a) Control is a process that attempts to assure that the actual activities performed match the desired goals that have been set. Control assures that deviations from the goals are corrected. It provides feedback that can aid in setting future goals and standards. Control systems are mechanisms.
The control systems a manager can use may be classified into three categories:
1. Managerial discretion,
2. Timing and
3. Information.
1. Managerial Discretion
This relates to the amount of discretion a manager has in completing the task i.e. the freedom or authority to make decisions or choices about a particular situation. Such systems may be either cybernetic or non cybernetic.
Cybernetic control systems are self-regulating i.e. they have built-in devices to automatically correct any deviations that may occur. They are self-regulating and self operating, they eliminate the need for people overseeing tasks. This system is useful for tasks and processes in which all of the steps and standards are very well known e.g the use of robots in production.
Non cybernetic control systems are those in which managers use their own discretion in making decisions about how best to complete an activity and meet performance goals. Quality circles allow the discretion of work groups in determining how best to complete a job and eliminate problems.
2. Timing
Steering controls anticipate results and guide an activity before the operation begins e.g. in new product development, demand is predicted, production schedules are set and expected delivery dates are defined beforehand.
Yes-No controls assess an activity while it is in progress. At checkpoints, progress is okayed, corrective action is taken or progress is halted. Yes-No controls are used in scheduling of and timing of steps or procedures such as the Critical Path Method (CPM) or Project Evaluation and Review Technique (PERT).
Post-action controls measure and evaluate the results of an activity after it is completed. They provide information for rewards and planning. They rely on feedback received from the system.
3. Information
Control systems are designed to monitor and evaluate certain activities, therefore they are designed to accumulate and evaluate certain types of information – financial, physical and administrative.
Information about financial resources is usually in the form of figures that show the amounts allocated and spent e.g. budgets, capital expenditures and cash flows.
In production, information about scheduling, inventories, quality control and materials has to be collected, stored and retrieved.
Human resource (administrative) information is collected showing records e.g. absenteeism, pay rises, training and performance evaluations.
b) Drawbacks of control systems
1. Game playing: People look at controls as something to be beaten. Many people look at rules and regulations as things to circumvent, the budget is frequently a version of ‘pad the budget,’ tax forms are never sincerely filled and most organizations ‘use’ every penny allocated to them – to justify that more resources are needed in the next budgetary season. These games are played within the procedures of the control system.
2. Sabotage: One form of sabotage is to create confusion. Experts may complicate projects so that management cannot understand them or the resources to support the project.
3. Inaccurate information: Managers may supply inaccurate information to make themselves appear better while subordinates may report what they perceive management wants to hear. Realistic reports and expenses may not be reported if they contradict what management expects. Management may ask for information that has not been collected and subordinates may make up numbers or give their best guess.
4. Illusion of control:Appearing to be in control is particularly important at the upper levels of the firm. Managers attempt to appear in control and to assure their superiors that everything is in order and flowing smoothly. Even in performance evaluation sessions, subordinates will attempt to appear in control and to deny the existence of any negative deviations from standards.