What Is Controlling?

The first important step of the controlling process is planning. Controlling process includes formulation of a basic plan and then comparing the actual behaviour of the organization with the planned behaviour of organization. If there is any deviation in the behaviour, then managers should try to reduce the gap between the actual and planned behaviour.

Comparisons should be done time to time. In the controlling process, the basic plan acts as a standard or control. Comparisons can generate three different results as given below-
1.If the actual performance is higher than the planned behaviour.

2.If the actual performance is equal to the planned behaviour.

3.If the actual performance is lower than the planned behaviour.

Case 2, reflects that the formulated plan is quite healthy for the organization and every department of the organization is performing efficiently. But in Case1 and Case3, further analysis of the deviation in the behaviour is required to be done. The managers should try to reduce this deviation by developing a new plan; this is known as management controlling process.

In the management controlling process there are different standards that can be used for controlling, for example-
1.Human resource standards

2.Cost standards

3.Quality standards

4.Financial standards

5.Revenue standards

Some organizations use benchmarking as their controlling standard. Benchmarking is a process of marking the ideal point for the organization. In simple language, whatever somebody else is doing in a better way (in the same category) becomes a benchmark for the organization. Controlling can be done through three methods—feedback controlling system, concurrent controlling system and feed forward controlling system.

Feed back control system
This method of controlling is also known as going-backwards controlling. Under this method, managers take the reference of previous situations and use the results to improve the performance for the future; for example, in first year if the actual performance is less than the planned performance; then under feedback control mechanism, managers will learn the lessons from the previous year’s mistake and implement the efforts in next year, in this way they try to reduce the deviation for the next year.

Concurrent control system
Concurrent control system is also known as real-time controlling mechanism. This system involves the analysing of the performance at the actual time and then controlling it simultaneously. This controlling process operates all the time in the organization, for example—hourly control mechanism. But it has been found that the concurrent controlling system sometimes causes de-motivation to the workers. This mode of control is more effective in quality control and assurance but should not be implemented in the human resource department.

Feed forward control
Feed forward control mechanism is based upon the fact that the outputs depend upon the inputs i.e. managers should pay attention on the inputs in order to increase the outputs. This controlling technique is less burdensome as compared to the other modes of controlling because here managers can control the performance at very initial levels of deviation. All approved standards (for example- ISO) provide basic platform for feed-forward controlling.

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