defined
Williams (2012) control is a regulatory process of establishing standards to achieve organisational goals, comparing actual performance to the standards, and taking corrective action when necessary.

3. Cont’d
Schermerhorn (2002) defines controlling as the process of measuring performance and taking corrective action to ensure desired results. Dessler (2007) defines control as the task of ensuring that activities are getting desired results

4. Control system informs management that:
the Activities are proceeding according to plans; so no need for the existing plans to be replaced, hence it should be continued.
Things are not proceeding according to the plan therefore, there is need for the existing plan to be adjusted.

5. Cont’d
The situation has changed the existing plan which is in place must be changed totally or a new plan should be put into use.

6. Key areas to control Physical resources Human Resources
Information resources
Financial resources

7. Importance of Controlling
Ensures that all activities of organisations are in accordance with plans.
Resources are utilized properly.
Leads to better results.

8. Enables management to cope with changes and uncertainty in the environment.
Controlling facilitates delegation and teamwork.

9. The Control Process/Steps in controlling
1.Establishment of clear standards of performance
2. Measuring/Comparing performance with established standards,
3. Evaluating deviations/performance
4. Corrective action to repair performance deficiencies

10. Step 1-Establishing Standards
Standards are criteria at which future performance will be measured.
Standards should be SMART.
Examples of standards are:
profit standards
market share standards
productivity standards
staff development standards

11. Cont’d Therefore, standards : Must enable goal achievement
Listen to customer’s comments, complaints, and suggestions.
Benchmarking
determining other companies’ standards

12. Step 2- Measuring/Comparing actual performance
Performance data can be obtained from:
written reports
oral reports
personal observations.
Statistical reports

13. Step 3- Evaluating deviations/ Performance
Comparing actual performance with standards set.
Managers apply conceptual skills –when comparing –the actual and standard performance.
If performance falls short of standards or exceeds -causes must be identified.

14. Step 4-Taking Corrective action
Corrective action is aimed at achieving better results.
Actual performance match with performance standards-no corrective action-only if standards set were SMART.
Any deviations corrective action is taken.

15. Step 3:Evaluate deviations/performance
Step 1 Establish performance standards
Step 4
Take corrective action
Step2: Measure/ Compare actual performance
Step 3:Evaluate deviations/performance

16. Control Methods Feedback control Concurrent control
Feed forward control
Feedback control is a mechanism for gathering information about performance deficiencies after they occur. This information is then used to correct performance deficiencies or prevent future deficiencies.
The three basic control methods are feedback control, concurrent control, and feed forward control. Feedback control is a mechanism for gathering information about performance deficiencies after they occur. This information is then used to correct performance deficiencies or prevent future deficiencies. Study after study has clearly shown that feedback improves both individual and organizational performance. In most instances, any feedback is better than no feedback. If feedback has a downside, it’s that it always occurs after the fact, after performance deficiencies have already occurred. Control can minimize the effects, but the damage is already done. Concurrent control addresses the problems inherent in feedback control by gathering information about performance deficiencies as they occur. Feedforward control is a mechanism for gathering information about performance deficiencies before they occur. In contrast to feedback and concurrent control, which provide feedback on the basis of outcomes and results, feedforward control provides information about performance deficiencies by monitoring inputs, not outputs. Thus, feedforward control seeks to prevent or minimize performance deficiencies before they happen.

17. Cont’d
Concurrent control addresses the problems inherent in feedback control by gathering information about performance deficiencies as they occur.
Feed forward control is a mechanism for gathering information about performance deficiencies before they occur.

18. Requirements of effective control system (principles of control).
Suitability
Prompt reporting
Forward looking
Focus on strategic points
Flexible.

19. Cont’d Objective—definite – qualitative/quantitative
Reflection of organization pattern.
Economical-cost effective
Understandable
Suggestive remedial action