The plan of action adopted for the achievement of the organization goals is called a long range plan. It also known as strategic planning and covers a time frame which could extent to five years or more. The mission of the organization is determining and the strengths and weaknesses are also evaluated. Long range plans also include the forecasting of the external environment like changes in the technology, social economical and political factors that indirectly effect the organization. Then the organizational goals are developed and those alternatives are chosen that can give competitive advantages to the organization. The implementation of strategy is the last step and control for measuring performance after the implementation of the plan should also be developed.
Following are the topics which are covered in this section. You can choose from the sub sections or continue directly below the sub sections.
- No categories
Short range plans or the operational plans are concerned with the day to day functioning and their focus is on short run operating period, generally a year or season. It is usually done at lower levels of management and involves gathering of information and selecting the most effective course of action after evaluating this information.
Short range plans are generally guided by standing plans and single use plans. The policies procedures and rules followed in the organization come under standing plans and single use plans are use for a specific period and includes market plans financial plans and production plans.
What is a planning?
Planning means setting up a blue print for future and deciding what do you went to do and who will do a particular task. Plans are of many times types and are formulated to achieve specific purposes or all purpose plans.
There are 7 elements of planning:
A successful plan should be flexible in nature and subject to improvement. It should also be subject to enforcement to be effective. A successful plan is evaluated by the extent that a plan is in conformity with the objectives of the organization and to the extent a plan satisfied the requirements of cost, speed, quality and return on investment.
What is the purpose of planning?
Every plan should be linked with some objectives. The planning done by managers is aimed at achieving the organizational goals. The planning helps people in concentrating their efforts on the most important jobs rather than wasting time on the lesser important work. The purpose of planning is also to minimize the cost of performance and eliminate unproductive efforts. It also helps the management in adopting and adjusting according to the changes that take place in the environment. Planning also provides a basis for teamwork as when the goals are properly defined assignments can be fixed and all the members can start contributing in the achievement of these objectives. Planning gives a sense of direction and ensured that efforts are being put to useful purpose instead of being wasted. Planning also facilitate control because without planning there will be nothing to control.
For making people act, different types of the methods like the planning, the organizing, the staffing, the leading etc. are used. But after the people start acting, generally the result that is obtained seems to be a mere waste. Now here, the role of the management of the organization is very critical and should be performed very carefully. The main responsibility of the management here is that it should take proper care of the fact that the results that are produced are strictly according to the objectives and none of them is a waste or use – less in the nature. This responsibility of the management of the organization is often referred to as the ‘Controlling’.
The Controlling acts as a very useful managerial function or the tool as it ensures that the actions conform to the expected results with the help of the suitable feedback systems. This process also includes correcting any deviation time in order to see that the results are ensured within the proper time and the costs as per the planned standards. One very important point that should be kept in mind is that for having the control, it is very necessary to plan the things i.e. without the planning, the control cannot be obtained. The major reason behind this is that if we will not know about the things that are to be achieved, the resources that are available, the various things that are to be taken care of etc., then it will not be possible to carry on with the process in a controlled manner.
So now it can be said that the planning is very much needed both at the personal level as well as at the organization level as it acts as a mental discipline and plays a very major role in the process of the controlling. But one very important thing that should be taken care of is that the planning that is done for controlling the process should be done very carefully and should not be vague in the nature i.e. should be very meaningful so that it can help in the establishment of the controlling standards.
Principles of the Controlling are :-
a. The establishment of the measurable goals acts as a prerequisite to the controlling.
b. For the implementation of the program, it is very necessary to have a conceptual document and this document is referred to as the planning.
c. From here, the process of the planning goes through the conceptual to the measurable objectives.
d. At times these can also be qualitative in the nature and in such cases it becomes very necessary to convert these into the measurable terms.
2. Establishment of the standards
a. The measurable goals that are created have to be converted into the standards.
b. In case of the measurable goals, the measure of weighing the results is fixed.
c. But in case of the standard, one expects for a minimum performance depending on the given efforts and the time.
d. During this step, the measures of the efforts, the time, and the cost are fixed in the nature.
e. The performance can be judged by setting the minimum standards.
3. Nature of the controls
a. The controls must be economical in the nature not only in the implementation but also in correcting the deviation by getting a signal on time.
b. The control costs in terms of the implementation.
c. The evaluation of the control in a tangible as well as the intangible form, depends greatly on the judgment of the management.
4. Selection criteria of the critical points
a. It is very necessary to keep the costs of the control down, so hence it is not at all possible to have a control over each stage in the process.
b. For this purpose, it is very important to select certain control points.
c. The selection largely depends on the individual testing skills, group output, its criticality to the operation in the total activity etc.
d. The raw materials that cannot be reworked and returned must be selected as the critical point for the control.
e. The selected critical points can be changed on a rotational basis and also by changing after the feedback that is obtained from the results of the process.
5. Feed back system
a. The feedback should be very efficient and meaningful in the nature.
b. It is very essential that the control points are very well supported by the control systems as these points at any stage can be feed forward as well as backward.
c. With the help of the Feedback system, one can make a decision over the fact that whether the cost of the continuity in the operations in the similar manner would be good in the customer’s interest or not.
d. This system helps in the determination of the fact that whether any type of the rework or correction is required or not.
6. Discipline and Flexibility
a. Both the Discipline and the Flexibility are very much required in the process of the controlling and for this, the presence of the control system is very essential.
b. Discipline can be achieved, if it is assured that the same process will be carried on during the existence.
c. In case of any type of the changes or the deviations in the design of the product etc, then it is not at all possible to continue with the same set of the control points.
d. Discipline can be maintained only if the various activities involved remain totally unchanged.
e. But sometimes such circumstances, like the results that are obtained at a particular point do not meet the requirements expected of such a control, arise and then it becomes very necessary for the control system to possess the flexibility.
f. One very important point to be kept in mind here is that the changes that are brought in the control systems should be brought in, depending on the demands of the business.
g. As the environment present around the organization and that present within the organization keep on changing continuously, so it is very important that the control systems possess the flexibility.
7. Development of the controls
a. The controls should be tailored in such a way that the whole organization should be able to read the feedback reports.
b. The results of the control should be communicable and also actionable in the nature.
c. Any type of the difference in the output should be brought out by the various controls as with this, the deviations can be easily pointed out without doing much work.
a. With the help of the controls, one can find out the deviations in the planned performance.
b. If the control is ideally placed, its organization and the management can act in the self interest of the business.
c. It is very necessary to direct the controls towards the corrections and then suitable corrective actions should be taken.
Types of the Controls
1. Direct controls
a. Called as the direct controls as the people here get so well tuned to the job that there are very less chances for the deviations to take place.
b. Also called as the preventive controls.
c. Aims at the saving on the cost of the control.
d. Also aims at the zero defects from the initiation.
e. Great emphasis is given on the prevention of the need of the controls; to build the systems, the procedures, the culture, the discipline etc.
f. But with time these types of the controls also get older and outdated.
g. For the proper functioning of the direct controls, assistance of the indirect controls is very much needed.
2. Feed forward controls
a. Whenever a process is performed, two factors are very critical namely the inputs and the outputs.
b. Here we take into account the various deficiencies of a process well in advance, so that these can be cured or controlled at the initial stages.
c. The shape of the feedback controls is taken by almost all the controls.
d. It is advised by the various experts to have the both feed forward and the feed backward controls on the process.
e. Helps in the establishment of a right direction and control right from the beginning.
3. Feed backward controls
a. Here the controls are put at the output end as the deviations that occur are not known to us till the moment of the output.
b. Very heavy cost is involved.
c. Results into the customer dissatisfaction.
4. Real time controls
a. Involve the instantaneous feedback almost in the real time, (real time can defined as the time when both the creation of a report and its transmission is done almost with no gap that one can almost read it at the time it is being sent) for e.g. the fax or the telephone.
5. Automation in the controls
a. Here, mainly for the development of the control systems involving very less human power, building of the instrumentation takes place.
b. Computers are used for the feedback systems and for the automatic corrections.
Designing the control system
a. The objective of the control system should be fixed.
b. The picture of the objective should be very clear in the mind of the people involved.
c. Answers to the questions like what to control and how to control etc. should be well planned beforehand, before the introduction of the control system.
d. The objective should be decided on the basis of the design of the system.
e. The deviation should be signaled automatically by the system.
2. Design essentials
a. The designing of the control should be done based on the desires of the customer.
b. For a particular control system, one person should be nominated responsible.
c. For knowing or testing the degree of the reliability, it is very essential to calibrate the various measuring instruments.
d. The corrections should be carried out.
e. Must possess feedback to its correctness.
f. The critical points form a very critical part of the control system design.
g. The deviation that occurs must be calculated or measured.
1. Budgeting techniques
a. Involves a very practical approach for carrying on with the controlling process.
b. Budgets are very future oriented and largely depends on the forecasting trends based on the past.
c. Budgeting depicts the forecasting trends mainly depending on the finance and the connected numerical information.
d. This technique acts as a very critical and an important tool for comparing what one has planned and what is the actual performance against it.
e. But the main drawback of this technique is that it takes into account the past performance as the only guide, which at times can prove to be short.
f. As a result of this, the whole package has to be worked out on the zero bases.
2. The Activities Network control
a. Forms a very critical and a necessary part of the management tool.
b. Here the performance of the various activities is compared and then depending on this, one comes to know about the various deviations and then accordingly the activities can be controlled.
c. Various techniques like the Gantt Charts, the Program Evaluation and the Review Techniques etc are used for performing the various activities.
3. Statistical database control
a. In this method, the generation of the Statistical data coupled with the planning system is generated, mainly for the management control system.
b. Special reports like the market prospects, the customers survey findings etc. are used as a feedback for the different activities involved and these activities can be based on the criteria of per person or per machine or per activity.
c. The data can involve the relations or the trends, which can be easily extrapolated.
d. For controlling the deviations and to know about them, the audits like the statutory audits, the performance audits, the cost audits etc., can be carried out.
4. Personal observations
a. This technique acts as a great tool for controlling and bringing the system back to having a very sound health.
b. In many cases, the eyes act as the best tool for noticing the overbalancing in the people, their working, and the environment.
c. A lot of time is saved by this technique.
d. The personal observation avoids much of the paper work.
e. One of the best methods used here is the ‘Wandering Around’ method.
f. In this method, wandering around is taken as a regular exercise and the work monotony is used.
g. People are not allowed to get stuck into their cabins for long periods of the time as with this, a gap is created between the relationships and the environmental attachment.
5. Social Controls
a. The managers possessing the objective view of the outsiders are helped a lot by this technique.
b. The users clubs of the customers, the supplier’ s club, the dealer’s club, the employees clubs etc. can be organized easily with this method.
6. Systems and the Procedures
a. Manuals form very necessary documents for bringing some rigidity in the operation.
b. It helps in creating a judicial system for an organization.
c. Management audits can be conducted sometimes in this technique to reduce the lacunae that may be present in an organization.
7. Management by the Objectives
a. Acts as a great tool for the control purpose.
b. By having a clear picture of the various objectives in mind, one can easily plan the various controls.
c. Management can be observed as the people working for the measurable goals, deciding the output at the end of an activity.