TECHNIQUES OF CONTROL

Prepared by:-
Vidit jain, Vivek kumar, Kamalpreet
singh, Sumender singh & Shubham
gupta
UID’s:- 18BME8001-07
 INTRODUCTION
 To enable managers effectively control
the organizational activities, a large
number of controlling techniques are
available.
 A manager should know these
techniques and in which situation it
should be applied.
 TYPES OF CONTROLLING
TECNIQUES
 Traditional techniques
 Modern technique
 What is traditional technique ?

 These techniques of control are being

used by managers since long time & there
fore Known as traditional techniques.
 TRADITIONAL TECHNIQUES
 Personal observation
 Budgeting
 Break-even analysis
 Financial statement
 Statistical data & report
 Quality control
 PERSONAL OBSERVATION
 This is the most traditional method of
control.
 It helps managers to collect first hand
information.
 It also creates a psychological pressure on
the employees to perform well as they are
aware that they are being observed
personally on their job.
 How ever it is very time consuming , & not
suitable for all kinds of jobs.
 BUDGETING
 Meaning-
 A budget is a statement which reflects future
incomes ,expenditures & profits of the firm.
 Benefit of budgeting-
 Standards of performance
 Planning
 Predicting the future
 Financial planning
 BREAK EVEN ANALYSIS
 It deals with the study of the relationship
between costs,volume, & profit.
 It determines the probable profit and
losses at different levels of activity.
 The sales volume at which there is no
profit,no loss is known as breakeven point.
 It can be calculated as ,
Breakeven point=fixed cost/selling price
per unit – variable cost per unit.
 FINANCIAL STATEMENT
 Financial statements shows financial position
of a firm over a period of time,generally one
year.
 These are prepared along with last year
statements, so that firm can compare its
present performance with last year’s
performance & improve its future performance.
 It offers information on ,
 Liquidity
 Financial strength
 profitability
 STATISTICAL DATA &
REPORT
 Statistical analysis in the form of
averages,percentages,ratios,..etc.
 Data can be used for diagramatic
representations like histograms, pie chart,
bar graphs..etc.
A Report is a statement that represents
data in the form of information for carrying
out the controlling function.
 QUALITY CONTROL
 Quality control uses operational techniques
and activities to sustain quality of the product
or service to satisfy customer needs
 It is the traditional way to manage quality
 There are three stages during the process
when inspection is performed-
1. When raw material is received.
2. When raw material goes through the
production process
3. When products are finished-testing takes place
before products are dispatched to customers.
 Modern techniques :-

 Return on Investment (ROI)

Profits are the measure of overall efficiency of a
business to the capital employed in a business efficiency
is an important control device. If the rate of return on
investment (shareholders funds) is quite satisfactory, it
will be taken as a yard-stick of good performance.
The return on investment is computed by dividing the
operating net profit (before interest and tax) by the
capital employed in the concern.
Programmed Evaluation and Review
Technique (PERT)

 PERT is useful at several stages of project

management starting from early planning stages
when various alternative programmes are being
considered to the scheduling phase, when time
and resources schedules are laid out, to final
stage in operation, when used as control device
to measure actual versus planned progress.
PERT uses “network’ as the basic tool of project
management and is helpful in completing a
project on schedule by coordinating different
jobs involved in its completion.
Management Information System
(MIS)
 Management information system (MIS) is an
approach of providing timely, adequate and
accurate information to the right person in the
organization which helps in taking right
decisions. So MIS is a planned and organized
approach to the transferring of intelligence within
an organization for better management. The
information is furnished into useful quantum’s of
knowledge in the form of reports. An effective
system of MIS collects data from all possible
sources. The information is properly processed
and stored for use in future.
 Management Audit

 Management audit is an investigation by an

independent organization to find out whether the
management is carried performance out most
effectively or not. In case there are drawbacks at
any level then recommendations should be
given to improve managerial efficiency.