BBPP 1103 Chapter 9 Controlling Definition of control

BBPP 1103 Chapter 9 Controlling

Definition of control Rue: ~is a process in ensuring that organizational activities are running according to the plan. This process can be carried out by comparing the true performance with the standard that have been established and taking corrective actions in order to rectify any distortion that does not comply with the standard. n Purpose of control: l l Quality assurance Preparation to face changes

Steps in control process n n Three basic needs : fixing standard, monitoring performance & corrective actions. Proper control process : l l Establish the performance standard Evaluate the true performance Compare true performance to standard Taking corrective actions if necessary

Basic Methods of Control n Future control l n Concurrent control l n Predicting problem before it happen Managing problem when it happen Feedback control l Managing problem after it has happened

Forms of control Ø Bureaucratic control -uses of hierarchy authority in order to influence employees by rewarding those who obey or punishing those who do not obey policies, regulations and procedures Ø Objective control -uses the measurement of observation towards the behavior of employees (behavior control) or output (output control)produced to evaluate work performance Ø Normative control -method that arranges the behavior of employees and results through norms and beliefs shared together among members within organization Ø Concertive control -method that uses norms and behavior discussed, formed and agreed by the work group (autonomous work group) Ø Self control -managers and employees control their own behavior by establishing their own goals, monitor their own progress, and rewarding themselves for their own achievement

Factors that need to be controlled n Financial perspectives l n Human resource perspective l n To avoid shortage or surplus of employees, to avoid losing expert workforce, planning can motivate employees etc Quality perspective l l n Financial statements, economic value-added This can determine the level of production and organizational performance Can strengthen customers’ perception, can reduce waste and product defects Consumer perspective l l Company will be able to increase profits Cost in obtaining new customer is five times greater compared to the cost of retaining an existing customer