Module 3 | Functions of Management - Controlling

It refers to the process of ascertaining whether organizational objectives have been achieved

Controlling

When \___ is properly implemented, it will help the organization achieve its goal in the most efficient and effective manner possible

Controlling

\___ minimizes the ill effects of such negative occurrences

Proper control

Steps in Controlling Process

Establishing performance objectives and standards; Measuring actual performance; Comparing actual performance to objectives and standards; Taking necessary action based on the results of the comparisons.

In controlling, what was to be achieved must firs be determined

Establishing Performance Objectives and Standards

Objectives and Standards for establishing performance

Sales Targets; Production Targets; Worker Attendance; Safety Record; Supplies Used

Expressed in quantity or monetary terms

Sales Targets

Expressed in quantity or quality

Production Targets

Expressed in terms of rate of absences

Worker Attendance

Expressed in number of accidents for given periods

Safety Record

Expressed in quantity or monetary terms for given periods

Supplies Used

There is a need to measure actual performance so that when shortcomings occur, adjustments could be made

Measuring Actual Performance

Once actual performance has been determined, this will be compared with what organization seek to achieve

Comparing Actual Performance to Objective and Standards

The purpose of comparing actual performance with desired result is to provide management with the opportunity to take corrective action when necessary

Taking Necessary Action

Corrective Actions:

Hire additional personnel; Use more equipment; Require overtime

Types of Control

Feed Forward Control; Concurrent Control; Feedback Control

Sometimes called preliminary or preventive controls

Feed Forward Control

It attempts to identify and prevent deviations in the standards before they occur

Feed Forward Control

It takes place while an activity is in progress

Concurrent Control

It involves the regulation of ongoing activities that are part of transformation process

Concurrent Control

It focuses on the outputs of the organization after transformation is complete.

Feedback Control

It is sometimes called post action or output control

Feedback Control

Advantages of Feedback Control

Provides managers with meaningful information on how effective its planning effort was; Enhance the employees' motivation

Behavioral Control under Feed Forward Control

Organizational Control

Behavioral Control under Concurrent Control

Hands-on Management Supervision during a Project

Behavioral Control under Feedback Control

Qualitative Measures of Customer Satisfaction

Outcome Control under Feed Forward Control

Market Demand or Economic Forecasts

Outcome Control under Concurrent Control

The Real-Time Speed of a Production Line

Outcome Control under Feedback Control

Financial Measures such as profitability, sales growth

Components of Organizational Control System

Strategic Plan; The Long-range Financial Plan; The Operating Budget; Performance Appraisals; Statistical Reports; Policies and Procedures

It provides the basic control mechanism for the organization

Strategic Plans

The planning horizon differs from company to company. Most firms will be satisfied with one year. Engineering firms will require longer term financial plans. This is because of the long head times needed for capital projects.

The Long-Range Financial Plan

The \____ differs from company to company.

Planning Horizon

Most firms will be satisfied with \___ of financial plan

One Year

\___ will require longer term financial plan

Engineering Firms

Engineering firms require longer term financial plans because of \___ needed for capital projects

Long Head Times

It indicates the expenditures, revenues, or profits planned for some future period regarding operations

The Operating Budget

It measure employee performance

Performance Appraisals

it also function as effective checks on new policies and programs

Performance Appraisals

It pertain to those that contain data on various developments within the firm

Statistical Reports

it is the framework within which the objectives must be pursued

Policies

It is the plan that describes the exact series of actions

Procedures

When operations became complex, the engineer manager must consider steps in controlling

Identifying Control Problems

Three Approaches mentioned by Kreitner:

Executive reality check; Comprehensive internal audit; General checklist of symptoms of inadequate control

Employees at the frontline often complain that management imposes certain requirements that are not realistic.

Executive Reality Check

It is one undertaken to determine the efficiency and affectivity of the activities of an organization.

Comprehensive Internal Audit

If a comprehensive internal audit cannot be availed of for some reason, the use of a \____ may be used.

General Checklist of Symptoms of Inadequate Control