1. Concept of Controlling: It is the process through which managers assure that actual
activities conform to the planned activities.
2. Nature of Controlling:
• It is pervasive function.
• It is a dynamic process.
• It is forward looking.
• It is action oriented.
• It leads to post-mortem of past events.
3. Importance of Controlling:
• Accomplishment of organisational goals.
• Judging accuracy of standards.
• Making efficient use of resources.
• Improving employee motivation.
• Ensuring order and discipline.
• Facilitating coordination in action.
4. Limitations of Controlling:
• Difficulty in setting quantitative standards.
• Little control on external factors.
• Resistance from employees.
• Costly affair.
5. Controlling Process:
• Establishment of standards.
• Measurement of performance.
• Comparison of actual performance with
• Analysing deviations, the standard.
• Taking corrective action.
6. Relationship between Planning and Controlling:
Planning and controlling are interrelated and in fact reinforce each other in the sense that:
• Planning is pre-requisite for controlling.
• Planning is meaningless without controlling.
• Effectiveness of planning can be measured with the help of controlling.
• Planning is looking ahead and controlling is looking back.
Identifying the Concepts
Concepts Key Words/Phrases
• Controlling Comparing actual performance with standards.
• Deviation Gap between actual results and desired results.
• Key Result Area Critical points of control.
• Management by Exception Significant deviations to be considered by management.
• Standard Criteria against which performance is measured.