Management control is the process of evaluating, monitoring and controlling the various sub-units of the organization so that there is effective and efficient allocation and utilization of resources in achieving the predetermine goals. Thus, the focus of management control is on the managers of organizational sub-units and hence its focus is on line managers responsible for the performance of their departments.
In 1916, Henri Fayol formulated one of the first definitions of control as it pertains to management: “Control consists of verifying whether everything occurs in conformity with the plan adopted, the instructions issued, and principles established. It[‘s] object [is] to point out weaknesses and errors in order to rectify [them] and prevent recurrence. “
Control can also be defined as “that function of the system that adjusts operations as needed to achieve the plan, or to maintain variations from system objectives within allowable limits. “
Management control therefore, is the control exercised by the management over the managers. Who controls the managers and what is the process involved in controlling them? Management control is exercised by evaluating the performance of cache responsibility center, against planned performance. Planned performance is decided in consultation with the managers of responsibility centers, taking into consideration the activities being managed by them and the resources available them in terms of men, materials money etc. Planned performance is usually translated into monetary terms, although physical achievements are also planned for. Manager are not only responsible for the achievement of physical tarsus, but also for the corresponding monetary values. Thus, management control is generally built around a financial structure. Actual and planned performance are compared regular intervals so as to identify resource gaps and, if need be, provide managers with more resources or transfer resources from on organizational unto another. The end-of-the-year review may be too late to take corrective action
The whole purpose of management control is to decide on connective action if there are substantial deviations from the planned performances. The management control system also provides mechanisms for proper coordination and integration of various organizational sub-units by interrelating the tasks being performed and deciding on the resource allocation. In the process of management control conflicts are inherent between managers for resource mobilization, allocation arid snatching. Thus, there is intense interaction among managers.
- Management Control Process
- Types of Management Control
- Principles of Management Control
- Objectives of Management Control Systems
- Importance of Management Control in an Organization
- Differences between Management Control and Operational Control
- Difference Between Strategic Planning and Management Control
- Organization Structure and Management Control
- The Control Function of Management (MIT Sloan)