What is the Importance of Controlling?
Controlling is an essential part of management that every manager needs to perform to guide their team. It helps improve the efficiency of other management tasks.
The Importance of Controlling is seen in how it ensures the proper use of resources to meet the goals of the organisation. The success of an organisation depends on having a simple and effective controlling process. Let’s have a look at the Importance of Controlling Function.
Steps in Controlling
There are three steps in controlling:
1. Establishment of Standards:
The first step in control management is establishing standards.
Standards are the paths that are planned by the organization towards which the performance has to be directed. They are obtained from the objectives of the organization based on which performances are measured. Standards may be set for different areas of the organization such as production, marketing, sales, personality development,
profitability and so on.
2. Measurement and Comparison of Performance
Once the standards are set, the next step is to measure the actual performances and compare them with the desired standards to find any deviations. If there are deviations, then the reason for it must be found. The end report from this step consists of deviations and their causes which will be forwarded to the team who will be taking further necessary corrective actions.
3. Corrective Actions when Deviations Occur
The final step in controlling is taking corrective actions for deviations. The deviations are first investigated and appropriate actions have to be taken. The reason for deviations could be the flaws in standards that have to be revised and changed.
Importance of Controlling Function
Achieving Organisational Goals
Controlling helps ensure that the organisation’s goals are met. It identifies any deviations from the plan and applies corrective actions to reduce the gap between expected and actual results, making it easier to achieve objectives.Adapting to Changes
Organisations often face changes, such as new products, technologies, government regulations, or competitor strategies. Controlling helps businesses adapt to these changes effectively.Efficient Use of Resources
Controlling minimises resource wastage and ensures proper utilisation of available resources. This leads to better organisational performance and productivity.Checking Standards for Accuracy
Managers compare actual performance with set standards to see if the standards are effective. If necessary, they adjust these standards to improve the efficiency of processes.Supports Better Decisions
Controlling helps managers identify gaps between planning and implementation. This improves decision-making and enhances the overall performance of the organisation.Motivating Employees
Employees know their performance is evaluated based on set standards. Regular performance reviews and rewards, such as bonuses, promotions, or increments, encourage employees to perform better.Maintaining Discipline and Order
Controlling ensures discipline in daily operations by enforcing rules and reducing unprofessional behaviour, creating a more organised work environment.Improving Coordination
Controlling aligns all organisational activities and employee efforts with overall goals. This ensures effective coordination and optimal performance.
Limitations of Control Management
No Control over External Factors: The organizations do not have control over the changes in the external environment for example changes in technology, competition and changes in consumer requirements.
Employee Resistance: Employees tend to oppose certain control procedures because it may limit their freedom. For example, time tracker machines or CCTVs may not be accepted by all employees.
Difficulty in Setting Standards: It gets difficult to measure performance because standards cannot be defined quantitatively which arise due to different problem areas such as human behaviours, employee morale and job satisfaction.
Costly: Controlling incurs a lot of expense, time, and effort and hence gets costlier. It must be ensured by the management that the cost involved in running a control system should not exceed the benefits gained from it.
Conclusion
Controlling is an important part of management that helps an organization achieve its goals. It ensures proper use of resources, keeps activities on track, improves teamwork, and motivates employees. With effective controlling, organisations can solve problems, work efficiently, and grow successfully.
FAQs on Features and Importance of Controlling in Management
1. What exactly is 'controlling' as a function of management?
Controlling is the management function that involves measuring performance against pre-set standards, identifying any deviations, and taking corrective action to ensure organisational goals are achieved. Think of it as the steering wheel of a car, making sure the organisation stays on its planned route.
2. Can you explain the main features of controlling with an example?
Certainly. The main features of controlling are:
- Goal-Oriented: It ensures all activities contribute to achieving organisational goals. For example, if a sales team's goal is 100 units, controlling tracks the progress towards that specific number.
- Pervasive Function: It is performed by managers at all levels. A factory supervisor controls quality on the production line, while the CEO controls the company's overall financial health.
- Forward-Looking and Backward-Looking: It analyses past performance (backward-looking) to identify shortcomings and improve future performance (forward-looking).
- Continuous Process: It is not a one-time activity but an ongoing cycle of monitoring performance, comparing results, and making adjustments.
3. What is the primary importance of controlling in a business?
The primary importance of controlling is that it helps in achieving organisational goals. By monitoring progress and correcting deviations, it ensures that plans are followed and objectives are met efficiently and effectively. It also helps in making the best use of resources and adapting to changes in the business environment.
4. How are the management functions of planning and controlling related?
Planning and controlling are inseparable; they are often called the two sides of the same coin. Planning sets the goals and standards, while controlling measures performance against those standards. Without clear plans, the controlling function has nothing to measure. Conversely, without controlling, a plan is just a wish with no mechanism to ensure it is achieved.
5. Can you walk through the basic steps involved in the controlling process?
The controlling process follows a few logical steps:
- First, setting performance standards, which are the benchmarks for measurement.
- Second, measuring the actual performance of employees or departments.
- Third, comparing this actual performance with the set standards to find any deviations.
- Finally, analysing the deviations and taking corrective action to address the issues and prevent them from recurring.
6. Does 'controlling' just mean finding faults with employees?
That is a common misconception. The purpose of controlling is not to find fault but to be constructive. It aims to identify the root cause of problems, which could be unrealistic standards, lack of training, or insufficient resources. A good control system also highlights positive deviations, helping the organisation understand what is working well and apply those lessons elsewhere.
7. How does controlling help a company use its resources more effectively?
Controlling ensures the optimal utilisation of resources. By carefully monitoring operations, a manager can identify wastage, idle resources, or inefficient methods. For instance, if a department is consistently over-budget or if a machine is producing too many defective products, the control function helps to spot this, allowing for corrective action that reduces costs and improves overall productivity.
8. Are there any practical challenges or limitations to implementing controlling in a company?
Yes, there are a few real-world limitations. It can be difficult to set clear, quantitative standards for qualitative aspects like employee morale or customer satisfaction. Additionally, some employees might resist control systems, viewing them as restrictive or a sign of mistrust. Finally, implementing a detailed control system can be an expensive and time-consuming process for the organisation.
