Operational control refers to the power and process exercised by management to influence and supervise the day-to-day operational activities of a business. This control ensures that the business runs efficiently and effectively, aligning daily operations with the broader strategic goals.
Understanding Operational Control
Definition and Scope
Operational control is the process by which management ensures that specific tasks align with predetermined plans and policies. It involves monitoring, guiding, and correcting operational performance to achieve organizational objectives.
Key Components
- Monitoring Performance: Keeping track of daily operations via Key Performance Indicators (KPIs) and reports.
- Setting Standards: Establishing specific performance standards or benchmarks.
- Evaluating Outputs: Comparing actual performance with standards.
- Corrective Actions: Making necessary adjustments to align outcomes with expectations.
Types of Operational Control
Pre-Control
This type of control—also called feedforward control—is implemented before an activity starts. It involves setting standards and instructions to guide operations.
Concurrent Control
Also known as real-time control, concurrent control monitors ongoing activities to ensure adherence to standards. This immediate feedback loop allows for quick corrective actions.
Post-Control
Post-control—also referred to as feedback control—occurs after an activity is completed. It involves analyzing the results of operations to identify deviations from the plan and making adjustments for future tasks.
Steering Control
This type combines elements of concurrent and post-control, continuously guiding operations towards achieving set objectives through ongoing adjustments.
Historical Context
Operational control has evolved alongside developments in management theories. Early industrial management saw control through strict supervision and manual record-keeping. The introduction of scientific management by Frederick Taylor in the early 20th century emphasized efficiency standards and systematic control. The advent of information technology and management information systems in the late 20th century has revolutionized operational control, making it more data-driven and responsive.
Examples of Operational Control
- Manufacturing: Monitoring the production line to ensure machinery is functioning as planned and products meet quality standards.
- Retail: Using sales data to control inventory levels and manage stock replenishments.
- Healthcare: Ensuring compliance with health regulations and standards in patient care procedures.
- Finance: Overseeing daily transactions and ensuring they adhere to financial policies and regulations.
Applicability and Benefits
Operational control is crucial for:
- Efficiency: Streamlining processes to reduce waste and improve productivity.
- Quality Assurance: Ensuring products/services meet established standards.
- Risk Management: Identifying and mitigating potential issues promptly.
- Employee Performance: Guiding and evaluating employee performance to align with organizational goals.
Related Terms
- Strategic Control: Focuses on ensuring that the organization’s strategies are effectively executed.
- Tactical Control: Concerned with the intermediate-term implementation and monitoring of specific tactical plans.
- Management Control Systems (MCS): A comprehensive framework integrating financial, non-financial controls for organizational governance.
FAQs
What is the difference between operational and strategic control?
How does technology impact operational control?
Why is operational control important?
References
- Taylor, F. W. (1911). The Principles of Scientific Management. Harper & Brothers.
- Anthony, R. N., & Govindarajan, V. (2007). Management Control Systems. McGraw-Hill.
- Drucker, P. F. (1999). Management Challenges for the 21st Century. Harper Business.
Summary
Operational control is an essential managerial function that ensures the smooth execution of daily activities, aligning them with organizational goals. Through different types of controls—pre, concurrent, post, and steering—management can effectively monitor, guide, and correct processes to achieve efficiency, quality, and compliance. Advanced technology continues to enhance the ways in which operational control is exercised, making it more precise and responsive.
