Group 1Maria ApostolJulianne BocalShayne IsokEduardo Platino III
Learning Objectives: At the end of the chapter, the student is expected to understand the following:Definition of ControllingThe Nature of ControllingThe Control ProcessCharacteristics of ControlTypes of ControlControl Methods and Systems
Definition of Controlling Controlling is the process of Controlling can be considered as measuring and correcting the activity for knowing and activities correcting important changes inSuch as plans, organization, the activities that are planned.personnel, of an organization. Controlling should be never be Controlling determines what is considered negative; it is being tackled by evaluating the managerial necessity and a help, performance and, if there is a not an impediment or hindrance deviation, by applying corrective measures so that the activities take place according to plans.
The Nature of ControllingPlanning is related to controlling.Planning identifies the things to do for futureaccomplishment. The failure of controlling wouldmean failure of planning, and success of planningmeans success of controlling. After measuring the plans, and knowing thatthe plans are not realistic, a modified or new planmust be formulated.
All forms of management controls are designed to give the manager information regarding progress. The manager can use this information to: Prevent crises.If a manager does not know what is goingon, it is easy for small, readily solved Update plans.problems to turn into crises. Remember that the final step in the planning process is to control the plan. Controls allow Standardization outputs. the manager to compare what is happening Problems and services can be standardized with what was planned.in terms of quantity and quality through theuse of good controls. Protect an organization’s asset. Controls can protect assets from Appraise employee performance. inefficiency, waste and pilferage.Proper controls can provide the managerwith objective information about employeeperformance. The Nature of Controlling
In exercising the control function, amanager measures the performance of anindividual, plans, or programs against theirpredetermined standards and takes correctiveaction if there are any deviations. Establishing standards.Thus, control involves: Measuring performance against the established standards. Comparison of actual performance. Taking corrective action when and where deviations from the standards occur. Making sure recommended corrective actions are followed through. The Control Process
Characteristics of Control• Attuned to the activity. Controls should reflect the needs of people using them. For instance, manufacturing people may require a king of control which • Control must be forward-looking. may not be applicable for marketing Rather than relying on past indicators people. or historical reports all the time, forecasts and other forward-looking• Deviations must be identified quickly. devices must be used. For instance, What is the use of checking the focusing on probable problem areas process or parts after they break and thus drawing attention for down? corrective action improved effectiveness.
• Control must be strategically oriented. This involves selecting of the crucial points at which control is applied. Care should be exercised in selecting these crucial points. • Control should be economical. The cost of• Control should be flexible. Controls establishing and maintaining controls should permit for unexpected changes or should not exceed the benefits to be situations. Rigidity destroys effectiveness derived from them. of control. • Control should be easy to understand. Unless people understand their purpose and the operations, they become useless. Control should indicate corrective action. Who or what is causing deviations and what should be done about it is the important aspect of control. Characteristics of Control
Control Methods and Systems There are two kinds of control methods: 1. Behaviour Control – (or personal) 2. Output Control – (or impersonal) is based controls is based on direct personal on the measurement of outputs . Tracking surveillance. production records or sales are examples of The first line supervisor maintains a close output control. personal watch over subordinates is using behaviour control.Thomas Peters and Robert Waterman strongly emphasize the need for managers at all levels totake a hands- on approach to managing. By hands-on, they mean regularly mixing withsubordinates and visiting them at their workplaces. Thus, organizations need to use a mix ofoutput and behaviour controls; each serves different organizational needs. A budget isstatement of expected results or requirements expressed in financial or numerical terms.
Flexible Budgets. In order to overcome many of the shortcomings resulting frominflexibility, flexible (variable) budgets are designed to vary with the volume of sales orsome other measure of output. Because of their nature, flexible budgets are generallylimited to expense budgets.Zero-Base Budgeting. Is one approach to budgeting that has received attention over thelast several years. It requires each manager to justify an entire budget request in detail,from scratch. Under zero-base budgeting, each activity under a manager’s discretion isidentified, evaluated, and ranked by importance.Written Reports – these are the two basic types of written reports, analytical andinformational. Analytical reports interpret the facts they present; informational reportsonly present the facts.Steps in preparing a written report:• planning the attack on the problem• Collecting the facts• Organizing the facts• Interpreting the facts• Writing the report• Control Methods and Systems
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