Controlling- Meaning, Definition, Elements, Process, Types, Techniques and Barriers

Methods and Techniques of Controlling

1 Budgetary Control

Budgeting is the formulation of plans for a given future period in numerical terms. Budget can be called as the statement of anticipated results in financial terms: as in venue and expense and capital Budgets or in no financial terms : as in labour hours, materials, physical sales volume of units or production.

There are following types of budgets such as

(i)Revenue and expense budgets.

(ii)Time, space, material and product budgets.

(iii)Capital expenditure budgets.

(iv)Cash budgets.

(v)Balance sheet budgets.

(vi)Budget summaries.

(vii)   Few-base budgeting.

2.Traditional Method

There are few traditional or no Budgetary Control Devices: Among the most important of these are

(i)Statistical data.

(ii)Special reports and analysis.

(iii)Analysis of break-even points.

(iv)The operational audit.

(v)The personal observation.

3. Modern Techniques

There are many advanced and quantitative techniques and devices available in this modern world to control such as

(i) Programme Evaluation and Review Technique (PERT)

(ii) Control through Return On Investment (ROI)

(iii) Just-In-Time Inventory Control (JIT) which is a technique for reducing inventories to a minimum by arranging for production components to be delivered to the production facility Just-in-time to be used. Just-in-time works best in companies that manufacture relatively. Standardised products for which there is consistent demand.

(iv) Ratio-analysis is the process of generating information that summarises the financial position of an organisation through the calculation of ratios based on various financial measures that appear. On the organisations balance sheet and income statements.

(v) Decision tree analysis is statistical and graphical multi-phased decision making technique that can be used in controlling.

(vi) Computer, Aided Design (CAD)

(vi) Computer Aided Manufacturing (CAM)

Controlling- Meaning, Definition, Elements, Process, Types, Techniques and Barriers

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