Planning and Control
Planning is a first step in management process which prepares a consistent, integrated and tactical programme. It consists of sequential operations to be conducted in future to attain the organisational objectives. Whereas the control system watches these sequential operations and stresses the events to conform to plan. Control and planning are two sides of the same coin. There cannot be planning without control. Control system uses certain standards to measure the planned operations. Control reveals the limitations of planning and suggests for revision. Revision may include setting of new goals, restructuring the organisation, correcting the staff position, change in directing and communication system. Therefore planning and control go hand in hand.
Planning process will be designed in such a way that they are automatically controlled. Systems, methods and procedure are designed to conduct the planning operations as per the objectives of planning. Systems themselves are the control tools. Control by nature is restrictive and regulative. Current day planning adopts a system which is relative in nature. Current planes do not like restrictions in their operations but they want to regulate. "The authority to control vests with the higher level of management because it is the superior who has delegated authority to the subordinate to carry out certain activity." But this higher level control regarding plan activity is not appreciated by management thinkers. They feel that it is restrictive in the sense that the workers involved in planned activity are controlled from the top. Peter. F. Drucker is of the opinion "that there should be self-control rather than control from higher level." Therefore control system should be regulative and "it should be a method of measuring progress through self-discipline of the workers." "Self-control here is a system of control wherein each level of management ensures for itself that it follows the planned course and attains the targets assigned to it. Self-control is a self-regulatory process." Thus planning sets the system for operation and control performs the duty of watchman to implement the plan successfully and if the plan does not get the desired result, control suggests the successful measures which can be adopted in replanning.
Relevance of Control
The relevance of control in the management process is already discussed in terms of the need for control. However, it should be noted that scarce resources of the firm can be effectively utilised if control systems are fully adopted. The men at work allowed themselves to work without control. There will be deviation from the plan and the work will be casual. Therefore it is relevant to have control systems in the management process. It enhances the work efficiency and boosts the morale of the organisation and ultimately brings efficiency in production. Less or no control results in inefficiency and conflicts among workers. Controls keep the workers under check. It introduces discipline amongst workers. It ensures effective utilisation of resources. "Control consists in verifying whether everything occurs in conformity with the plans adopted, the instructions issued and principles established. It has for object to point out weaknesses and errors in order to rectify them and prevent recurrence. It operates on everything — things, people and action." (Mc Forland).
Essentials of Effective Control System
Some of the essentials of effective control system are as follows:
(1) Reflecting Organisational Needs: The control system adopted should suit the needs of a concern. Control system used in the finance department will be different from that used in the sales department or the production department. Similarly, the control system for a capital-intensive or machine-based method of production is different from the control system that is needed in the labour-intensive methods of production. Hence, the manager should choose such control system which is appropriate to the nature and needs of a concern.
(2) Promptness in Reporting Deviations: The control system should enable subordinates to inform their superiors in time about their performance. This would help the managers in detecting the deviations and also in taking prompt corrective actions.
(3) Forward-looking Controls: A good control system is one that detects deviations early enough so as to enable the manager to take quick corrective action. For example, cash control forecasts cash needs well in advance and the manager is enabled to take corrective action immediately in case there is any deviations from the forecasts.
(4) Objective Control Controls should be objective. Objective controls clarify the expected results in clear and definite term and they also provide the control standards by which actual performance can be measured.
(5) Flexible Control: Plans and other predetermined standards or criteria need to be altered from time to time. Hence, the control system should be flexible so that it can be adjusted to suit the needs of any modification or alteration in the plans or other predetermined criteria.
(6) Economical Controls: The control system should be economical. The benefit derived by the business concern from a control system should be more than the cost involved in its maintenance.
(7) Simple Controls: To be effective, controls must be simple and easily understandable to the manager as well as to the subordinates. A control system which is complicated and not intelligible cannot be practised by the manager.
(8) Corrective Action: The control system should not only detect deviations from the predetermined standards but also should provide solution to the problems that are responsible for deviations. In fact, this can be said to be an important factor on which the effectiveness of control system depends. In the words of Koontz and O'Donnell, "An adequate system should disclose where failures are occurring, who is responsible for them and what should be done about them."
(9) Acceptable to Organisation Members: The system should be acceptable to organisation members. When standards are set unilaterally by upper level managers, there is a danger that employees will regard those standards as unreasonable or unrealistic. They may then refuse to meet them. Status differences between individuals also have to be recognised. Individuals who have to report deviations to someone they preceive as a lower level staff member may stop taking the control system seriously.
(10) Reveal Exceptions at Strategic Points: A control system should be such as reveal exceptions at strategic points. Small exceptions in certain areas have greater significance than larger deviations in other areas. Five per cent deviations from the standards in office labour cost is more important than 20 per cent deviation from the standard in cost of postage stamps. That we can quantify something is no reason for measuring it. The question is "Is this what a manager's attention should be focused on?"
(11) Motivate People to High Performance: A control system is most effective when it motivates people to high performance. Since most people respond to a challenge, successfully meeting a tough standard may well provide a greater sense of accomplishment than meeting an easy standard. However, if a target is so tough that it seems impossible to meet, it will be more likely to discourage than to motivate effort. Standards that are too difficult to attain may, therefore, cause the performance of organisation members to decline.
(12) Other Requirements: Controls should be such which should be positive, constructive and must be helpful and also provide guidance to the employees. Further, the manager should recognise the importance of human beings in the control system.