1 Co-Ordination & Control

Control :

Concept of Control:

Controlling is the process through which management assures that the actual

performance confirms with the planned performance .Control is basic managerial function which implies measurement and

correction of performance of subordinates to ensure that the predetermined objectives are

accomplished .

Control :

• Control• Provides organizations with indications of

how well they are performing in relation to their goals.

• Provides a mechanism for adjusting performance to keep organizations moving in the right direction.

• In simple it is the process of ensuring that actual conform to planned activities

Control Responsibilities differ according to Managerial Level:

• Integration with Planning–the more control is linked to planning, the more effective

the control system.• Flexibility

–the control system must be flexible enough to accommodate change.

• Accuracy–Inaccurate information results in bad decision making

and inappropriate managerial actions.

Characteristics of Effective Control :

• Timeliness–A control system should provide information as often as necessary.

• Objectivity–A control system must be free from bias and distortion.

Characteristics of Effective Control (cont’d)

TYPES OF CONTROL• Past-oriented Controls The Process of Controlling :• They examine what has happened in a particular period in

the past. These controls can be used to plan future behavior in the light of past errors or successes .

• Future-oriented Controls :• These are also known as steering controls or feed-

forward controls and are designed to measure results during the process so that action can be taken before the job is done or the period is over. They serve as warning-posts principally to direct attention rather than to evaluate e.g.: Cash flow analysis, funds flow analysis, network planning etc.

Figure 14.3 : Steps in the Control Process

• Establish Standards– Control standard—a target against which subsequent performance

will be compared.• Control standards should be expressed in measurable terms.• Control standards should be consistent with organizational

goals.• Control standards should be identifiable indicators of

performance.• Measure Performance

– Performance measurement is an ongoing process.– Performance measures must be valid indicators (e.g., sales, costs,

units produced) of performance.

Steps in the Control Process :

• Compare Performance Against Standards

– Define what is a permissible deviation from the performance standard.

– Utilize the appropriate timetable for measurement.• Consider Corrective Action

–Maintain the status quo (do nothing).–Correct the deviation to bring operations into compliance

with the standard.–Change the standard if it was set too high or too low.

Steps in the Control Process :

• On the basis of Areas of Control–Physical resources—inventory management, quality

control, and equipment control.–Human resources—selection and placement, training

and development, performance appraisal, and compensation.

–Information resources—sales and marketing forecasts, environmental analysis, public relations, production scheduling, and economic forecasting.

–Financial resources—managing capital funds and cash flow, collection and payment of debts.

Types of Controls :

• On the basis of time: i.e., before, during or after• Feed forward controls: it is also known as

preliminary or preventive control.• Concurrent control: it involves the regulation of

ongoing activities that are part of the transformation process to ensure that conform to organizational standards.

• Feedback controls: it focus on the result of operations.

Types of Controls :

• The control device may be classified as:–Traditional devices–Modern devices

Techniques of control :

• Return on investment control• PERT /CPM• MIS-Management Information Systems• Management audit

Modern devices :

CPM :• A critical path consists of that set of dependent tasks (each

dependent on the preceding one), which together take the longest time to complete. A CPM chart can define multiple, equally critical paths. The tasks, which fall on the critical path, should be noted in some way, so that they may be given special attention. One way is to draw critical path tasks with a double line instead of a single line. Tasks, which fall on the critical path, should receive special attention by both the project manager and the personnel assigned to them. The critical path for any given method may shift as the project progresses; this can happen when tasks are completed either behind or ahead of schedule, causing other tasks which may still be on schedule to fall on the new critical path

• Budget is a financial plan for a definite period.• It can be:

Master budgetPeriodic budgetPerformance budgetZero-base budget

Budgetary control :

• Sales budget• Selling & distribution cost budget• Production budget• Production cost budget• Purchase budget• Labour buget• Capital expenditure budget• Cash budget

Classification on the bases of purpose :

• It is an important function of management • It helps in preventing mistakes in future• It is a continuous activity• it aims to achieve results.• It manages both human & physical factors .

To sum up control is :

GLOBAL CONTROLLING & GLOBAL CHALLENGES

• Understanding different cultures: According to Richard D Lewis, the different nations :

• and cultures can be put into three groups:

• 1.Linear-active: In these cultures, people focus on a scheduled timeline and like to do one thing at a time. The people in these cultures are task-oriented planners.

• 2. Multi-active: People belonging to these cultures are more focused on interactions and dialogues. Meetings are given priorities and discussions and dialogues help to build relationship and it is this relationship that determines what comes out of work.

• 3. Reactive: People belonging to this type of culture are more introverted. They are respect-oriented listeners and concentrate on what people have to say without interruption and even if they interrupt it is rarely done. People in these cultures usually express their ideas in a passive voice.

Co-ordination &

Control

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Co-ordination & Control

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“Coordination is the orderly arrangement of group efforts to provide unity of action in the pursuit of a common purpose .”

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Coordination :

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Coordination is considered as a permeating function of management passing through the managerial functions of planning ,Organizing , directing & Control .

Techniques / Methods to Ensure Effective Co-ordination:

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Clearly defined Goals

Clear lines of authority & responsibility

Comprehensive programmes and policies

Staff meetings

Special coordinators

Cooperation

Effective Communication

Clearly defined Goals :

• The goals of the organization should be laid down clearly .Every individual in an enterprise should understand the overall objectives and contribution by his job to these objectives.

• Unity of purpose is a must for achieving proper coordination .

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Clear lines of authority and responsibility:

• This would help in reducing the conflicts among different positions which is essential for sound coordination .

• Comprehensive programmes and policies :• Everybody understands the programmes and

policies in the same sense.

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Staff meetings :

Periodic staff meeting can be highly effective in promoting coordination through better communication .

Special Coordinator : In big Organizations , special coordinators

are appointed .

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Cooperation & Effective Communication :

• Coordination must be accompanied by cooperation.

• The individuals in the organization must be willing to help each other .

• Effective Communication :• It is the key to proper coordination .The

channels in the organization should be reliable so that they can create proper understanding.

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liaison role :

• Growth of interactions and volume of information between any two or more departments may make it necessary to establish a liaison or linkage role strategy between them. accordingly, anyone or more persons may be assigned the duty of resolving the issues between any two or more interacting departments to perform liaison role.

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Control :

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Concept of Control:

Controlling is the process through which management assures that the actual performance confirms with the planned performance .Control is basic managerial function which implies measurement and correction of performance of subordinates to ensure that the predetermined objectives are accomplished .

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Control :

• Control

• Provides organizations with indications of how well they are performing in relation to their goals.

• Provides a mechanism for adjusting performance to keep organizations moving in the right direction.

• In simple it is the process of ensuring that actual conform to planned activities

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Control Responsibilities differ according to Managerial Level:

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Characteristics of Effective Control :• Integration with Planning

–the more control is linked to planning, the more effective the control system.

• Flexibility–the control system must be flexible enough to accommodate change.

• Accuracy–Inaccurate information results in bad decision making and inappropriate managerial actions.

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Characteristics of Effective Control (cont’d)

• Timeliness–A control system should provide information as often as necessary.

• Objectivity–A control system must be free from bias and distortion.

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Steps in the Control Process

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Steps in the Control Process :Establish Standards. Control standard—a target against which subsequent

performance will be compared.•Control standards should be expressed in measurable

terms.•Control standards should be consistent with

organizational goals.•Control standards should be identifiable indicators of

performance.Measure Performance. Performance measurement is an ongoing process.. Performance measures must be valid indicators (e.g., . sales, costs, units produced) of performance. 37

Steps in the Control Process :

• Compare Performance Against Standards–Define what is a permissible deviation from the

performance standard.–Utilize the appropriate timetable for measurement.

• Consider Corrective Action–Maintain the status quo (do nothing).–Correct the deviation to bring operations into

compliance with the standard.–Change the standard if it was set too high or too

low.38

Types of Controls :• On the basis of Areas of Control

–Physical resources—inventory management, quality control, and equipment control.

–Human resources—selection and placement, training and development, performance appraisal, and compensation.

–Information resources—sales and marketing forecasts, environmental analysis, public relations, production scheduling, and economic forecasting.

–Financial resources—managing capital funds and cash flow, collection and payment of debts.

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Types of Controls :• On the basis of time: i.e., before, during or after• Feed forward controls: it is also known as

preliminary or preventive control.• Concurrent control: it involves the regulation of

ongoing activities that are part of the transformation process to ensure that conform to organizational standards.

• Feedback controls: it focus on the result of operations.

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Techniques of control :

• The control device may be classified as:

– Traditional devices

– Modern devices

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Modern devices :

• Return on investment control• PERT• MIS-Management Information Systems• Cybernetics• Management audit

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Budgetary control :

• Budget is a financial plan for a definite period.• It can be:

Master budgetPeriodic budgetPerformance budgetZero-base budget

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Classification on the bases of purpose

• Sales budget• Selling & distribution cost budget• Production budget• Production cost budget• Purchase budget• Labour buget• Capital expenditure budget• Cash budget

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To sum up control is :

• It is an important function of management • It helps in preventing mistakes in future• It is a continuous activity• it aims to achieve results.• It manages both human & physical factors .

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Japanese management & Z culture of American companies

Differences between American and Japanese

Management Practices

William Ouchi proposed the concept of theory Z organizations. The

concept was developed in his efforts to understand the best practices of Japanese management which can be used in companies of USA. He

identified the differences between American and Japanese organizations in some aspects.

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American Organizations Japanese Organizations Short-term employment Lifetime employment

Individual decision making Collective decision making

Individual responsibility Collective responsibilityRapid evaluation & promotion Slow evaluation & promotion

Explicit control mechanisms Implicit control mechanisms

Specialized career paths Non specialized career paths

Segmented concern for employee as an employee

Holistic concern for employee as a person

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Thoughts for You

• “God has not promised skies always blues

flowers-strewn pathways all our life through,

God has not promised sun without rain; joy

without sorrow, peace without pain .But God

has promised rest of the labour, strength for

the day, Light for the Way”

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Keys to more efficient study : P to V Formula

Preview: Browse through the material to get a general idea of what it is about .

Question: Ask yourself a few question which you want your reading to answer .

Read: Read the material and make sure that you understand it. Underline key words and /or Phrases.

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Summarize: Make notes on what you read.

Test: Test yourself on what you have read by using the information to answer the questions you asked under Q above. Answer questions given at the end of the chapter in your book .

Use: Try to put the material to some practical use in everyday affairs.

Visualize: Picturise the ideas in your mind`s eye.

All the Best ! 50