Unit 4: Controlling
4.1 Meaning and Definitions
Managerial functions commence with planning and end at controlling. The other functions like organizing, staffing and directing are the connecting links between planning and controlling. Controlling men at work is as old a function as the human civilization is. It is fundamental function in every sphere if life-like the family, the academic institutions, the trade, commerce and industry, the government and even religious places. Thus control is a never-ending activity just as planning.
The managerial function of controlling implies, "measurement of performance against the standard and the correction of deviations to ensure accomplishment of goals as per plan." Thus control is the process that measures current performances and guides them forwards some predetermined objectives. In the words of Kontz and O'Donnell, "controlling is the measuring and correcting of activities of subordinates to ensure that events conform to plans." According to Peter Drucker, "control maintains the equilibrium between ends and means, output and efforts."
Controlling is a fundamental management responsibility closely linked with the planning and organizing process. It also has an impact on motivation and team behavior. Controlling is both a process e.g., working to keep things on schedule, and an outcome e.g., product standards.
4.3 Characteristics of Controlling
Good controlling has the following characteristics.
- Suitability: it is appropriate to the nature, needs and circumstances of a firm and each level of activity inside it.
- Quick reporting: since time is an important element in enforcing a control system, an ideal control system enables any supervisor to report quickly.
- Forward planning: by forecasting the future carefully, a good control tries to prevent, rather than remedy the situations arising from deviations.
- Pragmatic: a good control has enough flexibility so that it can be adjusted to suit the needs of any modification or alternative in a plan.
- Objective: a good control is not arbitrary and subjective. Its standards set to judge the actual performance are clear, definite and stated in numerical terms.
- Economical: an ideal control system must not by expensive.
- Simple: a good control is easy to understand and operate.
- Internal corrective mechanism: an ideal control provides for solutions to the problems that cause deviations.
- It is a comparison and verification process.
- It maintains a balance in activities directed towards a set of goals.
- It is a means to detect deviations from plans, policies, programs, schedules etc.
Control is made possible by two major factors. One of them is planning. Control is not possible in the absence of planning which involves the setting of objectives to be accomplished and the actions that need to be taken to accomplish them.
The other factor is action. Prevention is better than cure. The manager guides operations along the desired lines. Control comes in as soon as deviations for the desired lines appear.
4.3 Importance and Nature of Controlling
Controlling is an important function of management as it smoothes the working of an organization. Without control, a manager cannot do his job. It helps in verifying whether everything occurs in conformity with the standard set. Moreover, an effective system of control helps in realizing the following benefits.
- Basis for future action: control helps the management to avoid repetition of past mistakes and provides the basis for future action.
- Facilitates decision-making: control is fundamental to decision making. It helps in determining the future course of action whenever there is a deviation between the standard and the actual performance.
- Facilitates decentralization: the modern trend of business organizations towards decentralization calls for a systematic attempt towards controlling. Without proper control, decentralization cannot succeed.
- Facilities Supervision: the existence of a proper control system should have a positive impact on the behavior of the employees. It facilitates supervision.
- Improves efficiency: since a good control system smoothes away wrinkles in the working of an organization, the morale of the employees remains high.
- Facilitates Coordination: control helps in integration of activities through unity of action. It provides unity of direction.
Controlling is an important process used to evaluate actual performance, to compare actual performance to goals, and then to take action on the difference between performance and goals. Without carrying out this process, it is impossible to make sure whether plans are implemented and desired results are achieved or not.
4.4 Major Principles or Guides of Controlling
4.4.1 Principles Related to the Purpose and Nature of Control
- Principle of the Purpose of Control: the task of control is to ensure that plans succeed by detecting deviations from plans and furnishing a basis for taking action to correct potential or actual undesired deviations.
- Principle of Future Directed Control: because of time lags in the total system of control, the more a control system is based on feed forward rather than simple feedback of information, the more managers have the opportunity to perceive undesirable deviations from plans before they occur and take action time to prevent them.
These two principles emphasize the purpose of control in any system of managerial action as one of ensuring that objectives are achieved through detecting to attain them. Moreover, control, like planning, should ideally be forward looking. This principle is often disregarded in practice largely because the present state of art in managing has not regularly provided for systems dependent on historical data, which may be adequate for tax collecting and determination of stockholders earnings but are not good enough for the most effective control. Lacking means of looking forward, reference to history, on the questionable assumption that "the past is prologue," is better than not looking at all. But time lags in the system of management control make it imperative that greater efforts by undertaken to make future directed control a reality.
- Principle of Control Responsibility: the primary responsibility for the exercise of control rests in the manager charged with the performance of the particular plans involved. Since delegation of authority, assignment of tasks, and responsibility for certain objectives rest in individual managers, it follows that control over this work should be exercised by each of these managers. An individual's responsibility cannot be waived or given up without changes in the organization structure.
- Principle of Efficiency of Controls: control techniques and approaches are efficient if they detect and illuminate the nature and causes of deviations from plans with a minimum of costs or other unsought consequences.
Controlling techniques have a way of becoming costly, complex, and burdensome. Managers may become so engrossed in control that they spend more it is worth to detect a deviation Detailed budget controls that hamstring a subordinate, complex mathematical controls that thwart innovation and purchasing controls that delay deliveries and cost more than the item purchased are instances of inefficient controls.
- Principle of Preventive Control: the higher the quality of managers in a managerial system, the less will be the need for direct controls. Most controls are based in large part on the fact that human beings make mistakes and often do not react to problems by undertaking their correction adequately and promptly. The more qualified managers are, the more they will effective deviations from plans and take timely action to prevent them.
4.4.2 Principles Related to the Structure of Control
The following principles aim at pointing out how control systems and techniques can be designed to improve the quality of managerial control.
- Principle of Reflection of Plans: the more that plans are clear, complete, and integrated, and the more that controls are designed to reflect such plans, the more effectively controls will serve the needs of managers.
It is not possible for a system of controls to be devised without plans since the task of control is to ensure that plans workout as intended. There can be no doubt that the more clear, complete, and integrated these plans are, and the more that control techniques are designed to follow the progress of these plans, the more effective they will be.
- Principle of Organizational Suitability: the more that an organizational structure is clear, complete, and integrated, and the more that controls designed to reflect the place in the organization structure where responsibility for action lies, the more they will facilitate correction of deviation from plans. Plans are implemented by people. Deviations from plans must be the responsibility primarily of managers who are entrusted with the task of executing planning programs. Since it is the function of an organization structure to define a system of roles, it follows that controls must be designed to affect the role where responsibility for performance of a plan lies.
- Principle of Individuality of Controls: the more that control techniques and information are understandable to individual managers who must utilize them, the more they will actually be used and the more they will result in effective control.
Although some control techniques and information can be utilized in the same form by various kinds of enterprises and managers, as a general rule controls should be tailored to meet the individual needs of managers. Some of this individuality is related to position in the organization structure as noted in the previous principle.
Another aspect of individuality is the tailoring of control to the kind and level of understanding of managers. We have seen both company presidents and supervisors throw up their hands in dismay (often for quite different reasons) at the unintelligibility and inappropriate form of control information that was a delight to the figure-and table-minded controller. Control information which a manager cannot or will not use has little practical value.
4.4.3 Principles Related to the Process of Control
Control often being so much a matter of techniques, rests heavily on the art of managing on know how in given instances. However, there are certain propositions or principles which experience has shown wide applicability.
- Principle of Standards: effective control requires objective, accurate, and suitable standards. There should be a simple, specific, and verifiable way to measure whether a planning program is being accomplished. Control is accomplished through people. Even the best manager cannot help being influenced by personal factors, and actual performance is sometimes came out flagged by a dull or a sparkling personality or by a subordinate's ability to "sell" a deficient performance. By the same token, good standards of performance, objectively applied will more likely be accepted by subordinates as fair and reasonable.
- Principle of Critical Point Control: effective control requires special attention to those factors critical to evaluating performance against plans. It would ordinarily be wasteful and unnecessary for managers to follow every detail if plans are being implemented. Therefore, they concentrate attention on salient factors of performance that will indicate, without watching everything, any important deviations from plans. Perhaps all managers can ask themselves what things in their operations will best show them whether the plans for which they are responsible are being accomplished.
- The Exception Principle: the more that managers concentrate control efforts on significant exceptions, the more efficient will be the results of their control. This principle holds that managers should concern themselves with significant deviations, the especially good or the especially bad situations. It is often confused with the principle of critical-point control, and they do have some kinship. However, critical-point control has to do with recognizing the points to be watched, while the exception principle has to do with watching the size of deviations at these points.
- Principle of Flexibility of Controls: if controls are to remain effective, despite failure or unforeseen changes of plans, flexibility is required in their design. According to this principle, controls must not be so inflexibly tied in with a plan as to be useless if the entire plan fails or is suddenly changed. Note that this principle applies to failures of plans, not failures of people operating under plans.
- Principle of Action: control is justified only if indicated or experienced deviations from plans are corrected through appropriate planning, organizing, staffing, and leading.
There are instances in practice where this simple truth is forgotten. Control is a wasteful use of managerial and staff time unless it is followed by action. If deviations are found in experienced or projected performance, action is indicated in the form of either redrawing plans or making additional plans to get back on course. It may call for reorganization, it may require replacement of subordinates or training them do the task desired, or there may be no other there fault than a lack of direction and leadership in getting a subordinate to understand the plans or to be motivated to accomplish them. But, in any case, action is implied.
4.5 The Process of Control
As a process of maintaining conformance of the system, control is defined by the following elements (Ivancevich, 1994 pp 440-441).
- Specification is the statement of the intended outcome. Control requires the specification of a standard. A standard is an operationally defined measure used as a basis for comparison. Specification fully describes the preferred condition, which may take the form of a goal, standard or other carefully determined quantitative statement of conditions.
- Production means making the product or delivering the service. It is the work required to achieve objectives, this applies equally both to service and manufacturing.
- Inspection is a judgment concerning whether the production meets the specifications. Inspection determines whether corrective actions need to be taken.
Clear specification of a performance standard requires an operational definition. An operational definition converts a concept into measurable objective units. E.g., the concept "weight" can be operationally defined in terms of grams, pounds, or another standard measure. These measures are not subject to personal interpretation.
4.5.1 Steps in the Control Process
Control as a process consists of three steps:
- Setting standards for performance of activities
A standard is a model or level of performance to be attained. It is the measure by which performance is judged as "good" or "bad", "acceptable", or "unacceptable." Standards are performance targets. Set standards may be either quantitative or qualitative and the control techniques are based on these two standards.
- Quantitative standards: are those expressed in dollars, time elapsed, percentages, weights, distance or some other numerical terms. These standards are reasonably price and can be measured with a relative ease. The following are some of the most frequently used quantitative standards:
- Time standards – indicate how much time should be required to achieve specific results. E.g., 39 work hours per week.
- Cost standards – indicate how much money should be spent to perform an activity. E.g., material or labor cost per unit.
- Revenue standards – indicate how much income should be received from specific operations or activities. E.g., revenue per sales person per month.
- Historical data – managers often use past results as a basis for estimating future satisfactory performance.
- Productivity - standards for productivity are needed for all activities in an enterprise. Standards for measuring sales productivity might be expressed as sales per employee per day, per week, or other time period or sales per distribution outlet.
- Return on investment - (ROI) is the ratio of net income to invested capital. E.g., if the total net income is $2 million and the total invested capital is $10 million, the ROI is 20 percent. $ 2 million/ $10 million X 100 = 20%
- Profitability – while ROI indicates the ratio of net profit to invested capital, profitability (return on sales) can be expressed as a ratio of net profit to sales. E.g., if a firm earns profits of $5 million on sales of 50 million, the profitability ratio is 10%. $5 million/ $50 million X 100 = 10%
- Qualitative standards are subjective and difficult to use in evaluating performance. Qualities such as loyalty, cooperativeness, etc are examples.
2. Measuring Performance Against Standards
This involves comparing what was accomplished with what was intended to be accomplished. A standard serves no purpose unless the degree to which it is met is determined.
In measuring performance, it is necessary to pick strategic control points for measurements. Examples of strategic control points are given below.
- Income – is virtually a key control point in all organizations.
- Expenses over a period of time cannot exceed income, or the organization will fall. So, key expense data are reviewed by some managers.
- Inventory – its level is highly significant in many organizations, especially those engaged in retailing, wholesaling, manufacturing and processing. Inventory helps to determine whether production should be increased, cut back, or kept constant. For a merchant, inventory size may indicate a need to buy more, buy less, conduct special sales, or raise or lower prices.
- Product quality – the more health and safety considerations relate to consumption of a product, the more important quality control is.
- Absenteeism is an important control point in construction organizations.
- Safety of personnel is an important control point in construction enterprises.
3. Taking Corrective Actions
This is done when performance does not meet the standards set for it. Corrective action may involve very simple acts, such as adjusting a machine or giving employee instructions on how to perform properly. Giving an employee instructions on how to perform properly. Correcting a problem is often a problem. The following are some of the corrective actions.
- Prescribed Corrective Action - is effective for routine situations and emergencies. This action is necessary because some problems are certain to recur while others are highly unlikely to occur again.
- Judgmental Corrective Action – is a subjective move or step taken to correct shortcomings. It is clear that there are no manuals available to provide solutions. Instead managers must rely on experience observations of how problems in similar enterprises were solved, opinions of other managers, and the "feel" of the situation to develop appropriate action. While prescribed corrective action leaves little or any room for flexibility, judgmental problem solving permits considerable latitude. There is more challenge in using judgment than in implementing prescribed plans. But there is also much grater risk.
- Engineered Measurement Devices: Mechanical, electronic and chemical engineering devices are available to measure machine operations, product quality and production processes. Some of these measuring devices have built-in mechanisms to make the necessary corrections.
- Even human behavior is subjected to measurement by engineering devices. Department stores and libraries are detected by closed unit TV Cameras.
- Ratio Analysis examining the records of similar organization itself from and from an earlier period E.g., Dividing current debt by inventory.
- Sampling is used to measure quality in many industries – milk processing, concentrated orange juice production, and petroleum refining.
iv. Personal Observation:
- Informal personal observation
- Formal personal observation
- Scheduled versus surprise observation
4.6 Types of Control
Management has numerous control methods at its disposal. Each has strengths and limitations. Managers must decide what type of control system to employ in different situations. Some control techniques have very specific, limited application. Nonetheless, all control techniques must be economical, accurate, and understandable.
4.6.1 Preliminary Control
It focuses on preventing deviation in the quality and quantity of resources used in the organization. For example, human resources must meet the job requirement as defined by the organization: Employees must have the physical and intellectual capabilities to perform assigned tasks. Materials used in production must meet acceptable levels of quality and must be available at the proper time and place. Capital must be on hand to ensure an adequate supply of plant and equipment. Financial resources must be available in the right amounts and at the right times.
Preliminary control procedures include all managerial efforts to increase the profitability that actual results compare favorably with planned results. From this perspective, policies are important means for implementing preliminary control since policies are guidelines for future actions.
Management need to be concerned with preliminary control of processes in four areas: Human resources, material, capital and financial resources.
Human Resources: the organizing function defines the job requirements and determines the skill requirement of jobholders. These requirements vary in degree of specificity, depending on the nature of the task. Preliminary control of human resources is achieved through the selection and placement of managerial and non-managerial personnel.
Candidates for positions must be recruited from inside or outside the firm, and the most promising applicants must be selected based on the matching skills and personal characteristics to the job requirements. The successful candidate must be trained in methods and procedures appropriate for the job. Most organizations have elaborate procedures for providing training on a continual basis.
Materials: the raw materials that are converted into a finished product must conform to quality standards before they are used in the production process. At the same time, a sufficient inventory or delivery system must be maintained to ensure a continuous inflow of raw materials so the manufacturer can meet customer demand.
Numerous methods that use statistical sampling to control the quality of materials have been devised. These methods typically involve inspection of samples rather than an entire lot. Thus, statistical methods are less costly, but there is a risk of accepting defective material if the sample is non random or, by chance, contains none of the defective items.
Capital: the acquisition of capital reflects the need to replace existing equipment or to expand the firm's productive capacity. Capital acquisitions are controlled by establishing criteria of potential profitability that must be met before the proposal is authorized. Such acquisitions ordinarily are included in the capital budget, an intermediate and long run planning document that details the alternative sources and uses of funds. Managerial decisions that involve the commitment of present funds in exchange for future funds are termed investment decisions. The methods that serve to screen investment proposals are based on economic analysis. Below are a number of widely used capital control methods. Each involves formulating a standard that must be met to accept the prospective capital acquisition.
- The Payback Method: this is the simplest method of capital control. The payback method calculates the number of years needed for the proposed capital acquisition to repay its original cost out of future cash earnings.
Rate of Return on Investment: one alternative measure of profitability, consistent with methods ordinarily employed in accounting is the simple rate of return on investment. The rate of return is the ratio of additional net income to the original cost.
Discounted Rate of Return: the discount rate of return is a measurement of profitability that takes into account the time value of money. It is similar to the payback method; only cash inflows and outflows are considered. The method is widely used because it is considered the correct method for calculating the rate of return.
Financial Resources: adequate financial resources must be available to ensure payment of obligations arising from current operations. Materials must be purchased, wages paid, and interest charges and due dates met. The principal means of controlling the availability and cost of financial resources is budgeting particularly cash flows and working capital budgets.
These budgets anticipate the flow of business activity when materials are purchased, finished goods are produced and inventoried, goods are sold, and cash is received. This operating cycle results in a problem of timing the availability of cash to meet obligations. When inventories of finished goods increase, the supply of cash decreases as materials, labor, and other expenses are incurred and paid. As inventory is depleted through sales, cash increases. Preliminary control of cash requires that cash be available during the period of inventory buildup and be used wisely during periods of abundance. This requires the careful consideration of alternative sources of short term financing during inventory build up, and alternative short run investment opportunities during periods of inventory depletion.
4.6.2 Concurrent Control
Concurrent control monitors ongoing operations to ensure that objectives are pursued. The standards guiding ongoing activity are derived from job descriptions and from policies resulting from the planning function. Concurrent control is implemented primarily by the supervisory activities of managers. Through personal, on the spot observation, managers determine whether the work of others is proceeding in the manner defined by policies and procedures. Delegation of authority provides managers with the power to use financial and non-financial incentives to effect concurrent control.
Concurrent control consists primarily of actions of supervisors who direct the work of their subordinates. Direction refers to the acts of managers when they:
- instruct subordinates in proper methods and procedures and
oversee subordinates' work to ensure that it's done properly.
Direction follows the formal chain of command, since the responsibility of each superior is to interpret for subordinates the orders received from higher levels. The relative importance of direction depends almost entirely on the nature of the tasks performed by subordinates. The supervisor of an assembly line that produces a component part requiring relatively simple manual operations may rarely engage in direction. On the other hand, the manager of a new product research unit must devote considerable time to direction. Research work is inherently more complex and varied than manual work. So it requires more interpretation and instruction.
Directing is the primary function of the first line supervisors, but at some point every manager in an organization engages in directing employees. The direction given should be with in the stated organizational mission, goals and objectives. As a manager's responsibilities grow, the relative time spent directing subordinates diminishes as other functions become more important.
4.6.3 Feedback Control
Feedback control methods focus on end results. Corrective action is directed at improving either the resource acquisition process or the actual operations. This type of control derives its name from its use of results to guide future actions. The feedback control methods employed in business organizations include budgets, standard costs, financial statements quality control, and performance evaluation.
This section outlines two feedback control methods widely used in business:
- Financial statement analysis and
- Standard cost analysis
1. Financial Statement Analysis: a firm's accounting system is a principal source of information managers can use to evaluate historical results. Periodically, the manager receives a set of financial statements that usually includes a balance sheet and income statement. These financial statements summarize and classify the effects of transactions in assets, liabilities, equity, revenues and expenses – the principal contents of the firm's financial structure. The balance sheet describes an organization's financial condition at a specified point in time. The income statement is a summary of an organization's financial performance over a given time period.
A detail analysis of the financial statement's information enables management to determine the adequacy of the firm's earning power and its ability to meet current and long term obligations. Managers must have measures of and standards for profitability, liquidity and solvency. Whether a manager prefers the rate of return on sales, on owner's equity, on total assets, or a combination of all three, it's important to establish a meaningful norm – one that is appropriate to the particular firm, given its industry and stage of growth. An inadequate rate of return negatively affects the firm's ability to attract funds for expansion, particular if downward trend overtime is evident.
The measures of liquidity reflect the firm's ability to meet current obligations as they become due. The widest known and most often used measure is the current ratio (the ratio of current assets to current liabilities). The standard of acceptability depends on the particular firm's operating characteristics. Bases for comparison are available from trade associations that publish industry averages. A tougher test of liquidity is the acid test ratio, which relates only cash near cash items (current assets excluding inventories and prepaid expenses) to current liabilities.
The relationship between current assets and current liabilities is an important one. Equally important is the composition of current assets. Two measures that indicate composition and rely on information found in both the balance sheet and income statement are the accounts receivable turnover and the inventory turnover. The accounts receivable turnover is the ratio of credit states to average accounts receivable. The higher the turnover, the more rapid the conversion of accounts receivable to cash. A low turnover would indicate a time lag in the collection of receivables, which in turn could strain the firm's ability to meet its own obligations. Appropriate corrective action might be tightening of credit standards or a more vigorous effort to collect outstanding accounts. The inventory turnover also facilitates the analysis of appropriate balances in current assets. It is calculated as the ratio of cost of goods sold to average inventory. A high ratio could indicate a dangerously low inventory balance in relation to sales, with the possibility of missed sales or a production slowdown. Conversely, a low ratio might indicate an over investment in inventory to the exclusion of other, more profitable assets. Whatever the case, the appropriate ratio must be established by the manager, based on the firm's experience within its industry and market.
Another financial measure is solvency, the ability of the firm to meet its long-term obligations – its fixed commitments. The solvency measure reflects the claims of creditors and owners on the firm's assets. An appropriate balance must be maintained – a balance that protects the interest of the owner yet doesn't ignore the advantages of long term debt as a source of funds. A commonly used measure of solvency is the ratio of net income before interest and taxes to interest expense. This indicates the margin of safety; ordinarily, a high ratio is preferred. However, a very high ratio combined with a low debt-to-equity ratio could indicate that management has not taken advantage of debt as a source of funds. The appropriate balance between debt and equity depends on many factors. But as a general rule, the portion of debt should vary directly with the stability of the firm's earnings.
Firms also use debt ratios to assess the amount of financing being provided by creditors. Two popular debt ratios are the debt/equity ratio and the debt/asset ratio. The debt/equity ratio is a measure of the amount of assets financed by debt compared to that amount financed by profits retained by the firm and investments (stocks and other securities). The debt/asset ratio is an expression of the relationship of the firms total debts to its total assets.
2. Standard Cost Analysis: standard cost accounting systems are considered a major contribution of the scientific management era. A standard cost system provides information that enables management to compare actual costs with predetermined (standard) costs. Management can then take appropriate corrective action or assign to others the authority to take action. The first use of standard costing was to control manufacturing costs. In recent years, standard costing has also been applied to selling, general and administrative expenses. Here we discuss standard manufacturing costs.
The three elements of manufacturing costs are direct labor, direct materials and overhead. For each of these, an estimate must be made of cost per unit of output. For example, the direct labor cost per unit of output consists of the standard usage of labor and the standard price of labor. The standard usage derives from time studies that fix the expected output per labor hour; the standard price of labor is fixed by the salary schedule appropriate for the kind of work necessary to produce the output. A similar determination is made for direct materials.
The accounting system enables the manager to compare incurred costs and standard costs. Today, cost accounting practices are undergoing significant changes to keep pace with the rapidly evolving manufacturing environment. Activity based accounting, a new system of cost accounting based on activity, has been advocated by many academicians and practitioners. Its underlying principle is that activities consume resources and products consume activities. The labor costs of supporting departments can be traced to activities by assessing the portion of each person's time spent on each activity, which can then allow for restatement of departmental cost in activities and their associated costs. Activity costs then are traced to the product based on the amount of activity volume each product consumes. The overall impact is more accurate product costs information.
Like many management terms, control has different meanings to different people so an individual's concept of control often reflects a personal perspective. Statisticians may think of control in terms of specifications, monitoring and feedback, and managers think of controlling the activities, attitudes and performance of subordinates. Despite these differing approaches to control, there are some characteristics of all organizations that must be controlled: productions and operations, financial resources, human resources and organizational change and development.
After planning or making decision, managers must deploy organizational resources to achieve specific goals or objectives. Even though decision making and planning are conducted systematically and with accurate information, unexpected circumstances may yet arise. Unforeseen events may occur in the social, economic, political or natural environment. Thus, managers must be prepared to redirect organizational activities toward desired ends. To do this they need an understanding of the elements of control.
In the three types of control we just examined, the focus of corrective action differs. Preliminary control methods are based on information that measures some attributes or characteristics of resources; corrective action focuses on resources. Concurrent control methods are based on information related to ongoing process; corrective action is focused on these processes. The focus of corrective action associated with feedback control is not that which is measured i.e., results. Rather, feedback control provides information concerning the quality and/or effectiveness of resources and processes.