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5.6. Types of Control

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(iii) Psychological pressure. Control process puts a psychological pressure on the individual for better performance. The sound control system inspires employees to work hard and give better performance.

(iv) Coordination. Control helps to emerge the coordination of the subordinates in the organization. Control ensures coordination of the activities of different department through unity of direction.

(v) Employee morale. Control creates an atmosphere of order and discipline in the organization. Control contributes order and discipline in the organization.

(vi) Efficiency and effectiveness. Proper control ensures organizational efficiency and effectiveness. The organization is effective if it is able to achieve its objective. Since control focuses on the achievement or organizational objectives. It necessarily leads to organizational effectiveness.

5.5.2. Limitations of Control

Control is expensive and time-consuming process.

Control cannot consider the external factors such as technological changes, political factors, social changes, government procedures etc.

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2.6. Types of Planning (Hierarchy of Planning)

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PLANNING

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to those taken by upper-level managers-selecting realistic goals, assessing their sub-units’ particular strengths and weaknesses and analyzing those parts of the environment that can affect them.

7. Measuring and Controlling the Progress. Obviously, it is foolish to let a plan run its course without monitoring its progress. Hence the process of controlling is a critical part of any plan. Managers need to check the progress of their plans so that they can (a) take whatever remedial action is necessary to make the plan work, or (b) change the original plan if it is unrealistic.

2.6. TYPES OF PLANNING (HIERARCHY OF PLANNING)

From the viewpoint of scope and span of time, planning can be classified as under:

Types of Planning

Scope

Corporate planning

Span of time

Divisional/Departmental planning

Long-term planning

Sectional/Group planning

Mid-term planning

Short-term planning

(i) Corporate Planning. Planning for the company as a whole is known as corporate planning. It lays down objectives, strategies and policies for the entire organization. The purpose of corporate planning is to determine the long-term goals of an enterprise and generate plans to achieve these goals keeping in view the probable changes in its environment. It is proactive planning as it provides for future contingencies. It is less detailed and specific than sectional and divisional planning. It is designed to steer successfully the enterprise through various contingencies. It is done at the top-level management. It is very broad and general. For example, increasing the company’s market share by ten per cent in next five years, becoming a technological leader in industry, earning a 25% rate of return on investment and so on.

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2.9. Objectives

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(c) Difference between Policies and Rules

Sl.No.

Policies

Rules

1

A general statement

A most specific statement

2

Guide to decision-making

Guide to behaviour

3

Lays down management attitude

Indicates what should or should not be done

4

Flexible, may have some exceptions

Rigid, no exceptions or deviations

5

Provides discretion during implementation

Provide no scope for discretion

(d) Distinction between Objectives and Policies

Sl.No.

Objectives

Policies

1

Ends towards which all activities of an organisation are directed

Guidelines which facilitate the accomplishment of predetermined objectives

2

Determine what is to be done

Determine how the work is to be done

3

End-points of planning

Means by which objectives are to be achieved

4

Determined by top management

Formulated at top and middle levels

5

One objective may require more than one policy

Every policy related to one particular objective

6

Derived from philosophy of business

Derived from objectives

7

Indicate the destination

Provide the route

8

Basic to the very existence of an organisation

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2.5. Steps in Planning/Planning Process

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helps the manager to cope with and prepare for the changing environment. Planning does not deal with future decisions, but with the futurity of present decisions. The manager has a feeling of being in control if he has anticipated some of the possible changes and has planned for them. It is like going out with an umbrella in cloudy weather. It is through planning that the manager relates the uncertainties and possibilities of tomorrow to the facts of today and yesterday.

(b) Leads to Success. Planning does not guarantee success, but studies have shown that, often things being equal, companies which plan not only outperform the non planners but also outperform their own past results. This may be because when a businessman’s actions are not random or ad hoc, arising as mere reaction to the market place, i.e., when his actions are planned, be definitely does better. Military historians attribute much of the success of the world’s greatest generals to effective battle plans.

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1.7. Levels of Management

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Two broad categories of motivation are financial and non-financial. Financial motivation takes the form of salary, bonus, profit sharing, etc., while non-financial motivation takes the form of job security, opportunity of advancement, recognition, praise, etc.

(v) Controlling. The manager must ensure that everything occurs in conformity with the plans adopted, the instructions issued and the principles established.

Three elements are involved in the controlling function.

Establishing standards of performance.

Measuring current performance and comparing it against the established standards.

Taking action to correct any performance that does not meet those standards. In the absence of sound control, there is no guarantee that the objectives, which have been set, will be realized. The management may go on committing mistakes without knowing them. Control compels events to conform to plans.

Controlling function has the following sub functions. They are

1.7.

Fixation of standards,

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