Features of Effective Control

Effective Control is a term that describes the powers that a person or position has within an organization. We are obliged to verify the identity of all persons with Effective Control of an organization. Some of the features of Effective Control are as given below:

1. Future-Oriented:
The control system ensures that mistakes made in the past are not repeated in the future. It is a process that focuses on future plans. It helps in redesigning the plans by providing data upon which they should be based.

2. Multiple Control System:
The control system does not aim to control only one activity. Effective control systems simultaneously control production, inventory, sales, cost, and quality. Not only do they aim at different areas of operations, but they also aim at finding deviations of the inputs (feed-forward), work-in-progress (concurrent), and outputs (feedback).

3. Economical:
It is costly to institute a control system. Therefore, the costs of the control system should be less than its benefits. This is possible by applying corrective measures only on significant deviations (management by exception). Control by exception at critical points optimizes the use of resources on areas that best reflect organizational efficiency. Costs vary according to the size of the organization and the nature of activities to be controlled.

4. Timeliness:
Deviations should be reported as frequently as possible to the management so that timely remedial action can be taken. Late actions may be as good as no actions. Fast collection and appraisal of information on deviations can make the control system prompt.

5. Flexible:
The business operates in a turbulent and dynamic environment. Control systems should be flexible to adjust business operations to environmental changes. The impact of changes on planned performance (or standards) should be incorporated from time to time. There should be alternative plans to meet unexpected situations.

6. Control of Critical Points:
Rather than controlling every activity, the control system should focus on critical points only where deviations affect the organizational goals. Poor performance in these areas requires corrective action. Critical points determine areas where actions should be monitored. “Effective control requires attention to those factors critical to evaluating performance against plans.”

Rather than controlling activities related to the entire plan, it should aim at controlling activities where deviations can seriously damage organizational performance. Focus on factors critical to planned performance can increase the efficiency of the control system. Resources will be focused on exactly where they are required. This also promotes the timeliness and economy of the control system.

7. Operational:
The control system should not only find deviations but also correct them. Managers can artificially create a deviation and see how effectively the control system works in such conditions. A pilot runs on the simulated conditions increases the efficiency of the control system. It promotes feed-forward controls as corrective actions on expected deviations can be tested in anticipation of deviations.

8. Organizational Climate:
In organizations where employees have restricted freedom (autocratic style of management), a tight control system will be successful and organizations where the participative or democratic style of management prevails, a lenient control system should be adopted. The control system should suit the needs of the organization.

It should also be simple to understand to enhance its approachability. Complicated mathematical models and software can make the system complex. Though training enhances understanding of these models, the ability to understand them should match their application to the business operations. Highly complex models may change the focus from application to their understanding.

9. Objective Standards:
A control system will be effective if standards of performance are objective. Standards should be specific, quantifiable, and attainable. Poor or non-measurable standards will violate the purpose of the control system as it may be based on personal biases. It may result in short-term gains at the cost of long-term profits.

10. Control by Exception:
Managers should control only exceptional deviations as they have a serious impact on organizational efficiency. Some deviations can be ignored while others cannot. It should aim at deviations that affect organizational performance and allow minor deviations to correct on their own.