Making Control System Effective | Management

This article throws light upon the four main factors that will help in making control system effective in an organisation. The factors are: 1. Relating Controls to Meaningful and Accepted Goals 2. Set Tough but Attainable Pars 3. Limit the Number of Control 4. Emphasise Self-Adjustment.

Factor # 1. Relating Controls to Meaningful and Accepted Goals:

To be meaningful, a goal must reflect the language and activities of the individuals to whom it pertains. Upper-level managers, for instance, think naturally in terms of financial performance. At their level, it will be meaningful to relate at least some controls to quarterly financial-results and budgets. First-line supervisors, however, may not give due importance to a budget.

To them, control relates to such tangible things as hours of work, number of products produced, percentages of rejects, downtime, and material wastage. In their eyes, controls will be meaningful if they relate to and provide timely and accurate data on operational, day-to-day activities.

Newman suggests that for a control standard to work as intended it must also be accepted by organisation members as an integral and fair part of their jobs. For example, the necessity to keep costs under budget should be accepted as normal and even desirable.

As a general rule, when the people who must meet standards have a major say in setting them, they are more likely to be committed to those standards. Participation in goal setting by organisation members often causes the goals to become internalised — a part of their personal aims.

Factor # 2.  Set Tough but Attainable Pars:

A control target or standard has two basic objectives:

(1) to motivate, and

(2) to serve as a standard against which actual performance can be compared.

Needless to say, a control system is most effective when it motivates people to high performance. Since most people respond to a challenge, successfully meeting an easy 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 may, therefore, cause the performance of organisation members to fall short of target.

Newman puts forward the argument that very tough but potentially attainable pars have to be established so that high performance will be encouraged even if the actual goals are missed. Some companies often prefer to accomplish a similar objective by setting goals that are clearly achievable.

Others express the expectation that most individuals will exceed the goal by 20 to 25%. Both these approaches to par setting are fine — so long as they are well understood by everyone involved in the process.

Factor # 3. Limit the Number of Control:

With an increase in number of controls applied to an individual’s work the individual’s actual autonomy and freedom in how and when the work is to be performed declines. At some point, the number of controls will be seen as so constraining and threatening by the individual that he will start thinking more in terms of self-defense than of performance.

Instead of developing new and more effective ways to get the work done, and rather than seeking new responsibilities, the individual’s attention is likely to shift to ways to look good in those dimensions of the work that are being monitored.

The resulting defensive manoeuvers will most frequently be at the expense of other important dimensions that are not as amenable to detailed measurement and control. If managers do not realise what is happening, their response to this situation may well be to attempt to develop additional controls for the specific areas that are being ignored or neglected. Thus the cycle of “over control” continues to expand.

There are three ways of tackling the problem of excessive controls. First, controls should be focused on the major objectives to he achieved, such as the amount of money being withdrawn from petty cash. This step alone will eliminate much of the waste and unnecessary pressures of “control for the sake of control.” Secondly, minor targets can be stated in general terms rather than quantified absolutes.

For example, instead of targeting personnel turnover at some definite percentage, the criterion could be to “maintain personnel turnover at a satisfactory level” — the term ‘satisfactory’ should be interpreted as elastic enough to ease a manager’s feeling of pressure.

Finally, managers and other organisation members should be allowed considerable leeway in terms of how they achieve their control objectives. For example managers must have the authority to train their subordinates in their own way so long as the desired results are achieved.

Factor # 4. Emphasise Self-Adjustment:

A control system, of course, has as its major goal to show when and where corrective action has to be taken. Most managers accept this aspect of control but resent being told exactly how the corrective action has to be applied. They prefer to take their own action, rather than let it done for them by superiors or staff personnel.

As noted earlier, steering controls are particularly useful in this regard since they permit information to be feedback to the responsible individuals at an early stage to permit them to choose their own corrective actions. Through such feedback, effective control is maintained keeping managerial autonomy and pride intact.