Chapter 7 Controlling

1. CHAPTER 7:CHAPTER 7:
CONTROLLINGCONTROLLING
DMG 1213 / DMG1113 / DPM1213 / DPM1113
Principles of Management
Laura Law
Perak College of Technology
Laura Law Perak College of Technology
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2. Perspectives on Control
The controlling function of management is to
ensure that the outcomes of an organization are as
planned. (Stoner)
This process can carried out by comparing the
true performance with the standard that been
established and taking corrective actions in order
to rectify any distortion that does not comply the
standard
EXAMPLE:
1.Production targets are met
2.Quality is as planned
3.Organizational culture is what was wanted
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3. Challenges That Manager Face
1. Coping with uncertainty
2. Detecting Irregularities
3. Identifying Opportunities
4. Handling Complex Situations
5. Decentralizing Authority
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4. The Purpose of ControlThe Purpose of Control 5
Adapt to environmental change Limit the accumulation of error
Control helps the organization
Cope with organizational complexity Minimize costs
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5. The Purpose/Advantage ofThe Purpose/Advantage of
ControlControl
1. Assist the management process
2. Deal with change or uncertainty.
3. Deal with complexity (size & diversity).
4. Deal with human limitation.
5. Help delegation and decentralization to run
smoothly.
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6. Steps in
Control
ProcessCHAPTER 7: Controlling
DMG 1213 / DMG1113 / DPM1213 / DPM1113
Principles of Management
Laura Law
Perak College of Technology
Laura Law Perak College of Technology

7. Steps in the ControlSteps in the Control
ProcessProcess
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Establish/ Set
standards
Measure
performance
Compare
performance
against standards
Maintain the
status
Correct the
deviation
Change
standards
Determine need
for corrective
action
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8. 10Laura Law Perak College of Technology
Steps in the ControlSteps in the Control
Process:1Process:1

9. 2. Measure Performance
◦ Ongoing process
◦ Most challenging step
◦ Measuring period gap must not be too long or too often
◦ Performance measures must be valid indicators (e.g., sales,
costs, units produced) of performance
i. What to measure
ii. When to measure
iii. How Frequently to measure
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Steps in the ControlSteps in the Control
Process:2Process:2

10. 3. Compare Performance Against
Standards
◦ Easier of all steps
◦ Define what is a allowable deviation from the
performance standard
◦ Utilize the appropriate timetable for measurement
◦ Exp: Performance appraisal
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Steps in the ControlSteps in the Control
Process:3Process:3

11. 4. Determine the Need for Corrective
Action
◦ Done only if the performance does not meet the earlier establish
standard
◦ Maintain the status quo (do nothing)
◦ Correct the deviation to bring operations into compliance with the
standard
◦ Change the standard if it was set too high or too low
◦ Providing more incentive to enhance the performance
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Steps in the ControlSteps in the Control
Process:4Process:4

12. Type of
ControllingCHAPTER 7: Controlling
DMG 1213 / DMG1113 / DPM1213 / DPM1113
Principles of Management
Laura Law
Perak College of Technology
Laura Law Perak College of Technology

13. Types or Methods of ControlTypes or Methods of Control
1. Preliminary/Pre-Action/Feed-Forward
Control:
- Controlling is done at the input level of production
- It is initiated before the start of production of
service activity.
- This type of control is sometimes called preventive
control because the objective is to prevent
problems at the input level before going through
the transformation process.
- “Prevention is better than cure” 15Laura Law Perak College of Technology

14. 2. Steering Control/Concurrent
Control
- Focus on what occurs during the
work/transformation process
- The primary goal is to spot problems
as they develop and take corrective
action before final results are achieved
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Types or Methods of ControlTypes or Methods of Control

15. 3. Screening Control (Yes or No
Control)
- Specify check points that must be
successfully passed before an activity proceeds
further.
- Before proceeding to the next sequence, an
activity, product or service must be approved
or meet specific conditions.
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Types or Methods of ControlTypes or Methods of Control

16. 4. Post-Action Control/Feedback Control/Corrective
Control
- Controlling takes place AFTER the
action is completed.
- It attempts to measure the result of
certain actions
- If there are problems, corrective
action is taken and applied for future
activities 18Laura Law Perak College of Technology
Types or Methods of ControlTypes or Methods of Control

17. Forms of OperationsForms of Operations
ControlControl
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Preliminary control
Focuses on inputs
to the organizational
system
Inputs Transformation Outputs
Screening control
Focuses on how
inputs are being
transformed into
outputs
Postaction control
Focuses on outputs
from the organiza-
tional system
Feedback
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18. Characteristics
of an Effective
Control SystemCHAPTER 7: Controlling
DMG 1213 / DMG1113 / DPM1213 / DPM1113
Principles of Management
Laura Law
Perak College of Technology
Laura Law Perak College of Technology

19. Characteristics
1. To help avoid problems with human relations to control
2. Characteristics as guidance to make control more effective
3. Effective control system is:
i. Accurate (Information)
ii. Timely
iii. Objective and Comprehensive
iv. Focused on Strategic Control Points (Strategic and Result Oriented)
v. Flexibility
vi. Consistent with the Organization’s Structure (Organzationally Realistic)
vii. Acceptable by Organization Members
viii. Utilize all steps of the Control Process
ix. Understandable and Justifiable
x. Corrective Action
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20. Accurate (Information)
Inaccurate information
will cause the
organization to make
wrong decision or to
take the wrong action
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21. Timely
Information must
collected and evaluated
quickly to enable
managers to solve
problems on time
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22. Objective and
Comprehensive
Standards set must be
understandable and
measurable. Difficult
control system will cause
frustration.
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23. Focus on Strategic Control Points
(Strategic and Result Oriented)
Designed what is important
now and what will
important in the future.
Pass as a guidelines for
future measurement
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24. Flexibility
Leave room for
individual judgment and
is modified to fit new
circumstances as they
arise
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25. Consistent with the Organization’s
Structure (Organizationally Realistic)
Exercise and obtain by all
level of employees who
work within the
organization
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26. Acceptable by
Organizational Members
Able to motivate workers to
recognize the importance of
standards and engage
themselves in an appropriate
behavior to achieve them
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27. Utilize all steps of the
control process
Omitting any of these steps will
break (destroy) the overall
control system and the future
of the organization will be
doubtful
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28. Understandable and
Justifiable
Employees who know
exactly what is expected of
them will exhibit less
resistance, know earlier will
be easier to obtain
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29. Corrective Action
Any problem detected
should come up with
appropriate solutions
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