Controlling is a systemic exercise, referred to as the process of monitoring actual performance against standards or plans in order to ensure adequate progress and also to record the experience acquired to help possible future needs (Otley, 2016). Control in management is the organizational regulation activity which maintains a precisely focused output within an appropriate threshold. Without this regulation, organizations do not indicate how well they are performing concerning their goals. Control supports and ensures that the organization is in the right direction (Griffin, 2015). It compares to where the organization is in terms of performance to where it is supposed to be. The control function can, therefore, be described as an activity which ensures that operations in an organization are carried out according to required intentions. Controlling function of any organization contributes to the organization's efficiency through ensuring transparency of organizational processes (Griffin, 2015). Organizations need checks to determine whether their objectives are being achieved and, where appropriate, to adopt corrective measures.
Successful management of an organization in various dynamic environments requires an effective controlling system. Controlling is the process of defining objectives, planning, and management control so that every player in the organization can act by desired goals. Besides, since administration includes managing others ' operations, an essential portion of control functions ensures that others do what needs to be done.
Purpose of Organization Control
The purpose of control in an organization is to provide the organization with four main functions. It guarantees that an organization can adapt to environmental change, reduce the amount of mistake that occurs, help deal with complex organizational structures, and reduce expenses (Griffin, 2015).
In adapting to environmental change, a proper control scheme can assist managers in anticipating, monitoring, and responding to evolving organizational conditions and stay better attuned to rising standards. In contrast, an incorrectly designed system can lead to organizational performance that falls far below acceptable levels. Furthermore, by limiting the build-up of error, control in management ensures that there are minimal occurrences of failure and mistakes in an organization (Griffin, 2015). Minimal mistakes and errors do not often seriously damage the financial health of an organization. Over time, however, slight errors may accumulate and become very serious; therefore, reliable form of control over organizational activities is required.
Control in management also aids in coping with organizational complexity when organizations have a wide variety of management systems. This variety of management systems is mostly experienced by big corporations who employ hundreds of employees with different functions of management (Griffin, 2015). Control is also applied when handling instances such as organizational mergers, which comes with managerial complexities. Consequently, control can also assist in reducing expenses and increasing output when it is carried out efficiently. An active control system can eliminate waste, lower labour costs, and improve production per unit of input (Griffin, 2015).
Where and Why Is Control Used?
Organizations establish controls in various areas at various levels. Most organizations define areas of control in terms of the four basic types of resources they use: physical, human, information, and financial. Physical Resources in an organization include equipment, materials, supplies, facilities, and Infrastructure that are utilized by the organization. Control of these physical resources includes handling of inventory, quality control, and equipment handling control. The importance of controlling these resources ensures that the proper resources are handled at the correct place and at the right time. Therefore, all organizational activities proceed as expected (Griffin, 2015).
Control of human resources includes choice and positioning, training and progression, accomplishments, appraisal, and compensation. Relatedly, organizations also attempt to control the behaviour of their employees, directing them toward higher performance, for example, and away from unethical practices. Human resource control also helps managers to monitor the performance of freshly recruited staff and track their trends, alongside regular achievements of existing staff. Common kinds of controls include performance reviews, disciplinary programs, comments and reviews of practice and development. Since an organization's staff performance determines the general efficiency of the organization to a significant extent, it is imperative to control this area (Griffin, 2015).
Control of information resources includes forecasting revenues and marketing, environmental analysis, public relations, planning for manufacturing, and financial assessments (Samson, Donnet, & Daft, 2018). Almost every organization has confidential and confidential information, which they do not want to become general knowledge. Controlling access to such information and how it is shared is the key to controlling information as an entity.
Financial Control involves the management of the organization's financial obligations so that they do not become excessive. It ensures that the firm always has enough cash on hand to meet its requirements but does not have excess cash sitting idly in a checking account. Moreover, ensuring that receivables are collected and bills are paid on a timely basis. In many ways, the financial resources control is the most critical area, because financial resources are related to the control of all the other resources in an organization (Griffin, 2015). In an instance of financial control, too much inventory leads to storage costs, Poor staff choice contributes to termination and rehiring costs. Inaccurate sales forecasts also lead to cash flows disruptions and critical financial effects. Financial issues tend to pervade most control related activities (Griffin, 2015).
Importance to the Success of an Organization
Managers have traditionally controlled the full range of control mechanisms and concerns in organizations. They decide which methods of control the organization will apply. Managers then implement control desired control systems and take actions based on the information provided by the control systems. Thus, all managers in an organisation have full responsibility for control of the enterprise
All managers across an organization have the primary obligation to command control. If all the employees decided on what they felt as right for the organization, control, and even management would not be a requirement. People, however, sometimes are not able or willing to act in the most considerable interest of the organization. A system of controls must, therefore, be implemented to secure against unwanted conduct and to promote appropriate measures. Controlling provides in this regard an atmosphere of organizational service and discipline that helps in reducing irresponsible personnel behaviours. Control also aid in the implementation of a sound responsibility control system (Griffin, 2015). This system ensures that every employee is well aware of what he or she expects and what are the performance standards based on which they will be assessed. Therefore, it helps in motivating and increasing their potential so to make them and helps them to give better performance.
If the organization is not protected against unwanted behaviour, serious consequences can occur. Negative repercussions may also be due to the failure and absence of incentive to perform desired actions. Inappropriate monitoring, at least, can lead to reduced performance or an increased likelihood of poor results. At the extreme, if performance is not controlled on one or more critical performance dimensions, the outcome could be organizational failure.
Organizational control also helps to access standards accuracy. An active control system ensures that the organizational modifications are monitored carefully and gradually. It also enables to review and revise norms based on organizational and environmental modifications. Controlling allows shaping all departmental operations and individual attempts to achieve the organizational goals (Griffin, 2015).
In conclusion, effective control oversees and keeps track organizational activities successfully. Every organization is controlled by set standards, organized norms, and goals. Organizational control, therefore, ensures that overall organizational objectives are accomplished in an overall manner. Control provides managers with ongoing feedback so that managers can take steps to address problems if actions are not carried out correctly. This process is the management's primary control function. Managers must determine methods to control operations in their organizations through creativity, quality improvement, and cost reduction.
Griffin, R. W. (2015). Fundamentals of management. Cengage Learning.
Otley, D. (2016). The contingency theory of management accounting and control: 1980-2014. Management accounting research, 31, 45-62. https://doi.org/10.1016/j.mar.2016.02.001
Samson, D., Donnet, T., & Daft, R. (2018). Fundamentals of Management [6th Asia-Pacific Edition]. Cengage
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