Page 288 - DCOM102_DMGT101_PRINCIPLES_AND_PRACTICES_OF_MANAGEMENT

Principles and Practices of Management

Notes 2. Control leads to appraisal of past activities. The deviations in the past are revealed by the
control process. Corrective actions can be initiated accordingly.

3. Control is linked with future, as past cannot be controlled. It should anticipate possible
deviations and to think of corrective action for the control of such deviations in the future.
It is usually preventive as presence of control system tends to minimise wastages, losses
and deviations from standards.
4. Control is concerned with setting standards, measurement of actual performance,
comparison of actual performance with predetermined standards and bringing to light
the variations between the actual performance and the standard performance.

5. Control implies taking corrective measures. The object in checking the variations or
deviations is to rectify them and prevent their recurrence. It is only action which adjusts
performance to predetermined standards whenever deviations occur.
6. Control can be exercised only with reference to and or the basis of plans. To quote Mary
Cushing Niles - "Whereas planning sets the course, control observes deviations from the
course or to an appropriately changed one".
7. To some people, control is opposite of freedom. This is not true. Control is based on facts
and figures. Its purpose is to achieve and maintain acceptable productivity from all resources
of an enterprise. Therefore, control aims at results and not at persons. It is for correcting a
situation, and not for reprimanding persons.
8. Information or feedback is the guide to control. The feedback is helpful to the manager to
determine how far the operations are proceeding in conformity with plans and standards,
and where remedial action is called for.
9. Control involves continuous review of standards of performance and results in corrective
action which may lead to change in the performance of other functions of management.
This makes control a dynamic and flexible process.
10. Control is a continuous activity. It involves constant analysis of validity of standards,
policies, procedures etc.

Caselet Zenith Industries Limited

"I heard about this variable budget idea in a management conference I attended last week,"
remarked Mr. Kapoor, President of Zenith Industries, a small company whose clever new
sports products had given rise to growth since its founding five years ago to a level of 5
million in annual sales. "Some speaker said that the sound way to run a company is to let
all the department and section heads develop their own budgets.
But I cannot imagine doing this in this company. If I did, these people would spend so
much money that we would soon be bankrupt. No! As long as I am incharge of this
company, I will tell my people what they can spend. There will be no blank cheques here.
And I will hold my chief accountant responsible for making sure that this company makes
the profits I want. I have heard of too many companies, with the fast growth we have had,
that have gone into liquidation because optimism and uncontrolled spending went through
the ceiling. And this idea of variable budgets is even worse. Imagine what would happen
if I let everyone vary his budgets each month, quarter or year".
Source: Parag Diwan, Management Principles and Practices, Excel Books.

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