Other approaches to control
Another approach to control is to separate it into:
- automatic/technology controls
- procedural controls
- personal controls.
Automatic/technology controls
Automatic or cybernetic controls are built into computers and machines.
Technology controls also include computer applications or programmes that are designed to, for example, automatically report variations in monthly budgets.
Also, ‘executive support’ software or ‘Executive Information Systems’ (EISs) can use the information already generated by an organisation. An EIS can help a manager:
- get trend analysis and exception reports
- track and extract critical data and then compile it into reports
- build graphs, tables and text information.
example
A big retailer scans all products bought. Their software automatically calculates the number of products left and when more should be ordered from suppliers. The system automatically makes decisions about what to purchase when from suppliers. This controls inventory and procurement decisions.
Procedural controls
Procedural controls are rules that people have to follow. They control human action.
example
Financial delegations often control who can approve spending at certain levels. A first-line manager may be allowed to approve expenditure up to $2,000 in their area of responsibility, while a more senior manager may approve expenditure up to $10,000.
Personal controls
Personal or non-cybernetic controls require decision making by someone, often a manager. Many important organisational matters are hard to predict and so they have to be controlled by personal decision making.
example
Although staff usually have annual leave entitlements (a procedural control), someone has to decide when they can take this leave (a personal control).
A more complex example is a manager’s decision about what to do when actual spending exceeds budgeted expenditure in a particular area. In extreme cases, they face the dilemma of whether spending should be stopped until the budget is met or whether the budget should be revised. Such spending controls cannot sensibly be automated so a personal decision by the manager or person in control must be made.
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