Planning means looking ahead and chalking out future courses of action to be followed.

It is a
preparatory step. It is a systematic activity which determines when, how and who is going to
perform a specific job. Planning is a detailed programme regarding future courses of action.
It is rightly said “Well plan is half done”. Therefore planning takes into consideration available
& prospective human and physical resources of the organization so as to get effective
coordination, contribution & perfect adjustment. It is the basic management function which
includes formulation of one or more detailed plans to achieve optimum balance of needs or
demands with the available resources.
According to Urwick, “Planning is a mental predisposition to do things in orderly way, to think
before acting and to act in the light of facts rather than guesses”. Planning is deciding best
alternative among others to perform different managerial functions in order to achieve
predetermined goals.
According to Koontz & O’Donell, “Planning is deciding in advance what to do, how to do and
who is to do it. Planning bridges the gap between where we are to, where we want to go. It
makes possible things to occur which would not otherwise occur”.
Steps in Planning Function
Planning function of management involves following steps:-
1. Establishment of objectives
a. Planning requires a systematic approach.
b. Planning starts with the setting of goals and objectives to be achieved.
c. Objectives provide a rationale for undertaking various activities as well as
indicate direction of efforts.
d. Moreover objectives focus the attention of managers on the end results to be
achieved.
e. As a matter of fact, objectives provide nucleus to the planning process. Therefore,
objectives should be stated in a clear, precise and unambiguous language.
Otherwise the activities undertaken are bound to be ineffective.
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f. As far as possible, objectives should be stated in quantitative terms. For example,
Number of men working, wages given, units produced, etc. But such an objective
cannot be stated in quantitative terms like performance of quality control
manager, effectiveness of personnel manager.
g. Such goals should be specified in qualitative terms.
h. Hence objectives should be practical, acceptable, workable and achievable.
2. Establishment of Planning Premises
a. Planning premises are the assumptions about the lively shape of events in future.
b. They serve as a basis of planning.
c. Establishment of planning premises is concerned with determining where one
tends to deviate from the actual plans and causes of such deviations.
d. It is to find out what obstacles are there in the way of business during the course
of operations.
e. Establishment of planning premises is concerned to take such steps that avoids
these obstacles to a great extent.
f. Planning premises may be internal or external. Internal includes capital
investment policy, management labour relations, philosophy of management, etc.
Whereas external includes socio- economic, political and economical changes.
g. Internal premises are controllable whereas external are non- controllable.
3. Choice of alternative course of action
a. When forecast are available and premises are established, a number of alternative
course of actions have to be considered.
b. For this purpose, each and every alternative will be evaluated by weighing its pros
and cons in the light of resources available and requirements of the organization.
c. The merits, demerits as well as the consequences of each alternative must be
examined before the choice is being made.
d. After objective and scientific evaluation, the best alternative is chosen.
e. The planners should take help of various quantitative techniques to judge the
stability of an alternative.
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4. Formulation of derivative plans
a. Derivative plans are the sub plans or secondary plans which help in the
achievement of main plan.
b. Secondary plans will flow from the basic plan. These are meant to support and
expediate the achievement of basic plans.
c. These detail plans include policies, procedures, rules, programmes, budgets,
schedules, etc. For example, if profit maximization is the main aim of the
enterprise, derivative plans will include sales maximization, production
maximization, and cost minimization.
d. Derivative plans indicate time schedule and sequence of accomplishing various
tasks.
5. Securing Co-operation
a. After the plans have been determined, it is necessary rather advisable to take
subordinates or those who have to implement these plans into confidence.
b. The purposes behind taking them into confidence are :-
Subordinates may feel motivated since they are involved in decision
making process.
The organization may be able to get valuable suggestions and
i.
improvement in formulation as well as implementation of plans.
Also the employees will be more interested in the execution of these
plans.
ii.
iii.
6. Follow up/Appraisal of plans
a. After choosing a particular course of action, it is put into action.
b. After the selected plan is implemented, it is important to appraise its
effectiveness.
c. This is done on the basis of feedback or information received from departments or
persons concerned.
d. This enables the management to correct deviations or modify the plan.
e. This step establishes a link between planning and controlling function.
f. The follow up must go side by side the implementation of plans so that in the light
of observations made, future plans can be made more realistic.
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Planning to Plan
Have you ever heard the saying 'Those who fail to plan, plan to fail'? While I can't speak to all
facets of life, this is certainly true in business. Managers find themselves planning for all sorts of
things. So much so, that planning is one of the four major functions of management. In doing so,
a manager can be certain that he or she is working toward some organization goal.
There are three main types of plans that a manager will use in his or her pursuit of company
goals, which include operational, tactical and strategic. If you think about these three types of
plans as stepping stones, you can see how their relationship to one another aids in the
achievement of organizational goals. Operational plans are necessary to attain tactical plans and
tactical plans lead to the achievement of strategic plans. Then, in true planning fashion, there are
also plans to backup plans that fail. These are known as contingency plans. To better understand
how each type of plan is used by managers, let's take a look at an example from Nino's Pizzeria
and how Tommy, Martha and Frank carry out their planning responsibilities.
Strategic Plans
Strategic plans are designed with the entire organization in mind and begin with an
organization's mission. Top-level managers, such as CEOs or presidents, will design and execute
strategic plans to paint a picture of the desired future and long-term goals of the organization.
Essentially, strategic plans look ahead to where the organization wants to be in three, five, even
ten years. Strategic plans, provided by top-level managers, serve as the framework for lowerlevel
planning.
Tactical Plans
Now that you have a general idea for how organizational planning evolves, let's look at the next
level of planning, known as tactical planning. Tactical plans support strategic plans by
translating them into specific plans relevant to a distinct area of the organization. Tactical plans
are concerned with the responsibility and functionality of lower-level departments to fulfill their
parts of the strategic plan.
Operational Plans
Operational plans sit at the bottom of the totem pole; they are the plans that are made by
frontline, or low-level, managers. All operational plans are focused on the specific procedures
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and processes that occur within the lowest levels of the organization. Managers must plan the
routine tasks of the department using a high level of detail.
Importance of planning
Planning helps an organization chart a course for the achievement of its goals. The process
begins with reviewing the current operations of the organization and identifying what needs to be
improved operationally in the upcoming year.
Efficient Use of Resources
All organizations, large and small, have limited resources. The planning process provides the
information top management needs to make effective decisions about how to allocate the
resources in a way that will enable the organization to reach its objectives. Productivity is
maximized and resources are not wasted on projects with little chance of success.
Establishing Goals
Setting goals that challenge everyone in the organization to strive for better performance is one
of the key aspects of the planning process. Goals must be aggressive, but realistic. Organizations
cannot allow themselves to become too satisfied with how they are currently doing--or they are
likely to lose ground to competitors. The goal setting process can be a wake-up call for managers
that have become complacent. The other benefit of goal setting comes when forecast results are
compared to actual results. Organizations analyze significant variances from forecast and take
action to remedy situations where revenues were lower than plan or expenses higher.
Managing Risk And Uncertainty
Managing risk is essential to an organization’s success. Even the largest corporations cannot
control the economic and competitive environment around them. Unforeseen events occur that
must be dealt with quickly, before negative financial consequences from these events become
severe. Planning encourages the development of “what-if” scenarios, where managers attempt to
envision possible risk factors and develop contingency plans to deal with them. The pace of
change in business is rapid, and organizations must be able to rapidly adjust their strategies to
these changing conditions.
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Team Building
Planning promotes team building and a spirit of cooperation. When the plan is completed and
communicated to members of the organization, everyone knows what their responsibilities are,
and how other areas of the organization need their assistance and expertise in order to complete
assigned tasks. They see how their work contributes to the success of the organization as a whole
and can take pride in their contributions. Potential conflict can be reduced when top management
solicits department or division managers’ input during the goal setting process. Individuals are
less likely to resent budgetary targets when they had a say in their creation.
Creating Competitive Advantages
Planning helps organizations get a realistic view of their current strengths and weaknesses
relative to major competitors. The management team sees areas where competitors may be
vulnerable and then crafts marketing strategies to take advantage of these weaknesses. Observing
competitors’ actions can also help organizations identify opportunities they may have
overlooked, such as emerging international markets or opportunities to market products to
completely different customer groups.

Organizing is the function of management which follows planning. It is a function in which the
synchronization and combination of human, physical and financial resources takes place. All the
three resources are important to get results. Therefore, organizational function helps in
achievement of results which in fact is important for the functioning of a concern. According to
Chester Barnard, “Organizing is a function by which the concern is able to define the role
positions, the jobs related and the co-ordination between authority and responsibility. Hence, a
manager always has to organize in order to get results.
A manager performs organizing function with the help of following steps:-
1. Identification of activities - All the activities which have to be performed in a concern
have to be identified first. For example, preparation of accounts, making sales, record
keeping, quality control, inventory control, etc. All these activities have to be grouped
and classified into units.
2. Departmentally organizing the activities - In this step, the manager tries to combine
and group similar and related activities into units or departments. This organization of
dividing the whole concern into independent units and departments is called
departmentation.
3. Classifying the authority - Once the departments are made, the manager likes to classify
the powers and its extent to the managers. This activity of giving a rank in order to the
managerial positions is called hierarchy. The top management is into formulation of
policies, the middle level management into departmental supervision and lower level
management into supervision of foremen. The clarification of authority help in bringing
efficiency in the running of a concern. This helps in achieving efficiency in the running
of a concern. This helps in avoiding wastage of time, money, effort, in avoidance of
duplication or overlapping of efforts and this helps in bringing smoothness in a concern’s
working.
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4. Co-ordination between authority and responsibility - Relationships are established
among various groups to enable smooth interaction toward the achievment of the
organizational goal. Each individual is made aware of his authority and he/she knows
whom they have to take orders from and to whom they are accountable and to whom they
have to report. A clear organizational structure is drawn and all the employees are made
aware of it.
importance of Organizing Function
Specialization - Organizational structure is a network of relationships in which the work is
divided into units and departments. This division of work is helping in bringing specialization in
various activities of concern.
Well defined jobs - Organizational structure helps in putting right men on right job which can be
done by selecting people for various departments according to their qualifications, skill and
experience. This is helping in defining the jobs properly which clarifies the role of every person.
Clarifies authority - Organizational structure helps in clarifying the role positions to every
manager (status quo). This can be done by clarifying the powers to every manager and the way
he has to exercise those powers should be clarified so that misuse of powers do not take place.
Well defined jobs and responsibilities attached helps in bringing efficiency into managers
working. This helps in increasing productivity.
Co-ordination - Organization is a means of creating co-ordination among different departments
of the enterprise. It creates clear cut relationships among positions and ensure mutual
cooperation among individuals. Harmony of work is brought by higher level managers
exercising
their authority over interconnected activities of lower level manager.
Authority responsibility relationships can be fruitful only when there is a formal relationship
between the two. For smooth running of an organization, the co-ordination between
authorityresponsibility is very important. There should be co-ordination between different
relationships.
Clarity should be made for having an ultimate responsibility attached to every authority. There is
a saying, “Authority without responsibility leads to ineffective behaviour and responsibility
without authority makes person ineffective.” Therefore, co-ordination of authority- responsibility
is very important.
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Effective administration - The organization structure is helpful in defining the jobs positions.
The roles to be performed by different managers are clarified. Specialization is achieved through
division of work. This all leads to efficient and effective administration.
Growth and diversification - A company’s growth is totally dependant on how efficiently and
smoothly a concern works. Efficiency can be brought about by clarifying the role positions to the
managers, co-ordination between authority and responsibility and concentrating on
specialization. In addition to this, a company can diversify if its potential grow. This is possible
only when the organization structure is well- defined. This is possible through a set of formal
structure.
Sense of security - Organizational structure clarifies the job positions. The roles assigned to
every manager is clear. Co-ordination is possible. Therefore, clarity of powers helps
automatically in increasing mental satisfaction and thereby a sense of security in a concern. This
is very important for job- satisfaction.
Scope for new changes - Where the roles and activities to be performed are clear and every
person gets independence in his working, this provides enough space to a manager to develop his
talents and flourish his knowledge. A manager gets ready for taking independent decisions which
can be a road or path to adoption of new techniques of production. This scope for bringing new
changes into the running of an enterprise is possible only through a set of organizational
structure.
ORGANIZATIONAL STRUCTURE
Typically hierarchical arrangement of lines of authority, communications, rights and duties of an
organization. Organizational structure determines how
the roles, power and responsibilities are assigned, controlled, and coordinated, and
how information flows between the different levels of management.
Types of organisational structure
Organizational structures
Organisations can be structured in different ways:
by function, for example, operations, marketing, finance, fundraising, etc
by region
by product, for example, books, support, consultancy, delivery
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 in work teams, for example, client/customer groups.
 Hierarchical structures
Many organisations structure themselves in a traditional and recognizable way using a hierarchy.
The dictionary definition of hierarchy is a series of ordered groupings of people or things within
a
system. Hierarchy describes reporting levels and the status of people in the structure.
Diagram of hierarchical structures
The hierarchical organization structure is pyramid-shaped. At the top of the structure is a single
person, who has a small number of people reporting directly to them. Each of these people has
several people reporting into them and the number of people at each level increases as you move
down the structure.
Advantages of hierarchical structures
A hierarchical structure uses clear reporting lines. It is easy to see what each team is called,
how many people there are in each team and how they relate to other people in the system.
Disadvantages of hierarchical structures
People can feel stuck in a ‘silo’ and miss opportunities for co-operation, both for themselves
and the organisation.
Flat structures
Taking out levels of hierarchy creates a flatter organisation structure.
Diagram of flat structures
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Description of the diagram
There are fewer levels in the flat structure organisation. In this example structure, there is one
person at the top with everyone else reporting into them on an equal level.
Advantages of flat structures
people feel more involved and can take on more responsibility
greater communication
better team spirit
less bureaucracy and easier decision making
lower costs


Disadvantages of flat
structures
Decisions can get stuck as a result of consulting with many people.
People may have 'matrix management', with more than one manager.
Limited to smaller organisations.
The function of each department gets blurred as roles merge.
Informal structures
Many organisations develop informal, sometimes invisible structures. These are based on the
reality of day-to-day interactions at work. They are very important, as they can pass on
communications (or rumours), they can be friendly and supportive (or form cliques). They can
also influence decisions, as there is knowledge and discussion at an informal level. The influence
of these networks is significant.
No structure
It is difficult to imagine any organisation without a structure. Even groups of young children start
to establish a network or informal hierarchy. In the beginnings of a new organisation there may
be no formal structure but often this changes over time.
Example of an organisation with no structure………
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Benefits to Use Organizational Chart
Organizational chart is a good tool to chart the organization structure.
Fundamentally, organization charts benefit users for its visual communication of information
which is more effective than pure text. The following are some top benefits to use organizational
chart:
1. Organizational chart helps build and design the organization structure to meet the
business' objectives.
2. Organizational chart can guide the employees to know their rights and responsibilities.
3. Organizational chart help divide the functions of a company, enterprise or department.
4. It also shows the relationships between the organization's staff members.
5. With organizational chart, it's easy to find whether the officer's workload is too heavy.
6. It's easy to find whether the unrelated persons undertake the work of several loose, no
relationship.
7. Find out whether an employee is incompetent in this work at important positions.
8. Make everyone clear within their organizations and improve employee performance.
9. Other departments are also able to understand and enhance the coordination of the
organization.
10. It's easy to see the promotion channels open.
11. Some managers can use the organizational chart tool to analysis budget, design work
team and generate reports.
12. Organizational chart often outline employee tasks and which manager is responsible for
overseeing each employee.
Meaning of staffing
The managerial function of staffing involves manning the organization structure through proper
and effective selection, appraisal and development of the personnels to fill the roles assigned to
the employers/workforce.
According to Theo Haimann, “Staffing pertains to recruitment, selection, development and
compensation of subordinates.”
Nature of Staffing Function
1. Staffing is an important managerial function- Staffing function is the most important
mangerial act along with planning, organizing, directing and controlling. The operations
of these four functions depend upon the manpower which is available through staffing
function.
2. Staffing is a pervasive activity- As staffing function is carried out by all mangers and in
all types of concerns where business activities are carried out.
3. Staffing is a continuous activity- This is because staffing function continues throughout
the life of an organization due to the transfers and promotions that take place.
4. The basis of staffing function is efficient management of personnels- Human
resources can be efficiently managed by a system or proper procedure, that is,
recruitment, selection, placement, training and development, providing remuneration, etc.
5. Staffing helps in placing right men at the right job. It can be done effectively through
proper recruitment procedures and then finally selecting the most suitable candidate as
per the job requirements.
6. Staffing is performed by all managers depending upon the nature of business, size of
the company, qualifications and skills of managers,etc. In small companies, the top
management generally performs this function. In medium and small scale enterprise, it is
performed especially by the personnel department of that concern.
Staffing Process - Steps involved in Staffing
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Manpower requirements- The very first step in staffing is to plan the manpower inventory
required by a concern in order to match them with the job requirements and demands. Therefore,
it involves forecasting and determining the future manpower needs of the concern.
Recruitment- Once the requirements are notified, the concern invites and solicits applications
according to the invitations made to the desirable candidates.
Selection- This is the screening step of staffing in which the solicited applications are screened
out and suitable candidates are appointed as per the requirements.
Orientation and Placement- Once screening takes place, the appointed candidates are made
familiar to the work units and work environment through the orientation programmes. placement
takes place by putting right man on the right job.
Training and Development- Training is a part of incentives given to the workers in order to
develop and grow them within the concern. Training is generally given according to the nature of
activities and scope of expansion in it. Along with it, the workers are developed by providing
them extra benefits of indepth knowledge of their functional areas. Development also includes
giving them key and important jobsas a test or examination in order to analyse their
performances.
Remuneration- It is a kind of compensation provided monetarily to the employees for their
work performances. This is given according to the nature of job- skilled or unskilled, physical or
mental, etc. Remuneration forms an important monetary incentive for the employees.
Performance Evaluation- In order to keep a track or record of the behaviour, attitudes as well
as opinions of the workers towards their jobs. For this regular assessment is done to evaluate and
supervise different work units in a concern. It is basically concerning to know the development
cycle and growth patterns of the employeesin a concern.
Promotion and transfer- Promotion is said to be a non- monetary incentive in which the worker
is shifted from a higher job demanding bigger responsibilities as well as shifting the workers and
transferring them to different work units and branches of the same organization.
Features of Staffing:
The following are the features or nature or characteristics of the staffing function:
1. It is a universal function. It is the responsibility of every manager.
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2. It is a continuous function performed by every manager to ensure successful functioning of his
department and to develop his successors. Since staffing is a continuous function, it will be
effective in realizing its goals.
3. It is a dynamic and never ending process. With changes in the size and environment of the
organization, changes take place in personnel.
4. Human resources expects and deserves dignity. So the success of the staffing function lies in
involving every individual in the organisation in the task of achieving organisational goals.
5. It is a difficult function with problems of social, philosophical and psychological nature.
6. Staffing is a management function.
7. It in an integral part of management process.
8. Staffing is the pervasive function of management.
9. Staffing is concerned with the optimum utilisation of human resources.
Importance of Staffing:
Staffing function help in discovering of qualified and obtaining competent personnel for
various jobs in the organisation.
Since the right person is recruited for the right jobs, it leads for maximum productivity and
higher performance.
It promotes optimum utilization of human resources.
It increases job satisfaction and morale of the workers through adequate remuneration for
each job.
Since the staffing helps to ensure maximum utilization of human resources exist the labour
costs per unit or production will be reduced.
It ensures the continuity and growth of the organization, through development managers.
It help, business activities are not disrupted at any time due to shortage of competent workers
or excess of workers. Because it forecasts the correct staff requirements for the present and
for the long-term.
It leads to efficient functioning of the organization due to systematic programmes for the
selection, training and appraisal of employees are required by proper staffing function.
The use of latest technology can be achieved by the right person, selected in the organization.
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Employees now recognize the dignity of labour, there is awareness of the role of performing
the staffing function well; management can show the significance it attaches to the human
resource development.
PRINCIPLES OF STAFFING:
The principles, which relate to the nature and purpose of staffing, selection, training and
development and appraisal of managers, are given below:
(1) Principle of Staffing Objective:
The objective of staffing is to bring people with required skills into the organization and develop
them into valuable organizational resource. The implementation of this principle will help in the
undertaking of responsibilities of management by competent people and, thus ensure the
longterm success of the enterprise.
(2) Principle of Staffing Responsibility:
The responsibility of the efficient planning and execution of the staffing function rests upon
every manager at all levels of the organization. To be effective, specialized services of the
personnel, department should be utilized to carry out the staffing responsibility.
(3) Principle of Human Resources Planning:
In today’s complex and dynamic environment, human resources planning ensures that the
organization has adequate supplies of managers. Planning for manpower is necessary both when
managerial talent is in abundance or in scarcity.
(4) Principle of Recruiting Personnel:
To achieve the staffing objective, both internal and external sources of recruitment should be
judiciously utilized. The more an enterprise is committed to the assurance of quality
management, the more it will encourage open competition among all candidates for management
positions.
(5) Principle of Training Objectives:
The more precisely and carefully the training aims are stated, the more likely are the changes of
accomplishing them. The training needs should be stated for different categories of personnel.
This will ensure the measurement of the effectiveness of training efforts.
(6) Principles of Managerial Appraisal:
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The more clearly verifiable objectives and required managerial activities are identified, the more
precise is the appraisal of managers against these standards. This principle suggests that
managerial performance appraisal should be based both on the criteria of verifiable objectives
and evaluation of managers as managers.
Essentials of Good Staffing Policy:
It should take into account the interests of both employer and employee.
It should be consistent with the basic overall policies of the unit.
It should be complete in every respect.
It should be simple and precise.
It should be reasonably stable and permanent.
It should be flexible, in relation to changes in environment.
It should be responsive to prevailing trends in industry and society.
It should take into account variations in the capabilities, interests and attitudes of employees.
It should be uniformly applicable to all members of the organization.
It should be properly communicated to those for whom it is intended.
It should be acceptable to the employees
Meaning of leadership
Definition
Leadership can be defined as the area or process of influencing people so that they will strive
willingly and enthusiastically towards achievement of group goals. People should be brought to
such a pitch of their devotion to duty that they not only work willingly, but also work with
utmost zeal. A leader in stills values of honesty takes calculated risk and displays concern for
employees and customers. They do not stand and wait to see in despair things taking shape
Differences between a leader and a manager
The difference between management and leadership Management
1. Management cannot operate without formal organization
2. A manager directs people through the use of formal authority
3. The scope of management is wider than that of Leadership.
4. A manager has to perform all the five functions of planning, organizing, staffing
directing and controlling
Leadership
1. Leadership can exist in both the formal and informal groups
2. Leader may or may not have formal authority. He influences people through the use of
informal authority.
3. A leader directs followers by influencing their behaviour. Leadership is part of
management
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Need/importance of leadership
Motivating employees. Good leadership is itself a motivating force for individuals, which
inspires people to work hard.
Morale building. A good leader shapes the thinking and attitudes of the group and maintains
discipline.
Creating confidence. An effective leader creates and sustains self-confidence and enthusiasm
among his followers. He provides advice and guidance by which subordinates can recognize
their qualities and capacity.
Coordination. Leadership is the cohesive force, which holds the group intact, the force that
transforms chaos into order, the disciplinary power that keeps the group working towards the
goal.
Facilitates change. Leadership is the mechanism to convince people about the need for change.
The leader is the key to any changes in the organization.
Goal setting. A leader provides guidance to the group by setting and interpreting the objective.
He outlines the operations of the organization.
Representation. A leader is the representative of his/her followers. He serves as the personal
embodiment of the group and as the true guardian of his interests.
Motivation
Motivation is the reason for people's actions, desires, and needs. Motivation is also one's
direction to behavior, or what causes a person to want to repeat a behavior. An individual is not
motivated by another individual
How to motivate employees
Increasing motivation in your workplace can help improve performance, raise morale and boost
productivity. While different motivators work for different types of employees, there are several
common techniques for getting employees excited and energized. If in doubt, ask employees
what you can do to increase motivation.
Create a Positive Work Environment
Motivate employees by offering an upbeat, positive work environment. Encourage teamwork and
idea-sharing, and make sure staffers have the tools and knowledge to perform well. Be available
39
when employees need you to be a sounding board or a dispute mediator. Eliminate conflict as it
arises, and give employees freedom to work independently when appropriate.
Set Goals
Help employees become self-motivated by helping establish professional goals and objectives.
Not only does this give employees something to strive for, but your business benefits when goals
are tied to corporate contributions. Make sure goals are reasonable and achievable so employees
don’t get discouraged. Offer encouragement when workers hit notable milestones.
Provide Incentives
Increase motivation by providing incentives to work toward. You can create individual
incentives for each employee or team incentives to motivate employees as a group. Financial
incentives can include cash prizes, gift cards or restaurant gift certificates. Nonfinancial
incentives can include extra vacation days, compressed work weeks or choice office space or
parking spots.
Recognize Achievements
Celebrate employee achievements through employee-of-the-month or star performer awards.
Make a big deal out of accomplishments by celebrating at staff meetings. Print certificates or
engrave plaques, issue a press release or post a notice on your company website. Recognize team
accomplishments as well as individual efforts.
Share Profits
Motivate employees with the incentive of a profit-sharing program. In this way, employees
increase earnings while helping the business income rise. This approach simultaneously
promotes collective goal-setting and teamwork. It also gives employees a sense of pride in
ownership and can improve performance and reduce turnover as well as raise morale.
Solicit Employee Input
Regularly survey employee satisfaction. You can conduct anonymous polls or hire an
independent party to conduct a formal focus group. This will help you catch potential morale
breakers before they get out of hand. Soliciting employee input also shows staffers that you care
about the opinions of workers and want to continually improve working conditions.
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Provide Professional Enrichment
Encourage employees to pursue additional education or participate in industry organizations.
Provide tuition reimbursement or send employees to skills workshops and seminars. If an
employee is motivated to an upward career path, offer mentoring and job shadowing
opportunities. Promote from within whenever possible and create opportunities to help
employees develop from a professional standpoint.
What is Controlling?
Controlling consists of verifying whether everything occurs in confirmities with the plans
adopted, instructions issued and principles established. Controlling ensures that there is effective
and efficient utilization of organizational resources so as to achieve the planned goals.
Controlling measures the deviation of actual performance from the standard performance,
discovers the causes of such deviations and helps in taking corrective actions
Features of Controlling Function
Following are the characteristics of controlling function of management-
1. Controlling is an end function- A function which comes once the performances are
made in conformities with plans.
2. Controlling is a pervasive function- which means it is performed by managers at all
levels and in all type of concerns.
3. Controlling is forward looking- because effective control is not possible without past
being controlled. Controlling always look to future so that follow-up can be made
whenever required.
4. Controlling is a dynamic process- since controlling requires taking reviewal methods,
changes have to be made wherever possible.
5. Controlling is related with planning- Planning and Controlling are two inseperable
functions of management. Without planning, controlling is a meaningless exercise and
without controlling, planning is useless. Planning presupposes controlling and
controlling succeeds planning.
Process of Controlling
Controlling as a management function involves following steps:
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1. Establishment of standards- Standards are the plans or the targets which have to be
achieved in the course of business function. They can also be called as the criterions for
judging the performance. Standards generally are classified into twoa. Measurable or tangible -
Those standards which can be measured and expressed
are called as measurable standards. They can be in form of cost, output,
expenditure, time, profit, etc.
b. Non-measurable or intangible- There are standards which cannot be measured
monetarily. For example- performance of a manager, deviation of workers, their
attitudes towards a concern. These are called as intangible standards.
Controlling becomes easy through establishment of these standards because controlling is
exercised on the basis of these standards.
2. Measurement of performance- The second major step in controlling is to measure the
performance. Finding out deviations becomes easy through measuring the actual
performance. Performance levels are sometimes easy to measure and sometimes difficult.
Measurement of tangible standards is easy as it can be expressed in units, cost, money
terms, etc. Quantitative measurement becomes difficult when performance of manager
has to be measured. Performance of a manager cannot be measured in quantities. It can
be measured only bya. Attitude of the workers,
b. Their morale to work,
c. The development in the attitudes regarding the physical environment, and
d. Their communication with the superiors.
It is also sometimes done through various reports like weekly, monthly, quarterly, yearly
reports.
3. Comparison of actual and standard performance- Comparison of actual performance
with the planned targets is very important. Deviation can be defined as the gap between
actual performance and the planned targets. The manager has to find out two things hereextent of
deviation and cause of deviation. Extent of deviation means that the manager
has to find out whether the deviation is positive or negative or whether the actual
performance is in conformity with the planned performance. The managers have to
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exercise control by exception. He has to find out those deviations which are critical and
important for business. Minor deviations have to be ignored. Major deviations like
replacement of machinery, appointment of workers, quality of raw material, rate of
profits, etc. should be looked upon consciously. Therefore it is said, “ If a manager
controls everything, he ends up controlling nothing.” For example, if stationery charges
increase by a minor 5 to 10%, it can be called as a minor deviation. On the other hand, if
monthly production decreases continuously, it is called as major deviation.
Once the deviation is identified, a manager has to think about various cause which has led
to deviation. The causes can bea. Erroneous planning,
b. Co-ordination loosens,
c. Implementation of plans is defective, and
d. Supervision and communication is ineffective, etc.
4. Taking remedial actions- Once the causes and extent of deviations are known, the
manager has to detect those errors and take remedial measures for it. There are two
alternatives herea. Taking corrective measures for deviations which have occurred; and
b. After taking the corrective measures, if the actual performance is not in
conformity with plans, the manager can revise the targets. It is here the
controlling process comes to an end. Follow up is an important step because it is
only through taking corrective measures, a manager can exercise controlling.
Importance of Controlling:
1. Accomplishing Organisational Goals:
Controlling helps in comparing the actual performance with the predetermined standards, finding
out deviation and taking corrective measures to ensure that the activities are performed according
to plans. Thus, it helps in achieving organisational goals.
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2. Judging Accuracy of Standards:
An efficient control system helps in judging the accuracy of standards. It further helps in
reviewing & revising the standards according to the changes in the organisation and the
environment.
3. Making Efficient Use of Resources:
Controlling checks the working of employees at each and every stage of operations. Hence, it
ensures effective and efficient use of all resources in an organisation with minimum wastage or
spoilage.
4. Improving Employee Motivation:
Employees know the standards against which their performance will be judged.
Systematic evaluation of performance and consequent rewards in the form of increment, bonus,
promotion etc. motivate the employees to put in their best efforts.
5. Ensuring Order and Discipline:
Controlling ensures a close check on the activities of the employees. Hence, it helps in reducing
the dishonest behaviour of the employees and in creating order and discipline in an organization.
6. Facilitating Coordination in Action:
Controlling helps in providing a common direction to the all the activities of different
departments and efforts of individuals for attaining the organizational objectives.
Limitations of Controlling:
The defects or limitations of controlling are as following:
1. Difficulty in Setting Quantitative Standards:
It becomes very difficult to compare the actual performance with the predetermined standards, if
these standards are not expressed in quantitative terms. This is especially so in areas of job
satisfaction, human behaviour and employee morale.
2. No Control on External Factors:
An organization fails to have control on external factors like technological changes, competition,
government policies, changes in taste of consumers etc.
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3. Resistance from Employees:
Often employees resist the control systems since they consider them as curbs on their freedom.
For example, surveillance through closed circuit television (CCTV).
4. Costly Affair:
Controlling involves a lot of expenditure, time and effort, thus it is a costly affair. Managers are
required to ensure that the cost involved in installing and operating a control system should not
be more than the benefits expected from it