CPC & MBE

 (a) Critical Point Control

  • Critical Point Control’ helps in controlling processes by focusing on key result areas which are critical to the success of an organization.
  • The key result areas are set as critical points since it is neither economical nor easy to keep a check on each activity of the organization.

(b) Management by Exception

  • Management by Exception helps in the controlling process by identifying only significant deviations which go beyond the permissible limit and bringing them to the notice of the management.
  • It is based on the belief that any attempt to control everything results in controlling nothing

Advantages of Critical path control and Management by exception

  1. Saves the time and efforts of managers as they deal with only major deviations.
  2. Identifies critical problems which keep the organization right on track.
  3. Management by exception promotes delegation of authority and increases the morale of the employees

Nature of Controlling/Features of Controlling

  1. Controlling is a goal-oriented function: Controlling as a function of management ensures that the overall directions of individuals and groups are consistent with short and long-range plans of the organization. So it is completely a goal-oriented function.
  2. Controlling is an all-pervasive function: Controlling is a function that applies to all types of organizations and at all levels. Top managers are concerned with administrative control, which is exercised through broad policies, plans and other directives. The middle-level managers are concerned with executive control to get the plans, policies, and programs executed. At the lower level, supervisors exercise operational control to ensure the successful performance of actual operations.
  3. Controlling is a continuous function: Control is not a one-time activity. Rather, it is a dynamic process that involves constant analysis of actual and planned performance. The resultant deviations, if any, are correct as per the need of the situation.
  4. Controlling is both a backward-looking as well as forward-looking function: Effective control is not possible without analyzing our past mistakes. So from this point of view, we can call it backward-looking. But the business environment is ever-changing and controlling helps bring in changes in the organization in a conducive manner. So we cannot ignore the forward-looking aspect of it as well.
  5. Controlling is a dynamic process: Since controlling requires taking reviewable methods, changes have to be made wherever possible.
  6. Controlling is a positive process.
  • Controlling should never be viewed as being negative – as a hurdle in getting objectives won.
  • Controlling is a managerial necessity and help, not an impediment or a hindrance.