Summary of "Introduction To Controlling | Process Of Controlling | Principles Of Controlling | B.Com/BBA/MBA"

Main Ideas / Lessons in the Video: Controlling in Management

1) Meaning of “Controlling”

Controlling is a management function that:

Compares what was planned (goals/objectives/standards) with what is actually happening (actual performance).
Checks whether performance is being achieved effectively and economically.
Detects deviations (shortfalls or excesses) from standards.
Identifies the root cause of deviation and ensures corrective action so the same problem doesn’t repeat.

Example used:

If a target is 100 units and actual output is 95, then there is a shortage of 5.
Possible causes include:
- Employees being absent
- Machinery slowing down
- Raw material not arriving on time

2) Famous Definitions Referenced

Philip Kotler: Controlling is a process that helps ensure goals and actual work move together toward the desired results.
Dale Henning: Controlling ensures conformity of performance with planned action (actual performance is compared with planned performance).

Features / Characteristics of Controlling (as taught)

Fundamental / important management function
- Provides direction by ensuring other functions (planning, organizing, staffing, directing) lead to achievement of goals.
Required at every level
- Top, middle, and lower management each require controlling because plans differ across levels.
Continuous activity / continuous process
- Controlling must happen regularly, not only at the end.
Beginning and end of the management process
- At the beginning: standards/targets are set.
- At the end: actual performance is compared against standards.
Looking forward (not only looking back)
- Deviations are used to plan future corrective actions.
Related to results
- It focuses on outcomes; if performance differs from plans, corrections improve results.
Action is the essence
- Detecting deviations is not enough—corrective action is required.
Includes delegation (but with responsibility retained)
- Authority can be delegated, but managers must retain responsibility to maintain control.
Needs complete information
- Managers should gather full details before deciding what action to take.
Not “questioning” or “suppressing” employees
- Controlling is not meant for scolding, threats, or forcing work by pressure.
Emotional and motivational implications
- For some employees it can be demotivating (fear of blame).
- For others it can be motivating (clarity about shortcomings and improvement).
Improves efficiency
- Corrective actions reduce recurring deficiencies and improve performance.
Concerned with all factors of production
- Not only humans—also materials and other production factors.
Needed for coordination and to handle change
- Helps coordinate people and quickly adapt if market/implementation/plans change.
Positive and negative approaches
- Positive: use resources effectively.
- Negative: avoid misuse of resources.

Controlling Process: 5 Steps (Methodology)

Setting performance standards (Step 1)
- Set measurable standards/goals:
  - Quantitative standards: measurable in numbers/figures (e.g., cost, units, output)
  - Qualitative standards: not directly expressed in numbers (e.g., employee morale, quality of finished goods)
- Standards are set on common bases:
  - Quantity
  - Quality
  - Time
  - Cost
- Standards must satisfy conditions:
  - Reasonable (not too easy, not impossible)
  - Measurable
  - Flexible (adjustable when situations change)
  - Simple and clear
  - Deviation tolerance (acceptable level of variation)
Measuring actual performance (Step 2)
- Observe and record:
  - output units
  - speed/production rate
  - cost, etc.
- Collect real performance data continuously/regularly.
Comparing actual performance with standards (Step 3)
- Identify deviations:
  - No deviation: actual matches standards
  - Negative deviation: shortage (less than target)
  - Positive deviation: excess (more than target)
Analyzing deviations (Step 4)
- Determine:
  - whether the target was achieved
  - whether the deviation is acceptable or not
- Consider tolerance limits:
  - Minor/acceptable deviations can be ignored or managed
  - Serious deviations require revising plans/standards and taking action
- Apply two key principles:
  - Critical Point Control: focus on key result areas rather than every minor activity
  - Management by Exception: focus only when exceptional deviations occur; act on them urgently
Taking corrective action (Step 5)
- Corrective action targets the cause of deviations.
- Aim:
  - improve current work
  - reduce repetition in the future
- The emphasis is on action; controlling without correction is meaningless.

Limitations / Difficulties of Controlling (as discussed)

Difficulty in setting qualitative standards
- Morale/attitude/leadership quality is hard to measure precisely.
No control over external factors
- Deviations can arise from market, technology, competition, policy changes, etc.
Employees may resist monitoring systems
- Example mentioned: installing surveillance like CCTV can face resistance.
Controlling can be costly
- Small organizations may not afford expensive control techniques.
“Human problem” perception
- Employees may feel controlling is like corruption/threat/pressure.
Difficulty in fixing individual responsibility
- When many tasks exist and work is shared across people, it becomes unclear who is responsible.
Lack of knowledge in controllers
- If managers/controllers lack information or understanding, they may not take correct actions.

Principles of Controlling (topic: “13 principles”)

The video states there are 13 controlling principles (to be discussed in detail).
The specific principles explicitly highlighted include:
- Principle of Standards
- Principle of Efficiency of Control
- Principle of Direct Control
- Principle of Flexibility
- Principle of Assurance of Objectives
- Reflection of Plans
- Responsibility Control
- Organizational Suitability
- Critical Point Control
- Principle of Exception (Management by Exception)
- Future Control
- Individuality of Control
- Principle of Action (corrective action must follow deviations)