Factors Determining Good Control

A good control system has been influenced by certain vital factors. They are as follows:

1. Simplicity: The control system should be simple and should be easily understandable by those who operate it. If the operating system is not properly understood by the users (managers and workers) the control becomes ineffective. The control information supplied by the top should be assimilated at the operation level by the workers. The information relating to control should serve the purpose of that operation or method or procedure otherwise it becomes useless. Supposing finance manager sends some financial data to the lower level, like finance superintendent, in the form of statistical or mathematical formulae, the superintendent cannot understand that easily. Hence it will be of doubtful utility. Therefore, simple and easily understandable control system have to be evolved.

2. Adaptability: The control system should suit to the kind of operation it is intended to serve. Control systems vary from business to business, department to department in the business and one level to another in the same structure. Different control systems are adopted at the policy levels and different ones at the operation level. Even in functional areas like marketing, finance, production, human resource management or any other functional and sub-functional areas, the control systems differ. Techniques are different. The size of the business also determines the type of control systems to be adopted. Therefore whatever the control system devised should be adaptable to that particular activity for which it is designed.

3. Cost: There should be cost effectiveness in control systems. It should be economical in operation. Operations which do not require high degree of accuracy or quality which are expensive should not be designed for such operations. Control system should be based on the actual standard of accuracy. This brings down the cost of operation. Hence, control system should be economical and effective.

4. Versatile: The control system should be more dynamic in nature and versatile. It should be adjustable to changes. More flexibility is needed in control systems. There will be contingency in every plan of action irrespective of the fact that plan is thoroughly prepared. In such a contingency, if the existing control system fails, it should permit necessary changes that are required to meet the contingency. Control system should also identify the deviation in operation from the original plan. As Goetz puts "It is possible that some aspects of plan might fail. The control system should report such failures and deviations and should contain sufficient elements of flexibility to maintain managerial control of operations." Therefore one of the essentials of control systems is that it should be versatile and should be adjustable to any change required at the activity level. An element of flexibility should be there.

5. Quick Action: The control system should provide for quick action on the part of the concerned to correct the deviations in planned activity. "Day after the feast" policy should not be there in the control system. Deviations bound to take in planned programmes as plans are for costs of future activity. Therefore control system should facilitate to take quick corrective measures by the men at work. Late action will not serve the objectives of the plan. Therefore the control system should provide for quick corrective measures, whenever deviations are noticed in planned activity.

6. Progressive Feature: Control system should possess progressive feature and should foresee the possible deviations in the planned activity. This facilitates the corrective action to be taken even before the deviation takes place. The control system should be positive, progressive and forward looking. For example, raw material control in production activity. If the firm foresees the variation in production or anticipates the supply variation it can adopt a corrective measure even before the problem could arise and see that the production takes please as per the plan.

7. Need Based System: The control system should be in accordance with the needs of the organisation. It should conform to the organisation pattern. It must be capable of fixing responsibility on the deviators. If concept of "Accountability" is not found in the control system, it loses its ground. Organisation and control are interdependent of each other and control system should match to the organisation needs.

8. Identify the Sensitive Areas: Plans contain certain sensitive or critical areas in their operations. Management principle of exception should be followed to operate such sensitive activities. The control system should also identify such sensitive operations to have effective control.

9. Purposeful: Human element is more involved in planned activity. The control system to be adopted should consider the human instinct and adopt control measures which are objective and purposeful. As far as possible human element should not be disturbed in the operational procedure. Control measures should be objective and make human element to react positively to the control measures.

10. Scope for Corrective Action: The control system, besides identifying the deviations, should also contain a system which can suggest corrective measures. Supposing the production cost has increased and has resulted in fall in profit. The deviation — excess cost of production over the predetermined cost should be identified and in what area it has occurred. It is in row material or labour or other overheads should be identified and accordingly corrective measures can also be suggested. If the control system only identifies the deviation and does not suggest the corrective action, the system fails in operation.

Advantages of Control

Much has already been said about various dimensions of control. Theses dimensions cover one or the other advantage of controls. However they may be summarized as follows:

1. It prevents faulty operations and creates a good base for future faultless operations and help in taking sound decisions.

2. Control systems help taking corrective measures in case the plan activity is deviated from original designs and also assist in adopting follow-up actions.

3. Control systems provide a good opportunity for decentralisation of authority.

4. Control brings about co-ordination in planned activity.

5. Workforce in the organisation will be disciplined by adopting good control system and brings about operational efficiency.

Limitations of Control

Control systems are not free from 'Limitations.' Control system, functions as a component of management process which is controllable by the organisation. But there are other factors which are not controllable by the organisation like, government policies, consumer behaviour, political unrest, market behaviour, change in technology etc. These uncontrollable factors may hamper the organisational efficiency if proper strategies are not adopted from time to time.

Some of the control systems are expensive and cannot be implemented by small firms. Only common systems are adopted.

Quantification of some of the control operations is not possible. The behaviour or morale of employees etc. cannot be analysed in terms of quantity.

Mental agitation on the part of employees may also affect control systems.

Summary

1. Controlling is checking current performance against the predetermined standards contained in the plans with a view to ensuring adequate progress and satisfactory performance.

2. Control is an important function of management. It is the basis of planning and helps the management in achieving adequate progress and satisfactory performance. It covers almost all management activities and keeps check on the other functions of the management. It creates an atmosphere of order and discipline in the enterprise.

3. Essential steps in the control procedure are: (a) Establishment of standards for measuring performance (b) checking and reporting on performance and (c) taking corrective action.

4. Essentials of effective control system are: control system should suit the needs of the concern, promptness in reporting deviations and it should be forward-looking, flexible, economical, simple and constructive.

5. Control involves the comparison of actual results with desired results. Firm has to plan for specific results. Strategic control Involves three phases of operation: (i) Precontrol. (ii) Concurrent control and (iii) Post control systems.

 
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