Controlling Test - 46

Management By Objectives was popularised by Peter Drucker. It suggests that objectives should not be imposed on subordinates but should be decided collectively by a concerned with the management. The elements of Management by objectives and Results are:

• Roles and Missions
• Key result areas
• Indicators
• Controls
• Objectives
• Action plans
• Controls

The techniques of controlling are budgetary control, break even analysis, return on investment, management by objectives, management audit , financial statement analysis, direct supervision and observation, Management information system, PERT and CPM techniques and self-directed control.

In conclusion, the cash flow statement is not a technique of controlling.

Span of control is a term originating in military organization theory, but now used more commonly in business management, particularly human resource management. Span of control refers to the number of subordinates who report directly to a given manager or supervisor.

Controlling function encompasses the activity of auditing the work done by the employee and organization as a whole with the standards and goals set for the employee and organization, thus it is a forward and backward looking function.

The steps in controlling process are:

1. setting performance standards

2. measurement of actual performance

3. comparing actual performance with standards set

4 analysis of deviations or variances 

5 communicating the variance or deviations 6 taking corrective action. 

Rensis Likert conducted an extensive survey of management style in 1960. He outlined four systems of management to describe the relationship, involvement and roles of managers and subordinates in industrial settings. They are exploitative authoritative, benevolent authoritative, consultative and participative.

Controlling is a systematic process involving the following steps. 

1. Setting performance standards 

2. Measurement of actual performance 

3. Comparison of actual performance with standards 

4. Analysing deviations 

5. Taking corrective action

As controlling is the doing function of management activity, that is comparing the executed work with the planned work and measuring the difference and communicating the difference with the performer, it is a practical job. It is neither physical nor a thought of mind and not a theory proposed.

The correct steps involved in the controlling process are Setting performance standards, Measurement of actual performance, Comparison of actual performance with standards, Analysing deviations, and taking corrective action.

Obsolete machinery means that such a kind of machine is not more in use or the machine is old-fashioned or such machine uses an old technology. Thus, the best corrective action to make the machinery useful is to change the technology used in the machinery.