HSA 171 CAR 1436/5/10 3 Concept Of Controlling. Definition. Controlling Process. 4 Is the final function of management. Once a plan has been carried out the manager evaluates the results against the goals. If a goal is not being met, the manager must take any necessary corrective actions to continue to work towards that goal. 5 Process of gathering and feeding back information about performance so that decision makers can compare actual results with planned results and decide what to do about any apparent discrepancies or problems. Helps to check errors and take corrective measures so that the deviation from standards are minimized and goals of the organization are achieved in a desired manner. 6 The process of evaluating and regulating ongoing activities to ensure that goals are achieved. 7 Physical resources Physical resources :inventory management, quality control, and equipment control. Human resources Human resources :selection and placement, training and development, performance appraisal, and compensation. Information resources Information resources :sales and marketing forecasts, environmental analysis, public relations, production scheduling, and economic forecasting. Financial resources Financial resources :managing capital funds and cash flow, collection and payment of debts. 8 There are 4 steps in the control process: Step 1: Establishing performance standards. Step 2: Measuring actual performance. Step3:Compare results with objectives and standards. Step 4: Taking corrective action. 9 Standard: is any guideline established as the basis for measurement. It is a precise, explicit statement of expected results. It is usually expressed numerically It is created when objectives are set during the planning process. It is set for quality, quantity and time. 10 Two kinds of Standards: Output standards : Measures performance results in terms of quantity, quality, cost, or time. Input standards : Measures work efforts that go into a performance task. 11 Time controls Relate to deadlines and time constrains Material controls Relate to inventory and material-yield control Equipment controls Imposed on the operator to protect the equipment Cost controls Budgets control cost or expense related standards Financial controls Facilitate achieving the organizations profit motive Employee performance controls Focus on actions and behaviors of employees. Examples: absence, accidents, quality & quantity of work Operations controls Assess how efficiently and effectively an organizations transformation processes create goods & services. 12 Involves measuring the performance in the work in terms of control standards. Two ways to measure performance: Personal observation and direct supervision of human performance of their work. Reports that show the level of achievement on a daily, weekly or monthly basis. Statistical reports, Oral reports - For fast and extensive feedback, Written reports, Reports through network &, On line systems & Database programs. 13 Methods of measuring performance : Quantitative Quantitative Physical and monetary terms, easily and precisely measurable. E.g. Production units, sales, volume, profits etc. Qualitative Qualitative Intangible, cannot be measured precisely. E.g. Human relations etc. Techniques Psychological tests, opinion surveys. Measurement must be clear, simple and rational, relevant, direct attention and efforts, reliable, self announcing, and understandable without complicated interpretation or philosophical discussions. 14 deviations if any are noted between standards and performance, then management must study the:- (I) Causes for deviation (ii) Effect of deviation (iii) Size of deviation (iv) Positive or negative deviation. 15 Required standards achieved : No further managerial action is necessary. Control process is complete. Required standards not achieved : Extent of variation may differ from case to case, depends upon the type of activity. 16 Control Actions: Review of plans and goals and change therein on the basis of such review. Change in the assignment of tasks. Change in existing techniques of direction. Change in the organization structure. Provision for new facilities. 17 1. Feed forward Controls Focus on operations before they begin. To prevent anticipated problems. 2. Concurrent Controls During the process while work is performed 3. Feedback Controls Focus on the results of operations Guide future planning, inputs and process designs. Self - Control Sometimes called Adhocracy Control By training and encouraging individuals to take initiative in addressing problems on their own. 18 Integration with Planning the more control is linked to planning, the more effective the control system. Flexibility the control system must be flexible enough to accommodate change. Accuracy Inaccurate information results in bad decision making and inappropriate managerial actions. Timeliness A control system should provide information as often as necessary. Objectivity A control system must be free from bias and distortion 19