Control is the process of comparing actual performance with established standards for the purpose of taking action to correct deviations. A system of controls presupposes the existence of certain standards. The plans provide the standards of performance which serve as the basis of controls. Controlling helps an organization to put its resources to best use, bring order and discipline throughout the organization, facilitate coordination of activities and cope with uncertainty and change, quite effectively.
The process of controls involves four steps: establishment of standards, measurement of actual performance, comparison of actual performance with the standards and taking corrective action when required.
Effective controls systems tend to have certain qualities in common. The controls system should be simple, suitable, economical, reasonably flexible, forward-looking, achievable, objective and acceptable.
Depending on the time at which controlled is exercised, controls may be classified into three categories: feedback control, concurrent control, and feedforward control. In a large organization, it is not possible to control everything. So, usually, a multiproduct firm puts attention on key result areas through a critical or strategic point control system. Management by exception is another technique when attention is drawn towards unusual or exceptional items only.
While controlling the human element, management should be careful enough not to rub people on the wrong side. The feelings, aspirations and attitudes of employees must be given weight while devising quantitative standards. Top management must find ways and means to strike a proper balance between persons, standards, and organizational objectives.