1. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 Management and Organisational Behaviour 7th Edition PART 8 Improving Organisational Performance

2. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 Management and Organisational Behaviour 7th Edition CHAPTER 21 Organisational Control and Power

3. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.2 The meaning of control An inherent characteristic of the nature of organisations Process of control is at the centre of the exchange between the benefits that the individual derives from membership of an organisation & the costs of such benefits

4. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.3 The meaning of control Control processes help circumscribe idiosyncratic behaviours & keep them conformant to the rational plan of the organization Tannenbaum

5. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.4 Management control Primarily a process for motivating & inspiring people to perform organisational activities that will further the organisational goals. A process for detecting & correcting unintentional performance errors & intentional irregularities, such as theft or misuse of resources. Berry et al. Monitors the performance of the delegated task so that the expected results are successfully achieved. Payne & Payne

6. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.5 The nature of management control Figure 21.1

7. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.6 The controversial nature of control Control often has an emotive connotation & is interpreted in a negative manner to support direction or command by the giving of orders Control systems regulate behaviour People can be suspicious of control systems Control can emphasise punishment Organisational control exploits employees

8. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.7 Control & the classical approach Control is viewed as an essential feature of formal organisation and a hierarchical structure of authority Taylorism & scientific management can be seen as representing a form of management control over workers & the actual process of work

9. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.8 Control & the traditional view Assumes the amount of control is fixed Based on the use of routine procedures & the exercise of rules & regulations in an attempt to create consistency & predictability in behaviour

10. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.9 Control & the human relations approach Control is seen more as a feature of interpersonal influence and takes place within a network of interaction and communications

11. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.10 Control & the contingency approach Management control is an organisation variable While the need for control is constant, the extent & manner of control is variable

12. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.11 Messages for today Control must never outweigh leadership Control is the hallmark of the Old World while leadership is a measure of the New. Obeng Command and control is out. Consultation & communication is in … Lucas Many employees have grown up in hierarchical organisations & are accustomed to external authority & the dead weight of organisational history. Cloke & Goldsmith

13. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.12 Elements of an organisational control system There are five elements of a control system – 1.Planning 2.Establishing 3.Monitoring 4.Comparing 5.Rectifying

14. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.13 Elements of an organisational control system Figure 21.2

15. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.14 Planning what is desired Providing the framework against which the process of control takes place Involves – Clarifying the aims to be achieved Specifying objectives & targets

16. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.15 Establishing defined standards of performance Realistic measurements against which success can be measured Measurements stated where possible in quantitative terms

17. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.16 Monitoring & comparing actual performance Interpreting & evaluating information in order to detail progress, reveal deviations & identify probable causes Information feeds back to those concerned to let them know how well they are getting on

18. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.17 Taking corrective action Considering what can be done to improve performance Authority takes appropriate action to correct the situation, review the operation of the control system & make any necessary adjustments to objectives & targets

19. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.18 Forms of control Control systems can focus on the measurement of inputs, outputs, processes or the behaviour of people Controls can be concerned with general results or with specific actions Controls can be concerned with an evaluation of overall performance of the organisation as a whole or parts of it Controls can be concerned with the measurement & performance of day to day operational activities

20. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.19 Behavioural control Is based on direct supervision Useful to needs of individual managers in their attempts to control subordinates Is responsive to the particular needs of the tasks, abilities of the manager & the norms of the organisation

21. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.20 Output control Based on the measurement of outputs & the results achieved Serves the needs of the organisation as a whole

22. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.21 Technology & control systems Woodward’s study of 100 manufacturing firms in South Essex Unit & small batch production firms tended to have unitary & mainly personal control Process production firms tended to have unitary & mainly impersonal controls Large batch & mass production firms predominantly had personal controls

23. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.22 Increasing use of IT With increasing use of IT, control will become more indirect Information systems will be used to increase control by measuring more things, new things at multiple levels, and at a greater frequency than before Nordstrom & Ridderstrale

24. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.23 Characteristics of an effective control system Understood by those involved in its operation Conforms with the structure of the organisation Is related to decision centres responsible for performance Reports deviations from the desired standards of performance as quickly as possible

25. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.24 Characteristics of an effective control system Draws attention to the critical activities which are important to the success of the organisation Flexibility Consistent with the objectivity of the activity to which it relates Subject to a continual review

26. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.25 Strategies of control in organisations Personal centralised Bureaucratic Output Cultural Child

27. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.26 Power A complex & dynamic concept that is difficult to define easily Broadly – control or influence over the behaviour of other people with or without their consent More specifically – the medium through which conflicts of interest are ultimately resolved. Influences who gets what, when & how Morgan

28. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.27 Types of power Coercive Remunerative Normative

29. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.28 Involvement The degree of commitment by members to the organisation Alienative Calculative Moral

30. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.29 Perspectives of organisational power Processual level Institutional level Organisational level Fincham

31. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.30 Acquiring power Providing resources Coping with uncertainty Being irreplaceable Affecting decision processes By consensus Pfeffer

32. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.31 Pluralistic approaches to power Reward power Coercive power Legitimate power Referent power Expert power French & Raven

33. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.32 Three main forms of control Direct control by orders, direct supervision & rules & regulations Control through standardisation & specialisation Control through influencing the way that people think about what they should do Stewart

34. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.33 Manager – subordinate relationship Authority Responsibility Accountability

35. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.34 The basis of delegation Figure 21.5

36. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.35 Reasons to delegate Makes best use of manager’s time Means of training & development Encourages development of specialist knowledge & skills Geographical location Sound economics Improves strength of the workforce

37. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.36 Main stages in the process of delegation Figure 21.6

38. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.37 Balance between delegation & control Figure 21.8

39. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.38 Empowerment Allowing employees greater freedom, autonomy, & self control over their work, & responsibility for decision making Empowerment can be succinctly defined as the authority of subordinates to decide & act Mills & Friesen

40. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.39 Empowering managerial initiatives Empowerment through participation Empowerment through involvement Empowerment through commitment Empowerment through de-layering Lashley

41. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.40 Resistance to control systems Most likely to be present when: Control system measures performance in a new area Control system replaces a system that people have a high investment in maintaining Standards are set without participation Results from the control system are not fed back to the people whose performance is measured

42. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.41 Resistance to control systems Most likely to be present when: Results from the control are fed to higher levels in the organisation People affected by the system are relatively satisfied with things as they are Those affected by the system are low in self- esteem & authoritarianism Lawler

43. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.42 Overcoming resistance to management control Consultation & participation Motivation Organisation structure Groups & informal organisation Leadership style & systems of management

44. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 21.43 MBO as a control system Table 21.2 Source: Adapted and reproduced with permission from Humble, J.W., Management by Objectives, Management Publications Limited for the British Institute of Management (1972) p.46.