Organizational Control Systems

Organizational control is important to know how well the organization is performing, identifying areas of concern, and then taking an appropriate action. There are three basic types of control systems available to executives: (1) output control, (2) behavioral control, and (3) clan control. Different companies opt different types of control, but many organizations use a mix of all of these three types.

Output Control

Output control zeroes in on measurable outcomes within an organization. In output control, executives must decide the acceptable level of performance, communicate the general expectations to the employees, track whether the performance values meet the expectations, and then make any needed changes.

Behavioral Control

Behavioral control generally focuses on controlling the actions unlike the results in case of output control. In particular, specific rules and processes are used to structure or to dictate behavior. For example, firms having a rule that requires checks to be signed by two people to try to prevent employee theft.

Clan Control

Clan control is a non-standardized type of control. It depends on shared traditions, expectations, values, and norms. Clan control is common in industries where creativity is vital, such as many high-tech businesses.

Management Fads

There are many management fads that have been closely tied to organizational control systems. Management by objectives (MBO) is a procedure wherein managers and employees work together to create and attain goals. These goals help the firm guide employee behavior and serve as benchmarks for measuring their performance.

A quality circle is a formal employee group that often meets regularly to brainstorm various solutions for organizational problems. As the name “quality circle” suggests, finding out behaviors that would help to improve the quality of products and/or the operations management procedures that create the products was the formal charge of this circle.

Sensitivity training groups (or T-groups) were used in many organizations in the 1960s. It involved approximately eight to fifteen people coming together to openly discuss their emotions, feelings, beliefs, and biases about workplace issues. It did not have the rigid nature of MBO, but the T-group involved free-flowing conversations. These discussions lead individuals to nurture a greater understanding of themselves and others. The expected results included enlightened workers and a far more mutual understanding, and a better teamwork.