CONTROLLING WITH EXAMPLES

CONTROLLING -With Live Example A Group Presentation by: 1.Harshad Katikar 2.Aniket Ghodke 3.Atul Chavan 4.Amar Nikam 5.Sandeep Ekande Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc.

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Control Process of monitoring activities to ensure that what is being accomplished matches plans and corrects significant deviations Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc.

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Definition Of Control

 Henry Fayol: Control consists in verifying whether everything occurs in conformity with the plan adopted, the instructions issued and the principles established. 3

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc.

Definition Of Control

 Koontz and O’Donnell: Controlling implies measurement of accomplishment against the standard & the correction of deviations to assure attainment of objectives according to plans. 4 Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc.

Characteristics : • Continuous process. • Flexible and dynamic process. • Future oriented. • Planning and controlling are closely related. • Function of management. • Essence of control is action. Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc.

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Controlling

Planning

PlanningControlling Linkage Leading Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc.

Organizing 6

Purpose of Controls Goals and

• Measuring Performance

Objectives Organizational

• Comparing to Standards

Divisional Departmental

• Taking Corrective Action

Individual Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc.

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The Control Process Compare Performance to Standard

Yes

Measure Performance

Do Nothing

No Yes Variance Acceptable?

Objectives

Standard

Standard Attained?

Do Nothing

No Yes Standard Acceptable?

Identify Causes

No

Revise Standard

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc.

Correct Performance

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What Does A Manager Measures? • • • •

Information Operations Finances People

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc.

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How Do Managers Measure Performance? • Personal observations – MBWA (management-bywalking about)

• Statistical reports • Oral reports • Written reports Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc.

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Discrepancies Between Goals and Performance

Acceptable Upper Limit Standard

Acceptable Range of Variation

Acceptable Lower Limit

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc.

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Do Nothing

Taking Managerial Action

Immediate/Basic Corrective Action Revise the Standard

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc.

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Three Types of Control Input

Processes

Output

Feed forward Control

Concurrent Control

Feedback Control

Anticipates problems

Corrects problems as they happen

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc.

Corrects problems after they occur

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Control Techniques: “The tools, closely related to recent advances in planning techniques, have brought the systems approach to problem of control a recognition that better planning is of no avail without better control. - Koontz and O’Donnel. Control techniques may be broadly classified into two categories:5. Traditional control techniques. 6. Advance control techniques.

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc.

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Traditional Control Techniques:b)Personal observation. c)Statistical reports and analysis. d)Break-even analysis. e)Budgetary control. f) Cost control. g)Production control. h)Inventory control.

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc.

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Advance control techniques:b.Management Audit. c.Return On Investment. d.Responsibility Accounting e.Programme Evaluation and Review Techniques (PERT). f. Critical Path Method (CPM). g.Management Information Systems (MIS). Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc.

h.Zero-based Budgeting.

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Feedback Control • Meaningful information • Enhance employee motivation

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc.

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Qualities Of An Effective Control System Corrective Action

Accuracy

Multiple Criteria Emphasis on Exceptions

Timeliness

EFFECTIVE CONTROL SYSTEM

Strategic Placement

Economy

Flexibility Reasonable Criteria

Understandability

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc.

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FOM 7.17

Contingency Factors in Control Systems Contingency Variable

Organization Size

Position and Level

Degree of Decentralization

Organizational Culture

Importance of an Activity

Control Recommendations Smal Informal, personnel management l Larg Formal, personnel management e High Many complex criteria Low Few, easy-to-measure criteria High Increased number of controls Low

Reduced number of controls

O pen Close d High

Informal, self-control Formal, external controls

Low

Loose, informal controls

Comprehensive controls

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc.

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Dysfunctional Controls Inflexible Controls

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc.

Unreasonab le Standards 20

Contemporary Issues in Control • Rights that manager has to monitor employee behavior • Rights that manager has to control private lives of employees. • Employers MAY be able to control employee behavior outside the work environment

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc.

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You and Your Computer • Employers can read your e-mail • Employers can listen to your phone calls • Employers can monitor your work by computer

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc.

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Employee Theft • Ranges from embezzlement to fraudulent filing of expense reports to equipment removal • Nearly 85% of all organizational theft and fraud is committed by employees • Ready availability of information technology has made employee stealing an escalating problem Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc.

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Control and Ethics

Inform Employees

Written Policy

Monitor for Business Reasons Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc.

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Entrepreneurs Controlling for Growth • Plan for growth • Organize for growth • Control for growth

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Entrepreneurs Managing Downturns • • • •

Recognizing crisis situations Things can turn worse Exit the venture Business evaluation

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc.

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Limitations of Controlling:3.External factors cannot be controlled. 4.Determinants cannot be controlled. 5.Responsibility cannot be fixed. 6.Difficulty in finding out causes of variation.

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc.

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MUKESH AMBANI -Chairman, Reliance Industries •Mukesh Ambani (April 19, 1957 Aden, Yemen) is the chairman, managing director and the largest shareholder of Reliance Industries, India's largest private sector company and a Fortune 500 Company. Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc.

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• Mukesh Ambani joined Reliance in 1981 • Took over Reliance Industries on 18 July 2005 • Initiated backward integration from textiles into polyester fibres and further into petrochemicals. • He directed and led the creation of the world's largest grassroots petroleum refinery at Jamnagar Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc.

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• Mukesh Ambani has set up the largest and most complex information and communications technology initiative in the world in the form of Reliance Infocomm Limited. • Successfully developed RIL from the 51% stake he held after the split.

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc.

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The combined market capitalisation of the four Mukesh Ambani Group companies -RIL, Reliance Petroleum (RPL), IPCL and Reliance Industrial Infrastructure Ltd (RIIL) has crossed the Rs 400,000 crore mark. Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc.

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• On 26th Sept 2007, he was declared 4th richest person in the world, next to Carlos Slims, Bill Gates and Warren Buffet • Is worth a staggering Rs. 2,20,463 or $ 55.8 million

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc.

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• Before the split the annual turnover was estimated at $12bn. After it, on the basis of the 51% stake in RCC he generates an annual turnover of US $19.976 billion and profit of $2.033 billion. Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc.

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BAJAJ AUTO LIMITED

• Bajaj Auto Limited (BAL) is the fourth largest 2wheeler and the largest 3-wheeler manufacturer in the world. BAL is also the second-largest manufacturer and the largest exporter of two wheelers in India. It has manufacturing plants at Pune and Aurangabad in India and has plans for setting up plants in Indonesia and Brazil 34 Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc.

BAL’S GROWTH • During August 2006, Bajaj Auto reported motorcycle sales of 1,80,570 units, a growth of 21%. • Total 2-wheeler & 3-wheeler sales grew by 11% from 1,86,802 units in 2005 to 208,163 units in 2006. • The total 2-wheeler exports jumped 112% while 3wheeler exports also increased by 59%. • The Management believes that the motorcycle industry would touch 10 million units by 2010, which would further intensify BAL’s growth in its two35 wheeler segment. Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc.

ACHIEVEMENT AREA

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CONCLUSION • Thus, we can conclude that control whether managerial or otherwise is an important principle and part of modern management. • It is a vital link between the goals set, the performance put in, and the goals achieved. Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc.

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BIBLIOGRAPHY • Internet: Google, Wikipedia. •

Organizational Behavior & Principles& Practices Of Management - Prof. Ujagare

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Organizational Behavior & Principles & Practices Of Management- Dr P.C.Pardeshi.

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The Times Of India

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Fundamentals Of Management- Robbins

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THANK YOU !!!

YOUR QUESTIONS ARE WELCOME

Robbins et al., Fundamentals of Management, 4th Canadian Edition ©2005 Pearson Education Canada, Inc.

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