Controlling Keywords and Brief Notes

Controlling

  • Process
  • Function of management
  • Ensuring that activities are performed as per plans.
  • Continuous process
  • Not really the last function of management.
  • Brings to light the deviations.
  • Corrective action.

Importance of Control

  1. Accomplishing organisational goals.
  2. Judging accuracy of standards,
  3. Ensuring efficient utilization of resources,
  4. Boosting employee morale,
  5. Creating an atmosphere of order and discipline
  6. Coordinating different activities

Relationship between Planning and Controlling

  1. Inseparable twins of management.
  2. Planning initiates the process of management and controlling completes the process.
  3. Planning without Controlling is meaningless, Controlling is blind without planning.
  4. Plans are the basis of control and without control the best laid plans may go astray.
  5. If there no standards fixed (in Planning), there is no basis of controlling.
  6. It is pre-requisite for controlling
  7. Planning and Controlling are inter-related and reinforce each other.
  8. It prescribes appropriate course of action. Controlling checks that desired action.
  9. Planning is prescriptive. Controlling is evaluative.
  10. Functions, Planning and Controlling, both are forward looking and backward looking.

Process of Control

  1. Setting performance standards,
  2. Measurement of actual performance,
  3. Comparison of actual performance with standards,
  4. Analysis of deviations
  5. Taking corrective action.

 

Controlling Keywords and Brief Notes

Critical Point Control

  • Key Result Areas (KRA) is set as the critical points.
  • If anything goes wrong at the critical points, the entire organisation suffers.
  • Focus on KRAs.

Management by Exception

  • Attempt to control everything results in controlling nothing.
  • major deviations should be taken care of.
  • minor deviations may be ignored.

Advantages of Critical Point Control and Management by Exception

  1. Saves time and efforts of managers.
  2. Better utilisation of managerial talent.
  3. Facilitates delegation of authority and increases morale of employees.
  4. Identifies critical problems which need timely action.

Controlling Keywords and Brief Notes

Controlling

Financial Management Keywords and Brief Notes