Control Process in Management

Home About Site stay on Your Article suffice timberland Guidelines Disclaimer TOS Contact Us Skip to content 4 main move in look process in heed 4 main steps in control process in prudence be Control as a care operate on involves the following steps 1. Establishing standards Standards are criteria over against which results are careful. They are norms to achieve the goals. Standards are usu completelyy measured in terms of output. They skunk to a fault be measured in non-mo send awayary terms wish sound loyalty, customer attraction, good allow etc.Some of the standards are as. a. Time standards The goal depart be set on the bag of time lapse in performing a task. b. Cost standards These steer the financial expenditures involved per unit, e. g. material cost per unit, cost per person, etc. c. Income standards These fix to financial rewards received due to a particular activity like sales volume per month, year etc. d. Market serving This relates to the sha re of the companys merchandise in the market. e. Productivity Productivity can be measured on the basis of units produced per man hour etc. f. ProfitabilityThese goals will be set with the conside balancen of cost per unit, market share, etc. 2. cadence performance Measurement involves comparison amidst what is accomplished and what was intended to be accomplished. The bill of positive performance must(prenominal) be in the units resembling to those of pre obstinate criterion. The unit or the yardstick thus chosen be clear, well-defined and easily identified, and should be uniform and homogenous throughout the meter process. The performance can be measured by the following steps (a) Strategic control points It is non possible to check everything that is being done. blow article aboutProduction ManagementSo it is necessary to pick strategic control points for measurement. Some of these points are (i) Income It is a significant control point and must be as much per unit of time as was expected. If the income is significantly off form the expectation thence the reasons should be investigated and a strict action taken. (ii) Expenses Total and ope symmetrynal cost per unit must be computed and must be adhered to. Key expense data must be reviewed full pointically. (iii) Inventory Some minimum enumeration of both the finished product as well as raw materials must be unplowed in stock as a buffer.Any change in inventory level would determine whether the output is to be increased or decreased. (iv) Quality of the product Standards of established quality must be maintained peculiarly in food processing, drug manufacturing, automobiles, etc. The process should be unceasingly observed for any deviations. (v) Absenteeism Excessive absenteeism of personnel is a serious manifestation on the environment and working conditions. Absenteeism in excess of chance expectations must be seriously investigated. (b) Meclzanised measuring devicesThis involves a wide v ariant of skillful instruments utilize for measurement of machine operations, product quality for size and ingredients and production processes. These instruments whitethorn be mechanical, electronic or chemical in nature. (c) proportionality analysis Ratio analysis is one of the most important management tools. It describes the relationship of one business variable to another. The following are whatsoever of the important ratios i) Net sales to working with child(p) The working capital must be utilised adequately. If the inventory turnover is rapid then the same working capital can be used again and again.Hence for perishable goods, this ratio is high. Any change in ratio will signal a deviation from the norm. ii) Net sales to inventory The greater the turnover of inventory, generally, the higher the profit on investment. iii) Current ratio This is the ratio of current asset (cash, receivables etc. ) to current liabilities, and is used to determine a firms ability to pay the s hort term debts. iv) Net terminal to net sale This ratio measures the short-run profitability of a business. v) Net moolah to tangible net worth Net worth is the difference between tangible assets (not good will, etc) and total liabilities.This ratio of net worth is used to measure profitability over a long hitch. vi) Net profits to net working capital The net-working capital is the operating capital at hand. This would determine the ability of the business to finance day-to-day operations. vii) Collection period on credit sales The collection period should be as short as possible. Any deviation from established collection period should be promptly investigated. viii) Inventory to net working capital This ratio is to determine the extent of working capital tied up in inventory.Generally, this ratio should be less than 80 per cent, ix) Total debt to tangible net worth This ratio would determine the financial soundness of the business. This ratio should expect as low as possible. (d) Comparative statistical analysis The operations of one company can be helpfully compared with similar operations of another company or with industry averages. It is a very useful performance measuring device. (e) Personal observation Personal observation both formal and open can be used in veritable situation as a measuring device for performances, specially, the performance of the personnel.The informal observation is generally a day-to-day routine type. A director may walk through a store to have a general idea about how people are working. 3. Comparing the actual performance with expected performance This is the active principle of the process. The previous two, context of use the goals and the measurement format are the preparatory parts of the process. It is the responsibility of the management to compare the actual performance against the standards established. This comparison is less complicate if the measurement units for the standards et and the performance measur ed are the same and quantified. The comparison becomes more strong when these require subjective military ranks Ralph C. Davis identifies four phases in the comparison. 1. Receiving the raw data. 2. Accumulation, classification and put down of this information. 3. Periodic evaluation of completed action to date. 4. Reporting the status of achievement to higher line authority. At the third phase, deviations if any are renowned between standards and performance. If clear cut deviations are there, then management must study the- (i) Causes for deviation ii) Effect of deviation (iii) Size of deviation (iv) optimistic or negative deviation. 4. Correcting Deviations The final element in the process is the fetching corrective action. Measuring and comparing performance, detecting shortcomings, failures or deviations, from plans will be of no avail if it does point to the needed corrective action. Thus controlling to be effective, should involve not only the detection of lapses but also probe into the failure spots, fixation of responsibility for the failures at the right quarters, recommendation of the best possible teps to correct them. These corrective actions must be utilize when the work is in progress. The primary objective should be avoidance of much(prenominal) failures in future. The required corrective action can be determined from the qualified data as per the standards laid out and the performance evaluation already done. This step should be taken promptly, otherwise losses may be cumulative and remedial action will be all the more difficult to take. Corrective action must be well balanced, avoiding over controlling and at the same time letting not things to drift.You May Also Like 3 Elements of an Organisation suggested by Allen 14 principles of management suggested by Fayol Advertisement Free Subscription Top of design picpic Do you want some more information on this topic? reach your email id picpic Bottom of Form Do you like this site? I f you make whoopie reading PreserveArticles. com, please share this site with your friends.? Guidelines About Site content Quality Guidelines Terms of Service Privacy Policy Disclaimer right of first publication Recent Articles spellingerrors Report Spelling and Grammatical Errors Suggestions Suggest Us Testimonials Users Testimonials Preserve Articles is home of thousands of articles published and preserved by users like you. 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