Planning For Control

Written by Joe Driscoll

November 10, 2009

” The unfortunate thing about this world is that the good habits are much easier to give up than the bad ones. ”

W. Somerset Maugham

If you look at enough different definitions of management you will generally find one constant element.  While the middles will vary from definition to definition, most all will begin with planning and end with control.

The planning function receives considerable attention, and rightfully so, but it should not receive attention at the expense of the control function.  If you understand good management to be a continuous process, one that continually repeats, the control function is the initial step in the planning process and should receive equal billing.

What is the control function?  Is there more to it than having a bookkeeper pound out numbers, issuing reports and preparing statements that arrive too late and are too complicated to understand?  Who is responsible for maintaining control?  Is it just the job of the company’s controller?

Control can be simply defined as making sure that something happens the way it was planned to happen.  Even our best plans are only as good as our ability to execute them.  Controlling is the process that managers go through to control.

The controlling function has three main steps.  First you must find a method to measure results and quantify performance, next you must have predetermined standards against which to compare the performance and finally you must take appropriate corrective action to address any deviations.

The measurement of results is quite easy for some jobs, such as production line work, and quite difficult for others, such as research or design.  Remember that in order to have control, you must be able to measure.  It is probably true that the more difficult it is to quantify a task, the more important it becomes to find a way to control it.

Well thought out standards of performance need to be established for all areas of a business that are important.  A standard of performance says two things.  First, this area is important to us and second this is what we expect our performance to be in this area.  It is against these predetermined standards that actual performance is compared in order to determine if corrective actions are needed.

Taking corrective action to bring actual performance up the desired performance standards is the purpose of the control function and the essence of good management.  This is where good managers spend their time and effort.  It is important to view your role as a finder of solutions and not as a critic.  As you search for solutions, maintain a broad perspective of the entire operation from planning to execution and be careful to distinguish between symptoms and problems.

The controlling function does not begin after the activities have commenced.  Control takes place throughout the entire management cycle.  Management can begin by anticipating predictable problems and developing procedures that will prevent the sub-standard performance.

Controlling activities while they are in progress is generally regarded as a supervisory function.  The preparation of reports that provide management with information after activities have been completed is regarded as an accounting function.  Involvement in the control function is a management responsibility at all three times, before, during and after the activity.

The job of the controller is often confused with the responsibility of the control function of management.  The controller has his or her own job, a part of which is to assist other managers with their responsibility for control by providing them with timely information. The function of control is unquestionably a major responsibility of all managers and not just the dirty work left to the controller.

There are four key points to remember about control.  First it a means to an end and not an end in itself.  Controlling can only be justified to the extent that its benefits exceed its costs.  Don’t allow the decision making process to become paralyzed by a need for absolute control.

Secondly, insure that the control process is appropriate for the activity being controlled.  While all tasks need to be controlled, one control process is not appropriate for all tasks.  Third, act quickly when taking corrective action.  Information gathered in the control process generally loses value with the passage of time.  And finally, make sure that all individuals involved understand the control process and the veracity of the information it generates.  By understanding and accepting the validity of the information, they will be more adaptable to corrective actions.

Because it’s your business, properly exercise the control function to make it easier to keep the good habits and get rid of the bad.

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