Controlling Management Controlling Management

controlling management

1. Controlling is a primary goal-
oriented function of management in an
organization.
It is a process of comparing the actual
performance with the set standards of the
company to ensure that activities are
performed according to the plans and, if not,
taking corrective action.
Management needs to monitor and evaluate
the activities at all levels. It helps in taking
corrective actions by the manager, in the
given timeline, to avoid contingencies and
losses. Controlling is performed at the upper,
middle and lower levels of the management.

2. In modern organizations, there are
three kinds of control that you will
usually ?nd,
•Concurrent control
•Feedback control
•Feedforward control

3. Concurrent Control
This control can also be referred to as steering or real-time
control.
Thus, this control is associated with adjusting a performance
before any high damage is done.
For example, the ship’s movements are navigated by a sailor
continuously. Also, a driver adjusts the steering of its car
continuously.
This direction for both examples depends upon the obstacles,
destination, and many more. Usually, you will ?nd a control
chart in a factory. This is an example of concurrent control. So,
this control occurs when the activity is still in the process.

4. Feedback control
This process involves collecting information about a
finished task, assessing that information and improvising
the same type of tasks in the future.
The results of the completed activity are compared with
pre-determined standards and if there are any deviations,
corrective action can be taken for future activities. For
example, a restaurant manager may ask the customer
about the quality and taste of food ordered by him/her
and take suggestions to improve the meals.

5. Feedforward Control
A feedforward control system
improves system performance by
taking preemptive action based on
known or anticipated disturbances
rather than reacting to the system's
output. It directly manipulates the
system's input based on a model or
prediction of how disturbances will
impact the output.

6. Why Is Control
Important?
•As the final link in management functions:
Planning
❖Controls let managers know whether their goals and
plans are on target and what future actions to take.
Empowering employees
❖Control systems provide managers with information and
feedback on employee performance.
Protecting the workplace
❖Controls enhance physical security and help minimize
workplace disruptions.

7. The Control
Process
•The Process of Control
1.Measuring actual performance.
2.Comparing actual performance against
a standard.
3.Taking action to correct deviations or
inadequate standards.

8. The Control
Process

9. Common Sources of Information for
Measuring Performance

10. Measuring: How and What We
Measure
•Sources of
Information (How)
Personal observation
Statistical reports
Oral reports
Written reports
•Control
Criteria (What)
Employees
❖Satisfaction
❖Turnover
❖Absenteeism
Budgets
❖Costs
❖Output
❖Sales

11. Compari
ng
•Determining the degree of variation between
actual performance and the standard.
Significance of variation is determined by:
❖The acceptable range of variation from the standard
(forecast or budget).
❖The size (large or small) and direction (over or under) of the
variation from the standard (forecast or budget).

12. Taking Managerial
Action
“”
•Courses of Action
Doing nothing
❖Only if deviation is judged to be insignificant.
Correcting actual (current) performance
❖Immediate corrective action to correct the problem at once.
❖Basic corrective action to locate and to correct the source
of the deviation.
❖Corrective Actions
– Change strategy, structure, compensation scheme, or
training programs; redesign jobs; or fire employees

13. Taking Managerial
Action
•Courses of Action (cont’d)
Revising the standard
❖Examining the standard to ascertain whether or not the
standard is realistic, fair, and achievable.
Upholding the validity of the standard.
–Resetting goals that were initially set too low or too high.

14. Controlling for Organizational
Performance
•What Is Performance?
The end result of an activity
•What Is Organizational Performance?
The accumulated end results of all of the
organization’s work processes and activities
❖Designing strategies, work processes, and work
activities.
❖Coordinating the work of employees.

15. There are possibly as many interpretations of the
term organizational performance as the studies
that have used the construct. Luo et al. (2012)
who conducted a meta-analysis of organizational
performance suggested that it should be
measured in economic and operational terms:
•The economic performance looks at financial and
market outcomes which assess the profits, sales,
return on investment for shareholders, and other
financial metrics.
•The operational performance, on the other hand,
focuses on the observable indices like customer
satisfaction and loyalty, the firm’s social capital,
and the competitive edge derived from
capabilities and resources.

16. Financial measures
Financial metrics help a company evaluate its
profitability and overall effectiveness at making
profits.
One of the key financial metrics you can find for a
company is the return on assets. The return on
assets is a ratio that shows how profitable a
business is in comparison to its total assets.
Another financial metric you may calculate for a
company is the return on equity, which is the
result of dividing a company's net income by its
shareholders' equity.
This figure reveals a company's return on net
assets since its shareholders' equity equals a
business' assets minus its debts.

17. Internal business process measures
Internal business process measures are metrics
that quantify a company's operations.
For example, a company that sells a product may
calculate how long it takes employees to
manufacture one unit.
If the product is complex, the company may
decide to time each production stage. If the
product is relatively simple and does not contain
multiple components, the company may time its
completion as a whole.
A company may choose to compare its
production times to those of a competing business.
A service-based company may also time how long
it takes employees to deliver the service to its
customers.

18. Customer measures
Customer measures are organisational performance
metrics that relate to customer retention, satisfaction and
attraction.
Gathering data on customer measures can inform
business leaders of the perceptions that customers have
about a company.
A few common customer measures include the number of
new customers, the number of repeat customers and the
percentage of repeat customers.
If a business notices that it has a high percentage of repeat
customers but low numbers of new customers, its leaders
may determine that it needs to renew its marketing efforts
to a broader audience.

19. EMPLOYEE THEFT
employee theft refers to the act of
employees unlawfully taking or
misappropriating company assets, resources,
or time for personal gain. This can
encompass a range of behaviors, including
stealing physical goods, embezzling funds,
falsifying records, or even time theft by
being absent, unproductive, or engaging in
non-work-related activities during paid
hours. It poses significant challenges to
businesses, impacting their financial stability,
reputation, and overall operations.

20. WORKPLACE CONCERNS
Low motivation and job satisfaction.
Extended work hours
Being passed over for a promotion
Poor work life Balance
Lack of motivation
Trust issues
Lack of communication
Employee Theft