Small Business

Qualities of a Good Control System

Most companies achieve all their goals by developing plans and making use of control systems to ensure that all operations are running according to the plan. It is vital to have sufficient controls at the inputs, processes and outputs stages. The good thing about effective control systems is that they tend to have some common characteristics. In this article, you will know how to tell whether your business has effective control systems.

1. Accuracy

Effective controls generate accurate data and information. Accurate information is essential when it comes to managerial decisions. The moment you have an inaccurate control system, it means that management efforts will be diverted to the wrong channels. Once something like that happens, managers will not be informed in case there is a severe problem that needs immediate attention.

2. Flexibility

An active control system should be highly flexible. Flexibility means that the system can acquire data and process it so that the management can adapt to all conditions. If the data collected from a specific source does not reflect on the current situation, the management of a company should be able to get better sources of data and report the ones with problems. When your company has an ongoing project, it is important to make use of some sort of project accounting process to keep track of the financial progress. In such a case, your system should be able to adapt to the new processes that allow management controls in a different activity.

3. Objectivity

In all organizations, managers make major decisions based on the results of the control systems. All the decisions are accepted by the company only when they are based on data and evaluations that are objective. For your company to be able to acquire such objectivity, the control systems you use have to be transparent and consider all the parameters that are relevant to your business.

4. Economics

The amount of money you spend to purchase a control system should be reasonable enough compared to the work it does. Since it is a business, and you expect to make as much profits as possible, get a control system that has low installation and operation costs. You need to know that a good control system should help your business to reduce costs and achieve competitive goals. An expensive and intrusive control system raises the costs and decreases competitiveness.

5. Timeliness

In any organization, there are many issues that require immediate attention. The moment information about such problems does not get to the management at the right time; serious damage may occur. A good control system ensures that all information reaches the people who make decisions in the organizations on time so that action is taken immediately.

6. Corrective actions

An effective control system should not only be used to look for and identify faults, but it should be programmed in such a way that it can suggest solutions to faults. A computer in your company that keeps a record of inventories can be set to spot “if-then” guidelines. Therefore, if an inventory of a product drops the computer can signal for replenishment of the items.

7. Acceptability

The moment a new system is introduced to a company, the employees should be able to work with it comfortably. A control system that is difficult to understand can lead to many mistakes and misunderstandings among the workers, which is not good for business. All employees should all agree that they need a control system and that it will not affect their efforts to achieve personal and organizational goals.

Therefore, if you are in search of a fantastic control system, you should look for the traits in this article. The moment you can get a good system, you will discover that your company will have a high-level of planning and correction of mistakes will be useful and timely. All the best.

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Dennis Hung is an entrepreneur and product analyst specializing in mobile technology and IoT. He’s spent most of his career consulting for businesses in North America.

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