8 Essential characteristics of effective control system

Management Control System

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Essential characteristics of effective control system

If control is to be effective and adequate, it must satisfy the following requirements:

1. Perfect Plan: Control should reflect the plan designed to be followed. Managers should have information with regard to the plans for which they are responsible for working.

2. Point out Exceptions: Management by exception is a system of warning the management when the situation is likely to become out of control and the intervention of management is needed. Its main object is to make the task of managing simpler and more effective. If control is based on exception principle, it will allow the managers to concentrate on important issues. Hence, control should point out exceptions.

3. Objective: Control should be objective rather then subjective because an individual’s job is not a matter of subjective determination. Hence, objective standards are to be established.

4. Flexible: An effective control system should be flexible. It should be capable of adjusting itself to unforeseen changes of plans. It must be adaptable to new developments.

5. Economical: The control system should be economical to operate. The expenditure on control must correspond with the benefits derived from them. The question of economy should be decided by considering the factors like importance of activity, the size of the operation, the expense which might be spent in the absence of control and the utility derived from the control system.

6. Remedial Action: An effective control system should point out the deviations, the persons responsible for such deviations and make sure that remedial action is taken. The main purpose of control is taking remedial action to set right the deviations. If no remedial action is taken, controls are not necessary.

7. Simple: A control system to be effective, should be simple to adopt. It should be easily understandable by the parties concerned so that the smooth working of the system can be ensured.

8. Suggestive of Corrective Action: An adequate and effective control system should be suggestive of corrective action. It should not stop merely with pointing out deviations. It should go further and try to generate solutions to the problem responsible for deviation from the predetermined standards.

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