What controlling is

Controlling makes sure that activities go according to plan, and that resources are used effectively and efficiently. It is goal-oriented, and it is pervasive: needed in every organisation (schools and hospitals too) and at every level.

It is often called the last function of management, but it is not just the end: what controlling finds leads back to planning, so it completes the cycle and starts it again.

Why controlling matters:

• it helps achieve the organisation's goals;
• it checks whether the standards are right;
• it makes efficient use of resources, reducing waste;
• it motivates employees, who know what is expected and how they will be judged;
• it keeps order and discipline (computer monitoring once caught dishonest employees at an import-export firm);
• it helps coordinate activities.

Its limitations:

• it is hard to set quantitative standards for things like employee morale or job satisfaction;
• a firm has little control over external factors, such as government policy and competition;
• employees may resist it (for example, objecting to CCTV);
• it is costly in time, money and effort, so a small firm must make sure its benefits exceed its cost.