Chapter: Controlling (Class 12 Business Studies)
🔑 Meaning of Controlling
Controlling is the process of ensuring that actual performance conforms to planned performance. It
involves measuring progress, comparing with standards, finding deviations, and taking corrective
action.
🎯 Features of Controlling
1. Goal-Oriented – Ensures achievement of objectives.
2. Pervasive – Exists at all management levels.
3. Continuous Process – Ongoing, not a one-time activity.
4. Backward-Looking – Based on past performance.
5. Forward-Looking – Helps plan better in the future.
6. Brings Deviations to Light – Helps in taking corrective steps.
🔄 Steps in the Process of Controlling
1. Setting Performance Standards
o Standards must be measurable, achievable, and time-bound.
o E.g., Produce 1000 units/day.
2. Measurement of Actual Performance
o Through observation, reports, or performance appraisals.
o Can be quantitative or qualitative.
3. Comparing Actual Performance with Standards
o Identify deviations (positive or negative).
o E.g., Target = 1000 units, Actual = 800 units → Deviation = 200 units
4. Analysing Deviations
o Focus on key deviations (Management by Exception - MBE).
o Classify deviations as minor or major.
5. Taking Corrective Action
o Steps to bring performance back on track.
o E.g., providing training, improving systems.
🔑 Meaning of Controlling
Controlling is the process of ensuring that actual performance conforms to planned performance. It
involves measuring progress, comparing with standards, finding deviations, and taking corrective
action.
🎯 Features of Controlling
1. Goal-Oriented – Ensures achievement of objectives.
2. Pervasive – Exists at all management levels.
3. Continuous Process – Ongoing, not a one-time activity.
4. Backward-Looking – Based on past performance.
5. Forward-Looking – Helps plan better in the future.
6. Brings Deviations to Light – Helps in taking corrective steps.
🔄 Steps in the Process of Controlling
1. Setting Performance Standards
o Standards must be measurable, achievable, and time-bound.
o E.g., Produce 1000 units/day.
2. Measurement of Actual Performance
o Through observation, reports, or performance appraisals.
o Can be quantitative or qualitative.
3. Comparing Actual Performance with Standards
o Identify deviations (positive or negative).
o E.g., Target = 1000 units, Actual = 800 units → Deviation = 200 units
4. Analysing Deviations
o Focus on key deviations (Management by Exception - MBE).
o Classify deviations as minor or major.
5. Taking Corrective Action
o Steps to bring performance back on track.
o E.g., providing training, improving systems.
