Admas University
Faculty of Business
Department of Management
Introduction To Management
(Mgmgt 1011)
Prepared By Ins. Mesfin G. (MBA)
Chapter Eight
Controlling
Function
MEANING
• Controlling is the process through which
managers assure that actual activities
conform to planned activities.
• Controlling is the process of regulating
organizational activities so that actual
performance conforms to expected
organizational standards and goals.
• It is checking current performance against
predetermined standards contained in the
plans.
IMPORTANCE OF CONTROLLING
• Control helps an
organization:
–Adapt to changing conditions
–Limit magnification of errors
–Provide the means to monitor
performance.
THE CONTROLLING PROCESS
1. Determine Areas to Control
• identify critical control points.
• Critical control points include
all the areas of an
organization's operations that
directly affect the success of its
key operations,
THE CONTROLLING PROCESS
2. Establishing Standards
• Standards are units of
measurements established
by management to serve as
benchmarks for comparing
performance levels.
THE CONTROLLING PROCESS
2. Establishing Standards
Standards, if possible, must be
• Specific and quantitative as much as
possible.
• Flexible to adopt the changes that
may occur over the future.
• Challenging and should aim for
improvement over past performance.
THE CONTROLLING PROCESS
2. Establishing Standards
• Standards are units of
measurements established
by management to serve as
benchmarks for comparing
performance levels.
THE CONTROLLING PROCESS
2. Establishing Standards
• Generally, standards serve three
major purposes related to
employee behavior.
1. Standards enable employees to
understand what is expected
and how their work will be
evaluated.
THE CONTROLLING PROCESS
2. Establishing Standards
2, Standards provide a basis for
detecting job difficulties related to
personal limitations of organization
members.
3. standards help reduce the potential
negative effects of goal
incongruence.
THE CONTROLLING PROCESS
2. Establishing Standards
There are three types of standards:
1. Performance standards deal with quality,
quantity, cost and time.
2. Corollary standards support a given level
of performance.
3. Standards of conduct are moral and
ethical criteria that shape the behavioral
climate of the work place.
THE CONTROLLING PROCESS
3. Measuring Actual Performance
• For a given standard, a
manager must decide both
how to measure actual
performance and how often
to do so
THE CONTROLLING PROCESS
4. Comparing Performance against Standards
• This is a step where comparison is
made between the “what is” and
the “what should be.”
• Comparison result may show that the
actual performance exceeds (positive
deviation), meets (zero deviation), or
falls below (negative deviation)
expectations (standards).
THE CONTROLLING PROCESS
5. Taking Corrective
Action (on time)
• The corrective action to be taken
depends up on the type of
deviation that exists.
TYPES OF CONTROLLING
• There are three basic types of controls:
1. Preventive
2. Concurrent
3. Feedback
• Thus, an organization’s performance can be
monitored and controlled at three points:
A. Before
B. During
C. After an activity is completed.
TYPES OF CONTROLLING
1. Preventive/Steering/ Preliminary / Input Control
• Preventive control focuses on the
regulation of inputs
• Preventive control is future
oriented and takes place before the
operation begins.
• Its aim is to prevent problems
before they arise.
TYPES OF CONTROLLING
2. Concurrent/Screening/ Yes-No/Checking Control
• Concurrent control involves the
regulation of ongoing activities
that are part of the transformational
process
• Designed to detect and anticipate
deviations from standards at various
points throughout the processes
TYPES OF CONTROLLING
3. Feedback/Post-Action/ Output Control
• Action control focuses on the end
results of the process.
• The feedback control provides
information for a manager to
examine and apply to future
activities that are similar to the
present one.
CHARACTERISTICS OF AN
EFFECTIVE CONTROL SYSTEM
Future–Oriented
• To be effective, control systems need to help
regulate future events, rather than fix blame for
past events.
Multidimensional
Economically Realistic/ Cost Effective
• The cost of implementing a control system
should be less, or at most, equal to the
benefits derived from the control system.
CHARACTERISTICS OF AN
EFFECTIVE CONTROL SYSTEM
Accurate
• Since control systems provide the basis for future
actions, accuracy is vital.
Acceptable to Organization Members
Timely
• Control systems are designed to provide data
on the state of a given production cycle or
process as of a specific time.
CHARACTERISTICS OF AN
EFFECTIVE CONTROL SYSTEM
Reliability and Validity
• Controls not only must be dependable (reliable),
but also must measure what they intend to
measure (must be valid).
