Control of Activities in An Organisation: Meaning, Types and Resistance

After reading this article you will learn about:- 1. Meaning of Control 2. Nature of Control 3. Importance 4. Types 5. Behavioural Aspects 6. Resistance 7. Principles.

Meaning of Control:

Best framed plans, well-designed organisation structures, effective directions and intelligent staff cannot produce results if organisational activities are not controlled scientifically. Authority-responsibility relationships may not always be cordial, managers may not always be able to motivate and guide the subordinates towards desired goals and actual performance may not always conform to planned performance.

Since deviations can occur in carrying out managerial functions, managers attempt to minimise these deviations through an effective control system. As organisations increase in size and complexity, likelihood of deviations in the departmental activities also increases.

It becomes difficult for managers to integrate departmental activities with overall organisational activities and, therefore, the need arises for controlling. Controlling minimizes deviations so that goals are achieved efficiently.

Controlling cannot prevent deviations, it can minimise them by taking actions that reduce their recurrence. Controlling is taking steps to ensure that actual performance conforms to planned performance; by preventing deviations and taking corrective measures to reduce their recurrence.

“Controlling is determining what is being accomplished—that is, evaluating the performance and, if necessary” applying corrective measures so that the performance takes place according to plans.”

—Terry and Franklin

“Controlling is the measurement and correction of performance in order to make sure that enterprise objectives and the plans devised to attain them are being accomplished.”

— Heinz Weihrich and Harold Koontz

“Controlling is the process of regulating organisational activities so that actual performance conforms to expected organisational standards and goals.”

— William H. Newman

Controlling, thus,

1. Measures performance.

2. Compares performance with planned performance.

3. Finds and corrects deviations between actual and planned performance.

4. Ensures that organisational goals are accomplished with minimum deviations.

Nature of Control:

Nature of control is characterised by the following features:

1. Pervasive Function:

All business and non-business organisations control their activities. In business organisations, managers of all departments at all levels continuously control their departmental activities. All activities focus towards goal attainment. Managers at all levels – top, middle and low control the planned activities.

The scope of this function, however, varies at each level. Top-level managers are more actively involved in the controlling function than middle and lower-level managers as top managers have ultimately responsibility to ensure that organisational goals are achieved with minimum deviations.

2. A Process:

Controlling involves a series of steps. It is not a one-time process. Managers continuously observe the activities of subordinates to ensure that they conform to planned activities. It is not an after-the-event exercise that is, taking action when something goes wrong. Managers regularly measure the organisational performance and correct deviations whenever they arise in the input-output transformation process.

3. Inevitable Function of Management:

Not performing the control function presuming that actual performance will be in conformity with planned performance may prove fatal for the management. It is a vital and necessary function of management because deviations in the work performance may occur because of internal and external environmental disturbances. Changes do occur and since they cannot always be predicted, managers face the challenge of change. Change is the basis of control.

4. Closely Associated with Planning Function:

Control provides the basis for planning. Monitoring organisational activities ensures effective implementation of plans.

5. Associated with All Managerial Functions:

Though controlling function is more closely associated with planning, it is related to other functions of management also. Control highlights mal-structured organisations, inappropriate motivational and leadership policies that fail to satisfy the needs of workers or inability of the staff to carry out the assigned activities. Appropriateness of communication channels and media can also be checked through the control system.

6. Preventive and Corrective Device:

Controlling prevents and corrects deviations. It influences the behaviour towards predefined standards of performance. It measures actual performance against planned targets to review past performance and suggests guidelines for future courses of action. Correcting deviations on the basis of past experience makes control a corrective device.

Corrective action taken on the basis of past provides a guide for future so that deviations do not occur in future. It not only assesses what has happened in the past but also makes things happen in future. The future is, thus, guided by the past. This makes control a preventive device.

7. A Positive Function:

Control is not a negative managerial function. The purpose of control is to promote activities which help to attain organisational goals. It measures actual performance and improves it by setting better standards for future. Control provides a brighter future by setting profitable and attainable standards. Control does not mean taking action when something goes wrong.

This is the negative approach to control where action is taken against people responsible for failure. The positive approach finds deviations in the input- output conversion process as soon as they appear and prevents them from occurring in future. It believes in: ‘stitch in time saves nine.’ It prevents deviations rather than correct them.

It does not intend to punish people but aims at achieving results; in present and future. It does not control the freedom of people but promotes their efficiency and effectiveness. Control aims at results through people, not at people otherwise.

8. Means, Not an End:

Control does not mean punishing undesirable results. It improves results and achieves the desired goals. It guides actions towards pre-determined targets. It is a means to achieve objectives and frame targets for future and not an end.

9. Related to Management Information System:

Control function is based on complete and reliable information which is provided by the management information system (MIS). MIS provides complete, reliable and timely information at every level for all the departments. Information helps managers in taking timely actions in terms of detecting and correcting errors.

Importance of Control:

A sound control system has the following benefits:

1. Helps in Detecting Mistakes:

An effective control system helps to detect mistakes at early stages of performance. It saves time, effort and money by not allowing the problems turn into major deviations. Increasing costs, labour absenteeism and turnover, defective product samples are some of the indications that make control important so that production schedules are not disturbed.

2. Helps in Managing Complex Situations:

In a small-sized organisation, managers can personally control organisational activities but as organisations grow in size, they become complex and managers cannot personally monitor all the activities. Product lines, markets (domestic and international), retail and wholesale outlets become so diverse that organisational activities can be coordinated only through a formally designed control system.

3. Helps Face Change and Uncertainty:

Past policies help managers make plans for future. Future being uncertain, planned objectives may not be achieved. Changes in demand and preferences, technological factors, Government regulations, policies of suppliers and competitors can make the plans ineffective. Well-developed control systems help to forecast changes and face them rather than declaring the plans redundant.

4. Helps in Monitoring the Actions of Employees:

If employees are sure of not making mistakes, actual results will always be as expected and there will be no need to monitor their activities; but it does not happen. Mistakes do occur, actions do get diverted, wrong diagnosis of the problem and wrong decisions may also be made and, therefore, control is necessary to ensure the efficiency of plans and achievement of organisational goals.

5. Helps in Identifying Potential of the Organisation:

Control system helps to face challenges and changes as they occur and explore future opportunities which the organisations can venture into.

6. Facilitates Delegation:

Managers delegate authority as organisational work load cannot be managed by them alone. However, the accountability continues to vest with managers. Managers, therefore, ensure that delegated tasks are effectively accomplished by the subordinates through an effectively designed control system.

7. Facilitates Decentralisation:

Increasingly complex organizations decentralise the activities to achieve the goals. Wide geographical dispersions with respect to production, marketing and research make it difficult for control mechanism to be initiated from the head office. A well-devised control system facilitates control of decentralised units at the operational level.

8. Coordination:

Control provides unity of direction to organisational activities. It ensures that actions conform to plans and there is complete synchronization between physical, financial and human resources; internal and external environment; and goals at various levels.

9. Psychological Impact:

When employees know their actions are being observed through control system in the organisation, they perform better than they would in the absence of a control system. Control, thus, creates psychological pressure on employees to perform better. A control system related to rewards where good performance is rewarded and poor performance is not punished creates positive psychological impact amongst employees and increases organisational productivity.

Types of Control:

Controls can be feed forward control (steering control, preliminary control or pre-control), concurrent control (screening control or yes/no control) and feedback control (post-action control or output control), depending on the time when action has to be taken or the stages at which control is exercised.

Inputs, transformation or conversion, and outputs are three important components of production cycle. The controls associated with these components are: feed forward control, concurrent control and feedback control.

Different types of control related to different stages of production are as follows:

1. Feed forward Control:

Before starting the production process, organisation needs inputs in the form of men, machines, material, money and other resources. Feed forward control checks these inputs. It chooses the best inputs to avoid defective outputs which do not conform to standards. Thus, it evaluates inputs before the production operation is completed. Rather than contributing to organisational goals, these outputs will cost management additional time and money to reform them.

The input controls monitor resources like materials and personnel. The material must be of the right quality. Depending on the nature and value of material, either every unit of material is tested or sample checking is done. If sample is of the right quality, whole lot of material is presumed to conform to the standard quality.

Qualified and experienced people are required to work on various jobs. Job description and job specification help to control selection so that right person is selected for the right job. Feed forward controls can be applied at operating level and strategic level.

At the operating level, managers anticipate problems and identify the steps to be taken to face them when they occur. Budgeting is a common and simple technique to predict future activities and their impact on present activities. If managers foresee cash deficit in future, they arrange for funds to meet this deficit.

At the strategic level, managers anticipate environmental changes (technological, political, legal etc.) that affect organisational policies. Feed forward controls prepare managers to face changes and incorporate them in their operational practices.

Feed forward control aims at prevention rather than cure. It does not correct deviations but prevents them from occurring. It anticipates deviations and attempts to overcome them. Thus, it is also called preventive control or pre-control. Deviations and corrective actions are anticipated by managers.

It aims at the following:

(a) Identify the right kind of inputs through proper planning and control system.

(b) Regular analysis of data to ensure it is being rightly used and processed.

(c) Regular evaluation of variations in actual inputs and planned inputs to check their impact on results (outputs).

(d) Action plans to correct deviations in actual and planned inputs.

2. Concurrent Control:

Feed forward controls are based on future. Future cannot be predicted with perfection. Concurrent controls are, therefore, more practical than feed-forward controls. They control the activities while they are being performed. It is controlling the process of production before the goods and services are produced.

Rather than assessing the final output, it checks the work in process. It helps in deciding whether or not production process should be carried on further. If not, can corrective measures remove deviations or work should be stopped and planned again.

Managers control goods at the processing stage by observing sounds of the machine or behaviour of people at work. For example, if a machine is making unusual sounds, it should be repaired or replaced before it produces defective outputs. Similarly, employees whose behaviour is not cordial at the work place should be checked before it negatively affects productivity.

3. Feedback Control:

Feedback control analyses the final output, compares it with standard output, finds deviations and checks the deviations. It brings actual performance in conformity with planned performance. Though it cannot correct the past performance, it provides the basis for future planning. It is also called post-action control.

Feedback control is important because:

(a) It provides a measure against which organisational performance is evaluated.

(b) It helps in evaluating performance of workers and institute rewards (for good performance) and penalties (for bad performance).

(c) It alerts managers to alter the transformation or conversion process, if need be.

(d) It helps in detecting errors which have not been detected at earlier stages (feed forward and concurrent controls).

(e) It provides the basis for future planning. Depending on actual performance, plans can be revised or fresh plans can be made.

It measures results after the performance and takes actions to improve future performance. Past, thus, guides the future. Though errors made in the past cannot be corrected, it adjusts future actions so that errors are not repeated.

In business, feedback control normally consists of the following:

(a) Quality and quantity controls:

Quality controls aim to produce goods of excellence acceptable in the market. Quality of competitors’ goods provides the basis for quality controls.

Quantity controls aim to produce and sell the desired quantity of goods.

(b) Financial controls:

Organisational activities aim to maximise profits. Budgets, financial ratios and other financial statements provide the basis for comparing current performance with past performance and predicting the future performance. Financial data, thus, provides the basis for financial controls.

(c) Control on performance:

Employees’ performance should be regularly monitored to know whether they are performing up to the standards. It helps in strengthening the organisation’s human resource. The companies do not adopt one type of control at a point of time. They institute a multiple Control system where two or more control types are instituted to control the activities at different stages of production life cycle.

Cybernetic and Non-Cybernetic Control:

Whatever type of control managers adopt, the control process can be cybernetic or non- cybernetic. Cybernetic control process refers to automatic system of control. The operational activities are fed into computer and the moment deviation occurs, corrective measure is automatically taken by the system.

In inventory management, for example, order for economic quantity should be made when the inventory reaches the re-order point. Rather than human intervention to find when inventory reaches the re-order point, cybernetic control system provides for automatic ordering of inventory as soon as it reaches the re-order point. Minimum human effort is required in this system of control.

Non-cybernetic control allows human discretion rather than leaving the business operations to machines. Environmental uncertainties allow changes in the organisational working and, therefore, human interference is advisable for taking the action. Moreover, machine is only an application of human brain.

Non-cybernetic control system is more effective than the cybernetic system. Changes in preferences and demand for consumer goods, for example, may require change in the re-order point. Sudden increase in demand for goods may require goods to be ordered before the re-order point which is possible through application of human brain.

Behavioural Aspects of Control:

Control frames standards/objectives, measures and evaluates performance according to standards and takes corrective actions through control decisions if actual performance differs from standard performance. Control increases organisational effectiveness. The need for control system is legitimate and justified.

However, responses to control may not serve the purpose for which controls are designed. Controls are usually mistrusted and disregarded. The behavioural aspect to control causes concern about designing and implementing the control system. This concern arises from the assumption that individuals dislike controls as it restricts their freedom.

When organisational controls are put to practice, people generally work against rather than work with the control system. They take the reward for good results and blame others for poor results. They generally tend to disagree with standards, reporting procedures, cost allocations pertaining to control systems and in extreme cases, with the need for control itself.

They should realise that control does not restrict their freedom. Some form and degree of control is essential and even desired by most of the people. There is nothing behaviourally wrong with the control process as such. There is need to have optimum mix of freedom and control. Both are necessary.

Excess of both, however, can have negative effect on organisational performance. Positive responses to control should be created and negative reactions should be minimized. To exercise effective control system, managers foresee their behavioural implications and plan a judicious mix of control and freedom which depends upon many variables.

The following behaviourally oriented methods of control can help managers control their operations effectively:

1. Participative Standards:

Participation in framing standards promotes commitment to control. It develops understanding of the objectives and translates broad goals into meaningful operational criteria against which performance will be judged.

2. Positive Responses During Evaluation:

When actual performance differs from standard performance, managers should diagnose the problem and improve the performance rather than take negative actions against employees.

3. Coaching, Rather than Directive Role for Superiors:

Managers should coach rather than direct the workers. They should help rather than find faults in their performance.

4. Management by Objectives (MBO):

This is the goal-setting approach to management where “specific goals are set collaboratively for the organisation as a whole and every unit and individual within it; the goals are then used as a basis for planning, managing organisational activities and assessing and rewarding contributions.”

Every employee participates in framing personal objectives along with the means to accomplish them. MBO focuses on participative style of management and increases the acceptability of control systems.

5. Human Resource Accounting:

Human resource is an important asset of the organisation. Managers formally recognise the monetary value of this resource. They consider costs like costs of selection, training, loss due to vacancy, separation pay etc. in employee replacement analysis and control. Human resource accounting recognises the value of humans in organisations.

Accounting has become behaviour-oriented. Rather than focusing on balance sheets and operating statements for the benefit of stockholders and the government (users of financial statements), accounting for human resource focuses on people who prepare the reports and who are directly affected by these reports (those who are being reported on).

Accounting for human resource improves the effectiveness of accounting reports and creates a sense of self-control amongst people. “Self-control refers to those behaviours that an individual deliberately undertakes to achieve self-selected outcomes. The individual employee selects the goals and implements the procedures to achieve these goals.” Self-control is a pre­requisite for effective management of organisations, groups and individuals.

6. Nature of Control:

People often feel that control puts undue pressure on them to behave in a desirable way. They would engage in the right behaviour even in the absence of controls as it would satisfy their ego needs. Thus, control or no control, if organisational operations and processes are in tune with their needs, they shall perform well. They are self-motivated and directed to work rather than motivation coming from outside forces.

The nature of control, thus, has to be in conformity with the nature of people. If they are tuned towards Theory Y assumptions (McGregor’s Theory of Motivation), controls should be flexible and not rigid. Controls should, thus, aim at individual needs rather than purely organisational needs.

7. Perception of Employees:

Employees should feel that controls are not a check on their performance. Rather, increased organisational performance arising on account of controls will be shared amongst the employees. Thus, people will perceive that controls are not just for the benefit of the organisation but also for their benefit.

They are not used against them for increasing management profits only. Change in people’s perception to control will result in willing compliance to control (as they feel it will serve their needs) rather than forced compliance (they obey because it comes as order from superiors) or resistance (they work against the control system and want management to change it). Behavioural aspects of control, thus, recognise human resistance to controls and measures to overcome the resistance.

Resistance to Control:

Control should be viewed as a positive human behaviour. Yet, people do not always look at controls in a positive way.

They view it as a check on their freedom to work and, therefore, often resist control. Resistance to control arises on account of the following reasons:

1. Inaccurate/Inappropriate Controls:

Employees resist controls if they are not related to goals. If production department has to produce more without increasing the demand for raw material or sales department is asked to increase sales without increasing the expenditure on advertisement; whatever measures of control are applied by the management, they will not help to attain the goals (high production or sales).

Such controls are inappropriate controls. This normally happens when standards are set without participation of employees. Employees feel that standards are based on subjective judgment rather than scientific measurement.

2. Excessive Controls:

Though controls aim to improve the performance of employees, excessive controls can prove otherwise. Control over every activity of employees, for example, the way they talk, the way they work, the way they spend time during lunch break, persons with whom they interact (control on personal habits of employees) can restrict their performance rather than enhance it.

Excessive controls restrict their freedom and reduce flexibility to work. People see control as restriction on creativity which regulates their behaviour in a rigid way. People with high growth needs wish to work in a positive environment where they can use their creative abilities in bringing change and innovation. Controls impose standards which cannot be controlled by them and, thus, restrict their freedom.

3. Unachievable Standards:

If standards are unrealistic, employees may get frustrated and work below their capacities. A worker, for example, cannot work for more than 8 hours a day. Managers want him to work overtime for 2 hours. Even if the overtime has financial benefits, the worker may resist since it is beyond his capacities to work 10 hours a day.

If managers do not understand this problem, he may actually work for even less than 8 hours a day. Excessive controls can, therefore, suppress the creativity of employees.

4. Fear of Accountability:

In contrast to those who perform well, employees who cannot perform up to the standards also resist controls because of the fear of being punished by the superiors. They are afraid of controls if it exposes their weaknesses. The good and the poor performers, therefore, both resist controls either for loss of freedom or for the fear of accountability.

5. Unpredictable Standards:

If standards of performance keep changing, sometimes high and sometimes low, workers will not be able to assess their performance against any predictable target and, therefore, will not be motivated to work. Any measure of control will not achieve the targets.

People view self-control better than external control. They feel that controls are imposed because people cannot be trusted upon. This hurts their self-respect and, thus, resistance to control.

Principles of Control:

Control is based on the following principles:

1. Principle of the Purpose of Control:

The purpose of control is to detect and correct deviations and provide basis for sound planning in future.

2. Principle of Future-directed Controls:

Rather than controlling the deviations when they occur, controls should predict deviations and prevent them from occurring. Feed-forward controls help in doing this. Though the general notion is “planning is looking ahead and control is looking back, the feed forward controls help in identifying control as a function of looking ahead rather than looking back. Though not much in use, managers have to orient themselves to feed forward control. Managers generally base their decisions on past data and performance and, therefore, have to put in great efforts to make future-directed control a reality”.

3. Principle of Control Responsibility:

Managers who devise plans have the responsibility of controlling organisational activities.

4. Principle of Efficiency of Controls:

Though controls highlight deviations in actual work performance, excessive emphasis on controls may be costly. Managers should carry out cost- benefit analysis before designing the control system and adopt the system if its benefits are more than the costs.

5. Principle of Preventive Control:

Controls should prevent the deviations. “The more qualified the managers are, the more they will perceive deviations from plans and take timely action to prevent them”. This can be done through feed forward controls.

6. Principle of Reflection of Plans:

Controls are based on plans. Thus, quality of control can be improved by designing clear, complete and integrated plans with effective implementation and follow up.

7. Principle of Organisational Suitability:

Controls are implemented by individuals. If position of people in the organisation structure, authority-responsibility relationships and the responsibility centres are clear, controls will be effective in achieving the planned performance.

8. Principle of Individuality of Controls:

The control system should be so designed that managers understand and utilise it to meet its intended purpose.

9. Principle of Standards:

As standards form the basis for control (actual performance is measured against standards), they must be objective, accurate and accepted by superiors and subordinates.

10. Principle of Critical Point Control:

Controls should focus on salient factors of performance where deviations affect organisational efficiency. Factors critical to evaluating performance must be focused by managers.

11. The Exception Principle:

Only significant deviations should be reported up the hierarchy for necessary action.

12. Principle of Flexibility of Controls:

Unforeseen contingencies can require plans to be restructured. Controls should be flexible to accommodate changes. Flexible control systems economise on designing and implementing a new control system.

13. Principle of Action:

Control implies action. If deviations are reported in planned performance, it may require redrawing the plans, making additional plans, reorganisation or improved motivation, leadership and communication. The action can, thus, be planning, organising, staffing or directing.