Controlling and a Management Function

Controlling is that process of regulating organizational activities so that actual performance conforms to expected organizational goals and standards Planning, essentially, is the deciding of goals and objectives and the means of reaching them. Controlling lets manager tell if the organization is on track for goal achievement, and 4/13/12

Controls serve other important roles including helping managers cope with uncertainty, detecting irregularities, identifying opportunities, handling complex situations, and decentralizing authority.

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There are several major steps usually identified in the basic control process. determining the areas to be controlled, establishing the appropriate standards, measuring performance,
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comparing the performance against

The three basic approachess of control system are bureaucratic, clan, and market.

Bureaucratic controls rely on regulation through rules, policies, supervision, budgets, schedules, reward systems, and other administrative mechanisms aimed at ensuring acceptable behavior and performance . 4/13/12

Control as a management process

Controlling, one of the four major functions of POLCA management, is the process of regulating organizational activities so that actual performance conforms to expected organizational standards and goals. Controlling is largely geared to ensuring that the behavior of individuals in the organization 4/13/12

Controls can play five important roles in organizations.

Control systems enable managers to cope with uncertainty by monitoring the specific activities and reacting quickly to significant changes in the environment. Controls help managers detect 4/13/12 undesirable irregularities, such as

Types of control

Strategic control involves monitoring critical environmental factors that could affect the viability of strategic plans, assessing the effects of organizational strategic actions, and ensuring that strategic plans are implemented as intended. Strategic control is typically the domain of top-level managers who must insure core competencies are 4/13/12

Tactical control focuses on assessing the implementation of tactical plans at departmental levels, monitoring associated periodic results, and taking corrective action as necessary. a. Tactical control is primarily under the direction of middle managers, but top-level managers may at times get involved. 4/13/12

Operational control involves overseeing the implementation of operating plans, monitoring day-today results, and taking corrective action when required. a. Operational control is the responsibility of lower-level managers. b. Control is a day-to-day process.
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c. The concern is with schedules,

The control process

The control process is a three-step process of measuring actual performance, comparing it against a standard, and taking managerial action to correct deviations or inadequate standards.

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Measuring is the first step in the control process.

How we measure is done through four common sources of information that managers use.. a. Personal observation b. Statistical reports c. Oral reports d. Written reports

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Comparing is the next step in the control process.

It determines the degree of variation between actual performance and the standard. Its critical to determine the range of variation, which are the acceptable parameters of variance between actual performance and the 4/13/12 standard.

Taking managerial action is the final step in the control process. Although the manager might decide to do nothing, two other alternatives are possible. Correct actual performance. Once the manager has decided to correct actual performance, he or she has another decision to make.
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Take immediate corrective action,

Revise the standard. If the standard was set too high or too low, a manager may decide to revise it.

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AND MEASURING ORGANIZATIONAL PERFORMANCE Managers might use any of the

following types of performance control tools: financial controls, information controls, balanced scorecard approach, benchmarking best practices approach.
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Financial Controls. Traditional Financial Control Measures.

Financial ratios are calculated by taking numbers from the organizations primary financial statementsthe income statement and the balance sheet. The four key categories of financial ratios are as 4/13/12 follows.

However, budgets are also control tools. They provide managers with quantitative standards against which to measure and compare actual performance and resource consumption. Managers are using measures such 4/13/12 as EVA (economic value added) and

Other Financial Control Measures.

Information Controls.

Controlling information can be vital to an organizations success. A management information system is a system that provides managers with needed and usable information on a regular basis. Information can help managers control the various organizational 4/13/12 areas efficiently and effectively. It

Balanced Scorecard Approach.

The balanced scorecard is a performance measurement tool that looks at four areasfinancial, customer, internal processes, and people/innovation/growth assets that contribute to a companys performance. The intent of the balanced scorecard 4/13/12 is to emphasize that all of these

Benchmarking of Best Practices

Benchmarking is the search for the best practices among competitors or non-competitors that lead to their superior performance. Research shows that best practices frequently already exist within an organization, but usually go unidentified and unused.
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