Controlling

Controlling refers to the managerial process of ensuring that all the activities in an organisation are performed as per plan. Various features of controlling:
goal oriented,
pervasive,
continuous,
action oriented
and
forward looking.
The controlling function of management is essential for:
•    accomplishing  organisational goals,
•    judging accuracy of standards,
•    making efficient use of resources, etc.
Controlling involves a process of evaluating and verifying whether the decisions have been translated into desired action.
Relationship between planning and controlling is that planning is prescriptive where as controlling is evaluative. The relationship can be enumerated by interdependent, interrelated activities, forward and backward looking. Steps involved in the controlling process are setting performance standards, measuring of actual performances and comparison of actual performance with standards, analyzing deviations and taking corrective steps.
•    certain limitations of controlling are:
•    difficulty in setting standards,
•    resistance from employees,
•    less control on external factors and
•    costly affairs.
Span of control refers to  number of subordinates that directly report to a manager. A wide span of control can be possible by well trained and experienced managers, highly competent subordinates, routine and repetitive work, clear and specific performance targets, delegation of authority to subordinates, availability to staff assistance and expert advice and lower level management.

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  • Q1

    Explain the various steps involved in a controlling process.

    Marks:6
    Answer:

    Steps in the controlling process:

    1. Setting up standards: The first step in the controlling process is setting up the standards. Standards mean the target against which the actual performance is measured. The standards are the basis of comparison. The standards should be achievable, measurable and should be set keeping in mind the availablity of the resources. For example, an enterprise sets the standard of increasing its sales by 20 percent in the current year. The standards set should also specify the time limit. This means that it must specify the time limit within which they have to be achieved.

    2. Measuring of performance: After setting up of standards the performance of the employees is measures by evaluating the actual performance done by the employees. Both the qualitative and quantitative aspects of performance are measured. Although it is difficult to evaluate the quality standards, yet certain quality parameters are fixed to measure the performance.

    3. Comparing performance against standards: The next step is to compare the actual performance with the standards. If both are parallel to each other then the controlling process ends there only. But if there are any deviations then the manager tries to find out the reasons for the same. Deviations of minor nature can be ignored but if the deviations are major then timely action must be taken.

    4. Analysing deviations: Only the deviations which have a significant impact on the organisation should be brought to the notice of the top management. Deviations must be divided in two categories; deviations which need to be attended urgently and the minor deviations. These two deviations must be controlled in the following way:

    Critical point control: It means focusing on the key areas and in case of any deviation in these areas then it should be attended urgently.

    • Management by exception: A manager who tries controlling everything may end up controlling nothing. Therefore the deviations which are beyond
    the specific range should be handled by him and the minor deviations should be attended to by the lower or the middle level management.

    5. Taking corrective measures: After comparing the actual performance with the standards and finding out the deviations, the manger is required to know the reasons for the deviations and taking corrective actions to remove the occurence of such deviations in future.

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  • Q2

    State the meaning of controlling.

    Marks:1
    Answer:

    Controlling is the process of analysing whether actions are being taken as planned and taking corrective action to make these to confirm to planning.

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  • Q3

    If you try to control everything you will end up controlling nothing”. Explain.

    Marks:3
    Answer:

    According to the concept of ‘Management by Exception’ if a manager wants to control everything than he may end up controlling nothing.
    According to this concept, the deviations which are beyond the specific range should only be handled by managers and minute or minor deviations can be ignored. Manager should not waste his time and energy in finding solutions for minor deviations, rather he should concentrate on removing deviations of high degree.

    For instance, if the cost of production of Rs 1500 and as per policy any deviations beyond 5% need to be controlled. In such a case, if the cost increases by Rs 10, then it can be ignored, since it is within 5%. However, if it increases by Rs 100, then the manager must find out the reasons for such increase. He then need to take corrective steps to correct this deviation.

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  • Q4

    Explain the nature of controlling.

    Marks:3
    Answer:

    The nature of controlling can be explained as:

    1. Management Function: Controlling is a follow up action to other functions of management.
    2. Pervasive Function: Control is an essential function of every manager. It is exercised at all levels of management though the nature and extent of control may differ from one level to another.
    3. Forward looking and continuous: Controlling is related to future . It seeks to improve future results on the basis of experience gained in past. It is also never ending.

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  • Q5

    “Comparing the actual performance with the laid standards, finding out the deviations and taking corrective action is an important process of a function of management.” With refernce to this statement, explain the process of controlling.

    Marks:5
    Answer:

    Controlling is the function which compares the actual performance with the laid standards, finding out the deviations and takes corrective action.

    Steps in the controlling process:

    Setting up standards: The first step in the controlling process is setting up of standards. Standards mean the target against which the actual performance is measured. The standards are the basis of comparison. The standards should be achievable, measurable and should be set keeping in mind the availablity of the resources. The standards set should also specify the time limit. For example, an enterprise sets the standard of increasing its sales by 20 percent in the current year.

    Measurement of performance: After setting up of standards, the performance of the employees is measured by evaluating the actual performance done by the employees with the pre-determined standards. Both the qualitative and quantitative aspects of performance are measured. Although it is difficult to evaluate the quality standards, yet certain quality parameters are fixed to measure the performance.

    Comparing performance against standards: The next step is to compare the actual performance with the standards. If both are parallel to each other then the controlling process ends there only. But if there are any deviations then the manager tries to find out the reasons for the same.

    Analysing deviations: Deviations of minor nature can be ignored but if the deviations are major then timely action must be taken. Only the deviations which have a significant impact on the organisation should be brought to the notice of the top management. Deviations must be divided in two categories; deviations which need to be attended urgently and the minor deviations.

    Taking corrective measures: This is the final step of controlling. The manager needs to take corrective actions to remove the occurrence of such deviations which require immediate managerial attention and to take steps so that the deviations do not occur in again future and the organisation is able to achieve its goals.

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