Process of Controlling

Controlling entails making sure that performance does not depart from standards. Controlling consists of five steps: (1) establish standards, (2) assess performance, (3) compare performance to standards, (4) identify the causes of variances, and take remedial action as needed. Corrective action may involve modifications to performance standards, such as raising or lowering them or identifying new or additional requirements. Performance criteria are frequently expressed in monetary terms like revenue, costs, or profits. Still, they may also be expressed in non-monetary terms such as units produced, number of faulty items, or quality or customer service levels. Let us understand the need to have steps in the process of controlling the advantages of steps in the process of controlling. 

The four steps in the process of controlling

The control process is the mechanism that allows any company activity, such as manufacturing, packing, and delivery, to be established, measured, matched, and tweaked. The need to have steps in the process of controlling is real and helps organizations function effectively. You will also be unable to lead the workers effectively if you lack control. The control process is the functional process for organizational management that stems from the organization’s goals and strategic plans and is divided into four steps as follows: 

Developing Performance Measuring Standards and Methods

By definition, standards are just performance requirements. They are the designated moments in a planning program when performance is monitored so that managers may understand how things are doing and do not have to watch every step of plan implementation. Standard elements are beneficial for control since they establish properly defined, quantifiable objectives.

Performance Evaluation

Performance versus standards should be measured in advance to discover and avoid discrepancies. The organization’s performance is calculated using a variety of approaches. Appraising actual or predicted performance is very simple if criteria are adequately defined, and techniques for identifying what subordinates are doing are available. However, many activities are challenging to create appropriate standards for.

Determining whether or whether performance meets the standard

Determining whether or not performance meets the standard is a simple but critical stage in the control process. It entails comparing the measured findings to the previously established norms. Managers may believe that “all is under control” if performance meets the benchmark. Managers are not required to intervene in the company’s activities in this instance.

Taking Corrective Measures

If performance falls short of expectations and the analysis reveals that corrective action is necessary, this phase becomes critical. The remedial action may entail modifying one or more of the organization’s functions. Control can also show insufficient standards, in which case the corrective action may include a modification in the original criteria instead of a change in performance.

Why do we need to have steps in the process of controlling

Because planning offers the essential performance standards or objectives, effective managing necessitates the existence of plans. Controlling also requires an awareness of who is responsible for departures from norms. Budget and performance audits are two fundamental control strategies. An audit entails examining and verifying records and supporting documentation. 

Advantages of steps in the process of controlling

A budget audit informs the company about where it stands about what was planned or budgeted for. Still, a performance audit may attempt to discover if the statistics are given accurately represent actual performance. Although managing is commonly thought of in terms of financial criteria, managers must also oversee manufacturing and operations processes, service delivery methods, compliance with business regulations, and many other activities inside the firm. Let us look at some of the advantages of steps in the process of controlling- 

1. Managing uncertainty and complexity helps managers anticipate and identify adverse shocks, respond opportunistically to good surprises, and keep the organization focused on its plan.
2. Decentralized decision-making enables the business to be more responsive by delegating decision-making to individuals closest to consumers and areas of uncertainty.
3. Recognizing opportunities—assists managers in identifying and isolating the source of pleasant surprises, such as a new growth market. Internal comparisons of cost management and productivity across units might also reveal possibilities.
4. Controlling costs and productivity ensures that the company operates successfully and efficiently.
5. Quality control—helps with cost control (fewer defects, less waste), customer satisfaction (fewer returns), and increased sales (i.e., repeat customers and new customers).

Conclusion

Controlling is among the most critical management roles. Its primary goal is to guarantee that an organization’s activities proceed as planned. The control process, which all managers must implement, comprises various phases. The control function may be thought of as a four-step procedure: (1) Establish standards, (2) Measure performance, (3) Compare actual performance to standards and identify any variations, (4) Determine the cause of discrepancies, and take remedial action if necessary. The management control process guarantees that every action of a firm contributes to achieving its objectives. This approach essentially assists managers in analyzing the performance of their organization. They may decide whether to adjust their ideas or stick with them if they use them successfully.