Management Chapter 18 Monitoring and Controlling 2021 PDF

Management Fifteenth Edition, Global Edition Chapter 18 Monitoring and Controlling MGT 201 – Fundamentals of Management Alaa Hamade...

Management Fifteenth Edition, Global Edition Chapter 18 Monitoring and Controlling MGT 201 – Fundamentals of Management Alaa Hamade Copyright © 2021 Pearson Education Ltd. What Is Controlling and Why Is It Important? Controlling: management function that involves monitoring, comparing, and correcting work performance Copyright © 2021 Pearson Education Ltd. The Control Process Control process: a four-step process of measuring actual performance, comparing actual performance against a standard, and taking managerial action to correct deviations or inadequate standards Copyright © 2021 Pearson Education Ltd. Step 1: Set a Standard Managers need to decide what standards they will use in their organization. These standards are the benchmark to which the manager will be comparing. It is what they aspire to achieve. This could be the budget or forecast of results. Copyright © 2021 Pearson Education Ltd. Step 2: Measuring Actual Performance Sources of Information Control Criteria (What) (How) – Employees – Personal observation  Satisfaction – Statistical reports  Turnover – Oral reports  Absenteeism – Written reports – Budgets  Costs  Output  Sales Copyright © 2021 Pearson Education Ltd. Step 2: Measuring Actual Performance Copyright © 2021 Pearson Education Ltd. Step 3: Comparing Actual Performance Against the Standard Range of variation: the acceptable parameters of variance between actual performance and the standard Copyright © 2021 Pearson Education Ltd. Step 4: Taking Managerial Action Do Nothing Correct actual performance – Immediate corrective action: corrective action that corrects problems at once to get performance back on track – Basic corrective action: corrective action that looks at how and why performance deviated before correcting the source of deviation – Corrective Actions  Change strategy, structure, compensation scheme, or training programs; redesign jobs; or fire employees Copyright © 2021 Pearson Education Ltd. Step 4: Taking Managerial Action Revising the standard – Examining the standard to ascertain whether or not the standard is realistic, fair, and achievable. – Upholding the validity of the standard. – Resetting goals that were initially set too low or too high. – If performance consistently exceeds the goal, then a manager should look at whether the goal is too easy and needs to be raised. – Managers must be cautious about revising a standard downward. Copyright © 2021 Pearson Education Ltd. Exhibit 18.5 Managerial Decisions in the Control Process Exhibit 18.5 summarizes the decisions a manager makes in controlling. Copyright © 2021 Pearson Education Ltd. What is Organizational Performance? Performance: the end result of an activity Organizational performance: the accumulated results of all the organization’s work activities Copyright © 2021 Pearson Education Ltd. Measures of Organizational Performance Organizational Productivity: the amount of goods or services produced divided by the inputs needed to generate that output Organizational effectiveness: a measure of how appropriate organizational goals are and how well those goals are being met Copyright © 2021 Pearson Education Ltd. Controlling for Employee Performance Disciplinary action: actions taken by a manager to enforce the organization’s work standards and regulations Progressive disciplinary action: an approach to ensure that the minimum penalty appropriate to the offense is imposed Copyright © 2021 Pearson Education Ltd. Feedforward/Concurrent/Feedback Controls Feedforward control: control that takes place before a work activity is done Concurrent control: control that takes place while a work activity is in progress Management by walking around: a term used to describe when a manager is out in the work area interacting directly with employees Feedback control: control that takes place after a work activity is done Copyright © 2021 Pearson Education Ltd. Exhibit 18.8 Types of Control Exhibit 18.8 shows the three kinds of control. Copyright © 2021 Pearson Education Ltd.