This document provides an overview of a group presentation on managerial control given by seven students at Nepal College of Management. It begins with an acknowledgement of those who helped make the presentation possible, including their instructor Mr. C.P. Rijal. The contents section outlines the topics to be covered, including the meaning and concept of controlling, its importance, types of managerial control, outcomes of controlling on performance, the controlling process, performance measurement tools, and issues and challenges.

1. Kathmandu University
School of Management
Nepal College of Management
A Group Presentation On
Managerial Control
PALLAVI RIJAL (A14081)
SUJANA K.C (A14072)
SAFAL K.C (A14011)
NIKITA DANGOL (A14065)
SUBIGYA PALIKHE (A14078)
KAREENA KOIRALA (A14046)
BIRAT BANIYA (A14005)
BBA 2ndSemester Section A
Spring 2015

2. We feel extremely privileged as we got this opportunity to successfully
accomplish this presentation. The successful completion of this
presentation would really not have been possible without the helping
hands and efforts of many people who have rendered their continuous
support and co-operation throughout the presentation.
We would like to cordially thank our Business Management instructor
Mr. C.P. Rijal who with his expert opinions, experience, and constructive
feedback has made the accomplishment of this presentation possible.
We owe our deepest gratitude to Department of BM, Nepal college of
Management for having this kind of study in the curriculum which has
helped us to explore the different dimensions of this subject and helped
us expand our knowledge.
Acknowledgement

3. Contents
1. Meaning and concept of controlling
2. Importance of controlling
3. Types of managerial control
4. Outcomes of controlling on managerial
performance
5. Process of controlling
6. Performance measurement: Tools of organizational
performance measurement
7. Issues and challenges

4. Meaning and Concept of Controlling
Controlling is one of the managerial functions like planning, organizing,
staffing and directing. It is simply the process of monitoring, comparing,
and correcting the work performance. It is concerned with setting
standards and taking corrective actions if any deviations are realized.
Also control can be defined as “that function of systems that adjusts
operations as needed to achieve the plan, or to maintain variations from
system objectives within allowable limits.”
Management first prepares plans and policies and later implements them
in practical field to achieve pre-determined goals. According to time
interval, management evaluates the performance of all departments and
individuals of the organization. Management evaluates actual
performance with standard performance and take corrective steps in time
to maintain standard. This function of management is a part of
controlling. Controlling facilitates for effective and efficient achievement
of objectives.

5. Management first prepares plans and policies and
later implements them in practical field to achieve
pre-determined goals. According to time interval,
management evaluates the performance of all
departments and individuals of the organization.
Management evaluates actual performance with
standard performance and take corrective steps in
time to maintain standard. This function of
management is a part of controlling. Controlling
facilitates for effective and efficient achievement of
objectives.

6. Contd..
In 1916, Henri Fayol formulated one of the first
definitions of control as it pertains to management as
“Control of an undertaking consists of seeing that
everything is being carried out in accordance with the
plan which has been adopted, the orders which have
been given, and the principles which have been laid
down. Its object is to point out our mistakes in order
that they may be rectified and prevented from
recurring.”

7. A few definitions of controlling are highlighted below:
“Control is the process that measures current
performance and guides it towards some pre-
determined goals. -Joseph L. Massie
“Controlling is determining what is being
accomplished , that is , evaluating the performance
and of necessary, applying corrective measures so
that performance takes place according to plans”.-
George R. Terry

8. Importance of Control
1) Execution of plans
2) Making efficient use of resources
3) Improving employee motivation
4) Ensures order and discipline
5) Helps minimizing the errors
6) Facilitate co-ordination in action
7) Effective supervision
8) Helps in achieving organizational goals

9. 1) Execution of plans: Controlling is a means or
system which guides for the proper implementation of
plans. It measures either actual work is going in
accordance with standard or not. Besides, it guides to
take necessary steps to the management if any
deviation is there between actual or pre-determined
works.
2) Making efficient use of resources: Like traffic
signal control guides the organization and keeps it on
the right track. Each activity is performed according to
predetermined standards. As a result there is most and
effective use of resources.

10. 3)Improving employee motivation: An effective
control system communicates the goals and
standards of appraisal for employees to subordinate
well in advance. A good control system also guides
employees to come out from their problems. This
free communication and care motivates the
employees to give better performance.

11. 4) Ensures order and discipline: Control creates an
atmosphere of order and discipline in the organization.
Effective controlling system keeps the subordinates under
check and makes sure they perform their functions
effectively. Sharp control can have a check over
dishonesty and fraud of employees. Strict control monitor,
employees work on computer monitor which brings more
discipline in work environment.
5) Helps minimizing the errors: Small errors or small
mistakes may not seriously affect the organization. But if
these errors are repeated again and again it will become a
serious matter and can bring disaster for the organization.
An effective controlling system helps in minimizing the
errors by continuous monitoring and check. The managers
try to detect the error on time and take remedial steps to
minimize the effect of error.

12. 6) Facilitate coordination in action: Control helps to
maintain equilibrium between means and ends.
Controlling makes sure that proper direction is taken
and that various factors are maintained properly. All
the departments are controlled according to
predetermined standards which are well coordinated
with one another. Control provides unity of
direction.

13. 7) Effective supervision: Controlling involves
measurement of actual performance with that of
planned performance. Management can take corrective
steps if any deviation is there between actual and
planned performance. In the similar manner,
management provide timely guidance and instruction
to the concerned authority where there is limitation in
actual performance. It simplifies effective supervision
and maintains discipline among all the authorities of
the organization.
8) Helps in achieving organizational goals: When
the plans are made in the organization these are
directed towards achievement of organizational goal

14. Types of Managerial Control
Major types:
 Organizational control
 Social control
 Self-control
Others classifications:
 Steering control
 Yes-No control
 Past action control

15. Organizational control
 Formal rules and standard procedures
communicated throughout the organization
 Also known as administrative controls (being
concerned with total organization)
 The direction comes from the plan and purpose of
the organization
 Often expressed in terms of market share, cost
reduction, return of investment etc.

16. Social controls
 Based on the principle of mutuality
 Real and powerful form of control over behavior in
organizations
 Easy compliance

17. Self control
 Implies the control exercised by an individual on
himself to achieve goals
 Compliance includes satisfaction, elation and sense
of self mastery
 Also termed as “motivation”

18. Other classifications
Steering control
 Used to keep activities in right course
 Results are predicted and actions are taken before
the completion of total operation
 Stimulates a positive response when people on the
giving and receiving ends steer in the same direction

19. Yes-No control
• also known as go/no control
• Used as fail-safe standards in initial operation
• Would be unnecessary if steering controls were
fully effective

20. Post action control
 Results are compared with a standard
 Deviations are analyzed and corrective action is
taken to avoid similar mistakes in future

21. All three types of controls may be needed to control
a major activity. For example- most of the
instruments in the cockpit of an airplane are steering
controls for monitoring flight operations. Pre-flight
checks are Yes-No controls employed for a
commercial flight. Post action controls after the
flight include pilot debriefing sessions, evaluation of
information from in flight recorders and reports on
schedules, costs, maintenance, and other elements of
airline operations.

22. Outcomes of controlling on managerial
performance
Organizations will achieve their goals.
There will be effective and efficient utilization of
resources.
Employees will get motivation.
Discipline will be maintained.
Minimum production cost and maximum
production.

23. Organizations will achieve their goal
Controlling helps an organization to achieve its goal.
With the help of controlling, deviations are
immediately detected and corrective action is taken.
Controlling also helps in r educing the potential
problems.

24. There is effective and efficient utilization
of resources
Under controlling process, it is ensured that no
employee gets his/her work done in more than the time
allocated to him to do that task. This makes the proper
utilization of given resources because controlling also
checks the resources utilization and wastage.

25. Employees get motivated
Because of control, the employees also get motivated.
If controlling is implemented then the work of every
employee is evaluated and the progress report is
provided. This helps in motivating the employee and
even there will be competition between the employees
that whose work will be praised.

26. Discipline is maintained
With the implementation of control, all the undesirable
activities like theft, robbery, exploitation will be
reduced. This helps in maintaining discipline in the
organization.

27. Minimum production cost and maximum
production
As there is no undesirable act in the organization and
discipline is maintained, proper utilization of resources
is done then certainly there is maximum production
with minimum cost.

28. Process of Controlling
1) Establishment of standard
2) Measurement of actual performance
3) Comparison of actual performance
4) Analyze the causes of deviation
5) Taking remedial action

29. Establishment
of standard
Measurement of
actual performance
Comparison
of actual
performance
Analyzing the
cause of
deviation
Taking
remedial
action

30. Establishment of standard
The process of controlling starts with the
establishment of standard of performance. The
standard of performance must be practically attainable
and should be the basis of comparison with actual
performance. The standard of performance may be
tangible or intangible. Tangible includes quantitative
standard, financial standard and time standard.
Monetary standard express in terms of money like
cost, revenue, profit etc ; and quantitative standards
express in terms of unit like production, sale etc.
Likewise intangible standard includes competency of
managers, employee morale etc.

31. Measurement of actual performance
The second step in controlling is the measurement of
the actual performance with the planned performance.
The measurement of actual performance must be done
in accordance with standard laid down. It makes
measurement easier and meaningful. Qualitative
aspects of performance must be quantified as far as
possible. there must be the provision of regular and
systematic measurement of actual performance. The
measurement should be on future basis and also focus
on the future performance.

32. Comparison of actual performance
This step of controlling focuses on the detail study of
actual performance and comparison against of standard
performance. The comparison shows the range of
deviation from the standard. The management must define
about a standard deviation for various parts of activities. If
the range of deviation between actual and standard
performances is within standard deviation, such range can
be ignored. However, if the range of negative deviation is
more than standard, it is essential to note such deviation
for necessary steps. In the similar manner, some range of
deviation might be on positive angle and need to be
encouraged. Thus, comparison of actual performance is
helpful to locate weakness and strengths , if any, in any
part of performance and take necessary actions.

33. Analyze the causes of deviation
The detail study of each and every part of performance
guides to find out the causes of deviation in actual
performance. The causes of deviation in actual
performance against the standard may be : external
environment , internal environment , defect in planning ,
organizational structure ,technology and others. External
factors involve change in price, government rules ,
strategy of competitors etc. Internal factors involve
shortage of raw materials , outdated technology , lack of
co-ordination etc. Organizational defect involves lack of
job description , lack of span of control , imbalance
between authority and responsibility etc. Thus, it is
essential to detect where the problem is available so that
the corrective action can be taken in right time.

34. Taking remedial action
The final step of controlling process is to take
corrective action so that actual performance should
come forward to the level of standard performance.
The management must have a strategy to remove
limitation in internal environment through
modification and adjust itself with the external
environment. External factors are beyond the control
of the management. Hence, it has to develop strategy
to minimize loss due to change in external
environment. Generally , remedial action might
involve modification and improvement in planning,
betterment of internal environment, organizational
restructuring etc.

35. Tools for measuring organizational
performance
The activities which is performed in the organization
in an efficient and effective manner for the attainment
of the common organizational goals represent the
performance of the organization.
From the efficiency and effectiveness of the workforce
in the organization, we can know how well the
organizational activities are run in the organization for
the smooth operation.

36. Performance Measurement :Tools for
measuring organizational performance
1) Financial control
2) The balance scorecard approach
3) Informational control

37. The tools which helps to measure the
organizational performance are as follows:
1.Financial control:
Every business has a main motive of earning profit
in the organization. For the attainment of profit in
the organization analysis of financial statement is
done to calculate the financial ratios to ensure that
sufficient cash is available to pay ongoing expenses
and to be well known about the level of debts and
the proper use of assets in the organization.

38. Some measures for measuring the
organizational performance under financial
control
Traditional financial control measures:
 It includes both the ratio and budget
analysis.
 It helps to identify liquidity ratios, leverage
ratios, activity ratios and profitability ratios.
 Managers uses such ratios as internal
controls.
 Ratios are calculated using selected
information from the organization i.e.
balance sheet and income statement.

39.  Formulated budget is considered as a planning tool
which indicates the priority of work
 It helps to identify what and how much resources are
to be allocated.
 Budget are used as controlling to measure and
compare resource consumption.
 For example: If we find out that our monthly
miscellaneous expenses were higher than our budget
then we might spend less in another areas or work
for extra hours to get more income.

40. Managing earnings:
 It helps to provide unrealistic picture of
organization’s financial performance.
 It leads the organization to enhance the current
financial results.
For example:
At Wyeth pharmaceuticals, company
executives have participated in a retirement
program which allowed them to set aside,
pretax as much as 100 percent of their cash
compensation and Wyeth guaranteed these
executives a 10 percent return on this deferred
payment.

41. 2. The balanced scorecard approach:
• This approach helps to evaluate organizational
performance from more than just a financial
perspective.
• According to this approach, manager should
develop goals in finances , customers, internal
process and people assets.
• Manager use to focus on areas that drive their
organization’s success.
For example: IBM Global Services in
Houston, managers developed a scorecard
around an overriding strategy of customers
satisfaction.

42. 3. Informational controls:
A tool for measuring the organizational
performance which helps to maintain overall control
over the information of the organization which may
include classified files, data , information etc.
• It helps the manager to maintain control over
organizational activities.
• It also helps to maintain control over organizational
area.

43. • Right information with the right amount at
the right time is provided to the manager.
• Required information is provided to the
manager for the comparison of actual
performance and standard performance.
• It helps to determine whether derivations are
acceptable or not.
• It also provide the information for the
development of appropriate course of action.

44.  Management information system:
• It provide the manager with the required information
on regular basis.
• This system implies order, arrangement and purpose.
• It focuses on providing the processed and analyzed
data.
• It collects data and turns them into relevant
information for use.

45. Controlling information:
• The classified information are placed at a secure
place with high security.
• Regular monitoring is done to ensure all possible
precaution and to protect the important information.

46. Contemporary issues and challenges in control
Control is the key to growth, adaptation and survival.
The company managers and its employees can suffer
in case the challenges and situations are not
controlled well. There are basically four major issues
that managers face today; cross-cultural differences,
workplace concerns, customer interactions and
corporate governance.

47. Adjust controls for cross cultural differences
The control techniques can vary from country to
country. The differences are primarily in
measurement and corrective action steps of control
process. Technologically advanced countries use
better control devices, computer generated reports
and better supervisions to ensure works are been
forwarded as per the plans. But the technologically
less developed countries has to rely on highly
centralized decision making for control. Another
challenge could be comparability i.e., collecting
data for measurement and comparison.

48. Workplace Concerns
From monitoring the employees’ computer usage at
work time and employees intended of fraudulent
activities the managers need control for work to be
done effectively and efficiently. Workplace concerns
specially is related to workplace privacy, employee
theft and workplace violence

49. Workplace Concerns
Employee theft:
It refers to an unauthorized taking of the company
property by the employees for their personal use.
This can be the fraudulent activities from the
employees like removal of softwares, equipments or
office supplies, etc. The concept of feedforward,
concurrent and feedback control is useful to control
and identify measures to reduce employee theft.

50. Workplace Concerns
Workplace violence:
Verbal abuses, yelling at coworkers, damaging or
harming the office machines, physical violence, etc
come under workplace violence. Many different
reasons can result the workplace violence like;
militaristic leadership by the managers, grape vines,
repetitive monotonous works, hazardous work
environment, unrealistic deadlines, uncaring
managers, drug abuse, double standard inn terms of
policies, etc. Here as well the concept of
feedforward, concurrent and feedback control can
help to identify the measures to solve the problem.

51. Controlling Customer Interactions
Organizations want long term and mutually
beneficial relationships among their employees and
customers. Control is vital to customer interactions
because employee service productivity and service
quality influences customers perceptions and service
values. A company that proclaims customer service
as its goals can precisely see how satisfied the
customers are with the service provided. The
strategy and service delivery system of the company
influences how employees’ deals with their
customers. Satisfied customers are loyal that
ultimately improves the company’s growth and
profitability

52. Corporate governance
Corporate governance is the system used to govern a
corporation so that the interest of the corporate
owners are protected. The corporate governance has
been reformed as after many company were caught
under financial scandals. The roles of board of
directors and financial reporting are the areas where
the reforms has taken place.

53. BOEING
Boeing is the worlds largest aerospace company and leading
manufacturer . It represents the most diverse, talented and
innovative workforces anywhere. Being such a huge company
they believe that its more efficient and its possible to make an
airplane and satellite that is more economical. However how
well there strategies are, they wont be able to succeed the
plans unless they run a better core business and perform
perfectly. It was established on the name of William E. Boeing

54. Boeing controls
• Boeing stricts use of budgetary control that helps to
verify accomplishments and remedy differences.
The management uses budgetary controls to help
them stay within the monetary limits. In November
2009 boeing had to use the layoff of employees as
their budgetary control measures.

55. Boeing controls
• When world war I ended in 1918, a large surplus of
cheap, used airplanes prevented Boeing from
selling any new airplanes. Many airplane companies
because of this including Boeing went out off
business but they controlled the situation by selling
other products and later in 1919 Boeing B-1s first
flight pulled it back.

56. Boeing controls
• The company throughout the years has been
penalized and has been facing many issues and
challenges including the 911 incident but with
better control measures they have been able to
recover and stand as one of the largest companies
in the world. Through better plan execution
effective high tech use of resources has made them
able for it. No doubt they have reached to the
space.