Controlling Presentation
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CONTROLLING
CONTENT
I. Objectives
II. Definitions
III.Control Process
IV.Types of Control
V. Characteristics of an Effective
Control System
VI.Control Technique
VII.Controlling Overall Performance
VIII.Control Strategies
I. Objectives
Objectives
• Know the need for control
• Understand the control process
• Identify the types of control
• Learn the characteristics of an
effective control system
• Know the different control
techniques
II. Definitions
Controlling
Defined as the managerial
activity for ensuring the
achievement of an organization’s
objectives.
Controlling
Checks whether plans are being
observed and suitable progress
toward the objectives is being
made.
III. Control Process
Three Basic Steps of Control Process
Establishing standards
against which performance
can be measured.
1
Three Basic Steps of Control Process
Comparing actual performance
against standards.
2
Correcting deviations
or straightening up
what is crooked.
Three Basic Steps of Control Process
3
IV. Types of Control
Three Types of Control
Preliminary Control.1
• Identifies major problems before they
occur.
Preliminary
Control
Preliminary
Control• Focuses on the preventions of
deviations in planning, organizing,
staffing and directing.
• Assures that every possible malfunction
has been taken care of.
Preliminary
Control
Three Types of Control
Concurrent Control.2
• Controls the endeavors to
monitor the operation in
progress.
Concurrent
Control
• Serves as a screening test to
move to the next step.
Concurrent
Control
Three Types of Control
Post Action Control.3
• Control is carried out after the
event.
Post-Action
Control
• The poorest form of control
because it is wasteful of
resources.
Post-Action
Control
• Includes analysis of budget,
financial statements, and quality
control.
Post-Action
Control
V. Characteristics of an Effective Control System
1Characteristics of an
Effective Control System
Must be suitable for the
activity it seeks to regulate
and should be the minimum
required to achieve the
desired results.
2Characteristics of an
Effective Control System
Must be objective and measurable
in standards used for evaluating
workers.
3Characteristics of an
Effective Control System
Uses the “exception principle”
which provides that only
exceptional circumstances (good or
bad situations) requires the
attention of management.
4Characteristics of an
Effective Control System
Provides only usable control
data to the manager concerned.
5Characteristics of an
Effective Control System
Quickly reports undesirable
deviations to give the managers the
opportunity to take action in time to
prevent them.
6Characteristics of an
Effective Control System
Must be flexible otherwise it will
be unable to maintain control of
operations when a plan fails or is
suddenly changed.
7Characteristics of an
Effective Control System
Must be worth the expense otherwise
it’s a waste of resources.
8Characteristics of an
Effective Control System
Should show ways to correct an action.
Must not only identify what the error is,
where it occurred, but also who or what
is responsible for it.
9Characteristics of an
Effective Control System
Must pinpoint where the
responsibility lies for the various
control activities.
10
Characteristics of an Effective Control System
Must review standards and
objectives periodically for changes
and newly developed methods and
techniques.
11
Characteristics of an Effective Control System
Must be an on-going process since the
environment, operations, personnel, etc.
of an organization are constantly
changing.
VI. Control Techniques
Budgetary Control.1
Traditional Control Techniques
Additional Information
BUDGET
Is a financial statement prepared and
approved prior to a defined period of
time for the policy and purpose of
achieving a predetermined objective.
Budgetary
Control• Is the establishment of budget
related responsibilities of the
executives.
Break-Even Points.2
Traditional Control Techniques
Break-Even Point
Analysis• It is a point when the total income is
equal to the total cost.
• The level of activity when profit or
loss is made by the business
organization.
Gantt Chart Technique.1
Specialized Control Techniques
Gantt Chart
Technique• It is a way of presenting control
information to management developed
by Henry L. Gantt.
Network Analysis.2
Specialized Control Techniques
Network
Analysis• A technique for controlling a complex
project which requires analysis into
its various activities and events.
Milestone Scheduling.3
Specialized Control Techniques
Milestone
Scheduling• A schedule and control procedure
developed by the National Aeronautics
and Space Administration (NASA).
Milestone
Scheduling
• Like in Gantt Chart, it uses bar charts
to monitor progress.
VII. Controlling Overall Performance
Controlling Overall Performance
Income Statement.1
Income
Statement• A compile statement at the end of an
accounting period for calculating net
profit or loss from business
operations.
Controlling Overall Performance
Return of
Investment.
2
Return of Investment
(ROI)• Achieves the necessary objective rate
established by the organization.
ROI Formula
ROI =Profit (before tax) x
100%________________________
Total
Investment
Controlling Overall Performance
Key Area Control.3
Key Area
Control• A control technique which an
organization rates its performance
in a number of critical areas.
Key Area
Control• It includes quantity, quality, time
and cost with profit as the criterion
of success.
Controlling Overall Performance
Audits.4
There are three types of audits used
for overall performance: (a) internal,
(b) external and (c) management
audits.
Internal
Audit• Conducted by the employees of the
organization and are responsible for
performing impartial monitoring
activities.
External Audit
• Conducted by those who are
NOT employees of the
organization.
Management
Audit• A periodic assessment of the managerial
performance conducted by an internal or
external auditors.
Management
Audit• Its primarily aim is to determine whether
positive results are being obtained or
not.
VIII. Control Strategies
Control Strategies
There are three basic managerial
approaches, these are: (a) market,
(b) bureaucratic, and (c) clan
control.
Market
Control• A managerial approach that relies
on market mechanisms to regulate
prices for certain goods and
reasonable level of competition.
Bureaucratic Control
• Relies on regulations through rules, policies,
supervision, budget, schedules, reward
systems, and other administrative
mechanisms.
Clan
Control• Relies on values, beliefs, traditions,
corporate culture, shared norms, and
informal relationships to regulate
employee behaviors and facilitate
the reaching of organizational goals.
That ends our presentation
for today.
Thank you!