Importance of Control in Business Organizations.

Topics: Management, Process control, Control system Pages: 4 (1368 words) Published: August 11, 2010
Define control and discuss the control process and the importance of control in business organizations. * Define control
Management process in which the (1) actual performance is compared with planned performance, (2) difference between the two is measured, (3) causes contributing to the difference are identified, and (4) corrective action is taken to eliminate or minimize the difference Control Process

The control process is a continuous flow in Taj between measuring, comparing and action. Naturally Taj follows the four steps in the control process: establishing performance standards, measuring actual performance, comparing measured performance against established standards, and taking corrective action. Step 1: Establish Performance Standards. Taj's Standards are created when objectives are set during the planning process. Its standard is a guideline established as the basis for measurement. It is a precise, explicit statement of expected results from a product, service, machine, individual, or organizational unit. It is usually expressed numerically and is set for quality, quantity, and time. Tolerance is permissible deviation from the standard. · Time controls relate to deadlines and time constraints. Material controls relate to inventory and material-yield controls. Equipment controls are built into the machinery, imposed on the operator to protect the equipment or the process. Cost controls help ensure cost standards are met. Employee performance controls focus on actions and behaviors of individuals and groups of employees. Examples include absences, tardiness, accidents, quality and quantity of work. Budgets control cost or expense related standards. They identify quantity of materials used and units to be produced. · Financial controls facilitate achieving the organization's profit motive. One method of financial controls is budgets. Budgets allocate resources to important activities and provide supervisors with quantitative standards against which...
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