Directing and Controlling

Meaning and nature of directing, leadership styles, motivation, meaning and importance, Communication, meaning and importance, co-ordination, meaning and importance and techniques of co-ordination, control, meaning, features, importance and steps in control process, essentials of a sound control system, methods of establishing control (in brief).

1. UNIT V
1
MR.T.SOMASUNDARAM
ASSISTANT PROFESSOR
DEPARTMENT OF MANAGEMENT
KRISTU JAYANTI COLLEGE,
BANGALORE.

2. UNIT V
DIRECTING & CONTROLLING
Meaningandnatureofdirecting,leadership
styles,motivation,meaningand
importance,Communication,meaningand
importance,co-ordination,meaningand
importanceandtechniquesofco-
ordination,control,meaning,features,
importanceandstepsincontrolprocess,
essentialsofasoundcontrolsystem,
methodsofestablishingcontrol(inbrief).
2

3. DIRECTING
Meaning:
Directingissaidtobeaprocessinwhichthemanagers
instruct,guideandoverseetheperformanceoftheworkers
toachievepredetermined.
Itissaidtobetheheartofmanagementprocess.
Itisacomplexmanagerialfunctionconsistingofal
activitiesthataredesignedtoencouragedsubordinatesto
workeffectively.
Definition:
"Activatingdealswiththestepsamanagertakestoget
sub-ordinatesandotherstocarryoutplans"
-NewmanandWarren.
Directingconcernsthetotalmannerinwhicha
managerinfluencestheactionsofsubordinates. 3

4. Nature(Characteristics)ofDirecting:
InitiatesAction–keymanagerialfunctionandmanagerhas
toperformthisfunction.
ContinuingFunction–itisacontinuousactivity
throughoutthelifeoforganization.
PervasiveFunction–itisrequiredatalllevelsof
organization.
CreativeFunction–helpsinconvertingplansinto
performance.
Linkingfunction–initiatedattoplevel&flowstobottom
throughorganizationhierarchy.
ManagementofHumanFactor–itisrelatedto
subordinatesandthereforeitisrelatedtohumanfactor.
4

5. PrinciplesofDirecting:
•PrincipleofMaximumIndividualcontribution.
•PrincipleofHarmonyofobjectives.
•PrincipleofUnityofCommand.
•PrincipleofAppropriatenessofDirectiontechnique.
•PrincipleofManagerialCommunication.
•PrincipleofuseofInformalorganization.
•PrincipleofLeadership.
•Principleoffollowthrough.
ElementsofDirecting:
Thethreeelementsofdirectingare
•Motivation
•Leadership
•Communication
5

6. LEADERSHIP
Definition:
“Leadershipistheartofprocessofinfluencingpeopleso
thattheywillstrivewillinglytowardstheachievementofgroup
goals”.
-Koontz&O’Donnel
“Leadershipistheactivityofinfluencingpeopletostrive
willinglyforgroupobjectives”. -GeorgeR.Terry
“Leadershipisdefinedasinfluence,theartorprocessof
influencingpeoplesothattheywillstrivewillinglyand
enthusiasticallytowardtheachievementofgroupgoals”.
“Leadershipistheprocessofinfluencingtheactivitiesofan
individualoragroupineffortstowardsgoalachievementina
givensituation”. -Heresy&Paul
6

7. Nature(characteristics)ofLeadership:
Involvesguidingandmotivating.
Needssubordinatesandcommoninterests.
Promotesinterestinthework.
Needssupportfromall.
Influencessubordinatesthroughpersonalqualities.
Dynamicandcontinuousprocess.
Leadershipissituational.
Assumesobligation.
Needsinteractionwithfollowers.
Achievementofobjectives.
7

8. ImportanceofLeadership:
1.Motivatingemployees:
-Highermotivationwillmaketheemployeesforhigherperformance.
2.Leaderdevelopsteamwork:
-leader,subordinates&environmentarethreevitaldeterminantsof
teamwork&leadershouldmaketheenvironmenttoworkefficiently.
3.BetterutilizationofManpower:
-leaderimplementsplans,policies,programmesoforganizationto
utilizeavailablemanpowereffectively&getmaximumproduction.
4.Creatingconfidencetofollowers:
-leadercreateconfidentsinhisfollowersbydirectingthem.
5.Directinggroupactivities:
-leadercandirecthisfollowerandtakestheleadinallactivities.
6.Buildingmorale:
-basedonattitudes,voluntarycooperation,highmorale.
7.Maintainingdiscipline:
-promptsindividualtoobserverules,procedurestoachievegoals.8

9. LeadershipQualities:
9

10. LeadershipStyles:
Thebehaviourexhibitedbyaleaderduringsupervisionoffollowers.
1.AutocraticOrDictatorialleadership:
Theleadertakesalldecisionsby
himselfwithoutconsultingsubordinates.
Hehasfullauthorityandneverdelegates
authority.
*Types:
a)Strictautocrat–leaderfollowsthisstyleinstrictmanner.
-hefollowsnegativemotivationforgettingwork.
b)Benevolentautocrat–takesdecisionhimselfbutgivespositive
motivation.
c)Incompetentautocrat–adoptthisstyletohidetheirinabilities(i.e.)
incompetence.
*Autocraticleadershipstyleisappropriatein-
-subordinateshavinglackofknowledgeaboutcompanygoals.
-subordinatesareinexperienceorlackoftraining.
Autocratic leader
Follower
Follower
Follower
10

11. -companyindicatesfear&punishmentasdisciplinarytechniques.
-leaderisactiveanddominantindecision–making.
-littlechanceforerrorinfinalaccomplishment.
Advantages:
-facilitatesquickdecisionmaking.
-providesstrongmotivationandsatisfactiontoleader.
-highestproductivity,yieldpositiveoutcome.
-lesscompetentsubordinatesatlowlevels.
Disadvantages:
-employeemoralewillbelow,absenceofleaderaffectoutput.
-dissatisfactionwilldevelopamongemployees.
-employeeturnoverwillbemore.
-fullpotentialcreativeideasofsubordinatesarenotfullyutilized.
-communicationwithoutfeedbackleadstomisunderstandingand
communicationbreakdown.
11

12. 2.ParticipativeOrDemocraticleadership:
Subordinatesareconsultedandtheirfeedbackistakenintodecision
makingprocess.
Theauthorityisdecentralized&thisleaderattachedtobothworkand
people.
*Participativeleadershipisappropriate-
-trulydesirestoheartheideasofhisemployees.
-organizationhascommunicateditsgoalsandobjectivesto
subordinates.
-workersarereasonablyknowledgeandexperienced.
-timefortaskcompletionallowsforparticipation.
-subordinatesdesireactiveandtrueinvolvement.
Democratic leader
Follower Follower Follower
12

13. Advantages:
-subordinatesaremotivatedbyparticipationindecisionmaking
process.
-absenceofleaderdoesn’taffectoutput.
-labourabsenteeismandturnoverwillbeminimum.
-qualityisdecisionisimproved.
-leadermultiplieshisabilitiesthroughcontributionofhisfollowers.
Disadvantages:
-timeconsuming,resultsdelayindecisionmaking.
-subordinatesarelazy&avoidwork,controllingisdifficult.
-itcan’tappliedatlowerlevelofmanagement.
-leadersmaybeuncomfortablewithreductioninpower&control
overlabour.
-yieldpositiveresultswhensubordinatespreferminimuminteraction
withleader.
-leaderrequirescommunicationandpersuasiveskill.
13

14. 3.Laissez-FaireOrFreereinleadership:
Completefreedomtosubordinatesforplanning,motivation,control.
Authorityisdecentralized&leaderwillnottakedecision.
*Thistypeofleaderiseffective-
-leaderisinterestedindelegatingdecisionmaking.
-subordinatesarehighlyintelligentandawareofroles&
responsibility.
Advantages:
-positiveeffectonjobsatisfaction&
morale.
-createsenvironmentoffreedom&teamspirit.
-fullutilizationofpotentialofsubordinates.
Disadvantages:
-lackofdiscipline,lowestproductivity.
-nocontrol&co-ordination.
-membersputtheirowninterest.
Free –rein leader
Follower
Follower
Follower
14

15. 4.Bureaucraticleadership:
Theyfollowrulesrigorouslyandensurethattheirstafffollows
proceduresprecisely.
Thisisappropriatestyleforworkinvolvingserioussafetyrisks.
5.Charismaticleadership:
Itissimilartransformationalleadership,becauseleadersinspirelots
ofenthusiasmintheirteamsandenergeticindrivingothersforward.
Charismaticleaderscantendtobelievemoreinthemselvesthanin
theirteams.
Charismaticleadershipcarriesgreatresponsibilityandneedsalong-
termcommitmentfromtheleader.
6.Servantleadership:
Servantleadershipisaformofdemocraticleadership,becausethe
wholeteamtendstobeinvolvedindecisionmaking.
Someone,atanylevelwithinanorganization,leadssimplyby
meetingneedsofteam,itisdescribedas‘ServantLeader”.

16. 7.Transactionalleadership:
Itstartswithideathatteammembersagreetoobeytheirleadertotally
whentheyacceptajob.
Itislikepayingtheteammembersinreturnfortheireffortand
compliance.
8.Transformationalleadership:
Peoplewiththisstylearetrueleaderswhoinspiretheirteams
constantlywithsharedavisionoffuture.
Thisleaderslookafterinitiativesthataddnewvalue.
9.Task–Orientedleadership:
Itfocusonlyongettingjobdoneandactivelydefinesworkandroles
required,putstructuresinplace,plan,organizeandmonitor.
10.People–Orientedleadership:
Ittotallyfocusonlyonorganizing,supportinganddevelopingthe
peopleintheirteams.
Itisparticipativestyleandencouragegoodteamwork.

17. MOTIVATION
Definition:
“Motivation”isaLatinword,meaning‘tomove”.
“Motivationistheprocessofinducingpeopleinnerdrivesand
actionstowardscertaingoalsandcommittinghisenergiestoachieve
thesegoals”.
“Motivationisageneraltermapplyingtotheentireclassof
drives,desires,needswishesandsimilarforcesthatinducean
individualoragroupofpeopletowork”.-Koontz&O’Donnell
“Motivationmeansaprocessofstimulatingpeopletoactionto
accomplishdesiredgoals”. -Scott
“Motivationistheprocessofattemptingtoinfluenceotherstodo
yourwillthroughthepossibilityofreward”. -EdwinB.Flippo
17

18. Nature(Characteristics)ofmotivation:
-itisanunendingprocessbecausehumanneedsareunlimited.
-itisanpsychologicalconcept.(inducementoffeeling)
-itisbehaviouralconceptthatdirectshumanbehaviour.
-personcan’tbepartiallymotivated,frustratedmancan’tbe
motivated.
-itcanbeeitherpositive(incentive,bonus,rewards)&negative
(demotion,penalties).
-itisacomplexprocess&systemoriented.
-itdependson3factors–
i)influencesindividual
ii)influencesorganizationand
iii)externalenvironment.
-itisdifferentfromsatisfaction.(i.e.)Motivationisdrive&effortto
satisfyandSatisfactionisexperienced,feelswhenpersonissatisfied.
18

19. ImportanceofMotivation:
Productiveuseofresources.
Increasedefficiencyandoutput.
Achievementofgoals.
Developmentoffriendlyrelationships.
Stabilityinworkforce.
Bestutilizationofresources.
Willtocontribute.
Reductioninlabourproblems.
Sizeableincreaseinproductionandproductivity.
Basisofcooperation.
Improvementuponskillandknowledge.
Acceptanceoforganizationalchange.
Betterimage.
19

20. TypesofMotivation(Techniques):
1.Positivemotivation:
-properrecognitionofemployee’seffortsandappreciationof
employeecontributiontowardsgoalachievement.
(E.g.)pride,authority,responsibility,economicbenefits.
2.Negativemotivation:
-thisisbasedonforce,fear&threats.
(E.g.)failtocompletethework,demotion,dismissed,paycut.
3.Extrinsicmotivation:
-thisisinducedbyexternalfactors.
(E.g.)higherpay,restperiods,holidays,profitshare,health
insurance.
4.Intrinsicmotivation:
-thisisavailableatthetimeofperformanceofwork.
(E.g.)Praise,recognition,power,status,participation.
20

21. COMMUNICATION
Definition:
"Communication,isanintercoursebywords,letters
symbolsormessages,andisawaythattheorganization
memberssharesmeaningandunderstandingwithanother".
-Koontz&O’Donnell
Communicationfunctioninorganizations:
Itisthepowerfultool&significantcharacteristicsofman-kind.
Itissuccessofmanagementdependonabilitytocommunicate
withlabour.
Itistheprocessofinterchangingfacts,viewpointsandideas
betweenpersonsindifferentpositionsbyeffective
communication.
Thisleadtoworksatisfactorilyintheorganization.
21

22. ImportanceofCommunication:
NecessaryofPlanning.
BasisofCo-ordination.
Establishmentofeffectiveleadership.
Increasesmanagerialefficiency.
PromotesCo-operationandIndustrialpeace.
BasisofDecision–making.
MoraleBuildingandMotivation.
SmoothWorkingofEnterprise.
JobSatisfaction.
22

23. PurposeandFunctionofCommunication:
NeedforCommunication:
Toestablish&spreadgoalsofenterprisewidely.
Todevelopplansforfurtherachievement.
Toorganizehuman&otherresourcesinmosteffectiveandefficient
way.
Toselect,develop&appraisemembersoforganization.
Tolead,direct,motivate&creategoodworkingenvironment.
Tocontrol&maintaintheuniformsperformancethroughout.
Planning ControllingLeadingStaffingOrganizing
Communication
External Environment
•Suppliers
•Customers
•Governments
•Community
•Others
23

24. CommunicationProcess(Or)ModelofCommunication
(Or)Elements:
Feedback
Decoding
Source /
Sender
Encoding Channel
Receiver
Noise
Understanding
24

25. 1.Source(Or)Sender:
-thisisoriginofcommunication&itcanbeindividualorgroup.
-thepersonwhoinitiatetheprocessassender,sourceor
communicator.
-hesendamessagetosomeotherpersontoachievesomepurpose.
2.Encoding:
-thisindicatecontentofmessage,wheresenderusehisownframeof
reference(e.g.)organization,situation,personalrelationships,
attitudes,knowledge&experience.
-threeconditionsforencodingarei)Skill–speaking,reading,
listening&reasoningskills,ii)Attitudes–influenceourbehaviour,
predisposedideasonno.oftopics,iii)Knowledge–amountof
knowledgeaboutsubjectandseekstotransfer.
3.TheMessage:
-itisactualphysicalproductfromsourceencoding&contains
thoughtsandfeelings.
-2components,i)Content(words,ideas),ii)Affect(feeling,
emotion)
25

26. 4.Channel:
-themediumthroughwhichtheencodedinformationistransmitted
fromsendertoreceiver.(E.g.)noticeonnoticeboard,circulars,
booklets,telephone,e-mail,fax,videoconference.
5.Symbols:
-itprovidesthebasisfortransferofinformationsymbolsinformof
written(words),sketches,figures,orallikeactionandcoding,etc.
6.Decoding:
-itmeansinterpretingwhatthemessagemeans&itdependsupon
individualcharacteristicsofsenderandreceiver.
-itisbasedontypeofperception&subjecttoperceptionbiases.
7.Receiver:
-thepersonwhoreceivesfinalinformationortowhomthemessageis
directedandunderstandsit.
-tounderstandtherelevantinformation,thepersonshouldconvertthe
decodedinformationcorrectly.
8.Feedback:-helpsendertopayattention&interpretsit.
26

27. COORDINATION
Meaning:
Itisunificationandintegrationoftheeffortsofgroupmembers
andtoprovideunityofactioninachievementofcommongoals.
Coordinationishelpfulinachievingtheobjectivesofthe
organization.
Itisaprocessanditisnotfixed,itprefersgroupactivities.
Definition:
“Co-ordinationisapartofallphasesofadministrationand
thatisnotaseparateanddistinctactivity".-Newman
“Co-ordinationistheintegrationofseveralpartsintoan
orderlywhosetoachievethepurposeofunderstanding".
-CharlesWorth
27

28. ElementsofCo-ordination:
Co-ordinationthroughPlanning.
Co-ordinationthroughOrganizing.
Co-ordinationthroughStaffing.
Co-ordinationthroughDirecting.
Co-ordinationthroughControlling.
ImportanceofCo-ordination:
BackboneofManagement.
UnificationofActivities.
CreatingHealthyHumanRelations.
SecuringHighEmployeeMorale.
PromotingEfficiencyandEconomy.
ResolutionofConflict.
Integratingfunctionsofrelateddepartments.
28
CoreofGroupEfforts.
InterdependenceofWorkUnits.

29. TechniquesofCo-ordination:
1.ChainofCommand:
Employeeshouldreceiveordersfromonesuperior,because
dualcommandisacontinuoussourceofconflict.
Clearcutauthorityrelationshipwillreduceconflictsamong
differentdepartments.
2.Leadership:
Co-ordinationbecomespossiblethroughleadershipasit
providesindividualmotivationandpersuadesgroupto
identifyofinterests.
3.Committees:
Ithelpstopromoteunityofpurposeanduniformityof
actionamongdifferentdepartments.
Itprovideco-ordinationamongvariousactivities&persons
throughinformation,advice,etc.
29

30. TechniquesofCo-ordination:
4.Communication:
Effectivecommunicationconveysideas,opinionsordecisionsof
managerstosubordinateatdifferentlevelsoforganization.
5.VoluntarilyCoordination:
Itispossibleinaclimateofmutualco-operation,whentwoor
morepersonsworkingwithinsameordifferentdepartments,
mutuallydiscussandarriveatcoordinatedaction.
6.SoundPlanningandClear–CutObjectives:
Organizationobjectivesandpoliciesmustbeclearlydefinedby
management.
Clearformulationofpoliciesinthefieldofproduction,sales,
finance,personnel,etc.mustbecorrelated.
7.Incentives:
Incentiveshaveatendencytoigniteactionandbringaboutco-
ordinationandtoreduceconflicts.
30

31. CONTROLLING
Definition:
“Controlischeckingcurrentperformanceagainst
predeterminedstandardscontainedintheplanswithaviewto
ensuringadequateprogressandsatisfactoryperformance”.
-E.F.L.Breach
“Controllingisthemeasurementandcorrectionof
performanceinordertomakesurethatenterpriseobjectivesand
theplansdevisedtoattainthemareaccomplished”.
-HaroldKoontz
FeaturesofControlling:
Managerialfunction.
Forwardlooking.
Continuousactivity.
Controlisrelatedtoplanning.
Essenceofcontrolisaction.
31

32. CharacteristicsofControlling:
Itisauniversal(essentialfunctioninorganization).
Itisacontinuousprocess(non-stopprocess).
Itisactionbased(ensuresperformance).
Itisforwardlooking(linedwithfuture).
Itiscloselyrelatedtoplanning(plansinvariousbusinessactivities).
Itisanintegratedsystem&alsominimizeserrors.
Controlisamanagementprocess&embeddedineachlevelof
organizationhierarchy.
Controlisatoolforachievingorganizationalactivities.
Controlcomparesactualperformancewithplannedperformance.
Itfacilitatesoptimumutilizationofresources.
Itevaluatesaccuracyofstandardandalsosetsdisciplineandorder.
Itmotivatestheemployeesandboostsemployeemorale.
Itensuresfutureplanningbyrevisingstandards.
Itimprovesoverallperformanceoforganization.
32

33. ImportanceofControlling:
1.AccomplishingOrganizationalgoals:
Ithelpsincomparingtheactualperformancewiththepredetermined
standardsandtakecorrectivemeasurestoachievethegoals.
2.JudgingAccuracyofStandards:
Efficientcontrolsystemhelpsinjudgingtheaccuracyofstandards.
3.Makingefficientuseofresources:
Itchecksworkingofemployeesandensureeffectiveandefficientuse
ofallresourcesinanorganization.
4.ImprovingEmployeeMotivation:
Systematicevaluationofperformanceandrewardsinformof
increment,bonus,promotion,etc.motivateemployeestoputtheirbest
efforts.
5.EnsuringOrderandDiscipline:
Itensureaclosecheckontheactivitiesoftheemployeesandcreate
orderanddisciplineinorganization.
33

34. ImportanceofControlling:
6.FacilitatingCoordinationinAction:
Ithelpsinprovidingacommondirectiontoalltheactivitiesof
differentdepartmentsandeffortsofindividualsforattainingthe
organizationalobjectives.
7.Basisforfutureaction:
Continuousflowofinformationaboutprojectskeepsthelong-range
planningonrighttrack.
8.FacilitatesDecision-making:
Controlhelpindecidingthefuturecourseofaction,wheneverthereis
deviationbetweenstandardandactualperformance.
9.FacilitatesDecentralization:
Decentralizationofauthorityisnecessaryinbigenterpriseandvarious
departmentusecontroltechniquetoachievetheirtargetorgoals.
10.HelpsinImprovingEfficiency:
Ithelpsinimprovingorganizationalefficiencythroughregular
monitoringactivitiesonperformanceofeveryperson.
34

35. LimitationsofControl:
Itisexpensiveandtime-consumingprocess.
Itdoesn’tconsidertheexternalfactorsliketechnologieschanges,
political,socialandgovernmentprocedures.
Humanbehaviourandemployeemoralecan’tbemeasured.
ProcessofControlling(Or)ControllingProcess:
Establishment of
standards
Measurement of
Performance
Comparing actual
performance and
standards
Finding deviationsCorrective actions
35

36. 1.Establishingstandards:
Itisfirststepofcontrolprocess,expressedinquantitativeor
qualitativeterms.
Standardiscriteriaagainstwhichresultscanbemeasured.
Standardsshallbeaccurate,precise,acceptableandworkable.
Someofthestandardsareas–
a)Timestandards–goalwillbesetonbasisoftimelapsein
performingatask.
b)Coststandards–indicatefinancialexpendituresinvolvedperunit
(E.g.)materialcostperunit,costperperson,etc.
c)Incomestandards–relatetofinancialrewardsreceiveddueto
particularactivity.
d)Marketshare–relatetoshareofcompany’sproductinthemarket.
e)Productivity–measuredonthebasisofunitsproducedpermanhour,
etc.
f)Profitability–itissetwithconsiderationofcostperunit,market
share,etc.
36

37. 2.Measuringperformance:
Measurementofactualperformancedoesn’tmeanknowingwhathas
happened.
Performanceshouldbeinquantitativeterms.
Measurementtechniquemaybepersonalobservation,sample
checking,performancereport,etc.
Theperformancecanbemeasuredbyfollowingsteps:
a)Strategiccontrolpoints:Itisnecessarytopickstrategiccontrol
pointsformeasurementlike-
i)Income–itissignificantcontrolpointandmustbeasmuchperunit
oftimeaswasexpected.
ii)Expenses–totalandoperationalcostperunitmustbecomputedand
mustbeadheredto.
iii)Inventory–someminimuminventoryofbothfinishedproductas
wellasrawmaterialskeptinstockasabuffer.
iv)Qualityoftheproduct–standardsofestablishedqualitymustbe
maintainedespeciallyinfoodprocessing,automobiles,etc.
37

38. v)Absenteeism–excessiveabsenteeismofpersonnelisaserious
reflectionontheenvironmentandworkingconditions.
b)Mechanizedmeasuringdevices:Itinvolveswidevariantoftechnical
instrumentsusedformeasurementofmachineoperationsand
productionprocesses.Thesemeasurementsmaybemechanical,
electronicorchemicalinnature.
c)RationAnalysis:Ratioanalysisisoneofthemostimportant
managementtools.Itdescribestherelationshipofonebusiness
variabletoanother.
d)ComparativeStatisticalanalysis:Theoperationsofonecompany
canbeusefullycomparedwithsimilaroperationsofanothercompany
orwithindustryaverages.Itisaveryusefulperformancemeasuring
device.
e)PersonalObservation:Itcanbeusedincertainsituationasa
measuringdeviceforperformancesandwillhavegeneralideaabout
howpeopleareworking.
38

39. 3.Comparingactualwithstandards:
Tofindoutdeviationandidentifythecauseofsuchdeviations.
Employeemoraleandeffectivenessofhumanresourcesstatements.
Itgivescorrect,quickandfavourableresults.
4.Findingoutdeviations:
Itisfindingoutlocatingthedeviationspointsproperly.
Thecauseofdeviationswhichdependsuponproperaccurateand
timelyinformation.
Deviationbetweenstandardandactualperformanceisbeyondthe
prescribedlimit.
5.Correctionofdeviations:
Itisessentialwithcorrectingdeviationsfromplannedperformance.
Itmaybeaccurateforecastpoorcommunication,defectivemachines,
lackofmotivation,etc.
Managementshouldtakenecessaryactionforcorrectionof
deviations.
39

40. EssentialsofanEffectiveandEfficientControlSystem:
1.Simplicity:
Agoodcontrolsystemmustbesimpleandeasilyunderstandableand
managerscanapplyiteffectively.
2.Objectivity:
Standardsofperformanceshouldbeobjectiveandspecific,quantified
andverifiable.
3.Promptness:
Itshouldprovideinformationsoonenoughsothatthemanagerscan
detectandreportandtakenecessaryactioninpropertime.
4.Economy:
Controlsystemfollowedintheorganizationmustjustifytheexpenses
involved.
5.Flexibility:
Internalgoalsandstrategiesmustberesponsivetochangesin
environmentandcontrolsystemshouldbeflexiblebasedonchanging
conditions.
40

41. 6.Accuracy:
Controlsystemshouldencourageaccurateinformationinorderto
detectdeviations.
7.Suitability:
Controlmustreflectneedsandnatureofactivitiesoforganization.
8.Forward–lookingnature:
Controlsystemmustbedirectedtowardsthefutureanditwill
conformedwithplansadopted.
9.Motivating:
Agoodcontrolsystemshouldpaydueattentiontohumanfactorand
designedtosecurepositiveactionfromworkers.
10.CorrectiveAction:
Adequatecontroltechniquesshouldnotonlydetectdeviationsand
failuresbutshouldalsodisclosewheretheyareoccurringand
responsibletocorrectthem.
41

42. MethodsofEstablishingControl:
1.DirectsupervisionandObservation:
Itobservestheemployeesandtheirworkandbringsthemindirect
contactwithworkers.
Supervisorgetfirsthandinformationandbetterunderstandingwith
theworkers.
2.FinancialStatements:
Itgivesasummaryofincomeandexpensesforspecifiedperiod,
whichshowsfinancialpositionoforganization.
Ithelpstounderstandtheprofitability,liquidityandsolvencyposition
ofbusiness.
3.BudgetaryControl:
Budgetisaplanningandcontrollingdeviceanditisessenceof
financialcontrol.
Itisdoneforallaspectsofbusinesslikeincome,expenditure,
production,capitalandrevenue.
42

43. 4.Breakevenanalysis:
BreakevenanalysisorBreakevenpointispointofnoprofit,noloss.
Ithelpstofindoutcompany’sperformance.
(E.g.)Whenorganizationsells50Kcars,itwillbreakeven.(i.e.)any
salebelowthispointwillcauselossesandabovethispointwillearn
profits.
5.ReturnonInvestment(ROI):
Itisatooltoimprovefinancialperformanceandhelpsbusinessto
compareitspresentperformancewiththatofpreviousyear’s
performance.
6.ManagementbyObjectives(MBO):
Itfacilitatesplanningandcontrolandfulfillrequirementsrelatedto
objectivesforindividuals,periodicevaluation&regularfeedbackand
achievementofobjectives.
7.ManagementAudit:
Itisanevaluationandexaminesfullmanagementprocess(i.e.)
planning,organizing,directingandcontrollingtocheckcompany’s
plans,objectives,policies,procedures,etc.
43

44. 8.Self-Control:
ItisSelf-directedcontrolandevaluateone’sownperformanceand
takecorrectivemeasuresasandwhenrequired.
Itcontroltheimportantactivitiesofthesubordinates.
Controltechniquesprovidemanagerswithtypeandamountof
informationtheyneedtomeasureandmonitorperformance.
9.StatisticalDataandReports:
StatisticalDataandReportsDatahelpinapplyingstatistical
techniquesofaverages,regression,correlationetc.topredict
company'sperformance.
10.QualityControl:
Itisusedtosustainthequalityofproductorservicetosatisfy
customerneeds.
11.TotalQualityManagement(TQM):
Itisfocusedoneveryorganizationalactivityandaimsatcontinuous
improvementtofocusontotalsatisfactionofconsumers.
44

45. 45
Unit 5 -POM Mr.T.Somasundaram

46. 46Unit 4 -POM Mr.T.Somasundaram