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This is a research paper on organizational control. It will cover extensively on the basics and formalities involved in organizational control.
Organizational control involves the process that is designed in ensuring that organizational plans are being carried out in the manner they were designed to (Barnat, 2007). It is a systematic effort in setting the standards of performance with planning objectives, to design the systems of information feedback, to compare the predetermined standards with the actual performance, to determine if any deviation exists and measuring their significance, and to act on any requirement in assuring that there is utilization of all corporate resources in the most efficient and effective possible way in achieving objectives of the corporation (Das, 1993).
Types of organizational control
Organizational controls are implemented by the management. According to Barnat, (2007), a good organizational control system should be able to provide information in a manner that is timely, should provide organizational information that is accurate, and should also be so flexible that managers are able to respond as they are needed. Controls can be implemented before the commencing of an activity, as the activity goes on, or after the completion of an activity. There are three respective types of timing control (Barnat, 2007).
These are: 1. Feed forward; this focuses on inputs regulation in order to ensure that the standards necessary are met for the process of transformation. Such inputs include material, human and financial resources which flow into the organization. The feed forward control is evident in the hiring and selection of new employees. An example is when the organization attempts to improve the employees likelihood of up to standards performance by identifying job skills that are necessary and by use of tests and other devices for screening for hiring of people with those skills. Feed forward controls are desirable to the management as they allow for problems prevention rather than their later resolutions. However, the control requires information that is accurate and timely which is often difficult to develop (Barnat, 2007).
2. Concurrent; this takes place as the activity progresses for ensuring quality standards consistency. It involves the regulation of the activities in progress which are part of the process of transformation for ensuring their conformation to the standards of the organization. Concurrent control has been designed in ensuring that the correct results are produced from the activities of the employee's work. Since concurrent control is involved in the regulation of tasks that are ongoing, it therefore requires the involved specific's task thorough understanding as well as their relationship to the product that is desired. For example, most manufacturing operations involve those devices that measure whether or not the produced items meet quality standards. The measurements are monitored by the employees and when they see in an area where standards are not met, they correct it themselves or inform the manager of the occurring problem. Sometimes concurrent control is called yes/no or screening control as it most of the time involves checkpoints where it is determined whether the progress should be continued, corrective action should be taken, or the products and services work should be stopped (Barnat, 2007).
3. Feedback control; it focuses on the organization's output after the completion of the transformation. The feedback control is sometimes called the output or the postaction control as it fulfils various functions that are important. For instance, it is used when the feed forward or the concurrent controls are costly or infeasible. Other times the only viable control type available is feedback. It has two advantages over the concurrent and the feed forward control. (a), feedback provides meaningful information to the manager on the effectiveness of the planning effort. If there is an indication in feedback of little variance between the actual and the standard performance, it means then that planning was on target generally. If the feedback indicates a great deviation, the manager then can utilize this information in formulation of other plans that are more effective. (b) Feedback control is also known to enhance the motivation of the employees. One major feedback control drawback is that the damage is already done by the time the manager is reached by the information of a significant problem (Barnat, 2007).
Approaches to organizational control
The managers in an organization must make a choice on different control approaches regardless whether focus of the organization is on production, outputs or inputs control. There are three mechanisms of control approaches that managers use in implementing controls. These are: 1. Market control; it involves output evaluation by use of price competition. The prices and profits are compared by the managers to determine their organization's efficiency. Market controls are used where there is a reasonable competition level in the area of goods or services and there must be a possibility to clearly specify the requirements. Functional departments are not appropriately controlled by market control, unless the setting of the service prices is through competition and its true value representative of services provided (Ouchi, 1979).
2. Bureaucratic control; this involves the use of policies, reward systems, hierarchy of authority, written documentation and other formal mechanisms for influencing the behavior of the employee and assess performance. Bureaucratic control is normally used when the price or market mechanisms are able to control the behavior. 3. Clan control; this represent cultural value. This control relies on beliefs, shared norms, values, informal relationships, and corporate culture to regulate the behaviors of the employee and to facilitate the organizational goal's achievement. There is need to trust the employees in the organizations that use clan control. Good performance of the employees is assumed hence minimal standards and direction are given as they indeed participate in the standards setting as well as designing the control system (Ouchi, 1979).
The process of organizational control
The process of organizational control involves the careful collection of information about a process, a group of people, a person or a system so as to make decisions necessary about each. The control systems set up by managers have four steps which are:
Standard establishment for measuring performance. In the overall strategic plan of the organization, goals are defined by managers for the departments in the organization in operational terms that are specific and which include performance standards for comparison with the activities of the organization.
Actual performance measurement. Performance Formal reports of measurement are prepared by most of the organizations and which are reviewed regularly by the manager. The measurements should be of relation to set standards in the control process' first step. For instance, if the target is to increase sales, there should be a means in the organization for sales data gathering and reporting.
Comparison between standards and performance. This involves comparison between the actual activities and the performance standards. As the managers go through reports, they are able to identify if the actual performance meets the standards, exceeds them or have fallen short of. Such comparison is simplified by the performance reports by placing the reporting period performance standards alongside same period actual performance and by variance computation.
Taking corrective actions. When there is a deviation of performance from the standards, the necessary changes if any, must be determined by the managers. In the organizational environment where it's a center for productivity and quality, workers as well as managers are often empowered to do an evaluation of their work. After the cause (s) of deviation has been determined by the evaluator, corrective action then can be taken (Carpenter, Bauer, & Erdogan, 2010).
Techniques of organizational control
The control techniques of the organization provide amount and type of information to the manager which is needed for monitoring and measuring of performance. The various controls' information must be tailored to a specific unit, management level, operation or department. For consistent and complete information, standardized documents are often used by organizations such as project reports, financial and status (Barnat, 2007).
Every area in an organization has its own specific control technique that it uses. Such control techniques are: financial controls; after an organization lays down its strategies on goal achievement, funds for the necessary labor and resources are set aside. As money is being spent, statement updates are being made on how money was spent, how much it was, and what was obtained from it. The plans and programs' progress is monitored by manager by using such financial statements as balance sheet, or income statement. Financial audits; these are formal investigations which are conducted regularly to ensure that practices of financial management follow generally accepted policies, ethical guidelines, procedures and laws. Budget controls; a budget shows the amount of money an organization is expecting to spend that is the expenses or earn that is the revenues over a period of time (OCT, 2010).
Marketing controls; these help in progress monitoring toward customer satisfaction goals with prices, services, products and delivery. Controls of Human resource; these help the managers in quality regulation of the personnel that is newly hired, as well as monitoring of the developments of the current employees and their daily performance. The common types of control are observations, appraisals, disciplinary programs, and assessment for development and training. Information and computers control; every organization has sensitive and confidential information that would not want to be the general knowledge to everyone hence computer databases are put under access control (OCT, 2010).
Organizational control is a systematic effort in setting the standards of performance with planning objectives, to design the systems of information feedback, to compare the predetermined standards with the actual performance, to determine if any deviation exists and measuring their significance, and to act on any requirement in assuring that there is utilization of all corporate resources in the most efficient and effective possible way in achieving objectives of the corporation.
Organizational controls are implemented by the management. The managers in an organization must make a choice on different control approaches regardless whether focus of the organization is on production, outputs or inputs control. The process of organizational control involves the careful collection of information about a process, a group of people, a person or a system so as to make decisions necessary about each. The control techniques of the organization provide amount and type of information to the manager which is needed for monitoring and measuring of performance.