Question

Discuss three importances of controlling.

Hint:

{Three Importances:}

• {Goal achievement:} Keeps organization on track
• {Resource optimization:} Reduces waste, improves efficiency
• {Future planning:} Provides feedback for better decisions

Answer 1

Controlling is essential for the effective functioning of any organization. Here are three important reasons why controlling is important: Importance 1: Helps in Achieving Organizational Goals

• Controlling ensures that all activities are aligned with the predetermined goals and objectives of the organization.
• It monitors progress, identifies deviations, and takes corrective actions to keep the organization on track.
• Without controlling, efforts may become misdirected, and goals may remain unachieved.
• Example: A company with a goal of 20% market share uses controlling to track monthly sales data, identify regions where sales are lagging, and implement corrective strategies to meet the annual target.

Importance 2: Facilitates Efficient Utilization of Resources

• Controlling helps in ensuring that all resources—human, financial, material, and technological—are used optimally and without waste.
• By monitoring resource usage and comparing with standards, managers can identify areas of inefficiency and take corrective measures.
• This leads to cost reduction and improved productivity.
• Example: A manufacturing plant monitors raw material consumption per unit of output. If wastage increases beyond standard, controlling helps identify the cause (e.g., machine malfunction) and correct it, saving costs.

Importance 3: Provides Basis for Future Planning and Decision Making

• Controlling provides valuable feedback about what worked and what didn't.
• The information gathered through controlling helps managers make better decisions and formulate more realistic plans for the future.
• It creates a learning loop where past performance informs future strategy.
• Example: After reviewing quarterly performance, a company realizes that its new product launch failed due to inadequate advertising. This insight helps in planning a better marketing strategy for the next product launch.

Additional Importances (for reference):

• Improves Employee Motivation: Clear standards and feedback motivate employees to perform better.
• Ensures Order and Discipline: Creates a disciplined work environment through monitoring.
• Facilitates Coordination: Helps coordinate different departments toward common goals.
• Helps in Coping with Change: Enables quick response to environmental changes.